Vermont Legislature SmartTranscripts:

[Sen. Alison Clarkson — Chair]: You're live. I pinch myself. I'm always live. We are live on YouTube, however. Welcome back to Southern Economic Development, Housing and General Affairs where we are going to go back to one of our pillars of economic development in our downtowns and build centers which is our downtown program and our downtown tax credit program and to kick us off we have several witnesses and incredible expertise around the room on in this very subject we are going to begin with the deputy commissioner of economic development Nate Formularek. Yes for the record deputy commissioner

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: of housing community development.

[Sen. Alison Clarkson — Chair]: Oh, housing and Yes. Right.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Okay. I'm saying

[Sen. Alison Clarkson — Chair]: Department of Housing and Community Development and Ron Jeff, of course, is our new commissioner of the Yes.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Apology. I'm gonna give a very brief overview. I just wanted to introduce, and then Caitlin and Chris is here to answer questions as well as the real experts of this. One of our most viable and effective revitalization tools is the Downtown and Village Center Tax Credit program. For more than two decades, the program has helped catalyze reinvestment and breathe new life into communities across Vermont. This tax credit is often the first commitment to a project, which unlocks a lot of other funding opportunities for projects. It brings credibility, reduces risk and helps unlock all that other public and private capital that makes revitalizing our downtowns happen. I think, Chair, you know this well, but for every dollar that's invested, we see an additional investment of $20 to 25 a year.

[Sen. Alison Clarkson — Chair]: So that's grown from a leverage of 17 to one. We keep going.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Wow, you're joking. You're not just making that up 25 ish.

[Sen. Alison Clarkson — Chair]: Things cost more. The governor's

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: proposed budget, so right now this program is capped at $3,000,000 a year. The governor's budget, proposed budget did not include an increase of this annual cap. This is mainly due to the many priorities the enterprise is facing in the tough budget times of it.

[Sen. Alison Clarkson — Chair]: So it's still at three. It's still at three.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: He does support the program. Oftentimes it's one of our annual press conferences that we have out of, so there's a lot of support for it there, but with all the priorities and pressure on the budget, raising the cap could not

[Sen. Alison Clarkson — Chair]: make it. We've already had one witness in yesterday who asked us to eliminate the cap altogether. So why raise the cap?

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: I don't know the history of that other than in statute and then during ARPA, some one time funds were used to raise that to $5,000,000 which puts it more in line with demand, which Caitlin is going

[Sen. Alison Clarkson — Chair]: to talk about. Yeah, so our demand covers Yeah.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: And then after that parka went away, it went back down to 3. So I think it's just the statute that's

[Sen. Alison Clarkson — Chair]: where is. It'll be interesting to know why we have it in the first place if it's such an important economic development tool.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: I would agree with you. It is considered foregone revenue, so taxes that are No.

[Sen. Alison Clarkson — Chair]: I appreciate that. It's orgone raising me.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Yes. Have we hit the cap in previous years? Yes. Every

[Sen. Alison Clarkson — Chair]: year. Every year we

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: do because our demand exceeds We

[Sen. Alison Clarkson — Chair]: have a chart that's gonna lay that out. Our demand exceeds substantially. It exceeds what we have available. Yes. Okay. Great. Thank you. That was it? That's it. Experts.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Well, I'm so glad you made the journey down for that.

[Sen. Alison Clarkson — Chair]: It's good to have you here. Wonderful to see you all. Okay great, Caitlin welcome. Thank you very

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: much for having me, Caitlin Corkins with the Department of Housing and Community Development. I'm going to You have this presentation? I have a presentation for you guys if I can get my screen to share. Hopefully that is now showing All right, I also have handouts. So I have our annual report, and then this is the slate of projects. This is not annual report or

[Sen. Alison Clarkson — Chair]: is it just the sender tax credit?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: This is the other one. This is the slate of projects that we awarded this past fall. Right. So the most recent award recipients. So looks like some of you already have that. Just printed

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: out one of them, and it didn't print out the other one

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: This one? Report. Yes. Okay. So maybe I'll just pass this one over you guys thank you

[Sen. Alison Clarkson — Chair]: Okay

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: so I'm going to do a little bit of a review of program basics and talk a little bit about where things stand in terms of the program. Great. So the Community Investment Program recognizes and supports local revitalization efforts around the state. We do that with dedicated staff and funding to help our downtowns and village centers build and foster strong communities. The biggest carrot of this program is the Downtown and Village Center Tax Credit Program, which was created in 1998. As we've already stated, it awards $3,000,000 annually. To qualify for the program, a building must be located in a state designated downtown or village center, and the building has to be over 30 years old. The program is competitive. We always get more and requests than we have available to give out for those projects that we fund.

[Sen. Alison Clarkson — Chair]: Sorry, even when we had $5,000,000 Even when we had four, like, two

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: years. Two years, yes, and even in those years, we were oversubscribed.

[Sen. Thomas Chittenden — Member]: Would you opine on how much unmet demand there is? Like, if we remove the cap, do you think there would have gone to $5.10, $2,030,000,000?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: That's a tricky question because I do think demand would continue to increase if people felt like it was very predictable if they applied, they would get it.

[Unidentified Committee Member]: Based on who you didn't accept this year.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: I mean, certainly. And I have some data to show you that. We usually are at least a million oversubscribed in any given year from what we have. I think reasonably that would go higher than that if the cap was removed because people would no longer feel like, oh, I might be wasting my time, I might not get this. Having that predictability, I think would increase the overall number of applications. But I don't think it would suddenly go to 20,000,000 in

[Sen. Alison Clarkson — Chair]: a year or something like that. I think

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: there would be a time sort of gradual increase over time. So this is all just very basic talking about the different types of credits that we offer through the program. I know for most of you this is review, but just to sort

[Sen. Alison Clarkson — Chair]: of remind you know what to rebrand.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: What we fund, so we have a historic credit. This is for properties that are also listed in the National Register of Historic Places and using the Federal Rehabilitation Investment Tax Credit program. So they can combine that federal incentive with our state program. It covers 10% of all work that's both interior and exterior. Before you

[Sen. Alison Clarkson — Chair]: leave us, do you know if the federal RITC is going to continue?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: So far, it looks like it is not any danger. The program has been running as normal and the staff that are administering the program are still all in place. So that's encouraging. For projects that don't qualify for the federal program or are not interested in using that federal program, we do have a facade credit. This is for exterior work only. So 25% credit with a cap of 25,000 in credit. For buildings that are historic, we do expect that that work meet preservation standards, but as I said before, we do have buildings that are old but not historic, and in those cases there would be a lot more latitude to make whatever changes that were felt like they wanted to. The code credits through the program, these are the most popular, most frequently used, definitely the most funding goes towards this category of credits. This is basically anything that an owner would need to do to bring a building up to current building codes. We work with the Division of Fire and Safety. They do inspections to identify code efficiencies and then at the conclusion of the project obviously inspect those to make sure they're compliant. And they're a really great partner and actually advocate for us, you know, when they're talking with building owners who've maybe purchased an older building that needs some work and the owner is, you know, worried about the costs, they will send people my way, which is great. The code credits are 50% credits. We have different caps for some of the big ticket items, elevators up to 75,000 in credits, sprinkler systems up to 50,000 in credit, and then sort of a catch all for your general electric, plumbing, fire and safety improvements up to 100,000

[Sen. Alison Clarkson — Chair]: And those were last updated with?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: I think it's two years now since we increased the cap in the other code category because of increasing costs. We were finding that that just really wasn't enough and so we increased the cap in that category. And we still have projects that hit that cap, some of the bigger projects, but it does help with more of those small mid sized projects to really fully do 50% of current group grades.

