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Appalachia Service Project – New Build Appalachia

Hancock County, Tennessee
hancock-county

The Appalachia Service Project (ASP) is, according to their mission statement, a Christian ministry, open to all people, that inspires hope and service through volunteer home repair and replacement in Central Appalachia. Since 1969, ASP has made homes warmer, safer, and drier(R) and provided transformational service experiences for volunteers. In 2018 alone, 16,231 volunteers served with ASP and provided critical repairs for 493 families and constructed over 60 new homes across the Appalachian region.   

Appalachia Service Project envisions the eradication of substandard housing in Central Appalachia and the transformation of everyone who comes in contact with the ministry. ASP’s proven, innovative financing model for housing rehabilitation and the construction of new homes creates impact by building infrastructure and bolstering the housing stock of the communities served.

ASP serves families that typically fall through the cracks of the affordable housing spectrum because they are unable to access traditional loans or mortgages: families that have extremely low incomes that fall below 80% of the area median income. For these families, taking on long-term debt to support housing needs would be a significant barrier to purchasing health care, providing nutritious food or investing in education. ASP’s mortgage-free model provides housing to those families without adding debt.

The benefit to low-income residents and economically distressed communities is unmistakable. According to the Center for Housing Policy (CHP), stable housing has a profound effect on health outcomes for families and individuals, childhood development and school improvement. In addition, the benefits of stable housing extend beyond the occupants to the community at large. Opportunities for employment, increased community involvement, and contribution to the local economy are substantially increased following the provision of sufficient and affordable housing.
 

New Build Appalachia

ASP’S New Build Appalachia program constructed 37 new homes between 2013 and 2017 for low-income families in East Tennessee. An additional 75 homes have also been built through the Long-Term Recovery program that was launched in 2012 to provide homes to families who have lost theirs as a result of natural disasters. These programs have successfully leveraged partnerships with private contributors, volunteers and suppliers to bolster the housing stock of each community served.

In 2015, ASP began work with the Appalachian Region Commission (ARC) and the Tennessee Department of Economic and Community Development (TNECD) to grow the New Build Appalachia program. This project served two of Tennessee’s ARC-designated distressed counties, Cocke and Hancock, as well as distressed census tracts located within Carter, Claiborne, Grainger, Greene, Hamblen, Hawkins, Johnson, Sullivan, Washington and Unicoi counties.

During that time, ASP faced challenges in managing projects in Hancock County from their office in Johnson City. Distance and the remote nature of the Sneedville area made it difficult to provide case management to families receiving homes, to transport equipment and materials, and to assist volunteers assigned to the county. ASP and TNECD discussed these issues and TNECD’s focus on Hancock County as the most distressed county in the state. To address these issues and allow New Build Appalachia to make further strides in the county, ASP requested ARC grant funding to establish a local office and recruit additional employees to serve there.
 

Hancock County - New Build Appalachia

Addressing housing issues in Hancock County is a pressing need according to the Housing Assistance Council (HAC) Rural Data Portal. In 2017, an estimated 633 homes in Hancock County had values of less than $50,000. At 27% of the county’s housing stock, these low-value units are found in a higher concentration than throughout Central Appalachia where the rate is 18%. HAC data further shows that the county has a relatively high proportion of homes without complete plumbing and kitchens. More than 5% of units in the county lacked adequate plumbing, ten times the national rate.

The organization’s 20 years of experience in Hancock County confirmed these assessments. In 2016, 429 ASP volunteers repaired 14 homes in the county and worked 15,015 hours, equivalent to a total value of $353,753. A total of $60,000 was spent on construction supplies and materials to perform the home repairs in the county. In addition, ASP received 128 applications for significant home repairs over the last three years that had not been served. This backlog was in spite of ASP’s active work in this county since 2014, including the deployment of 2,000 volunteers who completed emergency repairs for 72 families and constructed new homes for two families.

In 2017, ASP worked with TNECD and ARC to develop a strategy to address substandard housing in in East Tennessee. The goal was to construct 33 homes for individuals living at or below 80% of the average median income in distressed counties or census tracts. The project was designed to leverage ASP’s four decades of expertise in home construction and long-standing partnerships with private contributors and suppliers to bolster the housing stock of each community served. These funding sources would leverage ASP volunteer labor to construct a new home at a dramatically lower cost than a unit built by contract labor.

