BRATTLEBORO—In most ways, the expansion celebrations held Dec. 28 at two area businesses didn’t have much in common.
But there was one key driver behind both a groundbreaking at G.S. Precision Inc. and a ribbon-cutting for the Ironwood Brands: The Windham County Economic Development Program, funded by a state settlement with Vermont Yankee owner Entergy, which pumped a combined $2.2 million into the projects.
Those who run the program say that, after a slow start, they’ve revamped and refocused it so that it is bearing fruit in the form of new jobs in a county that is economically reeling from the loss of Vermont Yankee.
“There is no other county in the state of Vermont that has cash at its disposal to pass out — to make loans and sometimes to make grants — to grow jobs,” Gov. Peter Shumlin said at the Ironwood event off Old Ferry Road. “So it does give us an advantage.”
Cushioning the blow
Vermont’s 2013 agreement with Entergy — a mutual settlement of several bouts of litigation surrounding its continued operation with an expired state license — came after the company announced its plans to cease producing power at the Vernon nuclear plant at the end of 2014.
With hundreds of jobs and millions in tax revenue leaving the county, Entergy agreed to cushion the blow by providing funding for taxes, clean-energy investment, and economic development.
The latter category is the largest: Entergy is paying $2 million annually for five years to support economic development here.
“The whole intent when I sat down with Entergy and it was clear that they were moving on — I said, ‘Listen, we’ve got to find a way to fund other jobs in Windham County,’” Shumlin recalled during visit.
Officials formed the Windham County Economic Development Program to manage the Entergy cash and sought the first round of applications for grants and loans in 2014, but the program didn’t initially go as planned.
Shumlin awarded less than half the available $2 million because, he said at the time, “most of the proposals didn’t offer the sort of transformational new jobs and economic opportunity we were hoping for."
One of the program’s initial commitments, however, was a $200,000 loan to a successful family of green-building companies run by Eli Gould in Brattleboro: Ironwood Brand LLC, PreCraft, and STIX L3C. With a boost from the state loan, Gould pieced together additional funding and has purchased the former J.J. Nissen Bakery Outlet building at 21 O’Bryan Drive.
Renovations will happen this winter. While Gould plans to maintain his shop on Abbott Road in West Brattleboro, the new space will allow him to grow.
“We hope, if we can pull this off, that five years from now we’re here in a space that can be hosting training, advanced practice, and have showroom displays of the sort of things we’re going to be manufacturing out in back,” Gould said.
The project also fits easily into the Windham Region’s Comprehensive Economic Development Strategy, often called the CEDS. That document “identified green building as a top prospect to replace Entergy jobs with new manufacturing careers in high-performance prefab and value-added timber and engineering,” said Adam Grinold, executive director of Brattleboro Development Credit Corp.
“It’s fair to say that we see Eli’s facility’s success as part of the region’s future success,” Grinold said.
Given the purpose of the Windham County Economic Development Program, the loan for Gould’s companies is “exactly what we had in mind,” Shumlin said.
Incentives could create 100 jobs
Also visiting Ironwood on Dec. 28 was state Commerce and Community Development Secretary Pat Moulton, who said the state funding shows that “we can move at the pace of business.”
That was true on a much larger scale with G.S. Precision, an anchor tenant at Exit One Industrial Park. The Brattleboro-headquartered maker of machined components serves customers such as the aircraft, medical, and automotive industries and employs about 300, but officials last year got word that Chief Executive Officer Norm Schneeberger was considering moving his business to New Hampshire as part of an expansion plan.
A team of federal, state, and local officials reacted quickly to prevent that from happening. The big question during a meeting at G.S. Precision, Shumlin recalled, was, “what can we we do to make sure that Vermont — Windham County — is the most competitive place for you to grow jobs?”
Schneeberger admits that he was initially skeptical about the state’s pitch to keep him in Brattleboro. Normally, he said, “I don’t view government intervention as something that’s conducive to running a successful business — no offense.”
But the multi-jurisdictional team apparently put together an offer Schneeberger couldn’t refuse. The Dec. 28 gathering — which included Shumlin and Moulton as well as U.S. Rep. Peter Welch, D-Vt., and U.S. Sen. Patrick Leahy, D-Vt. — served as a ceremonial groundbreaking for a $17 million G.S. Precision expansion that could create 100 additional jobs here.
The governmental financing package to support the company’s growth includes $1 million in federal Community Development Block Grant funds; a $1.5 million loan from the Vermont Economic Development Authority; $1 million in Vermont Employment Growth Incentives; $6 million in federal New Market Tax Credits; and a $200,000 loan, along with tax breaks, from the town.
Assisting businesses through the process
Another key piece of that package was a $2 million loan from the Windham County Economic Development Program.
As she departed from the Dec. 28 event, Moulton cited both the Ironwood and G.S. Precision projects as evidence that “things are really taking off” for the development program.
She also promised that “we’re going to be doing lots of these ribbon cuttings.”
In response to criticisms that the program might have been top-heavy, more regional and local input now enter into funding decisions, mainly via a Windham County Advisory Council that reviews potential projects and provides input to the state.
Also, the program now has a project manager, R.T. Brown, based at Brattleboro Development Credit Corp. Brown said his job is to “assist businesses as they navigate the process and to explore available options within the program.”
The idea is that both businesses and nonprofits need to have a better idea of the possibilities and the limitations of Windham County’s development money. For example, there were just two grant applications submitted by a Dec. 21 deadline, reflecting the fact that there is a much more structured process for requesting and reviewing grant proposals, Brown said.
And, while there have been more grants than loans handed out at this point, Brown said “we will see other loan applications coming through now.”
Loans are important, because they’ll assure that the Entergy money lasts beyond the company’s five years of required payments to the state.
In reference to Gould’s $200,000 allocation, Shumlin said “that money will be paid back and give the next generation of entrepreneurs who have a bright idea the ability to grow future jobs in Windham County.”
Gould said he’s been working toward expansion for a long time, but he’s not sure he would have bought his new building this year if not for the Windham County Economic Development Program.
“This is a program that helped a business take a risk,” he said. “It’s not a handout.”