Accountable USA - Vermont

Vermont’s spending on subsidy giveaways is substantial for a small state. Of the five programs we looked at, the largest, Vermont Economic Development Authority Loans, costs the state about $19 million a year. Despite the relatively low levels of programmatic spending, some individual companies have gotten what are by Vermont standards substantial subsidy packages. For example, in 2007 Green Mountain Coffee Roasters and Burton Corporation were each granted VEGI deals valued at over $1.5 million. Critics questioned whether Green Mountain Coffee Roasters, a company founded in Vermont, needed an incentive to keep from moving out of state. In 2010, Skypoint Solar, a start-up company, received an $8 million VEGI subsidy. The state also agreed to issue $25 million in Recovery Zone Facility Bonds for the company. VEGI was justified as a high-technology incentive, but it is providing windfalls for many companies that would have invested anyway. A 2012 audit of the state’s municipal TIF districts by the Vermont State Auditor found that municipalities erroneously retained $6 million of property tax revenues that should have been paid into the state’s education fund. Transparency practices are redeeming. Out of the five programs we looked at in our Show Us the Subsidies report, four had online recipient disclosure: EATI, VEGI, the Workforce Education and Training Fund, and Vermont Economic Development Authority Loans. Disclosure for the Vermont Training Program began after the report was published.

 

 

CLICK ON THESE LINKS FOR THE LATEST DATA ON VERMONT:

Corporate misconduct: Results page for Vermont in Violation Tracker

Subsidy deals: Results page for Vermont in Subsidy Tracker (see also: mega-deals)

Tax revenue loss: Results page for Vermont in Tax Break Tracker

Disclosure enforcement: Vermont GASB 77 Roadmap

 

 

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Key Subsidy Programs

Subsidy Program Recent Annual
Cost
Online Recipient
Disclosure
Recipient Disclosure
Score
Job-Creation/
Job-Quality Score**
Monitoring/
Enforcement Score***

Vermont Downtown and Village Center Tax Credit Program

$2.2 million (2019)

Vermont Employment Growth Incentive (VEGI)

cash grants for corporations creating jobs; replaced EATI in 2007

$2.9 million (2019)
33/100
103/100
102/100

Vermont Training Program

a cash-grant of up to 50 percent of training costs for new or existing employees (disclosure began after our report was published)

$1.5 million (2012)
56/100
90/100
85/100

Vermont Economic Development Authority loans

low-cost, non-forgivable financing for the purchase of land, buildings or equipment

$64.3 million (2013)
21/100
53/100
57/100

Workforce Education and Training Fund

cash-grants for worker training

$179,000 (2012)
61/100
40/100
60/100

* The score is derived from the Good Jobs First report Show Us the Subsidized Jobs (January 2014).

** The score is derived from the Good Jobs First report Money for Something (December 2011).

*** The score is derived from the Good Jobs First report Money-Back Guarantees for Taxpayers (January 2012).

Major Subsidy Deals

Skypoint Solar (2010)

Skypoint Solar, a start-up company seeking to produce solar power cells, told Vermont officials in January 2010 that it could create 400 jobs in the state but needed financial help. Skypoint asked for $10.4 million in Vermont Employment Growth Incentives – a large subsidy by state standards and more than the $10 million annual cap on total awards that could be authorized by the Vermont Economic Progress Council. Gov. Jim Douglas promptly convened a meeting of the state Emergency Board, which voted to raise the 2010 cap to $23 million. The council then approved up to $7.9 million for the $50 million Skypoint project, which also received authorization from the Vermont Economic Development Authority for $25 million in Recovery Zone Facility Bonds. (Key sources)

Husky Injection Molding (1996)

In 1996 Ontario-based Husky Injection Molding generated a five-state bidding war for a large new manufacturing facility in the United States with a projected 1,000 jobs. Vermont, which offered the company a $10 million subsidy package, won the competition as Husky chose the town of Milton north of Burlington. The package included infrastructure improvements such as the construction of a $6 million bridge across Arrowhead Mountain Lake, connecting the plant site with Route 7. The town agreed not to increase the property tax on the plant for ten years. When state and local officials were unable to deliver on the bridge, the state instead provided up to $10.6 million in tax credits through the Vermont Economic Progress Council.

The plant opened in 1998. Husky cut jobs in Milton in 2001, but two years later announced a $13 million expansion, for which it was offered $500,000 in additional tax credits and an exemption on sales tax for building materials in excess of $250,000. In 2005 Husky eliminated around 70 jobs in Milton. Husky was purchased by the Canadian private equity company Onex Corp. in 2007. (Key sources)

Walmart in Vermont

  • Good Jobs First found no instances of Wal-Mart subsidies in Vermont, but given the absence of comprehensive centralized data, it is still possible that deals have quietly occurred.
  • We found no instances of property tax assessment challenges by Wal-Mart in Vermont, but given the absence of centralized data, it is still possible that appeals have occurred.
  • Wal-Mart was found to rank fourth among employers in the state in terms of how many of their workers were relying on publicly-funded health insurance. This shows how taxpayers end up subsidizing Wal-Mart’s policy of providing low wages and inadequate benefits.

For more information, see the Vermont page of Wal-Mart Subsidy Watch.