Click on image to view governor's video of news conference. Source: Governor. 2.27.2020
Vermont Business Magazine At a press conference Thursday, Governor Phil Scott highlighted his proposal to allow communities to use Tax Increment Financing (TIF) for individual projects. This proposal would expand use of this important economic development tool, which is currently only available for larger scale community development projects.
The Legislature has been reluctant to expand the program in recent years because of the potential loss of property tax-related state education funding. The complex nature of the law has been at times difficult for the municipalities to follow. But in St Albans and Winooski, in particular, TIF is credited with assisting in economic expansion.
The proposed Project-Based TIF program would enable Vermont’s rural communities to be approved to use municipal and education tax increment financing from select parcels to fund qualifying infrastructure projects (i.e. stormwater, wastewater, brownfield remediation and redevelopment, transportation enhancements, etc.) that will spur specific private development. This tool will provide the gap funding to get necessary public improvement projects over the finish line, which otherwise wouldn’t be able to move forward.
Members of the Scott administration, town officials and legislators detailed the proposal and how it would benefit communities around the state, including Johnson, Middlesex, Montgomery, Westford and more.
You can view the press conference here and more information here.
Below is a full transcript of Governor Scott’s address.
Governor Scott: In my State of the State and Budget addresses in January, I focused on two of the greatest challenges we face as a state: Our demographic crisis and the economic inequity we see from county to county.
As a reminder, today in Vermont there are about 55,000 fewer people, under the age of 45 and 44,000 more, over the age of 65 than there were in the year 2000.
For years, we had more deaths than births and have seen more people move out of Vermont than in.
The impact of this is not the same in every community. We have to acknowledge the real, and growing economic disparity, from region to region.
Of the five towns that have seen the most growth in recent years, four of them are in Chittenden County. In the past 12 years, only three counties have added workers. The other 11 have lost a total of about 18,000. And from county to county, there’s a huge gap between home values, household income, average wage and so much more.
Because of this, across the state we’re feeling the negative impacts in everything, from our homes, schools and colleges, to our hospitals and nursing homes. And to be honest, counties outside of northwestern Vermont feel forgotten.
On Monday, I brought my entire cabinet to Essex County for Capitol for a Day.
Our first stop was 2.5 hours from here in Beecher Falls - population 177. We were within sight of both New Hampshire and Canada. The largest employer is Ethan Allen Furniture, with a little over 100 employees down from about 750 not too many years ago.
Beecher Falls’ all-volunteer Fire Department covers 600 square miles in Vermont, New Hampshire and Quebec. Their chief has served since 1973 and their deputy for over 4 decades, and he’s also a retired VTrans employee. We learned that their budget for the year is $85,000 dollars, so it’s clear, they do a lot with a little.
We heard stories like this, of hard work and dedication, all day. And as we traveled through the region, we heard time and time again: “please don’t forget about us, please don’t forget that wages are different here, benefits are different here, policies have different impacts here.”
Everything we experienced on Monday reinforced why my team is working so hard, and why we’re committed to an economic development strategy that expands growth and opportunity beyond Northwestern Vermont.
With that in mind, we built a balanced budget that doesn’t raise taxes, but includes more than $15 million for economic development to benefit every corner of the state.
It includes more money for the Working Lands Enterprise Fund; an increase to the tourism and marketing budget; the largest increase in the downtown and village center tax credits since the program was created; a plan to complete the Lamoille Valley Rail Trail, which will be incredibly valuable to the economies of 18 towns in some of the most rural parts of our state; and more.
It also includes a proposal to adapt Tax Increment Financing (TIF), a tool used by larger urban areas like Burlington and South Burlington, to successfully spark economic growth so it can be used in rural Vermont.
This Project-Based TIF tool will give downtowns and villages the power to complete much-needed infrastructure projects, which then spurs private investment, new housing and new businesses.
I want to thank the House and Senate Commerce committees for working with us on this and recognize those members here with his today.
I’ve also invited several communities to tell you about the obstacles they’ve faced when trying to reverse decades of decline in their communities. And most importantly, to tell you how this new tool could help them overcome these challenges.
The town of Westford will share their story, and Charlie Hancock, the selectboard chair from Montgomery, can tell you about their 20-year effort to build a wastewater system in downtown Montgomery, which is needed to allow for more businesses and housing in their village center.
Seth Jensen, a planning commissioner from Westford, can tell you about his communities’ work to redevelop their village core, which is also dependent on a wastewater system that’s just out of reach of their town’s financial grasp.
Russ Bennett, from Middlesex, can talk about the transportation and streetscape improvements the town needs in order to spark more private investment near Camp Meade.
Brian Story, the town administrator in Johnson, can tell you about the investments the town has made for a new industrial park that needs basic infrastructure in order to grow.
And of course, you could ask Paul Costello and the Vermont Council on Rural Development about the dozens of communities they’ve worked with and the many priorities in need of funding.
The Project-Based TIF proposal could help each of these communities. And the best part is, this approach doesn’t require new General Fund dollars. The concept is pretty simple. It uses the increase in tax revenue from the new project to pay off the debt with revenue that would not exist without this new investment.
For more than two decades we’ve allowed our larger communities to use this tool and complete transformative projects. It’s time to provide this same advantage to our rural communities – it’s only fair. And as we work to increase economic equity from county to county, this is a critical way to level the playing field.
Source: Montpelier, Vt. – Governor 2.28.2020