GILLETTE — When Cloud Peak Energy Inc. went public in 2009, the Powder River Basin coal producer gifted its first 500 shares to Youth Emergency Services in Gillette, an organization that provides an array of services for at-risk youth and their families.
Over the years, those 500 shares reached a high-value mark of approximately $11,500. Although only a fraction of the organization’s annual financial need, the gift represented much more. Even as Cloud Peak stumbled financially, the YES House held on to its shares in the company — the only coal producer headquartered in Gillette.
“Social services is always about hope,” YES House development director Tatyana Walker said. “When you’re working with kids, the greatest goal is to instill hope, because if you have hope you can overcome your challenges.”
Cloud Peak eventually filed for bankruptcy, was delisted from the New York Stock Exchange and sold its mines, rendering those 500 shares worthless.
“We kept the shares, and it did not work out very well,” Walker said. “We were always hopeful as a community — not just the YES House — that they would recover from those [tough financial] times. But they didn’t.”
That sense of hope and mutual dependence is being tested throughout Gillette and northeast Wyoming as the coal industry bleeds jobs and dollars. After a series of bankruptcies and an increasingly gloomy outlook for coal, the mining industry here is desperately trying to cut spending.
That includes a noticeable reduction in corporate giving and all manner of charitable support, according to officials overseeing local social service programs.
The YES House serves about 1,000 youth — and indirectly, their families — throughout northeast Wyoming. Declining donations and revenue have forced it to scale back outpatient and prevention services, as well as its mentorship program — just as the same forces that slow charitable giving also drive more need for a full range of social services in northeast Wyoming.
At the Council of Community Services — a Gillette-based social services organization that oversees 11 programs — staff has seen an increase in families signing up for the food pantry, as well as families in need of dental, medical, housing and rental assistance.
“A downturn in coal and a downturn in our economy — that’s going to affect everybody,” Council of Community Services executive director Mikel Scott said. “It will affect banks, it will affect individuals. It will affect everybody.”
United Way of Campbell County eliminated its only staff position — executive director — in June 2018, then a year later announced it was closing its doors.
Arch Coal recently suspended its annual, and highly publicized, teachers award program — established in 2000 — in Wyoming and West Virginia.
Although not vital in the context of pressing needs among a community’s most vulnerable, it is significant and a glaring sign of the coal industry’s shrinking community support. The annual teachers award, in addition to celebrating exceptional educators, was a way for Arch Coal to tout the fact that Wyoming schools were primarily funded by revenues the state reaped from coal. Today, declines in coal and energy has put the future of Wyoming’s school funding in serious doubt.
The company said it simply doesn’t have the resources to proceed with the program, which also awarded teachers cash prizes.
An industry’s obligation to its community
Among its many partners, the Council of Community Services counts equipment contractor Komatsu Mining Corp., L&H Industrial, Peabody Energy, electric utility Powder River Energy Corp., and Kiewit’s Buckskin Mining Co.
Similarly, the YES House has enjoyed a diverse portfolio of energy company supporters, including Cloud Peak, the namesake sponsor of the organization’s gymnasium.
When a tornado devastated part of Wright, Wyoming in 2005, coal companies jumped into action to help clean up and dispose of debris at a mine site. It’s one example of the support coal companies have offered to Wyoming communities.
Energy companies — whether international coal giants, or local service companies — have long understood the value of being a good “corporate neighbor.” Providing aid to those who are most vulnerable in the communities they rely on pays dividends directly to and beyond their own employees and their families.
Dominating the social contract is a continual examination of how to divide the spoils and responsibilities as a matter of tax, social and environmental policy. It was the massive buildout of coal mines and power plants that, in the 1970s, spawned the term “Gillette Syndrome” — the boomtown phenomenon of acute social disruption due to rapid industrial growth. Housing was in short supply, crime rose and the town’s water and road systems suffered from overuse.
Theresa Miller remembers moving from mining town to mining town before her family landed in Gillette in the 1970s during the coal boom. “People were living in their cars,” she said. “There was just no place to live.”
Her family found a small mobile unit at the Crazy Woman Campground, where her parents and three siblings and a dog lived until they could move into a newly-built home. “People were excited about building Gillette, building a community,” Miller said.
This was the era when Wyoming reexamined its tax rates and policies. The state established the Permanent Mineral Trust Fund, as well as the Industrial Siting Council, which diverts sales and use taxes to communities stressed by large industrial developments.
Over the next 45 years, the social contract that state and local governments struck with the coal industry helped squash the Gillette Syndrome reputation by fueling a thriving community whose facilities attracted statewide and international events. The same coal and energy wealth that transformed Gillette from a “syndrome” to the nation’s “Energy Capital” also helped create a Wyoming sovereign wealth fund of $20 billion dollars and modernized schools throughout the state.
Still, people fell through the cracks.
People who didn’t have high-paying jobs at the mines or in energy found it difficult to make a living in Gillette, Miller said. “People on the margins have always been invisible because Gillette is such a wealthy town.”
Whether it’s the continuing boom-and-bust cycles of oil and gas, the transient nature of the energy industry, the pressures of shift work or the intractable challenges inherent in rural life, social service programs in Wyoming have come to rely on the generosity of energy companies and their employees to help fill in the gaps where state and federal dollars don’t reach.
