Flood-damaged businesses slowly reopening
by Olga Peters, Vermont Business Magazine For most of the year, 2023 looked profitable for Central Vermont businesses. Then July’s floods put many of them on hold.
How quickly a business reopens after a disaster depends on multiple factors, including the type of business. For example, restaurant equipment - stoves, freezers, food, tables, and chairs - is more expensive to replace than some other types of business inventory.
Also, how quickly the business found contractors and how much damage was done to their space.
Several business owners expressed frustration that loans were the only funding available through the Small Business Administration (SBA). They had hoped for more COVID-era funding mechanisms.
The ability to cancel a debt in bankruptcy or death is a critical difference between many COVID-era loans and the loans typically offered during disasters by the SBA.
State kicks off Vermont Strong holiday campaign to raise $1 million more in flood relief for businesses
Melissa Bounty of the Central Vermont Economic Development Corp. noted that business owners experienced a rude awakening when they realized that the debt from a four or eight percent 30-year SBA loan would pass to their children if not paid off before they died.
In addition to this, most of the loans offered to businesses during COVID came due in November 2022, so on top of - for some - a $2,500 monthly debt repayment, she said.
Prioritizing Business Owners Who Need The Most Support
CVEDC Executive Director Melissa Bounty said the flood disproportionately affected business owners of color.
People of Color operated approximately 20 percent of the impacted businesses CVEDC worked with, and half of the RDC’s counseling hours were with members of the BIPOC community.
Montpelier’s approximately 43 business owners of color have faced systematic barriers to accessing flood support, such as immigration status, she said. These entrepreneurs have turned to individual philanthropy.
“Evidence shows that - particularly for BIPOC business owners, or for people who are new to the country - that traditional employment pathways are not available,” she said. “And that entrepreneurship has been a pathway for people to participate in society in Vermont, and to make money and be safe.”
She said that Vermont must protect entrepreneurship, or it will lose some of its ability to provide for residents equitably.
Bounty understands the tendency in economic development to funnel resources towards businesses with large economic footprints. This tendency, however, can result in treating minority-owned businesses, newer businesses, or business owners who didn’t come from generational wealth as less important.
“They're already being treated as less important in so many systematic ways that they become even less resourced in their ability to come back [after a disaster],” she said.
On top of this, climate change also disproportionately impacts people of color and those who don’t come from generational wealth, she said.
“We also know that when climate-related, extreme weather events occur, and there's damage that those same people who are already at a disadvantage, are also significantly less likely to be able to access funding from the federal government as a result,” she said.
In the future, Bounty hopes future funding will emphasize marginalized and historically disadvantaged business owners.
“Sometimes our legislature struggles with the concept of providing support to private businesses - and I understand that from a progressive point of view - but I also see this as an ecosystem that needs help,” said Bounty.
Exhaustion And Hope In Montpelier
“We need our cheerleaders,” said Katie Trautz, executive director of Montpelier Alive. “The morale is kind of low for businesses, you know, that haven't opened, and they've been working so hard, and they're so exhausted that they really need to know that the other communities care and want Montpelier back in action.”
Recovery is a moving target for Montpelier’s business community, said Trautz.
She hopes at least 80% of the businesses will be back in business within a year.
Trautz said businesses question whether they will ever achieve financial wholeness after this flood.
“They have suffered losses that they will not be able to recover from entirely, and it's almost like going back into business and starting fresh: without reserves, without a stable financial future, they have to start over,” she said.
Through its fundraising arm, Montpelier Strong, Montpelier Alive has supplied grants to local businesses. Several individuals have set up GoFundMe pages.
Trautz said that while every bit helps, the grants haven’t covered the losses so far.
In a labor shortage, business owners are trying to hold on to good employees. According to Trautz, some have elected to keep paying workers out of their pockets to keep them from taking another job.
