Highwall includes the construction of rental cabins, a conference center, a wellness center, and improvements to a vacant development site designed to provide a rustic Appalachian resort destination. - Budget Modification Introduction This budget update is submitted to align the project’s financial plan with its current status and needs. The Highwall project focuses on developing rental cabins, recreation amenities, and hospitality facilities on a vacant former coal mine site in Mingo County, West Virginia. This project aims to create new jobs offering living wages and opportunities for career advancement, with positions primarily filled by low-income residents and individuals in recovery from Substance Use Disorder. While the project is on track to complete the cabins and achieve its job creation goals, we require DHHS’ approval for two key items. First, we are requesting approval for an equity agreement, which would formalize the use of DHHS funds in the construction of two new cabins. Second, we are asking for the removal of the previously committed $8.1 million in matching funds, as the anticipated New Market Tax Credit (NMTC) funding could not be secured. Budget Breakdown Coalfield requests that DHHS confirm the following activities as allowable cost objectives under the “Other” category, consistent with the original design of the project, which anticipated $8.9 million in development costs categorized under “Other.” This breakdown clarifies the planned use of DHHS funds: “Rebuilding the Appalachian Economy from the Ground Up.” 2923 PARK AVENUE | HUNTINGTON, WV 25704 | 304.501.4755 | coalfield-development.org • Cabin Construction: $316,597 This portion of the DHHS grant will be allocated to the construction of rental cabins, which are crucial to the business model and success of the project. The construction will generate permanent jobs and contribute to the long-term sustainability of the Highwall site. • Site Reclamation and Remediation: $483,403 These funds will be used to remediate and reclaim the former mine land, including soil rejuvenation and preparing the site for safe and effective use in the resort’s development. This reclamation work will create employment opportunities for low-income individuals, including those facing barriers to employment, and will help workforce development participants increase their skills and value as employees. Equity Agreement Request Coalfield Development Corporation (“Coalfield”) has formed a single-purpose LLC known as Highwall Properties, LLC (“Highwall”), of which it owns 48%, to develop and own the property, ensuring sustainable job creation and retention. We request DHHS approval for an equity agreement equal to the $316,597 allocated for cabin construction. Under this structure, DHHS funds would be treated as an equity investment, granting DHHS a federal interest in the equity instrument rather than in the real property. This arrangement strengthens the legal structure of Highwall and aligns it with the project’s workforce development goals. The funds will also reimburse Coalfield for construction costs already incurred. Original Project Abstract <p>Coalfield Development Corporation (Coalfield) will use $800,000 in CED funds to support the construction and development of the Highwall project, a project to develop lodging accommodations, meeting venues, recreation amenities, and hospitality facilities on a vacant, former coal mine site in Mingo County, West Virginia. The Highway project will turn an abandoned coal site in Mingo County into a health and wellness resort destination offering rental cabins, wellness programs, and other natural outdoor activities to groups and individuals. The new jobs will offer living wages and opportunities for career advancement and will be filled by residents who are low income and/or in recovery from Substance Use Disorder (SUD), with a commitment of New Market Tax Credit funding. The project will leverage an additional $8,100,000. The project will create 32 new, full-time jobs, 24 of which will be filled by individuals with low income.</p>
