The Pointlessness of Bribing People to Move to West Virginia for $12,000

[hauntedheadnc]

The Pointlessness of Bribing People to Move to West Virginia for $12,000
Relocation incentives get lots of buzz. Do they work?
By Henry Grabar for slate.com

West Virginia is the latest place to offer a relocation incentive to remote workers: $10,000, parceled out in monthly grants, for your first year in Morgantown, with a $2,000 bonus to settle in for a second year.

The program is called Ascend, and the commercial is alluring—baritone voice-over, sunset drone panoramas, indie-folk harmonies. It’s been endowed by a $25 million grant, which makes it many times larger than similar programs in Vermont, and cities like Tulsa, Oklahoma, and Topeka, Kansas.

It also comes at an interesting time, since many companies are settling on remote work policies that will allow white-collar workers to settle far from the office. That raises the prospect that traditional regional development strategy could be turned on its head, with cities and states chasing workers instead of companies.

Programs like Ascend usually garner a lot of media attention, because their emphasis on no-strings-attached cash grants seems newfangled and zany, like federal stimmy checks or universal basic income. Fair enough—this kind of stuff is new. Since Ascend (which will later include two more West Virginia towns) was announced earlier this week, more than 2,000 people have applied for 50 spots!

But an application does not an interstate relocation make. In reality, these cash grants barely scratch the surface of the savings that their target applicants would unlock by moving to the places in question. And for that reason, it is hard to see them changing the game very much.

A one-bedroom apartment in Morgantown, for example, goes for $675 a month, compared with $2,155 a month in Washington, D.C., according to Zumper. A D.C. resident would already save more than $10,000 a year by moving there—and that’s before accounting for other cost-of-living expenses. Buying a house? The median home value in Morgantown is $222,000, according to Zillow, compared with $672,000 in Washington.

The comparisons are similar between Morgantown and other high-cost cities, such as New York, Los Angeles, or Boston. The $10,000 grant, and then some, is priced in without any actual grants.

Another $10,000 never hurts, of course. But the kinds of people Ascend seeks to attract—the application asks for your Instagram and LinkedIn handles, and promises free access to a coworking space—probably already know how many tens of thousands of dollars (hundreds of thousands, over the years) they would save by moving to a place like Morgantown. Will the prestige of an application process convince them?

The same dynamics apply to programs in Tulsa (10 grand), Northwest Arkansas (offering 10 grand and a bike), and Topeka (five grand toward rent, 10 grand toward buying a home; plus $1,000 from Jimmy John’s to live within five minutes of a sandwich shop). It is not the high cost of living in these places that has pushed young people toward larger cities, and so a relocation subsidy seems like an unhelpful response—doubling down on the one advantage you already have, the one that so far, has not done much for you. If the point of programs like these is to rebalance the economic geography of the country, I don’t see them working—if they succeed in pulling in ambitious young people, it will be from other struggling and depopulated places.

Source.

• Video Link

[Crawford]

I still don't understand why people think the non-poor can be convinced to uproot their families/lives and move across the country/planet to pay a few less in taxes or home prices.

If someone has modest earnings/wealth and happens to be in an extreme high-cost market (say prime Silicon Valley or Zurich, Switzerland), yeah I get moving to a cheaper locale. But, even then, it seems like a last resort, once all other options are exhausted. And this is doubly true if you have kids and/or have a job that doesn't suck.

[Handro]

Originally Posted by Crawford

I still don't understand why people think the non-poor can be convinced to uproot their families/lives and move across the country/planet to pay a few less in taxes or home prices.

If someone has modest earnings/wealth and happens to be in an extreme high-cost market (say prime Silicon Valley or Zurich, Switzerland), yeah I get moving to a cheaper locale. But, even then, it seems like a last resort, once all other options are exhausted. And this is doubly true if you have kids and/or have a job that doesn't suck.

I think these programs are authored by civic leaders who have read too many USA Today articles about Millennials.

[harryc]

Had to laugh at this one when I read it. But they should be careful what they ask for.

If you have people moving there for this
Morning in West Virginia by Harry Carmichael, on Flickr
( view from the finances' porch )

Then you will start getting pushback on stuff like this.
West Virginia by Harry Carmichael, on Flickr
This is just for an expansion of a Hwy interchange - for shopping malls they will take the entire top of a "mountain" off.

[jmecklenborg]

The eastern panhandle of WV is only 45-55 miles as the crow flies from Washington, DC. Realistically, it would still take 90 minutes to commute to an outer metro station and commute downtown, but that wouldn't be a big deal for someone who only goes in to work 2-3 times a week or month.

