CHARLESTON, W.Va. — Gov. Jim Justice knows he needs a new Commerce Secretary, and his help wanted list actually extends beyond that.
A list of postings for current top openings at the Commerce department would look like this:
Secretary of Commerce, deputy secretary of Commerce, executive director of the Development Office, director of the Small Business Development Center and director for Community Advancement and Development.
It’s a lot of openings in leadership for the agency tasked with growing West Virginia’s economy.
“They’ve got a lot of holes to fill,” said Keith Burdette, who was secretary of Commerce during the Tomblin administration. “There’s a reason those positions exist. It knits it all together to create a team to get the job done.”
Help wanted
The vacancies have been lingering, but attention around them picked up over the past week.
A story for Ogden newspapers focused on the continued role of Clayton Burch as interim secretary of Commerce. Burch’s background is in the Department of Education, and he was never meant to be a long-term fill-in for Commerce.
Burch has a reputation as a capable manager, but he has not been out front as the face of Commerce. “No sir, the truth is I haven’t met him,” Senator Ed Gaunch, R-Kanawha, said of Burch.
That led to questions of Governor Justice, who acknowledged during a press conference and then on MetroNews’ “Talkline” that the search for a new secretary of Commerce has been a challenge.
“We’re probably not near as close as I’d like to be,” Justice told “Talkline” host Hoppy Kercheval.
“To tell you the truth, if you’d be interested, I’d surely love to sit down and talk with you about it. But if you’re not, if you could send me a couple of names of people that are out there in your listening audience today, I’m looking for a really good person.”
West Virginia has been without a secretary for the Department of Commerce since the forced resignation of Woody Thrasher on June 14.
The agency also has been without the other top lieutenants too.
Development Office executive director Kris Hopkins left of his own accord. Josh Jarrell, the deputy secretary for Commerce, was pushed out prior to Thrasher’s departure.
Erika Bailey, the director of the West Virginia Small Business Development Center, left August 8. “It’s not a bad thing,” Bailey told The State Journal. “I’m leaving on good terms.”
The director of Community Advancement and Development was Mary Jo Thompson, who left in late June, following weeks of controversy about the RISE long-term flood relief program overseen by the office. Jennifer Ferrell is serving as interim director.
“These are not clerical positions,” said House Minority Leader Tim Miley, D-Harrison. “They are key and central to WV’s economic development operations, and they’re unfilled. There appears to be a lack of structure as to decision-making inside the agency.
“It’s a real problem ensuring the perception of stability that businesses want to see in our state.”
Miley expressed worry about potential missed development opportunities. He cast blame on Governor Justice for not providing a structure for success.
Miley said Commerce is “an agency that is leaderless, not just within its agency but from the top – that being the governor. I’m hearing morale is horrible.
“That doesn’t create an environment that’s going to attract anyone to come in and serve as Commerce director. Why would you give up a good position you have in the private sector to come work for this dysfunctional group?”
.@TimMileyWV joins @HoppyKercheval to talk about the serious issues at the commerce department. WATCH: https://t.co/wkudfIAoe1 pic.twitter.com/FuELZBM97g
— MetroNews (@WVMetroNews) September 7, 2018
Thrasher’s exit prompts search
Thrasher, a successful businessman whose engineering firm bears his name, became the Secretary of Commerce when the Justice administration took office in January, 2017.
When he was first announced for the position, Thrasher said he would only exit private business for Gov. Jim Justice. And Justice, in turn, called Thrasher the “number one guy I wanted to recruit.”
But the relationship culminated with Thrasher’s forced resignation almost four months ago.
Shortly after Thrasher’s departure, Justice said in news conferences that the names at the Commerce department matter less than his own name, relationships and efforts. He used West Virginia’s potential $73 billion deal with China Energy as an example.
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Gov. Jim Justice
“I can tell you just as simple as mud how it happened,” Justice said. “It happened through a friendship with myself and Donald Trump. Donald Trump realizes wholeheartedly that we have a terrible trade imbalance with China and he is on those people and on those people like stink on you-know what.”
He went on to say of the deal, “So how does West Virginia come into being? Do we really think it came into being because of our Commerce department? Of course it didn’t come into being because of that. It came into being because of the relationship between the two of us and the president trying to help his friend and trying to help what he loves, and he loves West Virginia.”
