If an amateur poet/miner down amidst the coaldust makes up a rhyme and another fellow adds melody that's not folk, yet.

When the other miners pick up on it, learn it, repeat it, pass it to their children who later perform it for free on the playground where
a skilled musician overhears it and adds it to his do list, performs
it in public to enthusiastic applause . . .

Somewhere along that line, regardless of musical style, it became a
folk song.

I lik Bernie Taupin's notion that when one of his efforts makes its way whether via punk, acid, or whatever; the song has then truly arrived at its intended state, i.e. passed to the people (remember them? the "folk"?) to do with as they will.