MONTPELIER — Gov. Peter Shumlin is proposing to use $5 million in surplus money to attract and retain businesses that offer high wages.
The announcement came Monday at the offices of the Vermont Economic Development Authority, which, under Shumlin’s proposal, would receive $500,000 from the general fund for its Vermont Entrepreneurial Lending Program.
Shumlin’s proposal also calls for $4.5 million for the creation of the “Vermont Enterprise Incentive Fund,” which would be used to help Vermont compete for businesses looking to relocate and to keep the businesses already in the state.
“We are announcing a new set of incentives that we believe will help us grow existing jobs in Vermont, help us retain and expand existing companies, and help new companies get the capital they need to thrive,” Shumlin said. “We know that all 50 states, for decades now, have lots of tools in their tool box, where they try to bring jobs to their states, often at the expense of the other 49 states. We’ve been good in Vermont about doing tax incentives well, but we feel we need another tool.”
The programs would be targeted toward what Shumlin called research and development and tech jobs that pay high wages.
The $5 million would come from a surplus from the 2013-14 budget. Shumlin said he was “cautiously optimistic” there will be a surplus.
The $500,000 for VEDA would augment $1 million in federal dollars already available for its entrepreneurial lending program and would be used to create a reserve fund to reduce the risk in lending money to start-up tech companies and similar companies that offer what Shumlin called high-value jobs.
“It doesn’t necessarily have to be technology. It certainly can be,” said VEDA’s chief executive, Jo Bradley. “It could be any type of fast-growing company that has a scalable business plan that will create good, high-paying jobs. As our demographics change, we need to be sure we have the jobs in Vermont that will keep our younger folks and will have our younger folks come back.”
But the bulk of the money would be used at the discretion of the governor — and with the approval of the Emergency Board — to provide incentives to businesses that are looking at leaving the state, or to attract businesses looking to relocate.
The Emergency Board includes the governor, and House and Senate members from key money committees, including finance, economic development and appropriations.
Both proposals will take the form of amendments to economic development bills currently making their way through the State House and come with the support of Republican Sen. Kevin Mullin of Rutland, the chairman of the Senate Committee on Economic Development, Housing and General Affairs.
“In today’s economic climate, the state must be more nimble than ever to effectively attract and retain quality good-paying jobs,” Mullin said. “VEDA has repeatedly demonstrated their ability to administer state funds in a very prudent manner. This will give them one more tool to help Vermonters seeking jobs and opportunity.”
The amendments also come with the support of the leaders of both the Senate and the House of Representatives.
“There are many companies that are still sending their businesses overseas, and what we’re trying to deal with and what the governor is looking at is to make sure we put a hold on that, so that the companies, instead of just running off to Asia, that they think of other places in the United States where they can have their business, grow their business and create jobs,” said Senate President Pro Tem John Campbell.
“It’s important to invest in our people, but we also know it’s important to invest in our businesses,” said House Speaker Shap Smith, who emphasized other businesses that have grown successfully in Vermont.
“We want to make sure that ideas that have sprouted here in Vermont can then grow into future jobs,” Smith said. “Sometimes, the idea is there and the capital isn’t, and this is really about trying to make sure that we can foster the next Dealer(.com) or the next IDX or the next My Web Grocer.”
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