[Sen. Alison Clarkson — Chair]: So there's and then we have a fourth We

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: have a fourth credit. This one is from fiscal year twenty twenty three, so the newest credit in the program. Unfortunately, was a little prescient, I think, because we added it right before the July 2023 floods hit Vermont. It's a flood mitigation credit designed to encourage owners to make improvements to their buildings to mitigate against flood risks. It's again a 50% credit up to 100,000 in credits. So what we saw in the first few years of this credit is that it actually was used to help some of the building owners that were impacted by flooding in 2023 and 2024 to build back better, to move utilities out of flood prone areas, to make improvements to their foundations, that kind of thing. And the hope is that going forward, people can more proactively make those improvements so that if flooded again, hopefully not for a while now, but if and when we are, they will be less vulnerable and will be offline for weeks and months.

[Sen. Alison Clarkson — Chair]: And so you're beginning to see those applications probably?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Yes, yes. We expect there'll be more of those sort of proactive asks coming in in the next year or so. Actually, of the ones I'm here, the Bennington High School, is an example of that. They were not flooded anytime recently, but they're doing a major rehabilitation of the building to convert it into housing. And so they're proactively implementing some flood mitigation for the lower level of the building, which is gonna be actually used for

[Sen. Alison Clarkson — Chair]: childcare facilities.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Just another note on sort of basics of how the program is used. So this is a state income tax credit that offsets income taxes can be carried forward up to nine years. For owners of buildings that don't have a lot of tax liabilities, small mom and pop businesses, or nonprofit organizations, the other option is that these credits can be sold to a bank or an insurance company and essentially monetized. Another nice way that this is used is it can help to finance a project. So an applicant can apply to the program if they're awarded a credit, they can then take their award letter to their local bank for some kind of collateral on a short term loan, use that loan to do the improvements to the building, and then basically pay off the loan by selling the bank their credit when the project is complete.

[Sen. Thomas Chittenden — Member]: Is that really common?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: It is actually very common, It's a really nice feature because it can help get money into the project at the beginning. Don't earn the credit until the building improvement is made, but this allows for more flexibility in terms of finding that upfront capital you need to do the project. I don't have the exact statistics. I know I did look this up a couple years ago, but I think probably half of the projects that we fund through the program end up selling their credits. And we work with a lot of the local Vermont banks. They're very familiar with the program, also really good allies in helping. I help sometimes help connect people with local banks that are interested in buying the credits. I don't know exactly the statistics on that but I could look that up if that was of interest.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Just got a few thoughts

[Unidentified Committee Member]: and move on. You said nonprofits around the board? Yes. Throughout businesses.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Yeah, absolutely. Businesses. Oh, yep. Yep.

[Unidentified Committee Member]: That last statement got behind

[Sen. Alison Clarkson — Chair]: you a little bit.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Oh, yeah. So so a business, in theory, they they have tax liability. They could just use the credit to offset their their liability. But if they're a small business and they don't have a lot of tax liability, they could also choose to sell their credit. Just depends on what helps them

[Sen. Alison Clarkson — Chair]: the most. Nonprofits would be very likely. Right. Could see what they sell their credit. Right. Because they know but but this is very helpful because so many of our new projects, particularly our general stores in our communities where they have been closing, and we have one of our partners here in the corner who enabled many of those redevelopment projects, and they are also adding to our housing challenge because most of them have apartments in them. Yes. Yeah. That's the one we're looking at.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: This map on the screen is a good example of that. Yeah.

[Sen. Alison Clarkson — Chair]: General store has one or two apartments. Three. Oh my gosh. Three apartments. So it's really waving in all the way through.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Single family homes are not eligible for the program. So that's, you know, again, potential source of development for properties that are dilapidated or that need repair in order to make them commercial products, and these are some of the

[Sen. Alison Clarkson — Chair]: Well, as long as they're not single family homes anymore.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Yeah.

[Sen. Alison Clarkson — Chair]: Well They'd have to be bought by a nonprofit or a business to to to do that.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Yeah. And we have seen and, know, we don't have, like, it doesn't have to be a multifamily. It could be a a former single family home that has become a rental. That would qualify. So yeah. Or if it's a larger, you know, used to historically single family home, but it's a large building could be, you know, split into a duplex or maybe three units and that would also qualify. So this is just a couple of, again, these charts showing the demand. So this first one shows that I'm just gonna give

[Sen. Alison Clarkson — Chair]: you feedback. The numbers at the bottom

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: are totally unwieldy. And they're very small. I know. I'm so sorry. I mean, particularly for those of us who have older eyes.

[Sen. Alison Clarkson — Chair]: May something blue, but they're older. Yes. Yes. Thank you.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: I will maybe if I did a darker color, it's hard because I want to give you like over a span of time and then it gets very big, but maybe if I scrimble through the last five years that would be more So what we

[Sen. Alison Clarkson — Chair]: had available was in '26 was, or FY 2020 we had 3,300,000 available and the demand was 4,600,000.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Correct, correct that's exactly right. So you can see over the past ten years has grown as we have increased the cap, and it has consistently stayed, you know, about at least a million over what we have available.

[Sen. Thomas Chittenden — Member]: You say they're competitively awarded. Is it also first come first served? No.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: It's not. No. So we do have an annual deadline. We get all the applications at once. They go to the Community Investment Board and that board scores the applications and makes the funding decisions.

[Sen. Alison Clarkson — Chair]: And I will note that the one year here that is saying you have okay. I I have this in my sidelines. You had two years

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: where we had one, we had 5.15

[Sen. Alison Clarkson — Chair]: and the other one, had 4,350,000.00 available. In the one year we had 5.15 just to go to our no cap cap question it up the requests were 5.7 yeah so only 600,000. Right, that was a rare occasion.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: The closest we've been to not being competitive, yeah. But

[Sen. Alison Clarkson — Chair]: there are some

[Sen. Thomas Chittenden — Member]: applications that are disqualified that you would not include in that green bar or does that green bar represent everybody that would be qualified?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: This represents everyone that was qualified. We don't get very many applicants that are not qualified, mostly because I try really hard to make sure they're qualified before they apply. It does occasionally happen but yeah this is reflective of everything that was yeah it's hard to

[Sen. Alison Clarkson — Chair]: make it all the through the end and say but hey you weren't really qualified for this yeah that was so

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: then this next one again these are super small so apologies this is just looking at the same data in terms of the number of projects instead of the dollar amount. So last year we had 43 applications, we funded 34 of them, which is actually pretty good. We've had some other years, 2025, we had 49 applications, we only funded 13 of them. And that's really tough because obviously we'd like to, there were a lot of really good projects that would have had an impact in communities that we were not able to fund that year. Sometimes people do come back if they're not successful the first time around, they might try applying again the next year and so hopefully some of those people eventually, you know, we get to them. But there are other people I think that just, you know, they're thinking about a project, they apply it, if they're not successful, they're like, I can't, this is too much, I can't do this without some sort of assistance and so they just move on and that's you know that's a shame.

