Our economic development plan will focus on building on our state’s entrepreneurial spirit, capitalizing on our incredible quality of life, and leveraging our proximity to major population centers. We must employ strategies that will help us export value and import money, which is essential for a prosperous economy.
While government can help identify specific opportunities for growth based on our brand and values (e.g., renewable energy, innovation, water quality technology, value-added agriculture, etc.), we should leave it to our state’s entrepreneurs to come up with the next game-changing idea. State government is best at providing the infrastructure, assistance, and transparent processes to allow all sectors to thrive. After all, who would have predicted that a billion-dollar auto dealer platform (Dealer.com) would emerge from Burlington, or security tools from Bennington, or world-class beer in every corner of the state, mapping technology from White River Junction, or cutting-edge rocket propulsion innovations from Vermont Technical College?
The key is to make sure we build an intentional strategy that allow entrepreneurs to move fast, retain and attract talent, and participate in the new economy on a global scale from Vermont. We need to ensure our main street businesses have the tools to effectively advertise and sell online. We need to be the best state in the country for remote workers, who can earn big city salaries from a home on top of a hill or a co-work space in one of our valley villages.
Infrastructure for the new Vermont Economy
- Broadband - With each passing year, the importance of broadband only grows. The story of the entrepreneur creating a global business out of his or her garage is now only possible with access to broadband. Meanwhile, our incredible value-added agricultural economy hinges on a farmer’s ability to connect with customers everywhere. We need to attract and retain young people who cannot imagine a world that is not connected. We need to expand opportunities for people in all parts of the state to work remotely for large companies around the world from a home office. We need to allow our seniors at the ends of dirt roads to connect to healthcare providers through telemedicine in order to get excellent, inexpensive care and reduce visits to emergency rooms. Having helped deploy world-class broadband in communities across the country, I am more confident than ever that we can make this happen. We will need to come together as a state, create new financial instruments for generating the capital necessary to create shared infrastructure for carriers to use, remove barriers for overbuilders and new entrants to the market, and put Vermonters to work building the interstates of our generation.
- Rail and Air travel - Employees working for businesses that compete in a global marketplace need to travel. We must work with our federal partners to continue to invest in rail and air travel to make transportation to other parts of the country - and world - simple and affordable. This would include continuing my past efforts to create efficient rail travel from both sides of the state to New York and Montreal, increasing options from BTV, Rutland, and Lebanon, and pursuing options for new commercial service to and from the Northeast Kingdom.
- Co-work space, Maker Spaces, VCET and residential innovation centers - In some of our communities, shared work and maker spaces have emerged as hubs where innovators can work, create and collaborate. We need to continue to encourage these kinds of investments, as well as networks like VCET that foster entrepreneurship and 21st century industry in Vermont.
- Residential Co-living Innovation Centers - Using successful models from other parts of the country, we can develop residential innovation centers through public/private partnerships. Housed in buildings that have residential space upstairs and co-work space downstairs, entrepreneurs would be selected based on a scalable business plan competition. The centers would be placed in historic downtowns that are struggling to transition to the new economy and would be partnered with institutions of higher education (including RPI and Dartmouth) for mentorship opportunities (http://thinkhouse.us/).
Strengthening our Small Businesses and rebuilding a Middle Class
- Bringing our businesses online - Business that are online grow 40% faster than those that are not (BCG Report, The Connected World: The $4.2 Trillion Opportunity, March 2012), yet just over half of Vermont businesses are online. In an initiative I helped lead in Vermont, we brought hundreds of small businesses online. If we can focus a portion of economic development resources on bringing small businesses into the digital age, we can increase revenue across the state. We’ve also found that this is an ideal opportunity to partner with undergraduates to develop this training on an ongoing basis.
- Microfinance and financial asset development - One of the most effective ways to empower people out of poverty is to help them start small businesses. During my time at AmeriCorps*VISTA, we found that micro-lending funds with corresponding support programs are very effective at helping low income people start and sustain local business. Even when working with people considered ineligible for loans in the commercial markets, the default rates are much lower than for loans made by traditional banks. Once capitalized, these funds can also be self-sufficient, allowing for investment over decades. Capstone Community Action has done excellent work in this area that can be scaled to the rest of the state
Eliminating barriers to redevelopment of downtowns, abandoned industrial sites, and land newly designated in floodplains - Vermont is very good at telling developers what they can’t do, but we are not as good at making it easy to invest in locations where we all know we want development. We need to expedite our brownfields process and pre-permitting priority development locations on abandoned industrial sites and downtown vacant lots. There are also many areas that have been home to dense development in the past and are now considered to be in a flood zone and are thus virtually untouchable. We need to support converting those locations into appropriate use (recreation space) or identify clear standards that would allow development to take place, including architectural/engineering solutions or even public projects to raise the height of land or foundations to a certifiable level.