Business owners have also faced challenges finding contractors. Partly, the flood recovery keeps contractors busy. Only some landlords have approached clean-up and renovations the same way, with the same speed or resources.
A new glimmer of hope shines in the downtown each time a business reopens.
“I think it's inspiring for the others that are struggling,” she said.
Recovery continues beyond a business’s reopening. Next, the downtown needs feet on the street. It needs people who will spend money locally. Many stores have planned sales around the end of October, she said.
Right now, Montpelier Alive’s fundraising efforts are focused on restaurants’ recovery. The organization is preparing for Oktoberfest planned for October 28.
Montpelier Alive has a few holiday promotions in mind to keep people’s attention on shopping downtown. The aim is to ensure businesses have a profitable fourth quarter ahead of the traditionally slower winter.
“So, in that sense, our recovery is in progress. And it'll be hard to tell when we are completely recovered,” she said.
Mother Nature Will Have Her Way
Mannequins wearing Tyvek hazmat suits stand in the front display window of Althea’s Attic, a boutique in Montpelier’s downtown, one of many flooded in July.
“When life gives you lemons, dress them up in a Tyvek suit,” said Sharon Whyte Estes, owner of Althea’s Attic Boutique.
The boutique officially reopened on October 1.
“There's a whole lot of things going on, but the reality is it feels good to be back where I belong and ready to welcome everybody,” she said.
Before the flood, Althea’s nine part-time staff were on track for a good year. The 3,200-square-foot store features approximately 60 percent new clothing and accessories and 40 percent consignment for store credit. It is one of the few places to find the work of two local clothing designers, Salaam and Max Razy.
Estes stored inventory in the basement.
“Sales were looking great, and we were gearing up for a good summer of tourism and local traffic, and all of that just came to a screeching halt,” she said.
When the flood washed through Montpelier, the waters rose 9 feet in Althea’s basement. A slope to the front door prevented water from flowing too far into the first floor. According to Estes, water filled the front bay window 2.5 feet like a fishbowl.
The business suffered a net loss of $158,000, she said.
Photos: Althea’s Attic, a boutique in downtown Montpelier, was one of many businesses flooded in July. Courtesy photo.
“A flood is mother nature. When she's mad, she's going to have her way,” Estes said.
Luckily for Estes, her husband is also her landlord’s contractor, so repairs started quickly. Her landlord also hired a professional hazmat and cleaning service.
Estes said her front window, floors, HVAC, electrical, and the walls were rebuilt, and the floor in the first third of the store was stripped and resealed.
Three-quarters of her consignment customers returned their store credit to Althea’s Attic. Other customers held “non-consignment parties” to gather clothing donations to help rebuild inventory. Estes says she’s grateful.
“There's like this survivor's guilt for those of us that are open versus those that aren’t,” she said.
Estes received financial donations through Montpelier Strong and a GoFundMe page organized by an employee. The funding has helped offset some of her immediate expenses.
She explained that overhead expenses, such as rent and utilities, continued despite the flooding.
“A disaster doesn't leave any doesn't spare anyone and leaves no one untouched by its effects,” Estes said. “We're coming back. But the effect is long-lasting. And I'd say where our fear is now. Are people going to come?”
It Feels Like Starting Over
Three months and a day after the flood, Julia Watson stood in the Capitol Grounds Cafe overseeing busy contractors installing a walk-in and new cabinets. Electricians have relocated an electrical box from the basement to the upstairs. The tile flooring and five layers of subfloor had been replaced.
The cafe’s damages totaled more than $125,000. To add insult to flood damage, in March, Watson, the owner of the cafe and 802 Coffee Roasters, renovated the cafe.
Watson said between nine and 15 inches had filled the cafe in July, depending on where one measured in the uneven old building.
She estimates the loss of revenue to total close to half a million.
“That is something I’ll never get back,” she said.
Between the two businesses, Watson employed about 26. She’s kept on three staff. Two roasters at 802 Coffee - the Barre location was spared by the flood - and one person at the cafe.