As a condition of receiving the home, families would agree to a 5-year restrictive covenant that would prohibit selling or borrowing against the home without paying a pro-rated penalty. ASP would provide homeownership counseling to the selected families with information on financial topics such as budgeting and credit and homeownership topics such as maintenance, insurance and pest prevention. A partnership with Appalachian Community Federal Credit Union and with other banks and community development agencies bring certified financial advisors to perform aspects of the counseling services.  

In 2018, ARC grant funding was awarded to ASP to fully fund the Hancock County operation. Funding allows ASP to lease an office in the Sneedville area to better provide counseling and family services, construction and project management, and community services to area residents. Three local full-time and additional summer employees funded by ARC are being recruited, hired and trained to provide services to implement the project. A Construction Superintendent is in place to oversee the office, and additional project management and volunteer management support is provided by the 30-member staff located at ASP’s Johnson City office.

The project builds upon ASP’s past investments in volunteer and case management activities in Hancock County to create local support resources for families who are homeless or living in substandard housing.  Insufficient housing units will be replaced by new, code-compliant homes at no cost to the homeowner through additional financial counseling and homeownership services. Construction funding to build each home will be provided by the Tennessee Housing Development Agency (THDA) HOME Program and the Federal Home Loan Bank of Cincinnati for the 33 homes to be built in the county. Because of ASP’s construction competency, a large volunteer labor force, relationships with major donors and private foundations, state and federal agencies, and partnerships with contractors, suppliers, local governments, churches and civic organizations, ASP is well-equipped to sustain the project beyond the initial two-year grant period.     
 

Economic and Community Impact

ASP will construct 33 new homes in East Tennessee with an estimated market value of $80,000 each. This construction activity will bolster the housing stock and generate more than $2.6 million in new housing assets. For each dollar contributed by ARC, more than $5 in value will be generated for the residents of distressed communities.

In addition to fulfilling a basic need for housing that is safe, warm and dry, ASP’s work includes significant contributions to the community and local businesses. ASP leaders work with local officials to design a program to suit the needs of the community that will not only create jobs, but tie into existing efforts to improve the lives of citizens in Hancock County. The project will make a substantial impact on ending substandard housing in Hancock County without creating debt for individuals who are living in poverty.

Projected 2019 and 2020 results include:

Total Volunteer Hours (1000 volunteer hours per home X 33 homes) 33,000
Total Low-Income Families to be Served (those making less than 80% of average median incomes) 33
Total New Homes to be Constructed 33
Average Estimated Home Values $80,000
Total Home Value and Ownership Created ($80,000 X 33 new homes to be built) $2,640,000


Project Funding

ARC Grant (Hancock County local staffing, local office expense)  $500,000
ASP Private Grant Match (Hancock County local staffing, local office expense)  $125,000
ASP Cash Contribution for Home Construction (THDA HOME and Federal Home Loan Bank of Cincinnati $60,000 per home X 33 homes) $1,980,000
TOTAL PROJECT FUNDING (Includes projected federal, state and private funding) $2,605,000


Project Leadership and Partners

ASP New Build Appalachia – Hancock County Construction Superintendent – Project Contact
Appalachia Service Project
Hancock County Government
City of Sneedville
Hancock County Jubilee Project
Appalachian Community Federal Credit Union
Federal Home Bank of Cincinnati
Tennessee Housing Development Agency
First Tennessee Development District
Appalachian Regional Commission
Tennessee Department of Economic and Community Development

For more information contact ASP.

 

Tennessee Applachian Regional Commission Programs

The mission of the Appalachian Regional Commission is to innovate, partner, and invest to build community capacity and strengthen economic growth in Appalachia. ARC supports a variety of activities to promote entrepreneurship and business development in the Appalachian Region. These activities help diversify the Region's economic base, develop and market strategic assets, increase the competitiveness of existing businesses, foster the development and use of innovative technologies, and enhance entrepreneurial activity. Through ARC funding, TNECD is able to award grants each year for economic and community development projects in the 52 counties in middle and east Tennessee served by the ARC.  

For more information visit TNECD Community and Rural Development.