What WV needs
West Virginia’s development efforts work best when the governor and the Commerce secretary have an open, cooperative relationship, Burdette said.
“Companies want to speak to someone who can be a decision maker,” Burdette said. “It really has to be someone who has open lines of communication with the governor.”
But much of the success is built on foundation laid by less-heralded team members.
“It was the team that made things happen,” Burdette said. “It’s important that the governor find someone in Commerce that can reassemble that team.”
Among the names rumored for the Commerce secretary position was current House Finance Chairman Eric Nelson.
Nelson said he has not been approached for the job, though.
“I have not talked with the governor or any of the governor’s staff about the Commerce position,” he said Friday. “They have not offered, nor have I asked. I’ve got to worry about getting re-elected and keeping our majority of Republicans in the House.”
As chairman of the Finance committee, Nelson is watching the situation in Commerce with interest.
“When you have positive vibes and positive promotion and a can-do attitude of what can happen, that’s good for everybody,” said Nelson, R-Kanawha. “Yes, that does start with our governor and his appointments of some of his secretarial positions.”
The path to sustained growth
Early last week, Governor Justice and other officials celebrated a revenue surplus of $65 million over the first two months of the fiscal year.
State officials attributed the current revenue growth to severance tax, consumer sales tax and personal income tax.
Much of that is connected to improved market conditions for coal and natural gas — as well as to construction work associated with five major natural gas pipelines.
“We’ve had two good months. Two good months does not necessarily make a year,” Nelson said. “We’ve got to really be positive about the trends that we’re in, but now’s the time we’re going through the budgetary process for the next fiscal year.”
Nelson suggested a fully-functioning Commerce department would help broaden West Virginia’s economy. “Now’s the time to do some diversification.”
Rebecca McPhail, president of the West Virginia Manufacturers Association, said it’s a key moment for the state’s economy.
“We are at such a crossroads of opportunity in West Virginia,” McPhail said.
“Having people lead the development effort is really going to be important to our ability to take advantage of the opportunities we have right now, whether that’s natural gas development, growing our tourism economy or influencing policy through an economic development lens that can really help create a positive environment for investment and job growth.”
The economic picture
West Virginia’s economy has been growing — but unevenly.
West Virginia’s gross domestic product growth was a strong 6.6 percent in the first quarter of 2017 but then minus-1.1 percent the second quarter of 2017, a scorching 10.2 percent in third quarter 2017, 1 percent in fourth quarter 2017 and 1.3 percent first quarter 2018.
A report last month from the Appalachian Regional Commission showed the region is starting to rebound but that West Virginia still has 15 counties considered economically distressed, an increase of three from last year.
West Virginia’s unemployment rate has been holding steady at about 5.4 percent over the past half year. The nation’s unemployment rate is 3.9 percent.
West Virginia Chamber of Commerce President Steve Roberts said now’s the time to shore up economic growth.
“We have gotten a reprieve, yet another of many, because when you are an energy-producing state energy economies run in cycles. We are in a pretty good up cycle for energy,” Roberts said, describing that as a result of focusing on a climate for economic growth.
“You add all of those things together, and we have a platform from which to build and diversify our economy,” he said.
Keys to the economic engine
Finding a dynamic, knowledgeable leader to head up that effort isn’t easy, Roberts agreed.
Many of the best candidates may already have rewarding work in the private sector. They may be making more than the Commerce secretary’s pay of $95,000, which is set in statute. And some may look at Thrasher — and his experience — and shy away.
“I thought Woody Thrasher did a terrific job. Woody was accessible, eager, energetic, informed and the likes of Secretary Thrasher would be very hard to replace,” Roberts said.
“I have to think if you are a person in West Virginia who might be interested and capable of being a candidate for that job, you would be mindful of who you’re following and what that reputation would have been like.”
So he has some sympathies for Justice’s challenge in filling the job.
“The truth is, around the country there are people who are very good at this and we are living in a competitive world. We’ve seen other people leave West Virginia and go places for competition,” Roberts said.
“If the governor is saying or implying that he wants to take his time and look broadly to find the very best person to take this job I would have nothing but praise for that approach.”