Affordable housing for Millennials and Baby Boomers - Research indicates that people in their 20s are looking for something different. Research shows that young people want to live in smaller living spaces with ready access to services and jobs without having to use a car. They seek an authentic sense of place and the ability to engage with other people online and in person. They value diversity. Housing needs for this cohort are simply not the same as for other generations and we must create housing that meets them where they are. At the same time, we need to prepare for the many baby boomers who want to age in Vermont. Many would prefer to decrease the maintenance costs of a stand-alone home and would enjoy the sense of community in a downtown area, especially if they could get their healthcare needs met within walking distance at small health clinics, or find accessible dining options and groceries nearby. These advances can be done together: revitalizing our downtowns, inviting outside capital through Low Income Housing Tax Credits investments and expanded versions of New Market Tax Credits, while fully funding the Vermont House Conservation Fund from the transfer tax and a streamlined permit processes for these kinds of investments.
Investment in higher education - The future of our economy depends on excellent higher education. We need to:
- Structure partnerships with our entrepreneurship centers (including colleges on our borders like RIT and Dartmouth).
- Encourage new higher education startups and reinvention to grow our knowledge economy. (Champlain College, Center for Cartoon Studies, Marlboro Graduate Center, Vermont College of Fine Arts are examples of economic development through new higher education).
- Provide resources to help our excellent state colleges and university to provide online content to low-residency Vermont programs and unique offerings around the globe.
- Use new strategies, such as mentors encouraging students to take the PSAT in their junior year, to increase the number of high school graduates going to college and provide a path for students to graduate from higher education debt free (see Vermont Service Scholarship).
Check out our education platform for more information.
Matching people to training to jobs in real time - With the growth of online education and data on real time job opportunities, we have the opportunity to develop systems to ensure that we connect job seekers to the training they need quickly to vie for jobs that are available in a given market. This can be particularly effective for older workers who may need additional skills to take on 21st century jobs.
Encourage capital to reinvest in Vermont after a company is sold and attract angel investors - When an investor receives a return on an early stage “angel investment”, we can defer capital gains taxes on that return if the individual quickly invests that money in a qualified early stage, Vermont based company.
Encourage investment in Clean Water Innovation - The Echo Center, Champlain College and UVM provide the perfect potential partnerships for encouraging innovation in clean water technologies. We need to clean up Lake Champlain without damaging our agriculture sector. We should seize the opportunity to test innovative approaches to buffers on farmland and strategies for reducing nutrient loads on farms. Also, with the new requirements for municipalities along the watershed, we can explore new approaches that can meet our stormwater targets.
Export support and formal partnership with Montreal - Most states have a formal operation dedicated to helping businesses get their goods and services to international markets, identify the federal incentives for export activities, and even coordinate shared shipping opportunities. Our closest economic partner is Montreal, and though we have made some small efforts to strengthen our relationship, a single person at the Agency of Commerce working on this issue is not enough. We need a dedicated representative in Montreal to foster more economic collaboration and ensure that our regulations work seamlessly with Quebec ones; our policies should include recognition of Quebec corporate structures and allow for filings in French.
$100M Energy Service Company (ESCo) to invest in energy efficiency and renewable energy, putting contractors to work across our state - While Vermont has led the nation in energy efficiency, we can do much more. The biggest challenges are leased commercial and rental properties where there is typically little incentive to make efficiency improvements. We have the opportunity to create a $100M fund through an ESCO bond that would provide free upfront capital to increase efficiency, provide renewable energy, and install heat pumps across the state to significantly reduce our carbon footprint and make home heating costs more affordable. We will also work with Vermont Technical College to ensure that we have the workforce to meet the significant need created by this investment. ESCOs have a strong track record; we can make this kind of investment and infuse significant capital into Vermont without affecting the state’s balance sheet.
Leverage the economic potential of our older demographic - Talent is ageless. Older Vermonters are staying active and productive longer and want to continue to contribute to their state. In addition, a significant percentage of Vermonters over the age of 65 have no desire to retire yet. We should also design targeted continuing education programs for older Vermonters through our community college system and focus resources in the Department of Labor on matching seniors with appropriate and fulfilling part time-jobs. By doing so, we can provide a wide range of opportunities for seniors to continue working, volunteering, and mentoring the next generation of Vermonters.
Climate Change Economy - Vermont is leading the nation in investment and innovation to reduce carbon production. Unfortunately, if all of humanity doesn’t significantly reduce its carbon footprint, we need to be prepared to live in a world with an altered climate. Vermonters are already developing innovative products that can help us thrive in this changed environment. Vermods are an example; Hurricane Irene highlighted the vulnerability of our mobile home parks to flooding, but also gave us an opportunity to replace inefficient trailers with durable and super-efficient modular homes. To help innovations like the Vermod succeed, we need to change the way this type of construction is valued for financing. It is more expensive up front, but costs much less to maintain over the long run; over 10 years, the actual cost of a Vermod is competitive with comparable residential trailers. Working with lending institutions, we can develop financing terms that reflect this valuation and take a huge step toward creating more energy-efficient, affordable housing in Vermont.