[Sen. Alison Clarkson — Chair]: And your application, how would you rate your application in terms of not being a barrier to application? Mean your application is fairly it's not I like to

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: think that it's pretty easy. It's certainly a lot easier than the federal program. I do try to keep the paperwork that we're asking for from people to a minimum. You know, it's not a lengthy application. It's, like, five pages. You know? It's Yeah. So it's it's not a barrier

[Sen. Alison Clarkson — Chair]: to application.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: I don't

[Sen. Alison Clarkson — Chair]: think so. I gotta ask

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Chris Coffin. We revise it typically every year based on feedback. Go ahead. It's just indirect problem. Right. It's always making it a little bit better than it was before.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Well, I'm glad I asked. And Yeah. We'll be revising it again so we can do accessibility guidelines so hopefully making it even less of a barrier for anybody who's interested in applying. I just wanted to end with a few examples of projects that we funded recently that are complete, just to give you again a sense of the sort of breadth of the program. To start with, this is something that's sort of on the higher scale, but a more really big project downtown Brownborough. This is a $10,300,000 project to rehabilitate an abandoned former warehouse building. They use the federal program as well as the state program, so you can see in total offset their investment by a little over $2,000,000 between the state and the federal program. And this brought 15 new units of housing online as well as some 1st Floor commercial space. Can you

[Sen. Alison Clarkson — Chair]: just tell us, because I don't think in your previous slides you just refer to it,

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: the federal RITC, what does RITC say? Rehabilitation Investment Tax Credit. It's a mouthful, so Yeah, but

[Sen. Alison Clarkson — Chair]: it doesn't use historic endpoint. This

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: is a sort of mid sized project in St. John's Prairie. This was done, the Northern Forest Center purchased this building. Again, it had some 1st Floor tenants, but a large part of the building was essentially vacant when they purchased the building. They rehabilitated it using our state credits, the facade credit, code credits. They put us sprinkler systems in the They stacked the credits. You did? Yes. So they took advantage of multiple types of credits through the program. Ultimately, 120,000 and change in state tax credits went to the project. This brought nine new units of housing online right in Downtown St. John 3 on Railroad Street and there are also still two commercial units in the building as well. How many housing units in the building?

[Sen. Alison Clarkson — Chair]: It's two or three

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: commercial units. Two commercial units on the Ground Floor and nine new units in the Great. And then this is, know, at the other end of the scale this is a relatively modest sized project in a smaller community. This is in East Harbour, and it was a former single family home that had been over the years sort of cut up into some not very nice apartments and had become kind of dilapidated. A new owner bought the building and put a lot of effort and investment into rehabbing it. This has three units of housing, and they're all you know new with new appliances and really nice know code compliant all of that. So again this project used the facade and the code credits 72,000 and change in credits on this project that was a little over $500,000 total investment. So that's just a slice, but I'm happy to answer any other questions that you may have if not I can turn it over

[Sen. Alison Clarkson — Chair]: to you. The governor's budget currently we have $33,000,000 yes. At least unlike Brownfields it wasn't a year and a half. Committee questions. Thomas any questions?

[Sen. Thomas Chittenden — Member]: Thank you for that.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Okay great well if any other questions?

[Sen. Alison Clarkson — Chair]: What so what anything further what are you most excited about this year Claire?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: This year? You know that's funny my sister's name is Claire, so I don't think it comes with that. Margaret gets to be with me all the time. What are

[Sen. Alison Clarkson — Chair]: you most excited about for this year?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Well, I am excited. I feel like we, after a couple of years of like very heavy flood sort of projects, I hope that this year we can see more of those sort of proactive looking forward kind of projects.

[Sen. Alison Clarkson — Chair]: Particularly in mitigation piece.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Yes, exactly. So I'm excited to see that and I think we'll have another, you know, every year there's great projects. So always, it's really inspiring to see all the things that people are doing all over the state.

[Sen. Alison Clarkson — Chair]: So next are we going to pivot to Ben or Chris? Ben Doyle welcome. Thank you for having I

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: feel like I'm

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: okay maybe. I'm gonna just

[Sen. Alison Clarkson — Chair]: Is Ben gonna continue with your I'm gonna stop sharing this.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: You can see Ben's family face.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: We're building a bridge to

[Sen. Alison Clarkson — Chair]: the nineteenth Yeah yeah, you're a mystery.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Yeah yeah, thank you so much for having me. Do have

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: It's a pleasure to have you. We haven't had you

[Sen. Alison Clarkson — Chair]: in here for far too long. Well it's always fun. Introduce yourself and go for it.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Sure. I'm Ben Doyle. I'm president of the Preservation Trust Vermont. Nice to see you all again. I have some prepared remarks if that's alright. I'm just gonna go through them, and I'm happy to answer any questions you have. Thank you Madam Chair and members of the committee for the opportunity to speak with you today about the Village and Downtown Tax Credit program and the critical role this program plays in rural economic development, particularly in light of recent and ongoing changes to Vermont's land use policy. For those of you who may not be familiar with the Preservation Trust of Vermont, we're a nonprofit organization founded in 1981 with a mission to build community through the preservation of historic buildings, villages, downtowns. Our work takes many forms including providing technical assistance to community groups, offering funding for preservation projects through both philanthropic and federal sources, and engaging in advocacy for Vermont's downtowns. At its core, our approach is simple. We ask Vermonters what they need to help save the spaces and places they care about, and then we do our best to help however we can with creativity, commitment, and persistence. We're often a small town project's first and longest standing friend. Last year alone, we worked in on 362 distinct projects in 155 communities across Vermont. Without question, the Village in Downtown Tax Credit Program is an essential tool for the communities we serve.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: As you