[jmecklenborg]

^Also, Ohio has spent a lot of money in recent decades improving roads through its hilly southeast region, so it's actually possible to super-commute to Columbus, OH now. The 4-lane state route south from Columbus is almost an interstate (it is the future I-73) and 33 from Columbus to Pomeroy saw two fully grade-separated bypasses built in the 2000s plus the "Super 2" highway between Athens and Pomeroy.

Cincinnati is too far away from Huntington for super-commuting, despite the construction of the almost-interstate AA Highway and many upgrades to US 52 on the Ohio side.

[Qubert]

Originally Posted by jmecklenborg

The eastern panhandle of WV is only 45-55 miles as the crow flies from Washington, DC. Realistically, it would still take 90 minutes to commute to an outer metro station and commute downtown, but that wouldn't be a big deal for someone who only goes in to work 2-3 times a week or month.

Once the Metro to Loudoun County VA opens I could see more folks making the drive.

[DCReid]

I've known colleagues from my Fed job in the DC area who have lived in places like Martinsburg, WV. It seems like their main reason was to get a big house with lots of land, while still being within 1-2 hours of the DC area. Other than attracting more remote workers to those bordering towns instead of them moving to MD, PA and VA far flung cities, like Hagerstown, MD or the Shenandoah Valley and Gettysburg PA, or the DC exurbs, I don't think their offer will benefit places like Morganstown. I think Northwest AK may be more successful because it has three large employers including WalMart and their supporting industries. NW AK seems like it may be as attractive to retirees as well. Tulsa may also do okay - Elon Musk even considered it for the gigafactory, and maybe it can become more competitive in growth to OKC, which has the advantage of being the capital.

West Virginia cities are fairing poorly in population growth according to Wiki:

https://en.wikipedia.org/wiki/List_o..._West_Virginia

[BG918]

Originally Posted by DCReid

I think Northwest AR may be more successful because it has three large employers including WalMart and their supporting industries. NW AK seems like it may be as attractive to retirees as well. Tulsa may also do okay - Elon Musk even considered it for the gigafactory, and maybe it can become more competitive in growth to OKC, which has the advantage of being the capital.

Northwest Arkansas is a very scenic area, along with Northeast Oklahoma (where Tulsa is located). Very different than the rest of their respective states with the forested hills, lakes and rivers. These are growing metro areas (Fayetteville-Bentonville has had 21% and Tulsa 7% population growth since 2010) but looking at diversifying their economies with more knowledge workers and especially remote workers. Similar in many ways to a city or state offering a company incentives but instead of companies it is individuals, and instead of governments it is private foundations.

Unlike NW Arkansas or Tulsa though most cities in WV are losing population and have a very small existing economic base. And WV, while beautiful in many parts, also is in a region that gets very cold and stays cloudy throughout the winter months.

[Crawford]

West Virginia, in theory is quite beautiful, but there isn't really much in terms of pristine wilderness. A lot of lopped-off hillsides, poisoned rivers, bombed-out towns and the like.

When I talk to people who moved from high cost/high tax locales, like the NE Corridor, and Coastal CA, the main reasons I here are 1. I'm retired, 2. Weather, 3. Want to be close to grandkids, 4. Too many liberals.

Don't think I've ever heard "homes cost too much" (if you own this is a good thing, no?) or "taxes are too high" though I suppose the "too many liberals" sentiments could kind of imply the latter?

[eschaton]

Originally Posted by Crawford

Don't think I've ever heard "homes cost too much" (if you own this is a good thing, no?) or "taxes are too high" though I suppose the "too many liberals" sentiments could kind of imply the latter?

I have known some artists (not poseurs, actual artists) who relocate to very cheap rural areas. It's the same reason artists often live in the worst urban neighborhoods - if you can cut your living expenses low enough, you can ditch the day job and work full time on your art.

Similarly, I knew a guy who worked on electronic music, but made his money selling rare stuff on ebay. He decided to relocate to rural NC (despite not owning a car) because then he could just live off of that.

The thing is...people like this are not middle class professionals in the Richard Florida sense. They are "creatives" - but not "creative class." Fundamentally they're working class in terms of income. If a critical mass of them forms in an area they might eventually "gentrify" a small town by attracting others with real money, but they won't bring in anywhere near enough by themselves to make up for the money being offered.

[Don't Be That Guy]

Originally Posted by eschaton

If a critical mass of them forms in an area they might eventually "gentrify" a small town by attracting others with real money, but they won't bring in anywhere near enough by themselves to make up for the money being offered.

