5-cent education property tax increase needed

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Statewide base property tax rates might increase again — by a nickel in 2015 — to meet the rising cost of education. But in recommending the rate bump, Tax Commissioner Mary Peterson also suggests looking for a way to get schools to curb spending.

Peterson issued her official property tax recommendation Tuesday afternoon: Base homestead property tax rates should go from 94 cents to 99 cents, she said; non-residential property tax rates should increase from $1.44 to $1.49. Peterson recommended no change to the homestead income tax rate of 1.8 percent.

The Legislature, which ultimately sets statewide tax rates, will consider Peterson’s recommendations when it reconvenes in January.

Lawmakers also might respond to Peterson’s urging that they consider ways to limit the growth of education spending from year to year. Her message echoes one she delivered to the House Ways & Means Committee at a recent pre-session meeting that focused on education finance.

Gov. Peter Shumlin on Tuesday also appealed to school boards to keep their budgets lean.

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Shumlin celebrates broadband progress, though target is missed

930 words / VTDigger.org Despite conceding that Vermont will miss his target of statewide broadband and cellular coverage before year’s end, Gov. Shumlin Wednesday gathered top telecommunications executives to celebrate how far they’ve come.

VTel president Michel Guité addresses a roundtable of telecommunications executives and press assembled by Gov. Peter Shumlin in Montpelier Wednesday afternoon. Photo by Hilary Niles/VTDigger

About 3,000 homes still lack high-speed Internet service — representing less than 1 percent of residences in the state. Of those homes without service, solutions have been identified for the vast majority, though connection dates remain elusive. Five or fewer locations still remain without any solutions figured out. Administration Secretary Jeb Spaulding said the effort has been largely successful. “I think (the governor) is excited and thankful and gratified for the progress we have made, and I think for all intents and purposes, we have hit his target.”

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Unfunded health care obligations threaten teacher pensions

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State Treasurer Beth Pearce might soon run out of metaphors for the chronic funding shortfall in Vermont’s teacher retirement system.

It’s a “monster,” she told the House Appropriations Committee on Wednesday. “It’s at a tipping point,” she said. It’s like a credit card that charges 18 percent interest, when a 2 percent deal sits idle on your desk. “It’s taking the wind out of the sails of (the pension system’s) recovery.”

The Vermont State Teachers’ Retirement System (VSTRS) encompasses pensions and other retirement benefits of retired teachers. It’s one of three pension systems managed by the state treasurer — the other two being state and municipal employees.

The teacher pensions have been consistently funded by the state Legislature in recent years, Pearce says, but the health care benefits have not. The state is falling about $20 million short each year, she estimates, based on the current cost of healthcare and demand for services. The health care is getting paid for, Pearce emphasizes, but in a very expensive way.

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State announces ‘open data’ pilot project

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As Vermont’s state government takes its first baby step into the giant world of open data, the state’s civic hackers are lining up to help.

Harry Bell of Vermont’s Department of Information and Innovation announced Tuesday that the state would be stepping out of its website shell and into the “open data” movement — a growing international trend toward making government data more available to the public.

20131008_Open-Data-610x324In line with principles of “proactive disclosure,” which makes public information freely available before anyone has to ask for it, open data is the product of a systematic methodology that seeks to catalog, structure, unify and publish as much government data as possible.

At an Open Data Consortium in Montpelier Tuesday afternoon, coordinated by the Vermont Center for Geographic Information, Bell described his job as using the Internet to facilitate communication between the state and the rest of the world. To date, that communication has consisted of a hodgepodge system of websites, most cut off from each other by separate back-ends and proprietary formats.

“The rest of the state’s interaction with open data kind of starts with last week on Tuesday,” Bell said.

And he wasn’t kidding.

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A post-mortem of Menck Windows’ Northeast Kingdom EB-5 Project

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Todd Bachelder will have to recalibrate his family’s vision for a new future — one closer to Springfield, Mass., than Newport, Vt.

The former site of Bogner skiwear and sporting goods in Newport, Vt., was planned to house the North American headquarters of the German window manufacturing company Menck. Plans for the immigrant-funded project fell through in September. Photo by Hilary Niles/ VTDigger

The CEO of Menck Windows said he and his wife were looking forward to moving from Maine to the shores of “beautiful Lake Memphremagog” in the Northeast Kingdom. Bachelder had been working with Jay Peak co-owners Bill Stenger and Ariel Quiros to establish the German window manufacturing company’s North American headquarters in Newport.

Stenger announced Sept. 13 that plans to bring Menck to Newport had fallen through because the parent company’s new equipment requirements would cut into the plant’s job creation projections. It turns out slow sales projections and facility constraints also played a role.

Menck still is moving forward to establish itself in North America: but not in Vermont, and not with EB-5 immigrant funding.

The EB-5 Immigrant Investor program, championed in Congress by Sen. Patrick Leahy, provides a two-year conditional visa to would-be immigrants who invest between $500,000 and $1 million in an American business. As long as 10 jobs are created directly or indirectly by that investment within two years — or, as long as 10 jobs’ worth of economic activity can be attributed to the investment — the visa turns into a green card.

Job creation and generally boosting economic activity is the program’s stated goal — and also, in Menck’s case, the hitch.

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Unemployment Trust Fund tapped for fraction of potential relief

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Vermont legislators agreed in May to offer up to $8.67 million in refunds and discounts to businesses that laid off workers in the wake of 2011′s disastrous floods.