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: heard in Caitlin's presentation, residents from small towns across Vermont use these credits to revitalize historic buildings that anchor downtown and village vitality, leverage additional resources, and protect generations of prior investment. Of the 33 projects awarded a credit in fiscal year twenty six, nearly one third have also received significant funding from the Preservation Trust of Vermont within the past three years. This includes $400,000 in committed funding for the Miss Bellows Falls Diner Project, thanks to a congressionally directed spending award, dollars 100,000 in Freeman Foundation funding for Catamount Arts 105 Eastern Avenue Masonry Project, and $100,000 in National Park Service funding for the Norwich Community Grange Hall. In our role as fiscal sponsor for the Stafford Community Trust General Store Project, another tax credit fiscal year twenty six recipient, we helped that community leverage nearly $1,800,000 in philanthropic funding. I'm not suggesting that these projects could not happen without the tax credit program. I'm optimistic anything is possible, but from my experience it's difficult to imagine many of these efforts being fully successful or even viable without access to this tool. I have served as president of the Preservation Trust for five years, and every year I come before this committee and others like it to talk about how important this program is. It serves as a catalyst for additional investment because the credits can be monetized. It's accessible both because of the simplicity of the application and the excellent technical assistance provided by Caitlin. It is the most equitable community and economic development tool in Vermont, one that small tools can actually small towns can actually use. As the demand you've seen demonstrates, communities value this program and actively seek it out. This year however feels particularly important to champion the Village and Downtown Tax Credit program, given the significant work you have accomplished last year with the passage of legislation reforming the designation program through new land use maps, as well as the creation of the community and housing infrastructure program. These changes offer exceptional opportunity for Vermonters, particularly in rural communities seeking to address housing needs and strengthen local economies, But their success will depend on whether the ethos behind them mirrors that of the tax credit program. Specifically, the effectiveness of these reforms will hinge on whether or not communities are able and encouraged to strategically use them to foster development and growth in established settlement patterns in ways that build the tax base, preserve and expand existing infrastructure capacity, and enhance overall community vitality. This approach stands in stark contracts to efforts that prioritize public investment in places that are merely easier to build in the short term, rather than places that deliver long term value to the villages and downtowns that define Vermont. That's why as we work together to address a housing crisis that threatens our economy, schools, and sense of community, we also need to remember, not all housing nor all public investment is equal. Subsidizing greenfield development might offer lower per cost units, but the true price of growing anywhere and everywhere is revealed when considering the full picture. Increased infrastructure costs, transportation burdens, municipal service expansion, and the erosion of economic activity in our historic town centers. This may not be an intentional action, but we have seen subsidizing this type of development inadvertently fuel the growth of national chains whose business model relies on disposable buildings and exported wealth, as opposed to authentic place based economies that define Vermont. Conversely, developing housing within our historic downtowns and villages, while not without challenges, leverages generations of existing investments. Consider the potential of a five story mixed use project in a historic center. It utilizes existing water and sewer infrastructure, reducing costs for all users. It may tap into brownfield funding to remediate contaminated sites that otherwise would sit vacant and likely sits near public transit, safety services, schools, and vibrant local businesses that generate municipal revenue through local option taxes. The Village and Downtown Tax Credit program helps even the smallest, most rural Vermont communities realize that potential. Five years ago the tax credit program had a cap of 3,000,000. Today it still has a cap of 3,000,000. This is despite the fact that two years in a row Vermont experienced significant flooding in many of our downtowns and villages and the tax credit program, which includes a credit for flood mitigation, is one of the only tools available to responsible building owners looking to protect their property and investment. Perhaps even more important to consider is that under the new land use review maps, the eligible areas for credits will for credits will more than double. This is a positive development because it gives more remote communities the opportunity to invest in existing settlement patterns where they already have infrastructure, where they have already planted a flag. But without increasing the cap, it's unfortunately a hollow gesture. As someone who grew up in a town of less than a thousand people in the Northeast Kingdom, I can promise you it's not land use policy that locks people into multi generational economic disadvantage. It's a lack of access to capital and investment. I'm so grateful for the thoughtful leadership of this committee and all the legislators who stand up for rural communities facing, in some cases, nearly existential challenges. I ask that you continue to be thoughtful and consider what makes Vermont a place where people can find authentic, sustainable communities. And then I ask you to provide those communities with the policies and tools that will help them invest wisely in their own collective futures. In other words, please support the Village of Downtown Tax Credit program. We should double the allocation allotted and clone Caitlin. One of those is easier to do than the other. Thank you for taking my testimony and for all that you do.

[Sen. Alison Clarkson — Chair]: Thank you Ben, very helpful. Yes, we have so we have a proposal between three uncapped

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: I mean yeah honestly like remove the cap right? I'm you know, pockets is the realm of the possible right? So you doubling I think is totally reasonable. I just feel like really not you know, used to work at USDA Rural Development. I've been doing community economic development for

[Johanna White — Public Policy Manager, VBSR]: Everybody appreciates that here.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Yeah. I've been doing community economic development in Vermont for, you know, well over a decade now. And I I have to say, I'm just constantly amazed at, like, how few tools there really are for community revitalization. At the end of the day, there are really few tools. I comes down

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: think this

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: is it. I mean, not it, but I think that this is one that's critically important and I think, reinforces all the investment that we've made for the past fifty years in our downtowns and village centers. And I think it's a wise investment, and I think people right now are hungry to put investment into communities, and the question is where are they going to do Right? And this is the thing that allows them, I think, the opportunity to make wise investments.

[Sen. Alison Clarkson — Chair]: Well, and we're constantly in this committee talking about return on investment. This return on investment, I mean, I watch it in our small communities with the general stores that you have saved. You now have saved and helped partner with communities to save

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: We haven't saved that. We we have worked with a lot of communities that yeah. Yeah. Yeah.

[Sen. Alison Clarkson — Chair]: You are the white knight. I'm I'm in a large that comes in and really gives communities hope that they can save these economic centers in their very small towns.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: I think that yeah. Do

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: think And that even have a total on the number of

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: rental stores alone as a program. And that's using the community supported enterprise model where we help a nonprofit form. Mean you saw a picture of East Dallas General Store or Strafford or East Dallas, or Straper, or Albany, you know, really small towns, frankly where a general store otherwise, you know, they're competing in a really in a global marketplace against Amazon and the Dollar Store, right? And so in order for those stores to be viable, you have to find a different business model. And we've been able to do that through the Community Supported Enterprise model, and it's working. I mean, in a place like a community like Albany, which is really economically disadvantaged, it's working. That would not be possible without the tax credit program. All of those general store projects you referenced

[Sen. Alison Clarkson — Chair]: Correct.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Use the tax credit.

[Sen. Alison Clarkson — Chair]: And all of them,

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: I guess, what I'm

[Sen. Alison Clarkson — Chair]: saying is, as we look at return on investment, all of them have a return on investment that isn't fully calculable. Absolutely. Because all of them not only provide economic an economic center, a community center, in many ways, a community gathering place every day. That's where you see every day. Housing. Yeah. And and and support for the communities. Yeah. Just it's just an underscoring of, yes, we matter, and, yes, we can be an economic center. Even if it's small, they're just essential projects. Thomas, do you have a thought?

