Addiction treatment as an economic development strategy? Dickenson County, ravaged by substance abuse and overdose deaths, says yes

Developer Greg May was pulling out of the parking lot of a barbecue lunch he throws every year in Dickenson County when he heard a commotion and saw a large man running toward him, waving his arms and yelling.

May stopped and rolled down the window.

“Are you Greg May?” the man asked, and May said yes. “I need to talk to you. I saw you on TV [talking] about this drug rehab in Kentucky and I think that’s something we need here.”

The man turned out to be Freddie Mullins, a 6-foot, 6-inch-tall lawyer from Clintwood who represents the county’s industrial development authority. 

While getting dressed earlier that day, Mullins was paying “about half” attention to a local TV news show when he realized they were interviewing a man who’d built a drug rehabilitation facility in nearby Pikeville, Kentucky, in memory of his brother, who died of a drug overdose.

His interest was piqued.

Later that day, at the lunch in the county’s public service authority office in Clinchco, Mullins saw May and thought he looked familiar. May had even introduced himself, but Mullins didn’t realize he was the man he saw on TV until he heard someone say the word “rehab.” But by that time, the developer had left.

So Mullins, who had been eating lunch, threw down his fork and took off after him in the sprinkling rain.

Their meeting in August 2020 was pure coincidence. May was at the luncheon because his company operates the county’s wastewater treatment plant and he hosts a meal for the county’s PSA and its employees once a year. Mullins attended because he also represents the PSA.

“That happened on a Tuesday, and by the end of the week, I was touring his facility in Kentucky,” Mullins said. “And it all started from there.”

“It” is the county’s plan to use substance abuse treatment coupled with job training as an intentional economic development strategy that they hope will put people back into the workforce and result in much-needed economic growth.

Substance use disorder and overdose deaths

For years, Mullins has been deeply concerned about the number of people in the county who are addicted to drugs. Like many others in the area, he has lost loved ones to drug overdoses.

He’d also been told by a judge years ago that the vast majority of court cases in the county were directly or indirectly tied to substance abuse. He wondered how the county could ever pull itself out of the cycle of addiction.

He’s right to worry. With some of the highest drug overdose death rates in the state, Southwest Virginia has long been considered the epicenter of the substance abuse crisis. Although Buchanan and Tazewell counties have had the highest rates among the far Southwest counties in recent years, Dickenson County had 53 overdose deaths involving all drugs between 2018 and 2024, the last year for which statistics are available, according to the Virginia Department of Health.

In 2024, the death rate for overdoses in Dickenson was 56.8 per 100,000 residents, which is more than double the state’s number of 24, the data from the state Health Department revealed.

Because local treatment options have been limited, Mullins said he and other county officials tried years ago to interest Ballad Health in bringing addiction treatment to the county, but it never went anywhere. So they decided to look into building one themselves, but the cash-strapped county government simply couldn’t afford it.

Even May, who owns Southwest Properties in Pikeville, couldn’t make the numbers work. He figured such a center would end up costing about $14 million.

Then he had an idea to use modular buildings instead of a traditional structure to significantly reduce the building cost to about $6.2 million, according to May. He took the idea, which made the project possible, to the IDA, which decided to move forward.

The total cost of the project is about $7.7 million. The Virginia Coalfield Economic Development Authority provided a $4 million loan, while a $2 million loan came from the Virginia Small Business Financing Authority. Contributors were the Gene and Anne Worrell Foundation, the Rapha Foundation, the county’s PSA and the town of Clintwood, which provided water and sewer infrastructure. The county also used some direct funding it received in opioid abatement money.

Five years after the chance meeting between May and Mullins, construction has been completed on the Wildwood Recovery Center, a residential treatment facility that will have beds for 112 men.

The center has nine buildings. Two buildings total about 7,000 square feet each. One has mainly offices and meeting rooms and is where patients will go when they first check in. The second structure has a large kitchen and dining room as well as a meeting and gathering space. Inside, the larger buildings are spacious and modern, with attractive finishes and scenic pictures of Southwest Virginia. 

The seven dorms are behind the two larger buildings. Each dorm has four groups of four bunk beds and other furniture. The furnishings are sparse, and Dana Cronkhite, the county’s economic development director, said the idea is that those undergoing treatment will be busy and won’t spend a lot of time there, other than to sleep. 

Wildwood will create 30 to 40 jobs; hiring has not started yet.

A second residential treatment center for women is in the planning stages. It will be built at an old school building in the community of Nora.

May is the developer for both projects. Addiction Recovery Care, ARC, a for-profit company based in Louisa, Kentucky, will operate both facilities. May has developed four addiction treatment centers in Kentucky, and all are operated by ARC.

In February, ARC announced that it had submitted its application to the Virginia Department of Behavioral Health and Developmental Services for a license to provide ASAM 3.5 level of residential care in Virginia. ASAM stands for American Society of Addiction Medicine, whose criteria has levels of care with 1 being the least intensive and 4 the most. The 3.5 level is clinically managed high-intensity residential treatment.

The project is behind schedule. Announced in early 2023, the original opening date was expected to be early 2024. But there were supply chain issues and drainage problems, and a learning curve with the modular buildings, county officials said.

Wildwood is now expected to open in early 2026, according to Tim Robinson, the founder and CEO of ARC. He attended a May 12 gathering at the center held by county officials to update stakeholders on the project and give tours.

Robinson, who said ARC officials have never had a warmer welcome than they’ve gotten in Dickenson County, announced that ARC had just received a licensing introduction letter from the state behavioral health department. That means the application is complete and the process is moving forward, he said, describing it as a milestone that could lead to a site visit.