Watson purchased the business from her father. She is three years into her ownership of the coffee business, her first year being during COVID-19.
“I started working here, standing on a milk crate when I was 10 years old. Yeah, there's definitely sentimental value,” she said.
Watson anticipates reopening at the end of October. She lost approximately 75 percent of her employees, however. Training up a whole new roster of crew members may delay the opening.
As more businesses reopen downtown, Watson said she’s feeling a mix of emotions.
“I'm really happy for everybody. But at the same time, I'm struggling emotionally, individually because I couldn't make it happen as fast, or what could I have done better?” She said.
Capitol Grounds has existed for 25 and July was not its first flood. But previous floods had only hit the basement. After July’s flood, Watson plans never to use the basement for storage. Watson has worked with her landlord to make other changes, such as installing the compressor for the walk-in on the roof.
“We won't lose as much next time,” she said. “Emotionally, it's hard to prepare for things that you know are going to happen again and that are just going to be as devastating.”
Deliberating Over Debt
Nine days before the flood, The Three Penny Taproom restaurant and bar opened its renovated restaurant. The project expanded the Taproom into an adjacent storefront, additional back-of-house storage, and a new walk-in cooler.
The business owners, Wes Hamilton and Kevin Kerner, and the Taproom’s 38 staff felt they finally understood the Taproom’s post-COVID costs and customer habits. Before the pandemic, the restaurant side of the businesses played second fiddle to the bar. The pandemic flipped everything, said Hamilton.
“We were really excited for the summer. And you know, that literally went down the drain very, very quickly,” Hamilton said.
In October, the Taproom had reopened its bar and offered a light food menu. The business kitchen remains a work in progress.
“Our chef has done a pretty good job of putting things together with, you know, little air fryers and crock pots and sandwich presses,” he said.
The Three Penny Taproom is located in what Hamilton described as an ancient wooden building with dirt basement floors. Drying the structure out as part of the mold mitigation process felt like forever and a week.
“My business partner and I took turns coming in once or twice a day and emptying - it feels like hundreds, but it wasn't hundreds - of dehumidifiers,” he said.
Hamilton said the total for cleaning out and reopening is a moving target. The company lost an estimated $60,000 in kitchen equipment and another $60,000 in inventory.
“It won't surprise me if we hit half a million dollars to get ourselves reopened,” he said.
“In any normal year, I would tell you, we make all of our money from essentially May through the end of October, and then we essentially, from November through the end of April, spend the savings that we built up over those months as we lose money for that six months,” he said.
He worries that the business could be bankrupt by the winter without its summer nest egg. Many of the Taproom’s staff receive tips. He wonders, too, about the long-term economic effects of staff losing wages during the busy season. The following 10 months might be tight for people.
He’s hoping for a good November and a lot of tourist visits.
The business partners are funding the rebuilding through a mix of sources. They had flood insurance and have received a few grant monies and loans like the Emergency Disaster loan through the SBA.
It’s loans on top of loans for these partners.
“Having just done that renovation, we were, you know, we were up to our eyeballs in debt,” he said.
He continued, “The loan from the SBA, certainly appreciate that it's low interest, but, you know, taking on that, you know, it's literally a second mortgage on my home, that if I don't make it to a ripe old age, it's going to follow my daughter.”
Hamilton acknowledges that the partners knowingly took on debt for the expansion project. They did so, however, based on predictions sans a natural disaster.
Not taking on additional debt meant not reopening, and not reopening meant wasting the time, effort, and loans they’d put into the expansion project.
“So, that means in 11 months, we're going to start having a whole other loan payment to make, which is, frankly, terrifying to me,” he said. “I’m a little bit in the space of just kind of trusting and hoping that it all washes out in a way that is sustainable and makes sense, but that kind of remains to be seen at this point.”
Hamilton expects most of the Taproom’s staff to return once the business reaches total capacity.