[Sen. Thomas Chittenden — Member]: I agree there are some unmeasurables but one piece that I'd be interested in is if you look at the total grand list of those communities, once you get these investments in place are the neighbors then improving their properties because they're seeing the value of the community. I'm assuming that's obvious to some extent and that is quantifiable if you're able to look at the grandest communities that invest it, when they invested it and how that increased relative to the communities that haven't done this.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: It's a great

[Sen. Alison Clarkson — Chair]: avenue study. That's true. Often it's people not moving away too, because often it's saying yes and keeping people who would begin to move away if there weren't those centers.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: I mean, I'll say from our the way we think about this work is really what makes the community viable, right? And we're thinking about new people trying to reach that 802 number if we're gonna do that, right? What they can't all just go to Chittenden County, right? And so what what is it that makes somebody want to choose, you know, the town that I grew up in Sutton or Belfer or places or you know Athens, what makes them choose communities like that? And I think if there's not a community center or a place where they can see themselves, they can meet people I think about like Harry's Hardware in which is not a community support enterprise, it's just a hardware store, but we have a bar and bands play there and it's this incredible multi generational gathering place that I think makes Downtown Cabot vibrant and viable. And so when people come from away, they can kind of see Well, themselves

[Sen. Alison Clarkson — Chair]: thank you, thank you for all that you do. I brought copies of our annual report and

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: a map that shows the three sixty two projects that we worked on, and I would also just say that if you ever have constituents that have an old building in trouble,

[Sen. Alison Clarkson — Chair]: we send them our way. Yeah. I mean, Welch family haven't been able to do this in in line with this Redding.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: We're actually working with Redding right now. They're one of the The backdoor story is just Well, if I could just very briefly, you know, thanks to the leadership of senator Leahy, we were able to start an initiative called the Village Trust Initiative in partnership with Vermont Council on Rural Development and the Vermont Community Foundation, where we're going to work with 20 villages of 2,500 or fewer over the next ten years to create a community trust and some kind of transformational revitalization project in the village. Reading is one of the first cohorts actually that was selected.

[Sen. Alison Clarkson — Chair]: Well that's so exciting!

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: The green talk.

[Sen. Alison Clarkson — Chair]: Would be lovely if all our senators do that. I mean the three senators that represent it. Yeah.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: That's exciting! It's very exciting!

[Sen. Alison Clarkson — Chair]: And can you share with us some of the other communities that make

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: sure Actually I just referenced Belvedere. Belvedere, you know, three seventy residents. You know, we're thinking a lot about what does economic development look like in Belvedere, and so they're one of the communities that have been selected. Let me see here. Snowfield Community

[Sen. Alison Clarkson — Chair]: Trust. Apologies for Snowfield.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: That is in Braintree.

[Sen. Alison Clarkson — Chair]: Oh, it's in Braintree and Mike

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: It's really you know Benson is a really great one. I love the Benson Community Trust. Their general store burned to the ground in 2019. These kind of two women started community trust. One was the principal of a local elementary school, the other one moved here from New York. They had this dynamic duo. They raised, I think, a million and a half dollars to rebuild the store, they're breaking ground in the spring. Yeah, we're really seeing a lot of interest in the program and I think it's getting really successful. The idea behind it is that we identify a village in need of revitalization and then just provide whatever wraparound services they need. And so VCRD's team comes in and helps them vision their future. Reservation Trust, we're really doing kind of project management, you know, what do

[Sen. Alison Clarkson — Chair]: you need in architecture? To actually build the housing. They need work. We'll see. You know? So we're it's all working in concert team, committee team, team members. Hi. We're all enabling this, which is great. This is very exciting. Any other questions? Randy, David?

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Thanks for all

[Sen. Alison Clarkson — Chair]: your time. Ben, thank you. Always a pleasure. It's I'm now a building that we could dedicate to the pages.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Well, there's always the Federal Building.

[Sen. Alison Clarkson — Chair]: And it was looking That's true. And there's plenty of groups there. Absolutely. Well, appreciate some crowds. And you got everything in, didn't you?

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: No. I think I think

[Sen. Alison Clarkson — Chair]: we've got it sad that the feds don't turn to you for their for help. They should. Maybe they do. Are they The Federal Building? Yeah. Well, it What are we doing with the Federal Building? You do have I would welcome

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: the number 10 to talk about it. Can reach out

[Sen. Alison Clarkson — Chair]: to So

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: in December the federal government general service administration notified that they were gonna going to dispose of the building, dispose of the asset, and so there's a process for disposal of a federal building. Where we are right now is the I am on the city council,

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: this is not a city

[Sen. Alison Clarkson — Chair]: project. It It's actually

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: a project of Montpelier Commission on Recovery and Resilience, which was founded kind of after the two thousand threat flood. And so the Commission kind of stepped up to try and work with GSA around, you know, that is a central property in the City Of Montpelier. You know, when you think about it, people have been trying to rent redevelop the pit along Port Street for over thirty years. And it's always kind of broken down because the federal government didn't want to play, right? So you've got the Feds, Vermont Mutual, and then the state of Vermont, DGS, owns, you know, all of those parking lots. And Those are all the

[Sen. Alison Clarkson — Chair]: parking lots, just so everybody knows, from the pavilion all the way through to the laundry bay. That's right. Or go to the houses just before Exactly. The

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: And so, you know, when you add in the Federal Building to that scenario, all of a sudden you've got access from Court Street, Elm Street, State Street, and it becomes really possible to think about a comprehensive redevelopment of all of those sites in a way that has not been imagined before. And so the commission, we worked with philanthropic partners to raise some money to hire real estate redevelopment professionals, Samantha Dunn and Jeff Glassberg. We hired GBA architects to help kind of look at what a comprehensive redevelopment could look like. And the secretary of the agency of commerce and community development as an entity affiliated an eligible entity for negotiation with GSA raised their hand and said, we will negotiate with GSA for the purchase of this building with no intention of actually owning the building, right? It's a transferable option to purchase. And so we've been working really for the last six months negotiating with GSA and

[Sen. Alison Clarkson — Chair]: doing due diligence on the commission. That's the long failure

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: commission. And again we've hired kind of professionals to do this work for us. What we have found I mean we've turned over every stone. What we have found, it's an incredibly difficult project to begin with, but in addition there are some potential or known environmental concerns on the site that GSA frankly didn't share with us during the beginning of the process, but then just after the government shutdown finally shared a report with us showing different kind of environmental concerns with the building. That would make a potential redevelopment extremely challenging, but they will not allow potential buyers of the building to go in and continue to characterize the contamination. It's an as is various sale. So there is a scenario in which what would happen next if we're unable to come to terms, that building would go to auction. At which point any speculative investor, whether they're capitalized or not, could potentially purchase that building without access to brownfield funding and you could essentially have a white elephant in the downtown capital for the next couple decades while people figure out how to do it. We do not want to know about that.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: And I

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: would just say too on the modeling, you would look at the modeling of that building and there's different scenarios. Does the building stay? Does the building go? But should the building stay, you know, it could be condoized into different office units, it could be turned into there is a plan, an idea of how to turn into a hotel, but on the back lot alone, it's 1.6 acre parcel on the back lot alone, you could fit over 50 units of housing and then when you start to look at, you know, the grand scheme of the different scenarios of what could happen in the other parking lots, you could literally fit hundreds of units in our downtown.

[Sen. Alison Clarkson — Chair]: Which would be fabulous.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: It would be the new economic engine and it would demonstrate to the state and I think to the nation what a

[Sen. Alison Clarkson — Chair]: flood resilient capital could look like. Yes, yeah, yeah. You can raise it all up a bit. But contamination is in the building itself, is it?