But only 75 employers, among the untold eligible businesses hailing from every county in the state, applied for the unemployment insurance relief. Instead of giving breaks for a “worst-case” scenario of 11,247 layoffs, the state forgave at least partial charges on just 299.

On their July 1 unemployment insurance bills, 54 businesses accepted $264,178.53 in refunds.

“Really, that’s all? Wow,” said Steve Moyer, CFO of Woodstock Farmers’ Market.

20130830_Woodstock-Farmers-MarketThe retail business benefited from the program almost two years after temporarily laying off all of its 50 employees.

Like other businesses, the company’s unemployment insurance charges — the money that feeds the trust fund from which unemployment benefits are paid — presumably had gone up because they’re based partly on employers’ history of layoffs: the more layoffs, the bigger the bill.

But on top of other flood-related repairs, the insurance hike hindered their recovery, employers argued. Lawmakers agreed to cut them some slack.

After a partial refund and with a discount on its current unemployment insurance charges, Moyer estimates the market’s costs will increase by $90,000 over the course of three years.

“We got hit very hard with that cost,” he said. Had more relief been offered, he wonders if his business would have taken such a hit.

Moyer’s reaction embodies the conundrum policymakers wrestled with when they struck a deal in May to create the state’s Unemployment Insurance Disaster Relief program. Some legislators were reluctant to give employers any relief, while others wanted to offer more.

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Federal reforms pushing flood insurance rates ever higher

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When it comes to flood insurance in Vermont, it’s federal reforms that worry Susan Donegan.

The commissioner of the Department of Financial Regulation gives an example: She heard from a Washington County resident a few days ago who faced an $8,000 premium for a year of flood insurance in a high-risk zone. The bill was sticker shock for a property owner who hadn’t resided in a risky zone before the latest flood map for Washington County was adopted in March.

But it’s not just the new designation that drove up the price — and that may drive down the home’s property value. It’s the fact that the bill reflects the property’s actual risk.

Residential flood insurance, for the most part only available from the federal government, is undergoing major changes in 2013 with the rollout of the Biggert-Watters Flood Insurance Reform Act of 2012. The congressional changes were inspired long before Tropical Storm Irene, as was the Federal Emergency Management Agency’s initiative to update the country’s flood insurance rate maps.

“You can debate global warming,” Donegan said, “but you can’t deny that we’re having more severe and more frequent severe storms.” Known as BW-12, the Biggert-Watters Act was crafted to address that reality and shore up federal flood insurance in its wake.

Donegan doesn’t argue the intention, but she’s concerned about what its drastic changes will mean for Vermont property owners.

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Public to private: State and independents struggle with school conversion

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When North Bennington turned its public school private this year, some people in the Statehouse and Agency of Education grew nervous.

What would this mean for local and state taxpayers, they wondered. For the Education Fund? For children in the district?

A moratorium and an outright ban on the same transition in other towns were floated in both the House and Senate, but ultimately lawmakers settled on a committee to study the issue further. That group met for the second time Wednesday morning. It’s off to a slow — but passionate — start.

Central to the sometimes edgy debate was all manner of access: Access to a full range of services for students with special needs, access to school choice for families and access to school records and accountability mechanisms for state officials and members of the public.

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Leahy proposal would alter EB-5 job creation formula

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In a bid to shore up the controversial EB-5 Immigrant Investor Program, Sen. Patrick Leahy, D-Vt., has proposed a roster of improvements: stronger oversight, better reporting and streamlined reviews of business plans and visa applications, among them.

Jay Peak Resort co-owner Bill Stenger said that careful timing of their EB-5 funded construction projects creates full-time employment for the workers. Here, an empty ski slope in the background highlights Stenger’s goal to turn the ski resort into a year-round destination. Photo by Hilary Niles/ VTDigger

His revisions also would tweak the job creation requirement to define full-time employment not as someone working at least 35 hours per week, but by the equivalent of a full-time job, “regardless of how many employees fill the position.”

The changes would be written into a new statute that codifies and makes permanent what is now a pilot program. So-called regional centers help private businesses pool investments from would-be immigrants, at either $1 million or $500,000 apiece, depending on the regional center’s location.

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Aviation and aerospace industries land in Vermont

947 words / VTDigger.org

When Adam Truso returned to Vermont after flying Black Hawk helicopters in Iraq, he wanted to transition to civilian employment.

But most of what he found in the want ads were jobs as nurses and Walmart greeters, Truso said. Wasn’t he surprised when a contact from the Vermont Department of Labor introduced him to Liquid Measurement Systems in Georgia.

Donna Chizmar heads up the cleaning department and manages inventory for Metal Flex. Components are counted by hand and using automated technology. Photo by Hilary Niles/VTDigger
Donna Chizmar heads up the cleaning department and manages inventory for Metal Flex. Components are counted by hand and using automated technology. Photo by Hilary Niles/VTDigger

The manufacturing company is the sole supplier of carbon-fiber fuel gauges for Black Hawks, plus Boeing’s CH-47 Fox model Army helicopters, an entire line of auxiliary fuel tanks by Robertson Fuel Systems, and the experimental Sikorsky X-2 helicopter that holds a helicopter speed record of 259 mph.

Truso now works in the sales and marketing division for LMS — a company considered an anchor in Vermont’s $2 billion aviation and aeronautics industry.

Air prowess was on display Thursday at the Burlington International Airport for the state’s first Aerospace and Aviation Trade Show, hosted by the Vermont Chamber of Commerce.

“We’ve never had a trade show just for the aerospace and aviation industries,” said Chris Carrigan, the chamber’s vice president of business development.

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