This is occurring in some West Virginia towns like Davis, Thomas, Buckhannon, Shepherdstown, Fayetteville, Lewisburg. But these are very small places with good bones that weren't decimated by the coal industry. They either have to more unspoiled scenery, easy access to the DC metro, or already had some money. But it's not enough of a mass to make a huge difference across the state. Those towns are quite nice and I could see enjoying a second home in any of them.

But no one with means is moving to Clarksburg, Weirton, or Welch just because they are cheap. And no knock on Morgantown, it's not a bad place, but I just don't see the incentive to live there beyond a job at WVU or hospital system, which is pretty good by the way. Morgantown has horrendous traffic for a city of its size and the infrastructure to handle the growth that they have experienced is garbage tier.

That said, I wonder what West Virginia would have been or could be if its politics were more like Colorado or Vermont?

[eschaton]

Originally Posted by Don't Be That Guy

That said, I wonder what West Virginia would have been or could be if its politics were more like Colorado or Vermont?

One of the interesting what ifs I think about - since it's local - is if Virginia won out with its land claims over Southwestern PA, which would have resulted in a border for the state at the Allegheny/Ohio. Presumably WV still happens come the Civil War, with Pittsburgh (minus the North Side, which - being across state lines - would still be in PA) ending up in WV.

Morgantown would likely remain the state capitol, as I believe it was during the Civil War, since it would be more centrally located in the state. West Virginia would not be an overwhelmingly rural state, but anchored with a major urban area on its fringe (similar to Missouri).

[harryc]

Originally Posted by Don't Be That Guy

This is occurring in some West Virginia towns like Davis, Thomas, Buckhannon, Shepherdstown, Fayetteville, Lewisburg. But these are very small places with good bones that weren't decimated by the coal industry. They either have to more unspoiled scenery, easy access to the DC metro, or already had some money. But it's not enough of a mass to make a huge difference across the state. Those towns are quite nice and I could see enjoying a second home in any of them.

But no one with means is moving to Clarksburg, Weirton, or Welch just because they are cheap. And no knock on Morgantown, it's not a bad place, but I just don't see the incentive to live there beyond a job at WVU or hospital system, which is pretty good by the way. Morgantown has horrendous traffic for a city of its size and the infrastructure to handle the growth that they have experienced is garbage tier.

That said, I wonder what West Virginia would have been or could be if its politics were more like Colorado or Vermont?

Hey I resemble that remark-

Clarksburg WV
Nice park installation
Clarksburg WV by Harry Carmichael, on Flickr

With many of the buildings we get all upset about when the tear them down in Chicago.
Clarksburg West Virginia by Harry Carmichael, on Flickr

Clarksburg West Virginia by Harry Carmichael, on Flickr

[hauntedheadnc]

Originally Posted by Crawford

West Virginia, in theory is quite beautiful, but there isn't really much in terms of pristine wilderness. A lot of lopped-off hillsides, poisoned rivers, bombed-out towns and the like.

When I talk to people who moved from high cost/high tax locales, like the NE Corridor, and Coastal CA, the main reasons I here are 1. I'm retired, 2. Weather, 3. Want to be close to grandkids, 4. Too many liberals.

Don't think I've ever heard "homes cost too much" (if you own this is a good thing, no?) or "taxes are too high" though I suppose the "too many liberals" sentiments could kind of imply the latter?

You'll hear it a lot if you ask people who have moved from Asheville, which is definitely a high cost locale. It's why we moved to Greenville. You'll find quite a few of us ex-pats in Greenville, Spartanburg, and also in Johnson City, Tennessee. I keep repeating it because it still astounds me but, the money that bought us a four-bedroom, two-story house on a quarter of an acre, fifteen minutes from downtown Greenville wouldn't buy us anything inside the city limits of Asheville, and would have only bought us a trailer anywhere in Buncombe County.

For what it's worth we also considered Roanoke, Virginia for a while when it looked like a friend might be accepting a job offer up there. It seemed to emanate the same vibes Asheville was giving off twenty years ago before all the rich people piled in and made it boring. If there was somewhere in West Virginia that one, wasn't actively dying, two, had decent food, and three, gave off those same vibes, we probably would have given it a serious look and had their been a $12k incentive...

[Crawford]

Originally Posted by hauntedheadnc

You'll hear it a lot if you ask people who have moved from Asheville, which is definitely a high cost locale. It's why we moved to Greenville. You'll find quite a few of us ex-pats in Greenville, Spartanburg, and also in Johnson City, Tennessee. I keep repeating it because it still astounds me but, the money that bought us a four-bedroom, two-story house on a quarter of an acre, fifteen minutes from downtown Greenville wouldn't buy us anything inside the city limits of Asheville, and would have only bought us a trailer anywhere in Buncombe County.