“We do take it incredibly seriously, providing quality jobs where people can make their rent and pay their bills and enjoy themselves and feel respected at work.”
New Remote Workers In The Mad River Valley
The Mad River Valley’s economy is doing well.
The valley experienced minimal flood damage, which Eric Friedman attributes to a little luck and a lot of post-Irene resilience work. He’s grateful to both.
“We've had a bit of a sluggish summer,” said Friedman, the Mad River Valley Chamber of Commerce executive director. “The weather didn't help, and the national news media talking about the flooding didn't help.”
Friedman said the valley’s economy has diversified in recent years. Tourism remains the area’s bread and butter, but other businesses have moved in, especially with remote workers moving to the area during the pandemic.
“The amenities that the tourism brings - the restaurants and the theaters, all the other stuff - that are attractive to tourists are attractive to residents,” he said. “The advent of remote work and people's flexibility, it's been a really positive thing for the valley.”
Approximately half of the homes in the valley are second homes.
The valley is making investments right now. One large project centers on improving outdoor recreation facilities and amenities in Waitsfield.
The chamber received a Vermont Outdoor Recreation Economic Collaborative grant, the largest award in the state, to increase outdoor recreation in town.
Waitsfield is using the funding to build a welcome center and, eventually, a bridge to connect the downtown and the local trails.
Friedman said he’s already seeing benefits.
A few new businesses decided to open in Waitsfield to be near the blossoming recreation hub, such as outdoor retailer The Mad Rover clothing store, MadBush Falls, a restaurant, lodging and biking business, and furniture store Addison West.
On the negative side, the valley struggles with housing, like most places in Vermont.
“That is a drag on growth. Businesses can't expand because they don't have the staffing,” he said.
The Best of Route 100 joint marketing initiative between the Valley, Stowe Association, and Discover Waterbury continues to bring tourists to the area.
In the past year, the initiative received a grant to do a video project featuring members of the BIPOC community enjoying the local recreation opportunities.
He said the initiative has obtained almost $100,000 in grants for various projects.
“The most important thing is that we have this experience of working together more closely and that we've developed relationships,” he said.
Providing Care Throughout The Flood
Fortunately, CVMC and its 27 practices located throughout central Vermont, none sustained any flood damage in July, according to Anna Tempesta Noonan, president and COO of Central Vermont Medical Center, part of the University of Vermont Health Network.
One of Washington County’s largest employers, Central Vermont Medical Center and Woodridge Rehabilitation and Nursing in Berlin, are part of the UVM Health Network.
Noonan wrote in an email that members of the hospital’s team “worked beyond their scheduled shifts, some staying on site overnight to ensure we provided necessary health care services to our community when their colleagues faced impassable, washed-out roads and dangerously high waters.”
In one day, the emergency department treated 93 patients while the pharmacy team provided emergency refills for people unable to access their regular pharmacies.
“When the rain stopped, we headed down the hill and into the devastated and flood-ravaged streets to offer medical assistance, muck out basements, and deliver meals,” Noonan wrote.
The hospital is far from immune to the challenges facing other Vermont employers.
Reliable childcare is critical for CVMC’s employees, Noonan said. The organization has engaged more than 300 employees about childcare needs and founded an employee advisory council.
It’s no surprise that CVMC has struggled with staffing shortages.
In 2018, CVMC launched a few workforce development programs. Noonan explained that the programs allow current employees to seek career education while maintaining their salaries and benefits.
CVMC, in partnership with the Community College of Vermont and Vermont State University (formally Vermont Technical College), developed a program to train Licensed Practical Nurses (LPNs).
“The program, flexible in its design, enabled participants to “earn while they learn,” mitigating an obstacle many non-traditional learners face: balancing work, life and continuing education,” said Noonan.
In 2021, 13 CVMC employees graduated as LPNs.
