Rural Development Philanthropy Resources | Severance Tax Policy ScanLocal Control of Assets

Central Appalachian communities have inherited a great wealth of culture, natural resources, and people. CARN's Local Control of Assets initiative works to identify and educate about policies that allow communities have a say in how these local assets are managed and put to use.

The Local Control of Assets initiative is active in three policy areas: transfer of wealth and rural development philanthropy; severance taxes; and fostering community capacity.

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Transfer of Wealth and Rural Development Philanthropy
A recent transfer of wealth study in Kentucky documented that within 10 years, billions of dollars will transfer from one generation to the next in its Appalachian counties. Much of the next generation does not live in these communities, meaning that without infrastructure and incentives to receive contributions, these assets may be lost forever.

Permanent endowments, focused on philanthropy as a community development activity where anyone can become a donor, are an important tool that can provide stewardship of wealth that has already been created in Central Appalachian communities.

CARN is working for:

incentives, like tax credits for donations to community endowments;
state and federal policies that provide grants to support the creation of community endowments;
public resources to be matched two to one by communities to build their endowments.

For more information about Rural Development Philanthropy Resources, click here.

Severance Taxes
In Central Appalachian states, severance taxes on extracted minerals are often used for immediate local and state needs, but could create a legacy for our resource-rich communities. States including New Mexico, Wyoming, Colorado, Alaska and Montana have created severance endowments ranging in size from about $800 million in Montana to more than $37 billion in Alaska. Earnings from these funds are available for a wide range of development needs.

Endowments derived from severance tax revenue can:

protect against booms and busts driven by commodity prices;
turn non-renewable resources into sustainable wealth for communities;
create inter-generational equity so future residents continue to benefit from the extraction of resources today.

CARN is assessing existing severance tax policies and will develop policy positions to facilitate retention of public revenue derived from resource extraction for development in the communities where the resources were extracted.

For more information about the Severance Tax Policy Scan conducted by CARN, click here.

Fostering Community Capacity
Building and leveraging local assets in Central Appalachia requires diverse leadership and resilient governance structures rooted in the cultures of regional communities. Many rural areas have yet to develop the social and philanthropic infrastructure that is necessary to capitalize and sustain structures to govern local assets, and rural communities are often perceived as reliant on corporations and government agencies to support community development.

Community Foundations, Community Development Financial Institutions, and Community Action Agencies are three approaches to managing local assets to complement local, state, and federal resources for education, health and welfare, and other efforts that build community capacity and local economy. CARN believes that fostering community capacity for wealth creation and stewardship in Central Appalachia will require a regional network of community leaders, elected officials, policy advocates, and philanthropists to share resources, case studies, and best practices.