$3 Million in VCEDA Funds Will Be Used for Modular Housing Manufacturing Facility in Russell County
LEBANON, VA – OCTOBER 29, 2025– A modular housing production facility which also focuses on construction training and education will soon be coming to Russell County, due in part to an up to $3 million loan recently approved by VCEDA to the Russell County Industrial Development Authority (IDA).
Appalachian Highlands Housing Partners (AHHP), a 501 c3 non-profit corporation formed in 2024 by the Wellspring Foundation of Southwest Virginia, has been working with the IDA on the project which anticipates the creation of 89 jobs within five years. The funds will be used to finance the purchase of real estate, building upfits and improvements at the former Buster Brown Building in the Russell County Industrial Park.
AHHP is a 501c3 non-profit Virginia corporation formed in 2024 by the Wellspring Foundation of Southwest Virginia. The Wellspring Foundation has a mission to enhance the health and wellbeing for the Virginia residents of Washington, Grayson, Russell and Smyth counties.
Wellspring identified workforce housing as one of the greatest needs in its impact area and therefore made the decision to create AHHP to provide housing for income earners between 80 percent to 120 percent of the Area Median Income (AMI). AHHP then quickly identified the need for the manufacture of modular housing which is built in component parts and then brought to a home site and placed on a permanent foundation. Modular housing is built to the International Building Code and is regarded the same as stick-built homes by building regulations.
“In addition to developing a facility at which modular housing will be manufactured, thereby creating jobs, AHHP also recognized a workforce development component was needed, so there would be skilled laborers to work in the modular home construction facility and also so that those workers could be trained in employable skills and trades that are needed in the region,” said VCEDA Executive Director/General Counsel Jonathan Belcher.
AHHP has had discussions with the county career and technical programs, community colleges and Virginia Tech about the need to create a pipeline of skilled laborers.
“The goal is to inspire employees to not only learn about modular construction, but to also learn about various careers in construction such as electrician, plumber, HVAC, carpentry, engineering, project management or other skills needed in the ecosystem of construction,” the application for funding noted.
“This initiative not only delivers high-quality, cost-effective homes for our community but also equips local workers with in-demand skills in modern construction techniques, creating lasting economic and social impact,” said Mayana Rice, AHHP director. “We sincerely thank the Virginia Coalfield Economic Development Authority (VCEDA) for its vital support. VCEDA’s investment helps us provide attainable housing for hardworking families earning 80–120 percent of the Area Median Income, ensuring our community has access to safe, high-quality homes they can afford."
Plans call for at least 260 units of modular housing to be manufactured in the first year in the approximately 92,000-square-foot Russell County building. As the workforce is trained and grows, the facility is proposed to generate 300-400 additional housing units annually. The homes will be marketed throughout the region based on partnerships with housing agencies as well as other advertising strategies. AHHP has confirmed that although Wellspring’s service territory is Washington, Grayson, Russell and Smyth Counties, the modular homes produced at the Lebanon facility would be available for purchase in any county in the VCEDA region.
Loan funding from VCEDA for the project will include up to $2 million from the VCEDA Communities for Opportunity Loan Fund, a revolving loan fund to encourage economic development in the coal producing counties of Virginia. The remaining up to $1 million in loan funds come from the VCEDA Coalfield Workforce Development and Training Fund, which is funded from part of the revenues which VCEDA received from the now-defunct state Coalfield Employment Enhancement Tax Credit.
“Russell County IDA is excited about the new facility and the workforce training that it will provide for the region,” said Russell County IDA Director Ernie McFaddin. “Not only will this project assist with workforce training, it will also help alleviate the workforce housing shortage for the region. This is a great project for Russell County and we look forward to the continued partnership with Appalachian Highlands Housing Partners.”
About Virginia Coalfield Economic Development Authority and Southwest Virginia’s e-Region: The Virginia Coalfield Economic Development Authority, created by the Virginia General Assembly in 1988 to enhance and diversify the region’s economy and help create jobs, markets Southwest Virginia’s e-Region and its focus on electronic information technology, energy, education, emerging technologies, and entrepreneurship. VCEDA is a unique economic development organization that manages funds for economic development projects from a percentage of the coal and natural gas severance taxes paid by coal and natural gas companies that operate in the region. Located in southwestern Virginia, the region includes Buchanan, Dickenson, Lee, Russell, Scott, Tazewell, and Wise counties and the City of Norton. www.vceda.us or www.e-Region.org.
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PHOTO CAPTION: VCEDA Executive Director/General Counsel Jonathan Belcher, right, presents a ceremonial check for $3 million to Russell County IDA Director Ernie McFaddin, left; and Mayana Rice, Appalachian Highlands Housing Partner director, center. The funds will be used to develop a modular housing production facility which also focuses on construction training and education, bringing with it a projected 89 new jobs within five years to Russell County, VA.