(Host) We hear a lot about where Vermont’s economy stands in various national
rankings. Former Vermont governor and commentator JIm Douglas puts a few of them in perspective.
Vermont has weathered the recent economic storm (not to mention the
literal one) better than most states. We can speculate as to why: the
diversity of our economy, ingenuity and hard work of our residents,
strong bond ratings, perhaps other factors. Two recent national rankings
shed some light on the creative use of state and Federal programs that
have contributed to our success.
Washington-based research organization called Good Jobs First rated
Vermont third best in the nation for using state subsidies to create
jobs. The report cited our grants for training from the Departments of
Labor and Economic Development and low-cost financing thru the Vermont
Economic Development Authority. But the highest scores were earned by a
program scorned by many lawmakers. In 2004 I proposed reforming the
Economic Advancement Tax Incentives, a successful but overly complex
array of stimuli, by creating a single refundable credit to reward an
employer for achieving job creation targets. It took the legislature
three years to approve it, but the new program, the Vermont Employment
Growth Incentive (or VEGI), was responsible for creating nearly seven
thousand jobs by the end of 2010.
the second year in a row, Vermont’s EB-5 Regional Center was named the
best in the country by the Artisan Business Group. EB-5 is a Federal
program that offers immigration priority to foreigners who invest in
companies that create a minimum number of jobs. Ours is the only
state-run center (thru the Agency of Commerce) and continues to
demonstrate success in attracting investors from around the world,
especially Asia. I led several missions there in recent years to
encourage support, despite their characterization by a prominent
legislator as ‘junkets.’ The Jay Peak Resort in northern VT is arguably
the most successful EB-5 project in the nation.
are other rankings, though, that are quite troubling. Forbes rates
Vermont 45th ‘Best for Business and Careers,’ assessing each state’s
costs of doing business, labor supply & regulatory climate, among
other factors. The Small Business and Entrepreneurship Council lists VT
as 48th for small business survival. The study cites high taxes and
other costs of doing business, along with excessive government spending
at the state and local levels.
these rankings are announced there are always those who reject the
methodology and insist that everything here is really more favorable.
The problem is that businesses making decisions on where to locate or
expand give them at least some credence. I recall vividly that, when I
signed the bill creating low-profit limited liability companies in 2008,
a Washington attorney attending the ceremony thanked me and then
expressed surprise that VT would take such a step. "You know," she said,
"you don’t have a very good reputation as a place to do business."
our tremendous advantages as a place to live and work, and the creative
incentive programs that have been recognized nationally, we must still
acknowledge the need to lower the costs of doing business so we can
improve in national business rankings.