Shrinking support, increasing needs
The Council of Community Services was established more than 50 years ago as a way to leverage limited resources to meet multiple needs that, independently, might not have the professional resources to effectively organize, raise funds and deliver services.
Its budget includes approximately $2.5 million in federal funds dedicated to a group home and the Low Income Energy Assistance Program. For the remainder of its nine programs — its soup kitchen, food pantry, homeless shelter, thrift store, low-income housing/rental assistance and others — the organization relies on local governments, donors and volunteers.
For those programs, the Council of Community services works hard to pull in a little more than $500,000 annually, including funds for limited staff, according to executive director Scott. It’s not enough to bridge the growing divide between the need for services and decreasing charitable support.
“We have two [federal] programs that are funded pretty well, and the rest are not,” Scott said. “Our homeless shelter will be in the red this year. Our food pantry, our soup kitchen, homeless shelter — all of those programs; we’re going to have to work extra hard for them to meet their budgets.”
The increase in demand for social services correlates with the downturn in the coal industry, Scott said. There’s usually steady support from an array of businesses and individuals of various means, and not necessarily tied to the coal industry. In tough times, some continue to step up while others step back.
“We are grateful,” Scott said. “It’s just that, lately, when I do my budget every year, I look at it conservatively in a way that I’m not going to count on anything coming through on that end [coal corporations].”
Long-established social service providers such as the Council of Community Services and the YES House struggle to maintain a diverse portfolio of revenue and support. Federal and local government funds are vital, but it’s difficult to overstate how much the organizations depend on private support, according to the YES House’s Walker.
“When one [revenue source] goes away, we have to find another one that can allow us to support the services for our vulnerable youth,” Walker said. “What has been happening, when we lose local support, we reach out to federal support.”
Federal support comes with strict limitations. “We cannot do the same thing we’re able to do with private funds because private funds allow innovation. It allows us to spend the way we feel like it will benefit Campbell County the best,” Walker said.
Social service providers face a constant struggle in retaining staff — made more difficult with the rising cost of living and a downturn in the economy. Sometimes organizations lose qualified staff who have to take on extra hours or take other jobs to make ends meet. Money is important, Walker said, but the YES House’s most valuable assets are staff and volunteers.
“If you look at the profile of kids we work with, they need caring adults in their lives,” Walker said.
Among the many painful implications of any major downturn in an energy economy is that large, wealthy corporations often sell off their remaining assets (oil and gas wells, and coal mines, for example) to smaller companies with smaller budgets. One of the most consistent and generous supporters among local coal producers — for the YES House, Council of Community Services and others — was Cloud Peak Energy. It carried on the tradition from former owner Kennecott Energy, a division of global mining giant Rio Tinto.
Navajo Transitional Energy Co. bought Cloud Peak’s mines in 2019, taking on the former coal producer’s tens of millions in unpaid taxes in Wyoming at a time when the outlook for the local coal industry is dimming. Locals wonder if NTEC will also take on its predecessor’s role of charitable support.
“It does change,” YES House human resources director Ryan Anderson said. “Those relationships change when a company’s owner changes, and that has had some effect. I originally came from the coal industry, and it’s definitely different than what it used to be.”
Both the YES House and Council of Community Services said that a representative from NTEC has been in touch to discuss needs, and possibly to contribute. NTEC did not respond to WyoFile’s requests for comment.
How is Wyoming responding?
United Way of Natrona County recently stepped up to help out its partner organization in Campbell County. Bruce Brown, who served as secretary and treasurer for United Way Campbell County, said the local chapter remains closed. For now, its partners in Natrona County are conducting a campaign on behalf of Campbell County.
Geno Palazzari, communications manager for the City of Gillette, said local governments in Campbell County have won voter approval to implement the optional 1% sales tax each time it’s been on the ballot since 1976. A portion of that revenue — 5% — is dedicated to local social service programs, amounting in about $1 million annually.
Some years “that number has come up a little short,” Palazzari said. Occasionally, the social services apportionment is adjusted upward to 6% to make up for a shortfall. However, a downturn in the economy often results in a smaller amount of “Penny Power” funds for social services.
Generally, social services across the state avoided major reductions when lawmakers met this winter to reshape the state’s budget around a declining energy economy. However, the legislature declined to expand Medicaid in Wyoming for the seventh year in a row. Proponents say that expanding Medicaid would prevent many Wyomingites from relying on local social services.
Meantime, homelessness is a growing problem throughout the state, and one that is almost left entirely to counties and towns to figure out. A 2019 homeless needs assessment outlined several ways the state could play a more direct role.
“Homeless programs are not just under-funded by the state, they’re just not funded by the state,” Scott said. “So you have to rely on your local community [for that need], and when your local economy is not doing well, it’s even harder.”
Theresa Miller is leading an effort through the Catholic Church to provide a “low barrier” day shelter — a place for people to come in from out of the cold. So far, “Theresa’s House” is only open one day a week. Its founders are trying to pull together enough funds and volunteers to keep the day shelter open more frequently.
Miller said there is a shelter for people in need of a place to stay the night. But it’s closed during the day, leaving many people without a place to go. “We want to build a community for people who are on the margins.”