By Scott Robertson
With so much going on, my head’s been going in a dozen different directions at once all week. So here are a few timely notes and observations.
Yes, Virginia, there is a Ballad. Or at least there will be, barring a seismic shift in the thinking of the boards of Wellmont Health System and Mountain States Health Alliance. The Virginia Department of Health Monday issued an order (contingent upon the company meeting 49 conditions) approving the cooperative agreement that would govern a Ballad merger in the Commonwealth. Tennessee had already approved a similar Certificate of Public Advantage for the merger.
The most strident opposition to the merger in Virginia came from Anthem, an insurance provider. That company’s song-genre name, along with Ballad’s, make the headline for this column one of the easiest we’ve ever written.
Others have pointed to the spring of 2015 as the birth of the Ballad initiative. But in going back over my notepads (yes, when this started, we still used notepads – that’s how long this process has taken) the first mention I find of either existing system speaking on the record about seriously considering a merger was back in 2012. Then-Wellmont CEO Margaret “Denny” DeNarvaez told me the possibility of a merger was a driving factor in how she managed the company. “It will put us in a much more attractive position where we will ultimately decide to grow further, be acquired or anything, merged, anything like that. We want to be the best we can be when that happens…We just want to be a prettier date,” DeNarvaez said. “We want to be the prettiest date we can be.”
DeNarvaez never favored Wellmont merging with Mountain States, though. After trying to engineer a Wellmont merger with one of two larger for-profit systems from outside the market, she’s no longer around to see the pretty girl engaged to the local boy from the other side of the tracks.
Economic development realities are real – really. The Unicoi County Commission last month voted not to adopt a capital investment plan for the county that would have allowed the use of PILOT (Payment in lieu of taxes) agreements as incentives to bring jobs and capital investment into the county. We’ve addressed in this space how distasteful it is that in today’s marketplace companies can demand taxpayer-funded incentives from communities as part of the site selection process. Unfortunately, it’s a very real part of the process, now, and unless it’s outlawed worldwide, it will remain so. Communities like Erwin are no longer just competing with the Elizabethtons and Mountain Citys of the world. They’re competing with the Livingston, Montanas; Guanajuato, Mexicos and Xijiang Qianhu Miao Village, Chinas.
The site selection firms that represent major employers have a checklist of reasons not to advise their clients to locate in any particular town, and lack of incentives is near the top of the list. Municipalities today know they must be able to provide three things to even get a second glance – a qualified workforce, available buildings or flat land ready to build on, and a competitive package of incentives.
So while incentives aren’t the only factor that drive decisions (New York offered an auto maker who eventually came to Tennessee a flat $1 billion), the lack of incentives is a ready deal-breaker. And with a community that just lost CSX’s jobs a year before, the decision to reject the notion of PILOTs is a bit of nostalgic idealism Unicoi County can’t afford.
Northeast State staying put in JC. The campus of Northeast State Community College in downtown Johnson City will continue operations. After the college announced it would pull its Entertainment Technology program out of downtown Bristol to is Blountville main campus, we spoke with President James King, who said the agreement for the Johnson City space is much more favorable to the college than the agreement in Bristol had been.
The college will, however, put its Gray building on the market, ceasing operations there, and will begin the process of seeking property to own in Elizabethton. The college has rented property in Carter County long enough that if it had bought property instead of renting, it would own a building by now, King said.