State asks Chester, other towns for economic development funds

By Shawn Cunningham
© 2020 Telegraph Publishing LLC

With a request from Vermont to dedicate a portion of the Chester Development Fund to a state-run loan program, the Chester Select Board on Wednesday night turned to Bob Flint of the Springfield Regional Development Corp. to help explain what’s happening.

Bob Flint of Springfield Regional Development explained some of the options possible for using the town’s revolving loan fund for Covid-19 relief.

Flint said that the legislature has not given the Vermont Economic Development Authority the money to roll out an emergency loan program. “The state has reached out to a number of towns trying to float an idea where the towns float a portion of their (revolving loan funds) into a common kitty to lend statewide. That’s moving slow and I’m skeptical that it will get traction for a variety of reasons. Whether you want participate in that is up to you.”

Board chair Arne Jonynas said he is not crazy about putting Chester money into a statewide pool and never seeing any of it used here. Flint told the board that because of the origins of the money (like HUD funding that was disbursed through the state of Vermont), the state is able to just take money from the loan funds of some towns, but not from Chester. Chester’s fund originally came from federal development grants from the 1980s.

“It depends on whether you want to play ball or not,” said Flint.

Flint’s advice – since Chester can use the fund in ways that some towns can’t – is to consider taking a chunk of that to put toward bridge funding for companies in town that won’t jeopardize their position with any federal programs that may involve loan forgiveness.

Flint said that 35 businesses from Chester have reached out to SRDC with questions about grants, loans and other assistance during the pandemic.

He said that the town could set aside a predetermined chunk of money at good terms (such as 5 years at low interest) to lend to local businesses, noting that the town will still be earning something on the money if they get it back. The board and Flint discussed how such money would be lent and how to determine whether businesses were good risks or if they would be lending to businesses that don’t have a chance of surviving.

Board member Heather Chase said she found using the revolving fund now ‘kind of daunting.’ File photo from earlier, non-Covid-19 meeting.

“I don’t want to be negative, but I don’t know how to assess,” said Chase, herself a businessowner. “We want to support businesses, but I don’t know how to assess business’ cash flow, how much debt and other figures. Using that money is kind of daunting right now.”

Flint agreed saying that Chester is a small town but it really isn’t. “There are a lot of really small businesses, so how do you make these judgments?”

“In the end of the day, loan funds are meant to be end-of-the-day funding,” said Flint. “You may want to think about getting creative, but I would caution that you don’t play around with it too much.”

Shovel-ready stimulus measures

Flint said regional development and regional planning authorities are beginning to hear from federal agencies and from the state’s delegation asking for shovel-ready fundable projects for economic development to help jump-start the economy as the shut down ends. He noted that some agencies already have funding for such projects and “there’s more coming.”

Flint asked how communities can position themselves for that to help their local businesses to rebuild. Hance said she has a spreadsheet going.

State doesn’t deem public works employees essential

Town Manager Julie Hance told the board that a directive a state directive came in earlier in the day saying that that public works employees are deemed nonessential and should be sent home. “The only thing they can be working on are high safety risks so a culvert blows out and washes out part of a road or bridge failures, major potholes and we are allowed to have the guys in the graders keep the back roads graded. Those guys are by themselves,” said Hance.

Hance said she has reached out to VTrans to see what qualifies as a public safety risk and whether that includes a failing culvert on Smokeshire Road or a bridge on Route 103.

‘I would think that the time to replace a failing culvert is before it fails, not after,’ said board chair Arne Jonynas Telegraph file photo

“I would think that the time to replace a failing culvert is before it fails, not after,” said Jonynas.

Hance explained that Public Works employees were not labelled as essential employees so it left “a big open vagueness on what is critical and what is not. ” Hance said this is one of the portions of the order that is enforceable.

“Technically, if our guys are out working our police can arrest them,” said Hance. “I’m not going to push too far but it seems that these two projects are a safety risk.”

Hance also said she would be talking with the schools about paying over time as is allowed under the law.

“Currently we are making our final payment at the end of December,” said Hance, noting that the coming tax season may have a lot of delinquencies and that paying monthly ending on June 30 – as is allowed by state law – would give the town an six extra months to collect. 

She noted that with delinquencies, the town may have to do its tax anticipation note earlier – in January or February – and for more money.

Regarding questions of interest and penalties for late taxes, Hance said the town can “play with that” but excusing all interest and penalties beyond a certain point “would be suicidal” for us.

Solar farm’s future, other business

Before the Covid-19 crisis, the board was looking at the possibility of exercising its option to buy the Route 103 solar farm, which it understood was available in 2020. Hance advised the board that the actual date is 2022 and after some discussion, the board decided to look at it and revisit the idea in the future.

Hance also noted that bids are going out for the Public Safety Building and the town is seeing a very positive bidding climate that could result in some very good bids. While that is moving ahead, the gravel project is on hold at Act 250 and will probably remain so.

Board  seeks further work on Town Plan economic chapter

The Select Board held what was to be its second and final hearing on several amendments to the Town Plan to receive public comment ahead of adopting the changes during its regular Select Board meeting.  The board did not object to the chapters on facilities and utilities, education and child care and energy, but when the discussion came to economic development, the board considered a letter from Telegraph publisher Cynthia Prairie.

Telegraph Publisher Cynthia Prairie explains the importance of local news media and high speed internet to economic development at the January meeting Telegraph file photo

Back in January, Prairie had appeared before the board to ask that the chapter on economic development include a mention of the importance of high speed internet to the town and a mention of The Telegraph. Prairie noted that every year it is less common for a community to have a newspaper and that local news outlets are also economic drivers.

The board sent the chapter back to the Planning Commission asking for revisions along those lines. But according to minutes of the commission’s meetings, that panel questioned the idea of naming any business in the document since companies go out of business and that would make the plan seem dated.  In her letter to the board Prairie pointed to NewsBank, Drew’s and Lisai’s as examples of businesses that have longevity in the town.

Jonynas said he didn’t mind mentioning businesses in town – especially the bigger ones and those that have been around for a while.  Heather Chase agreed saying that it is a living document and the names personalize it and make it unique to the town.

“It’s a snapshot about where we are now,” said Jonynas, “I think we should leave those names in there.” Chase called the plan a historical time piece.

“And especially The Chester Telegraph, I think that’s an important part of our economic development,” said Jonynas. “Having a daily newspaper  is a cornerstone of an well-informed public and the health and vitality of our community. The fact that we mention it by name is something we should be proud of. It’s a strong part of economic development because it’s positive to have a resource like that.”

The board sent its thoughts back to the Planning Commission, adjourned the public hearing. It will vote on the Town Plan changes at a later date.

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  1. Angie Tupelo says:

    I’d rather see the funds Chester has available for economic development loans go to directly to small businesses which are in our town and surrounding areas.

    I admit this is entirely selfish of me, because as someone who owns/operates a b&b in Chester I’d hope to qualify for a bridge loan myself. I’ve had little luck with the federal EIDL or PPP programs (as are many other small business owners), and it’s not clear if the new funding for those programs will be enough to help everyone who applied. Even a relatively small loan would make a significant positive impact on my business, and I’m sure for many other very small local businesses.

    I’d understand if the town chose not to create a local loan program, Chase’s concerns about how to asses businesses as loan candidates are reasonable. But the situation we’re experiencing is unlike anything most of us have seen before and non-traditional solutions may be necessary to bridge the gap. Assistance in the form of affordable accessible loans from the Chester Development Fund could make a difference to some (even many) of us, and to how well our town bounces back from this challenging situation.