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Is. PCBs. Oh, it's PCBs. Yeah. And it hasn't been fully categorized because GSA won't let us go in there. I will say that the Secretary of Commerce has been extremely helpful as Secretary Moore in kind of strategizing the delegation has written strongly worded letters. But I think the reality is, you know, we're a non profit group of folks that are just like, you know, got some philanthropic hours together, we did get support from a special appropriation last year to do due diligence in the building, received in Northern Border's Regional Commission, through the Central Vermont Regional Planning Commission. You know, all the team is there. It's a team sport. Everybody's working hard. I'm just gonna say it. The reality is that project will not move forward without state leadership, and the Agency of Commerce and Community Development has been a great partner. We have significant challenges ahead of us that will be here again, I think for decades if you want to step up.

[Sen. Alison Clarkson — Chair]: So thank you for that. Thanks. ACCD with BGS would be great partners on that project forward. Thank you. That's a great update. How exciting. Mean, Yeah. Thank you. We are now gonna pivot. Thank you very much. Caitlin, thank you. Grace Banks, Ben, and Rebecca. You. Good work. Get rid of my

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Thank you.

[Sen. Alison Clarkson — Chair]: Now we are also proud of this program and so dependent on it.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Alison, I sent you those addresses.

[Sen. Alison Clarkson — Chair]: Thanks. I I I haven't had time to finish those, not my thought as well. But I Fun videos. Anyways. Welcome.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Hi there. Thank you. So

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: we're gonna start with Chelsea.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Yes. Chelsea Vargo Lewis, executive director of PDSR. I sent

[Sen. Alison Clarkson — Chair]: Good.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Some slides. Do you or Johanna sent them yesterday? Yeah. What is the best We have one. Left out. I I haven't Care

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: but Care can run them for

[Sen. Alison Clarkson — Chair]: Thank you, Caitlin.

[Nate Formalarie — Deputy Commissioner, VT Dept. of Housing & Community Development (DHCD)]: Thank you

[Sen. Alison Clarkson — Chair]: very much. So much appreciated. Great to see you. Good to see you. Okay so why don't you

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: put us up Thank for you for inviting us here today. Jill Monica reminded me that this committee knows DBSR very well but I've only been here for six months so I get to take the opportunity to reintroduce all of you to VBSR and it's a preface for me too so And introduce yourself! Yes indeed! It's great to be back in the building. I moved to Vermont fifteen years ago for a job across the street with Vermont Agency of Agriculture and it was a dream job for someone who had just gotten a graduate degree in agricultural policy and spent a lot of time in this building, mostly not in this room, but in the the ag committee room. It's great to be back. VBSR is a as you know, business membership association focused on triple bottom line business results. So we talk about people, planet, and prosperity. We were founded thirty five years ago by some of our premier Vermont businesses who also really believe that social impact and environmental impact should be at the core of their business. So Ben and Jerry's, Seventh Generation, Vermont Creamery all had this idea of scheming around someone's kitchen table and chore over some great cheese and ice cream.

[Sen. Alison Clarkson — Chair]: Those were three of the

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: founding generation. Yes. Among among others. Pat Heffernan from MPI and many I won't start naming them because I'll then I'll hear I was there too, which has been one of the most fun things that I've gotten to hear over the past six months is people the pride of ownership in creating the platform that VBSR is today. So next slide. Here's our mission to leverage the power of business for positive social and environmental impact, and we do that through these three key ways, which I'll talk about a little bit later. And so go ahead to the next slide. This is our vision, a just thriving and transformative economy that works for all people in the planet. Here's our team. We are a small scrappy team that really punches above our weight in terms of the impact that we have. After I was at the agency of agriculture, I was at the Vermont Community Foundation, doing both our grant making and our mission investments. And that's where I met Mickey Wiles from Working Fields. He was a portfolio company. Mickey had an idea for a startup that would connect people who are in recovery coming out of incarceration to employment through a staffing agency model. I spent four years doing the startup thing and really recognized Centering Impact First. And you know all of our members right now and our members are at all different scales of business. Many of them have 20 members. I will share more data on that. We have about five fifty five members today and they are thinking about how to make the most impact for they're looking at every single dollar and we are doing the same thing on their behalf. We are really have no intention of becoming a large team. We really want to have a lot of impact using the incredible champions that we have on our board and in our membership to make the impact that we seek to have. So here's our team, of course Johanna you know and you will hear from Molly Rand is our Education and Events Manager and Jeremy Gerber is our Membership Manager.

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: Great.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: And here is our amazing board,

[Sen. Alison Clarkson — Chair]: as you can

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: see representing multiple sectors. We do have nonprofit representation in our membership and on our board and pretty much every sector that you can think of in the Vermont economy. I will note here we do we have our C6 membership association and then we have our C3 which is the focus on the education component of our work. Next slide. Here are our champion members. I have my concept to a sticker here. We were just in more still visiting them last week. Newly turned purpose ownership trust business. But as you can see again businesses from across the state who want to align their brands and their commitment to purpose with DBSR's brand and we really aim to have engagement at every level of the organization so of course a lot of the folks who come to our meetings are at the top or the CEO C suite level and more and more getting kind of into the general employment populace in these companies and making sure that anyone in the company, no matter where they are, sees an opportunity for leadership here in Vermont and that DBSR can be part of their professional development and also a part of what they love about living and working here in the state. Next slide. Okay, so yes, diversity of industry and scale. So here's just kind of a snapshot of some of our businesses. TuckToo, I don't know if you've heard about this startup tech company that is revolutionizing the care economy. Actually Is that TuckToo? TuckToo, yeah TuckToo originally founded in Vancouver, Wisdom Stimson Luta moved to Vermont with his wife when she got a job at UPM and he's now relaunching this company here in Vermont and it connects people with caregivers. So it can be a lot of elder care is a primary use statement. So you can go on and log in and have someone come and care for your mother for a few hours. But there's also housecleaning and pestening and it's a hub for care and connection in communities. Global Village Foods, up

[Ben Doyle — President, Preservation Trust of Vermont; Montpelier City Councilor]: in White

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: River. This is Mel Hall is

[Sen. Alison Clarkson — Chair]: on our This is Mel, the design.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Mel. Yes. Mel Hall is a media board And yeah. And that makes incredible food and now is

[Sen. Alison Clarkson — Chair]: Great garlic, we have him together. Garbage, but he's from Africa.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: He's originally from West

[Sen. Alison Clarkson — Chair]: Africa. Yeah.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: Jasper Hill Farm, everyone knows. Bell Poe, know, really represented in every company in the state. Weight and Burke, I'm sure you're hearing from a good amount as you focus on housing in Derringer, also incredibly relevant in this moment.

[Sen. Alison Clarkson — Chair]: I don't know what Derringer does.

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: They do trade, import, export, brokerage and advising. Awesome. All of them. Yes. Alright. And then also last week, we a great visit with Railroad Savings and Loan ever since their new CEO. They're also a certified b corp and really doing incredible things for community thinking there in that community. I think the next slide is the is the data. So here's our memberships. How many of

[Sen. Alison Clarkson — Chair]: your companies of your five fifty members, are certified B Corps?

