Hope rises: Housing developments are underway in Eastern Kentucky as communities rebuild after major flooding

By Jenni Glendenning
Institute for Rural Journalism, University of Kentucky 

Eastern Kentucky’s recovery from the devastating floods of 2022 passed a significant, heartwarming milestone on Wednesday, June 5, as Melissa Neace got the keys to her new home. 

Neace, of Perry County, is the 100th flood survivor to get a home built or rehabilitated by the Hazard-based Housing Development Alliance, one of several nonprofits working with state and local officials not only to rebuild for flood victims, but to address the region’s chronic shortage of housing and land available for it. 

The effort has turned adversity into hope for scores of families in the region; more than 600 new homesites have been laid out, and many more are expected in the next few years with an influx of $298 million in federal disaster-relief money this year.

“Today's celebration marks not the end but the dawn of a new chapter filled with promise and progress,” Scott McReynolds, head of HDA, which has built homes in Breathitt, Knott, Perry and Leslie counties for more than 30 years. 

And not only government money is at work. “We've had hundreds of volunteers who have come out and swung a hammer, shoveled mud, whatever needed to be done,” McReynolds said. “We've had a lot of volunteers in the community that participated in case management, and the long-term recovery communities, and distribution centers.” 

The outpouring of generosity extended far beyond local boundaries, McReynolds said during an event at Neace’s home in the Blue Sky subdivision next to the Wendell H. Ford Regional Airport. With donations pouring in from individuals, organizations, and even unexpected sources “like antique car clubs and Elvis impersonators,” from humble $5 contributions to substantial donations reaching $500,000. 

HDA received $2.5 million from the state Rural Housing Trust Fund to build Neace’s home and 23 others, as well as to repair and renovate 16 existing homes. Other funding sources enabled it to rehabilitate about 60 more. All told, it and other agencies have built 63 new homes and rehabilitated 270, Gov. Andy Beshear said Thursday. 

Much of that work was done with federal and state emergency funds. More housing announcements are expected after July 1, the deadline for applying for $298 million in federal Community Development Block Grant Disaster Relief funds. 

At Wednesday’s event, Beshear said the vision for housing in the region extends beyond individual homes to the creation of whole new neighborhoods such as Sky View, east of Hazard, and Chestnut Ridge in Knott County. 

This fall, he said, “We're going to see houses coming up on Sky View. The possibility between all the available land is for over 300 homes. We could have 1,000 people eventually living in that community. That is not just a response, that is a solution – both to what happened and to the housing crunch and crisis that we face around Kentucky.” 

Hazard Mayor “Happy” Mobelini said at the event that he believes “Perry County is better today than it was before the flood happened.” 

Neace, who is orignally from Jackson, received the keys to her home with her daughters Rachel, 18, and Beth, 16, and their Husky, Nuka. They lived for 20 months in a trailer provided with emergency funds. 

“I’m excited to get out of the camper but grateful to have had it because I would have been homeless if I didn’t,” said Neace, who is disabled with lupus and unable to work. “We’ve been in a small place for so long, it’s going to be great cooking meals in this big kitchen.” The girls said they were looking forward to having their own rooms and their own beds. 

Blue Sky is a private development that began development before the floods, on reclaimed strip-mine land. HDA bought 12 lots to build homes for flood survivors. 

Here’s a rundown of other projects, generally in the order that homes are likely to be occupied: 

The Cottages at Thompson Branch in Whitesburg (Letcher County) was the first high-ground site to be developed after the floods. Two of 10 homes for survivors have been completed by Housing Oriented Ministries Established for Service (HOMES Inc.). 

In Wayland (Floyd County), the Appalachia Service Project, which uses volunteer labor, is completing its 11th home for flood survivors on 4 acres the Foundation for Appalachian Kentucky bought from the Wayland Volunteer Fire Department for $200,000. Families are preparing to move in this month. 

In Prestonsburg (Floyd County), the state Department for Local Government and Mountain Housing Corp. of Prestonsburg will use a federal community development block grant build 33 new homes, and rehab one house, for flood survivors. Groundbreaking on New Hope Estates is expected this summer. 