“Each of whom aced their Board exams on their first attempt—a testament to the quality of instruction and support these students received,” said a proud Noonan.
So far, this training program has saved the hospital approximately $1 million in traveler expenses, said Noonan.
To learn more about the inaugural LPN Pathway Program cohort, check out CVMC’s website.
The hospital has since expanded the training program to include a Registered Nurse (RN) Pathway program.
“As of June 2023, the combined output of these programs was 27 LPNs and 8 RNs,” said Noonan. “We have since expanded our roster of programs to include training for an array of other medical specialties, including licensed nursing assistants (LNAs), medical assistants, phlebotomists, and surgical technologists.”
According to Noonan, the UVM Health Network has adopted CVMC’s approach as a template used across our partner organizations, Noonan added.
“Thanks to a $735,000 federal grant secured by Vermont Senator Peter Welch, we are set to expand our educational facilities,” she said. “The funds will support the construction of a second classroom and a state-of-the-art simulation lab, both crucial for broadening the scope of nursing-specific training to include laboratory science and radiology.”
Noonan described the Green Mountain Care Board’s decision to decrease CVMC’s FY 2024 budget requests as disappointing.
Along with the hospital’s partners within the University of Vermont Health Network (UVMHN), CVMC is exploring its options and strategies to navigate what Noonan called “significant financial constraints.”
“Our mission, irrespective of the financial challenges, remains steadfast: to minimize the impact on those we serve and our staff,” Noonan said.
“I am so proud of our staff for their response to the flooding emergency, and I am proud of the work they do every single day to provide high-quality care,” she said.
An Award-Winning Year
The Cabot Creamery’s campus sustained minor damage in July compared to the town of Cabot itself.
Companies like Cabot, part of Agri-Mart, that depend on agriculture, felt the effects of the rainy summer.
According to Amber Sheridan, Director of Communications for the company, the most significant impact of the wet weather will be on the quantity and quality of available feed.
“That, of course, directly impacts how much feed farmers will need purchase for the year, and we have seen feed costs go up because of weather impacts,” she wrote in an email.
She continued, “The Vermont Agency of Agriculture has been a valuable resource for Vermont farmers. The support they have provided through tools like the Farm Feed Finder Marketplace has been greatly appreciated.”
So far, however, Cabot continues to show year-over-year growth.
This year, the creamery introduced Gouda, Pimento Cheese Spread, Cheese Curds, and a 10-year cheddar. The distribution of these products is still rolling out, wrote Sheridan. More information is available on the company’s website.
Cabot Creamery took home multiple awards in July. Four first-place awards, five second-place, and nine third-place awards at the American Cheese Society Awards Ceremony in Des Moines, Iowa, wrote Sheridan. The first-place wins included Garlic & Herb Cheddar, Extra Creamy Sea Salted Butter, Extra Creamy Unsalted Butter, and Crème Fraiche.
“We are really proud of Vermont’s cheesemaking heritage,” she wrote. “A lot of love and pride goes into crafting our products. And the fact that Vermont took home 44 ACS awards demonstrates the quality of Vermont dairy and expertise of its cheesemakers.”
The creamery launched two collaborations with Vermont businesses to benefit community causes.
Sheridan highlighted the creamery’s latest Artist Collaboration with Burlington artist Beenanza, who designed merchandise for sale on the Cabot Creamery website. Purchasing Beenanza’s designs benefits Vermont Flood Relief efforts.
Cabot and Darn Tough Vermont created a Cabot-inspired sock. Sheridan said that 10 percent of profits from sock sales go to Vermont Adaptive Veteran Ventures.
Cabot, like many employers in the state, is facing labor shortages.
In response, Sheridan wrote the company has formed a strategic recruitment and retention team. Sheridan noted that Cabot has a variety of job openings, including at the Cabot and Middlebury campuses, Montpelier Distribution Center, and Waterbury Retail store.
Olga Peters is a freelance writer from Windham County.