“We think we’re going to be fully licensed in September, if all things go well, and then we’ll be opening sometime, hopefully, in January. Now that’s dependent on the credentialing within the contracting with the insurance companies,” he said.

The Dickenson County projects are ARC’s first outside of Kentucky, and there are many more steps in the licensing process in Virginia than in Kentucky so it has taken more time, May said.

On property next to Wildwood, construction will start soon on the second phase of the project, a health and wellness center for those at the facility and for the community.

The center will offer testing, education, vaccinations, family planning and new programs focused on fitness, nutrition, mental health services, substance misuse education, vocational training and recovery support. The aim is to provide comprehensive services that promote physical and mental well-being, contribute to the community’s health needs, and address the opioid crisis with a holistic approach, county officials said.

How getting people off drugs and into workforce training is ‘critical for the future economy’

Dickenson County leaders draw a direct link between their low labor force participation rate and the high number of residents who are addicted to opioids, methamphetamine, heroin, fentanyl and other substances.

The rate is the percentage of the civilian population ages 16 and older who are part of the workforce. It is different than the unemployment rate, which includes only those who are unemployed and actively looking for a job.

Among surrounding counties, Dickenson has the second-lowest labor force participation rate, 41.1%, in far Southwest Virginia, where all the rates are well below the state and federal numbers, according to the Virginia Rural Center’s Rural Opportunity Dashboard. The source of the numbers was the Census Bureau’s American Community Survey in 2023.

At 35.3%, Buchanan County has the lowest rate and Lee County has the third-lowest at 42%. Russell’s rate is 44.4%, Tazewell’s is 44.8%, Scott, 45.1%, and Wise is at 46.4%.

In April, Virginia’s rate was nearly 65.4%, according to Virginia Works, the Virginia Department of Workforce Development and Advancement. Across the country, the rate was 62.4% in May, according to the Bureau of Labor Statistics.

Worried about having so few people in the workforce, Dickenson leaders came up with a “novel approach” to couple substance abuse treatment with job training so those who are addicted can turn their lives around and go to work.

“We have found in Dickenson County, our workforce participation rate is much lower than in some of the other areas across the state, and we’ve been able to correlate that directly to the high rate of substance use disorder that we experience here and Southwest Virginia,” said Cronkhite. “Being able to provide a treatment facility for Dickenson County residents and residents in neighboring counties that will allow them to go back into the workforce, is something that I think is critical for the future economy of all of our localities.”

County officials see the approach as a form of economic development, and they felt so strongly about it they located the first treatment center across the road from the new industrial park they are building in the Red Onion section of the county. The hope is businesses will offer internships that will provide needed experience that could eventually lead to permanent jobs, at that company or another.

“The plan is to leverage the workforce being developed when marketing the sites at Red Onion Industrial Park,” Cronkhite said. “Addiction Recovery Care will work with any business to help develop the training necessary to train the needed workforce.”

County Administrator Larry Barton said a low labor force participation rate makes it difficult to attract and retain new businesses, and many of the current coal mining jobs are being filled by people who drive in from neighboring counties and Eastern Kentucky.

Barton, a certified public accountant, used to work as the chief financial officer for the county school system. In both positions, he said many times there are no applications for good jobs, and he believes a lot of that is due to addiction.

Currently, the county’s population is estimated by the census to be 13,411, with 7,484 in the 18-64 age group. But the number of those working was just 4,831, as of April 25, according to the Federal Reserve, he added.

“That’s a big gap,” Barton said.

Virginia Labor Secretary Bryan Slater said a low labor force participation rate hurts the local economy.

“It has a significant impact because if people aren’t working, they’re not buying new cars, which means they are not paying more personal property taxes. They’re not buying new homes, which means they’re not paying more real estate taxes. They’re buying less, which means the sales tax component is lower,” he said.

He added that prospective business and industry officials look at the labor force numbers, and low numbers could lead them to go elsewhere because they would worry about being able to fill jobs and wouldn’t want to locate in a county or town with a struggling economy.

Plus, if a person manages to land a job despite an addiction, he or she wouldn’t be able to pass a drug test, he added.

Barton also noted that about 33% of county residents are disabled, which he said is one of the highest disability rates in the state.

The county’s main employer is still coal mining, although the industry has gone through a serious downturn in recent years. The work is physically demanding and some miners develop back issues that can lead to drugs and addiction, Barton said.

Robinson said ARC has paired drug treatment with economic development for years at its facilities in Kentucky, and it works. In Springfield, for example, an ARC facility is located next to a couple of auto plants and some who complete the ARC program have gone to work there, he said.

ARC employs more than 800 people, and about a third of them have successfully completed the substance abuse program and then gone to work for ARC, he added.

Cronkhite and others involved with the treatment centers have been told there’s a lot of buzz about their approach across the state, particularly in Richmond.

One of those interested is Tony McDowell, executive director of the Virginia Opioid Abatement Authority, which is providing $3.4 million over two years for the health center being built next to Wildwood.

He drove down from Richmond to visit the center on June 2. He said the authority reviews applications for funding, goes over budgets and expenditures and looks at performance measures. But they also like to “put our eyes on the project that we’re providing funding for.”

“We have a fiduciary responsibility to ensure that they’re following all of our requirements … but we also like to go and see in person what’s happening,” he added.

He met with Barton and others involved with the project and said he could tell that they were committed to the project and that it’s personal for them because so many people have lost loved ones to drugs.

Wildwood is one of several projects happening in Southwest Virginia that “are like no other. I mean they’re setting the standard for how much these funds can be used to save lives and help communities,” he said.

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