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Vermont Gov. Peter Shumlin explains why not all of the first year’s allotment of funds from the Windham County Economic Development Program would be awarded during a Dec. 12 news conference at the Brattleboro Municipal Center.

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VY funds, round one: $814,000, and a few lumps of coal

Shumlin admits funding process and expectations need a reboot, projects ‘not transformational enough’

BRATTLEBORO—Gov. Peter Shumlin announced five awards on Dec. 12 in the first round of Windham County Economic Development Program last week.

The news came with sides of sweet and spicy.

The sweet: Five organizations received official word that they’d received a grand total of $814,000 in grants and loans from the Windham County Economic Development Program (WCEDP).

The governor delivered the good news during a press conference in the Selectboard Meeting Room at the Municipal Center.

The spicy: The state awarded just a fraction of the $2 million pot available in this round.

The $5.6 million in proposed projects did not meet the governor’s expectations for job generators.

Or as Shumlin said, all the applications were worthy of WCEDP funding, but “they weren’t transformational enough.”

Shumlin and Commerce Secretary Pat Moulton said the application process and fund program expectations will need a “reboot.”

This left some organizations that thought they would receive funding discovering second hand that their projects had not made the cut.

Of the remaining $1.186 million in this year’s WCEDP, some will go toward legal costs and technical assistance. Most will roll over into 2015.

Monies from the WCEDP are intended to fund economic development projects and job growth in Windham County. As part of an agreement reached with the state last year, Entergy has agreed to give $2 million for five years toward economic development in the county.

Entergy owns the 42-year-old, Vernon-based Vermont Yankee nuclear plant, which is set to cease energy generation on Dec. 29. As the plant enters decommissioning, the money it pumped into the local economy in the form of higher-than-average wages, charitable donations, taxes, and contracts is also expected to cease.

The plant, which in recent months employed more than 600 people from the tri-state region, will be laying off nearly a third of its workers in January.

All in all, it is a tough transition for a county with an already sluggish economy.

Shumlin said the state wants to take a one-time economic benefit and “turn it into real jobs for Windham County folks going forward.” To do this, however, will require revamping the WCEDP.

“I am allocating funds to a limited number of projects that promise job creation and investment in Windham County,” said Shumlin. “The rest of the funding will roll over to the next round and I’ve asked Commerce Secretary Pat Moulton to redesign the application and allocations process.”

The redesign, Shumlin and Moulton said, will aim to attract more loan applications. Any future grant applications will need to “meet specific entrepreneurial economic development objectives.” Namely, creating more jobs at existing businesses or attracting new businesses to the area.

The winners

The following entities walked away with WCEDP funds in this first round:

• The Bellows Falls Area Development Corp., took $300,000 for its Island Redevelopment project designed to revitalize a blighted industrial area. The Island will house a new facility for Chroma Technologies and other businesses, said Rockingham Development Director Francis “Dutch” Walsh.

• The Brattleboro Development Credit Corp., gained $170,000 to develop two initiatives. The first initiative will support continued development of the region’s growing green building sector. The second initiative is developing a Southern Vermont Business Accelerator.

• Sustainable Timber Investment Exchange received $200,000 toward building a hub for training in the green building industry. Eli Gould of Sustainable Timber said that the new facility will also allow for such things as meeting space, a small prototyping space, and a construction area.

• Strolling of the Heifers took $79,000 — contingent on additional information requested by the state — for its annual business plan competition it runs with BDCC.

• The United Way of Windham County benefited by $65,000 — like Strolling, these funds are contingent on additional information — to fund a program called Working Bridges. This program helps employers identify mid- and low-income earning employees’ needs with the goal of keeping people employed.

Shumlin also allocated $25,000 to the Vermont Economic Development Authority to cover potential interest and legal costs of servicing WCEDP loans. Another $25,000 was allocated to the Vermont Small Business Development Center to provide technical assistance to business applicants.

Humbled Shumlin

Audience members noted that a thinner, humbler, and more subdued Shumlin than usually seen in Windham County entered the Selectboard Meeting Room last week.

Shumlin received less than 50 percent of the popular vote in the November elections despite expectations that he would be the clear gubernatorial winner.

Shumlin congratulated the awardees. Yet he also said that many of the applications to the WCEDP fell short of his goals for entrepreneurial activities and job creation.

During the question portion of the press conference, Susan Smallheer of the Rutland Herald asked Shumlin if he had spoken to Entergy about the applications. According to Smallheer, Entergy felt the projects that received awards lacked creativity.

The state started earlier this year developing the application process and funding criteria for the WCEDP earlier this year. Shumlin had repeatedly stated his goal that the monies should fund job growth.

Based on the applications received in the first of what will be many rounds, however, the state believes it needs to “reboot” the program, streamline the application process, and better express its expectations of what type of projects the WCEDP will fund.

“We take a certain amount of responsibility for not messaging this well,” said Moulton of the state, clarifying the program’s expectations.

State employees from the Agency of Commerce and Community Development (ACCD) cautioned throughout the WCEDP development process that the infant program may require restructuring or fine tuning after the first application round.

In an August workshop aimed at preparing potential applicants, Fred Kenney, executive director of the Vermont Economic Progress Council (VEPC), part of the ACCD, advised applicants to be patient. The program will probably change.

Shumlin approved the final list of five awardees. News broke last month that a list of semifinalists had been chosen by the WCEDP team. The organization listed the semifinalists in a set of draft minutes on its website.

Notably missing from Shumlin’s top five were established organizations that had made it to the semifinalist round, such as Brattleboro Memorial Hospital, World Learning, Inc., and Windham & Windsor Housing Trust.

Next steps

The state expects to release its revised WCEDP process in March 2015. The next funding round will open in the summer.

In a press release, Shumlin said that he has tasked Moulton to redesign the awards program along the following guidelines:

• Allocate a specific amount for loans and grants year fiscal year.

• Simplify the application process and accept business loan applications on a rolling basis.

• Help existing businesses and businesses looking to relocate to the region apply for loans.

• Contract with the SBDC to provide skill development or technical assistances to businesses looking to apply.

• Issue a request for proposals for organizations applying for grants.

The RFP will require specific economic development goals and steer potential applicants towards collaborations and funding sources. The grant application deadlines will be longer to give applicants time to partner with other organizations and apply for matching funds.

“I especially appreciate the time and effort of organizations in the region to develop the applications received,” Shumlin said. “Everyone did what they were asked to do. But when I reviewed the applications with my team, I found that most of the proposals didn’t offer the sort of transformational new jobs and economic opportunity we were hoping for, and that they wouldn’t have the desired long-term impact on the region’s economy.”

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Originally published in The Commons issue #285 (Wednesday, December 17, 2014). This story appeared on page A1.

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