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: That is a great question. I think they're in total, I can give you the exact step, I think there's about 50 certified B Corps in the state, and we have almost all of them as members. We actually have a program called the Vermont B Corp Collective that's focused on providing technical assistance and opportunities. Collective action is now a requirement for B

[Sen. Alison Clarkson — Chair]: Corp

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: certification, so we provide a platform for those businesses to attain that portion of

[Sen. Alison Clarkson — Chair]: the certification. So

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: yeah, here's the data. We mostly these are small companies. 215 of our members are small companies, and our definition of small company is not the federal definition, it's less than 15 employees. Less than 15. 15, yes. These are very small. We have engaged students, we've engaged startups, we have an individual membership level for people who are either retired or job seeking and then our champion members as I said that's really kind of our they're supporting the mission beyond just the transactional value of membership.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: We added 136

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: new members in the past year and here you know I think around 2020, DBSM are really sort of leaning into our programmatic work. So we were responding to help businesses adapt to COVID. We ran a small business COVID relief grant. We were doing some really deep JEDI work and helping our businesses react to the moment, racial reckoning that was happening in this country. And then we had two years applauding, as of course you all know, and we stood up the Climate Ready Vermont program and which is still running and it's still helping businesses both with climate resilience, but also just continuation plans for any disaster. During that time where we were focused on meeting the needs, we were not as focused on reminding members to join DBSR, and we are now back in that moment and we are growing. Our membership, as you can see here, is we're in a growth phase right now. We're in the health sector, so yes. Next slide. Here's our programming and event highlights from last year. So here's how we do our work events and and bring people together. This is part of the reason we're in a growth phase right now is because I think all businesses recognize that they can pay a lot for some dataset or learn from some economist or policy prognosticator. There's no one that can tell them what's happening or what's going to happen next month or what's coming out of BC, which is why they're seeing opportunities to get together for peer learning as the biggest benefit to their business right now. Peer Problem Solving Partnership, BBS provides a platform for that. So we have a variety of different events. We have our annual conference which really focuses on education. We have our BVSR Day in the State House which is coming up. But every month there's an opportunity for members to get together in person and then we also offer online platforms for people to learn and connect with each other as well. Okay, next slide. Just wanted to put these save the dates in here. Next week we have our annual partnership event with Simba at UBM, and we'll be focused on career pathways and retaining talent here in The States. We have a winter Wednesday coming up in Burlington, and we've moved we've outgrown Hula for our annual conference. So we'll be moving to Downtown Burlington. And then our awards ceremony will be with SS, and our legislative breakfast will be at Hula again in November. Would like to see all of you come in, please. Okay, next slide. And here's where I'm

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: going to turn

[Chelsea Vargo Lewis — Executive Director, Vermont Businesses for Social Responsibility (VBSR)]: it over to Johanna, but of course, our policy work is a huge pillar of it's a big part of why we were founded was to be the business voice for We want to continue to hold the bar so that, you know, Vermont of course the reason people start businesses here is because they want to be connected to the community, they love the environment, and you know sometimes there's an assumption that business voice will vote for the lowest cost proposal and we want to continue to be here to say sometimes that means investing in our communities and our people and our environment to have long term business success.

[Sen. Alison Clarkson — Chair]: Much appreciated. We have appreciated your partnership for many years. So thank you thank you you Chelsea and welcome Johanna

[Johanna White — Public Policy Manager, VBSR]: oh no we can kick this up for a quick second how's everyone doing today pulling in before lunch

[Sen. Alison Clarkson — Chair]: we're we've got a packed agenda this day We do, we've had our boots. Wonderful. Well, we're gonna end with the ESR. Okay,

[Johanna White — Public Policy Manager, VBSR]: thank you all so much for having me here today. It's so great to have the opportunity to come back in front of this committee. I'm sure you all remember from last year the time that we spent here. I want to start by saying it's a pleasure to be here speaking as a public policy manager for Vermont Businesses for Social Responsibility. Again, our mission is to leverage the power of business for positive and social and environmental impact, and we advance our mission through shared learning, connection building, and collective action. I want to first start by thanking all of you, especially for the medical leave bill that was signed into law last year. We worked closely with this committee and really appreciate the expanded protections for LGBTQIA employees, their families, and individuals in need of bereavement leave, as well as those in need of safe leave in Vermont. We worked closely with you all last year. Thank you again for your hard work on that bill. We want to thank you as well for the key housing initiatives that were passed in the budget last year, especially the 36,900,000 on the VHCb property transfer tax, as well as the additional $5,000,000 for VHCb's affordable housing protections. I want to also say that in the midst of everything going on last year that was an incredibly challenging time and we're going to continue to see more challenges as we know in the coming budget year, but we also appreciated your protection of funding for child care in the budget last year, so thank you for your continuing to advance that work. I have a lot of numbers that I could share with you, but you know many of them and I don't want to get us too into the weeds here. I want to make sure that we get to talk specifically about some of our key platforms that are relevant for this committee. So specifically, I wanna talk first that these priorities have been democratically developed. They begin with input from our membership and from two separate membership surveys, and then there's extensive discussion among our VBSR public policy committee and ultimately approved by the board of directors. So when I come in here, I'm not just speaking for me. There's a whole process that goes in from our membership and

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: so you can count on the fact

[Johanna White — Public Policy Manager, VBSR]: that this represents the voices of VBSR. I think that's really important to talk about, especially considering the large proportion of our membership that are small businesses. I know often we're thought about as a big business entity. We represent some of the largest employers in Vermont, but we also represent incredibly small employers, so it's 15 FTE and less, and it's notable that actually if you account for all of our membership and we tally up all of their number of employees, we represent about 43% of all employees in Vermont are BPSR members. So we like to highlight

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: that when we're talking about

[Johanna White — Public Policy Manager, VBSR]: what our priorities are, where we're coming from. I want to really focus in on housing for you all. You've heard these numbers and these asks a lot this week. So just note that we're in high alignment especially with the Housing and Homelessness Alliance of Vermont and Let's Build Homes when we see strategic ways that these two entities intersect and that we need to support smart growth in the state of Vermont. We often balance our priorities between these entities and you can always come to us if you're interested in a perspective on what's the smart path forward for Vermont housing that's going to support workforce development and our economy. First and foremost, I want to make sure that we prioritize capital funding to create and rehabilitate and preserve affordable housing in the state of Vermont. The Housing and Homelessness Alliance and us support the $37,600,000 of base funding for the Vermont Housing Conservation Board, as well as the property transfer tax, and the $40,000,000 in additional one time funding for BHCB to maintain progress on its housing crisis, addressing programs. Also $5,000,000 in base funding for the Vermont Housing Improvement Program, the VHIP program to rehabilitate rental housing and making it more affordable at federal fair market rent standards. So you all heard about those priorities from HHAB. We support those priorities as well, especially the Vermont Housing Conservation Board allocation in the budget this year. I also want to note that we continue to support the state's rental assistance opportunities, so especially with over six seventy Section eight vouchers statewide at risk of a death spiral increasing the federal funding starting this year to prevent further losses. HHAB and VBSR continues to support up to $7,900,000 in one time state funds for the voucher contingency reserve. This is to support the Vermont Housing Authority and the public housing authorities in their addressing of the section eight voucher crisis.