The largest project in the works is Chestnut Ridge, to be built in two phases on former coal property. The state first acquired 100 acres to build 147 homes, but construction will start first on 57 homes on 27 acres adjacent to the state land. Western Pocahontas Properties, a natural-resources company, donated the property, and Joe and Kelly Craft donated $4 million to the Foundation for Appalachian Kentucky to start construction. 

“We got started a little bit before the state did and we've had some private money, so we've been able to go ahead and get started building on this first section,” said Gerry Roll, the foundation’s founder in residence. She said the two developments are “staying coordinated on power and broadband and the main road” that is being built to the area. 

These first 57 homes will be built and funded through public and private partnerships of HOMES Inc., HDA, the Appalachia Service Project and Samaritan’s Purse, an international relief organization. 

Three other developments have master plans in the works, said Logan Fogle, spokesman for the Department for Local Government. 

The first phase of Sky View would have up to 102 homes on 50 acres donated by the Ison family. Geotechnical and environmental reviews are complete, and an access road is under construction. Another 375 acres, in the next three phases, would have 300 to 350 housing sites. 

Olive Branch, in Knott County near the Perry County line, has a plan for 132 homes on approximately 77 acres donated by Shawn and Tammy Adams. The Right-of-way plans are in development for the initial access road. 

Grand View in Jenkins includes up to 116 homes on 92 acres donated by the Johnson family. An environmental review is underway, and funding applications for water and sewer lines are being submitted. 

Also in Letcher County, the county government has outlined a comprehensive plan, allocating $8.7 million to build 29 homes in Seco and Uz. This includes the necessary infrastructure such as roads, water, sewer, and electricity. 

In Breathitt County, the City of Jackson is using $2.36 million to build eight homes for flood survivors. Beshear said Thursday that FAHE, formerly the Federation of Appalachian Housing Enterprises, hopes to break ground “in the next 30 days.” 

In addition to the new communities, the state’s Team Eastern Kentucky Flood Relief Fund has partnered with HOMES Inc., the Housing Development Alliance, and Partnership Housing of Booneville to build 19 homes in Breathitt, Floyd, Knott, Letcher, Martin, and Perry counties, providing over $1.4 million in relief. 

To the west, in Laurel County, Clayton Homes and Beshear broke ground in May on Redbud Estates in London, featuring 51 energy-efficient CrossMod® homes eligible for conventional financing programs. This type of construction, manufactured homes completed on site, could offer housing solutions for other regional developments due to the off-site construction processes and their energy efficiency. 

What about rental housing, which can’t get emergency funds? The forthcoming $298 million in federal community development block grant disaster funds for 2022, can be used to build rental housing. The DLG and the state’s Kentucky Housing Corp. used a coordinated application process for $59.7 million in CDBG money for Western Kentucky tornado victims, and on June 3 announced $233 million in financing for 953 rental units in four counties. 

The agencies plan to use the same approach for Eastern Kentucky, but Beshear cautioned that it will be more difficult in the east due to the region’s lack of land available for development and the lack of income to support market-priced housing. Also, apartment living is not as common in the east as it is in the west. 

“People like to own the land, and it is a very important part of our history and culture because families are tied to the land, and apartment living has not been historically feasible or realistic in our area,” Roll said. “I wouldn't say people are opposed to it, as much as it's just a foreign concept, it's not something that people are accustomed to.” 

There is not a lot of flat land in the region that has not been mined, making big apartment complexes unrealistic, Roll said. In addition to topography, income levels in the region often fall short of the rent needed to cover the costs of development and maintenance, making it almost impossible to maintain fair market rents. 

Zack Hall, community engagement officer at the Foundation for Appalachian Kentucky, does believe there is a market and a need for apartment rentals in Hazard. “I'm in the 20-to-30 age group of young professionals and know of people my age who want to move back to the area but aren’t ready to buy a house yet, but there aren’t apartments available.” he said. 

Pam Johnson, FAHE’s executive vice president of business development and outreach, like Roll, feels like apartment living “isn’t within the culture of the region” and feels that it would “lean more into duplexes and triplexes” when considering multifamily rentals. 

Jenni Glendenning, a Ph.D. student at the University of Kentucky, is the David Hawpe Fellow in Appalachian Reporting for UK's Institute for Rural Journalism. Reach her at jenni.glendenning@uky.edu.