Vermont Business Magazine The Vermont Bond Bank is pleased to announce the successful closing in late March of nearly $15 million in Municipal Climate Recovery Fund (MCRF) loans, which will benefit 18 communities across the state. In many cases, the subsidized loan will be the first financial assistance since the immediate aftermath of the flooding.
“The Bond Bank knows the financial challenges faced by Vermont’s municipalities well and we immediately began to evaluate how we could help when the disaster struck this summer. We’re thankful for our partnership and loan from the State, which allowed us to bring this program from concept to reality in only a few months,” said Bond Bank Executive Director Michael Gaughan.
Testimonials from local administrators highlight the timely impact of the MCRF loans. Ripton Town Administrator Alison Joseph Dickinson remarked, "The MCRF loan arrived just in time to alleviate a lot of worry. It is the first financial assistance we have received since the summer floods and emergency work that depleted our funds. Now further recovery and resiliency work can begin, and pre-existing obligations can be met."
Similarly, Johnson Village Manager Erik Bailey expressed gratitude, stating, "The MCRF loan through the Vermont Bond Bank was a shot in the arm when we needed it most. With our flood-related expenditures far outpacing the FEMA reimbursement process, this program was the first major financial assistance to come to our aid. It not only saved us on finance charges but also provided a deferred payment structure that aligns with our cash flow from FEMA reimbursements. This program significantly eased the burden during a very challenging time for the village."
The Bond Bank established the MCRF with support from the State of Vermont's Treasurer under the "10% for Vermont" program. The MCRF is one of only three other similar statewide programs nationally and no other program matches the flexibility of the program. The rate on the loans is 1.30 percent for 7 years with the first two interest only. An additional partnership with VLCT PACIF will enable many communities receiving loans to further benefit through an interest rate subsidy.
State Treasurer Mike Pieciak commented, "Thanks to the swift and effective work of the Vermont Bond Bank, communities across the state awaiting FEMA reimbursement were able to quickly access low-interest loans. I'm thankful for the Bond Bank's partnership to leverage our state's strong balance sheet to support communities' post-flood economic revitalization efforts, saving impacted municipalities millions and benefiting local taxpayers."
MCRF loans will benefit communities within nine of Vermont’s counties including a combined $3.6 million to Barre and Montpelier. The application process saw an overwhelming response with 19 applications and requests totaling $35.5 million—in comparison to the $15 million available. Loan requests were sized by weighting the impact of the disaster relative to the size of the grand list in addition to the Bond Bank’s conventional due diligence process.
The Vermont Bond Bank remains committed to supporting municipalities through innovative financial solutions to recover from the summer 2023 disasters as well as addressing future climate risk.
Source: Burlington, VT (April 10, 2024) - The Vermont Bond Bank