[Sen. Alison Clarkson — Chair]: Which we're beginning to address in a significant way in the BAA. That's right.

[Johanna White — Public Policy Manager, VBSR]: I also want to note that it's so crucial to continue to invest in homelessness assistance prevention and services through this time. We know that this is an economic issue, right? When our workforce can't find places to live and when we have folks around house in our communities, it has serious impacts on our communities and our businesses. We especially are requesting a $1,300,000 increase in the fiscal year twenty six budget adjustment act, the BAA for this year, for the HOP financial assistance through the community action agencies and homelessness service providers to restore funding those laws in fiscal year twenty six to address that specific challenge.

[Sen. Alison Clarkson — Chair]: So have you testified in front of the appropriations committee? In the house. In the house.

[Johanna White — Public Policy Manager, VBSR]: We've been letting the HHAB folks go first because we want to make sure that they get on the docket and then we'll come over and talk more about

[Sen. Alison Clarkson — Chair]: it. Yeah.

[Johanna White — Public Policy Manager, VBSR]: I also want to make sure that we have adequate funding and policy reforms for general assistance emergency housing. So this is a $44,000,000 for the general assistance emergency housing program. We want to note that that's essential housing and it's an essential safety net for those experiencing homelessness when no alternative emergency shelter exists. This has been a very contentious issue as you all know. We wanted to make sure to get on the record stating our support for the General Assistance Emergency Housing Program. We recognize that there's a lot of reforms that need to happen in that program and those conversations are continuing to move forward but we can't leave people out on the street in the meantime. We need to find a middle ground. We also agree with the work that lets other artists in

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: doing the work that's coming out of the

[Sen. Alison Clarkson — Chair]: house in terms of their plan.

[Johanna White — Public Policy Manager, VBSR]: Yes.

[Sen. Alison Clarkson — Chair]: And right. Yeah. Currently. Great.

[Johanna White — Public Policy Manager, VBSR]: We'll see how the language keeps changing, of course. But yeah as it stands we are. You know, you see the Let'sville Homes poster on Newell's

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: committee here, we work closely

[Johanna White — Public Policy Manager, VBSR]: with them, we're in leadership with them, we also believe in the fact that it's time to provide real predictability and speed of time to market, as you all have heard, unlocking capital and reducing construction costs. Especially the ending of sales and use tax exemption for all home construction in tier one areas, the state can directly reduce the cost of housing construction by 6%. And so we know that the cost of construction is a major prohibiting factor from developing in housing even in these tier one areas. We also were looking forward to continuing discussion of the changes happening Act two fifty, 181, and the Holmes Act. So we're following very closely the ways in which tier one is continuing to be developed. Please don't hesitate to reach out

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: to us.

[Johanna White — Public Policy Manager, VBSR]: I want to quickly mention our democracy work in addition to this effort. So this year, UBSR especially believes that it's crucial that businesses continue to stand up for democracy in the state. We know that democracy is good for business. So we're going to continue to support opportunities to protect voting rights as well as ensuring that the civil liberties across our state are moving forward in the right direction.

[Sen. Alison Clarkson — Chair]: If you

[Johanna White — Public Policy Manager, VBSR]: have any questions for your last stop testifying on those bills please don't hesitate. Speaking

[Sen. Alison Clarkson — Chair]: to Brian about that when it comes, I don't remember who's starting it, we met together yesterday in the two committees but I don't recall who's starting the Voting Rights Act.

[Johanna White — Public Policy Manager, VBSR]: Yeah, the Senate Judiciary is taking up a different bill right now that has announced some protections and all of these stuff so we're tracking them really closely. Which is great. Yeah, we're also here and always available to speak to workforce development issues if there's opportunities to support the small businesses. We noted last year that we provided written testimony in support of the small business technical assistance bill that moved forward.

[Sen. Alison Clarkson — Chair]: We would love to see again in terms of our economic development bill, but a review that with Rick and see what we want

[Johanna White — Public Policy Manager, VBSR]: to continue that. Okay perfect please don't hesitate to ask us if there's anything that we might have someone put on an echo we're very much in support of that small business systems work.

[Sen. Alison Clarkson — Chair]: Right and one of the key things we're trying to do in this session I think and one of the and it I don't yet know whether we're going begin it in the house or here and this occurred a tiny bit but at the Pepsi conference when we, when Art very wisely said well edgy isn't for everybody, it isn't for every stage of business development, being really clear about what the stages of development are for our businesses. Startups early stage, maturing matured, what do we offer in the state for each development stage, how we can better market it, what are we missing, what is the key, you know, I'm not sure the state should be involved in access to capital, I mean I think that's a, you know, capital, but, you know, that's that's an ongoing need at every level, but each level of development in a business needs are the resources we provide. We need to fund those resources, but what are we missing too? So I think I'd love to have this committee dig into those four areas and what we do provide and what we can do better.

[Johanna White — Public Policy Manager, VBSR]: And we'd be very happy to speak to those especially our programming work that's been developed over the last five years we've been directly caring for businesses what is it that they need to ensure as much pragmatic success

[Sen. Alison Clarkson — Chair]: moving forward as When we share that with the committee we'll begin that work it would be great to have you at the table on that.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: That sounds great.

[Sen. Alison Clarkson — Chair]: Because you represent businesses in all Not maybe not so many startups, but certainly What if you start

[Johanna White — Public Policy Manager, VBSR]: to see here? More and more startups than ever, mostly because we're seeing such a boom in Vermont,

[Sen. Alison Clarkson — Chair]: so we want to And we provide all sorts of skill building and we do have a chance for that. Any questions for Joanna? So your platform supports a lot of our work and have you been into healthcare supporting?

[Johanna White — Public Policy Manager, VBSR]: We just sent you letters. Yeah, we just sent a letter supporting the primary care bill. So on average,

[Sen. Alison Clarkson — Chair]: just curious, on average I've heard that, you know, we've heard on the exchange how unaffordable the increases have been for individuals, but I've also heard that business plan increases were actually more much more modest that were, like, I've heard from companies they were only 3%, which is have you collected that information for your companies and what on average have been the increases in their plans?

[Johanna White — Public Policy Manager, VBSR]: So because folks were still determining up until very recently whether or not they were even going to re enter the process of having a business established plan or whether they would continue to encourage their employees to enter into the marketplace. We're still gathering that data. I think we probably won't know for another month or two because that's when we'll see that data about how many folks continue to say especially our small businesses that have part time employees or where you know they might not provide employer based health coverage because it's been more affordable to have those on the exchange and so that's changed now right but it took until certain deadlines because we didn't

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: know if the tax credits would

[Johanna White — Public Policy Manager, VBSR]: be extended until last week for example you know to know exactly what the numbers are.

[Sen. Alison Clarkson — Chair]: Thank you very much it's great to have you go up Chelsea it's all good to have you on our committee and committee I think we're set until tomorrow we'll shift to Lager so thank you all we'll see you tomorrow and we are ready to say goodbye to our public audience. Thank you so much.

[Caitlin Corkins — VT DHCD (Downtown & Village Center Tax Credits)]: Have a great

[Sen. Alison Clarkson — Chair]: day.