Yeah, I get this, but this doesn't really speak to the WV campaign. What you're describing is typical human behavior, having a home budget of X, and trying to get the best home according to your specific criteria.

People are always trading space, land, location, whatever, to fit their X budget. We did that when we bought, as we could have gotten less space in a better neighborhood, or more space in a worse neighborhood.

But, excepting retirees, or some dramatic change in income/wealth, I don't see people moving to reduce/increase their housing budget, really ever. Instead they'll move to some super cheap locale and then boast that they have 5 bedrooms and 10 acres for the same price as they previously paid. Or they moved to an expensive locale, and sacrificed space and amenities. They didn't change their housing budget, they changed their housing typology.

[DCReid]

Originally Posted by hauntedheadnc

You'll hear it a lot if you ask people who have moved from Asheville, which is definitely a high cost locale. It's why we moved to Greenville. You'll find quite a few of us ex-pats in Greenville, Spartanburg, and also in Johnson City, Tennessee. I keep repeating it because it still astounds me but, the money that bought us a four-bedroom, two-story house on a quarter of an acre, fifteen minutes from downtown Greenville wouldn't buy us anything inside the city limits of Asheville, and would have only bought us a trailer anywhere in Buncombe County.

For what it's worth we also considered Roanoke, Virginia for a while when it looked like a friend might be accepting a job offer up there. It seemed to emanate the same vibes Asheville was giving off twenty years ago before all the rich people piled in and made it boring. If there was somewhere in West Virginia that one, wasn't actively dying, two, had decent food, and three, gave off those same vibes, we probably would have given it a serious look and had their been a $12k incentive...

Yes and when you read those articles about people moving from California to Boise or Reno, many talk about how they lived in a small condo and now have a big 3000 sf house. Even many who move to Texas say the same thing. I have not read that much about people moving because there are too many liberals, although some conservatives may add that as another reason for moving (or to them, a benefit or excuse). But I am sure they are happy to sell there small condo or house on a small lot in California that is now worth $750K to $1 million to get a 3000-5000 SF home in TX or Idaho, especially if they have kids to raise. Unless you are multimillionare or richer, I would guess that it is hard to justify moving because of politics.

[Crawford]

Originally Posted by DCReid

Yes and when you read those articles about people moving from California to Boise or Reno, many talk about how they lived in a small condo and now have a big 3000 sf house.

Right. Maybe this is a pedantic point, but it isn't really saving on housing costs, it's having the same housing costs, but with a different typology.

The random family who moves from the Bay Area to Indiana isn't looking to cut housing costs, as they aren't gonna live in the same home they had in the Bay Area. They're looking to change their housing according to their preferences. They're probably gonna trade their little condo or modest bungalow for a McMansion.

[hauntedheadnc]

Originally Posted by DCReid

Yes and when you read those articles about people moving from California to Boise or Reno, many talk about how they lived in a small condo and now have a big 3000 sf house. Even many who move to Texas say the same thing. I have not read that much about people moving because there are too many liberals, although some conservatives may add that as another reason for moving (or to them, a benefit or excuse). But I am sure they are happy to sell there small condo or house on a small lot in California that is now worth $750K to $1 million to get a 3000-5000 SF home in TX or Idaho, especially if they have kids to raise. Unless you are multimillionare or richer, I would guess that it is hard to justify moving because of politics.

We moved in spite of politics. It was kind of rough to acknowledge that as someone whose politics are quite liberal, my vote is never going to count again for as long as we live in South Carolina.

What was funny though, is that directly across the road from our house, one house had the Biden/Harris signs up while the house next to theirs had Trump signs up. Of the two, the Trump supporters were the ones who came across the street with a pecan pie to say hello. That was a huge surprise.

[photoLith]

Wheeling, Morgantown, etc are not really comparable to the rest of WV. They might as well be part of Pennsylvania as they share a more common history with industry and ethnicities as Pittsburgh. WV doesnt start to feel like WV until you get down about 30 miles south of Morgantown and thats about where the accents start to change.

Originally Posted by Crawford

West Virginia, in theory is quite beautiful, but there isn't really much in terms of pristine wilderness. A lot of lopped-off hillsides, poisoned rivers, bombed-out towns and the like.

That is utterly false. The only part of WV that is destroyed by coal mining is the southwestern part of the state and unless you are in a plane, you cant see it from the roads. Most of WV is wilderness or at least hardly populated. I go to WV about twice a month, going down there this weekend to go camping. I would move to Wheeling. Its only an hour from Pittsburgh and the rent is about half of what it costs here.