Ep. 5: “State to Main” – Manufacturing Tax Exemption

Ep. 5: "State to Main" - Manufacturing Tax Exemption

“State to Main” is a policy-focused podcast series complementing the widely read weekly legislative newsletter of the same name.

In this episode we welcome Chris Carrigan, Vice President of Business Development for the Vermont Chamber of Commerce, and Julia Birnn Fields, owner of Birnn Chocolates of Vermont, to discuss recent advocacy efforts on the manufacturing tax exemption.

Episodes are available to stream online via Spotify, Apple Podcasts, Soundcloud and on the Vermont Chamber of Commerce website.

“State to Main” is made possible by our sponsor, AT&T.

Ep. 3: “State to Main” – Military Retirement

Ep. 3: "State to Main" - Military Retirement

“State to Main” is a policy-focused podcast series complementing the widely read weekly legislative newsletter of the same name.

The third episode of the series, “Military Retirement,” features Chris Carrigan, Vice President of Business Development for the Vermont Chamber of Commerce, and Steve Gagner, Founder of 14th Star Brewing Company in St. Albans, to discusses the tax on military retirement pay, and veterans in the Vermont workforce.

Episodes are available to stream online via Spotify, Apple Podcasts, Soundcloud and on the Vermont Chamber of Commerce website.

“State to Main” is made possible by our sponsor, AT&T.

Self-Managed Utility Benefits Vermont

Self-Managed Utility Benefits Vermont

GlobalFoundries’ economic impact in Chittenden County and the state is tremendous, and its continued success and growth in Vermont is important to the business community. As one of the state’s largest private employers, GlobalFoundries employs 2,200 Vermonters and generates an additional 5,000 indirect. GlobalFoundries owns 8% of the 12% of global chip manufacturing in the nation, 93% of the smartphone market, and is an emerging leader in the renaissance for United States semiconductor chip manufacturing for the auto industry with a recent partnership with the Ford Motor Company.

To address the challenge of high energy costs, GlobalFoundries has proposed an innovative solution; a forward-thinking self-managed utility (SMU) as a way to cost-effectively and efficiently manage its own energy portfolio and meet its customers’ as well as Vermont’s high carbon reduction standards.

Unfortunately, critics have misrepresented the impacts to Vermont and mischaracterized GlobalFoundries’ intent. The benefits include:

  • GlobalFoundries economic impact in Chittenden County and the state is enormous and its continued growth and success in Vermont is important to all of us.
  • The approval of a Self-Managed Utility is critical for GlobalFoundries to manage its own energy costs, remain competitive nationally and globally, and continue to invest and grow in Vermont.
  • The proposal has minimal impact on ratepayers ꟷ zero in the first year and estimated to be less than 0.27% in any year thereafter.
  • Approval will enable GlobalFoundries to continue to make substantial investments in cutting-edge renewable and carbon-free energy generation projects at their campus in partnership with the University of Vermont and other local businesses.
  • GlobalFoundries Self-Managed Utility will help meet Vermont’s climate goals.

The next step in the process will be before the Public Utility Commission who will rule on GlobalFoundries’ petition to move forward. 

For questions or to learn more, please contact Chris Carrigan.

Removing the Tax on Military Pensions

Removing the Tax on Military Pensions

The Vermont Chamber supports the removal of the State income tax on military pensions. Vermont is one of only four states (CA, VT, VA, Washington, D.C.) that offers no tax relief to military retirees. Removing the tax would serve to recruit and retain a diverse population of military retirees and help address the severe worker shortages for all industries. This is a legislative priority for Vermont Governor Scott, the Vermont National Guard & Veterans Affairs, and the Vermont Chamber of Commerce.

To learn more, please contact Chris Carrigan.

Expanding the Manufacturing Tax Exemption

Expanding the Manufacturing Tax Exemption

The Vermont Chamber supports the expansion of the manufacturing tax exemption, as proposed in H.437, a bill currently in the Senate Committee on Finance. The bill would exempt machinery and equipment used as an essential part of an integrated production operation and all ancillary processes between raw materials and finished goods. The benefits to manufacturers include greater compliance and fewer costly audits, savings to reinvest in workforce recruitment, new machinery and equipment, and updated technology for cybersecurity compliance. Expansion would also serve as an economic development recruitment tool and make Vermont competitive with the thirty-three other states that have similar tax exemptions.

To learn more, please contact Chris Carrigan

State of Manufacturing

State of Manufacturing

Over the past twenty-one months manufacturers have weathered the pandemic and now face several challenges. Supply chain bottlenecks and disruptions have arisen due to a rapid rebound in customer demand for commodities, supplies, materials, and goods. The lack of semiconductor chips, for example, continues to negatively impact the U.S. auto industry. Illustrating the degree of disruption, the price of new vehicles soared 11.1% in 2021.

Fueled by strong consumer demand and shortages of goods amid a snarled supply chain, U.S. inflation hit a four-decade high in December with the Consumer Price Index (CPI) rising by 7%, the highest since 1982 according to the Labor Department. Rising inflation is also outpacing wage growth.

Along with inflation, the world is in an energy crunch and manufacturers are bracing for soaring energy and utility costs. Additionally, and, exacerbated by the Great Retirement, Reshuffle, and Resignation, manufacturers now face worker shortages. Not surprisingly, manufacturer’s sentiment dropped in December according to the Institute for Supply Management.

While supply chain, pricing pressures, and workforce challenges will persist in the new year, new orders for manufactured goods increased 1.6% from October to November, according to the U.S. Census Bureau, supply delivery times improved, and the manufacturing sector overall continues to expand. Sentiment remains strongly optimistic for Q4 and 2022 according to the National Association of Manufacturers.

 

Aviation Tech Center Is an Investment in Vermont’s Future Workforce

Plane in sky
Aviation Tech Center Is an Investment in Vermont’s Future Workforce
Plane in sky
  • The State of Vermont Aerospace and Aviation

Vermont is home to a $2 billion aerospace manufacturing and civil aviation industry. According to the U.S. Economic Impact of Civil Aviation by State Report done in November 2020 by the Federal Aviation Administration, the economic impact of civil aviation alone for the state of Vermont includes:

  • $1.195 billion in economic output
  • $304 million in earnings
  • $644 million in value added
  • 8,917 jobs

Civil aviation represents 2% of Vermont’s gross domestic product (GDP).

Vermont is also home to industry leaders including Beta Technologies, Collins Aerospace, A Raytheon Technologies Company, GE Aviation, General Dynamics, G.S. Precision, and an established, world-class supplier base of small and medium-sized enterprises (SMEs).

  • Pandemic Impact

Paradigm shifts brought about by the pandemic impacted aerospace manufacturing for commercial aviation, as well as global supply chains, moving suppliers to pivot to defense contracting and OEMs and Primes to adapt and innovate. Integrated supply chains are becoming more focused on digitization, cybersecurity compliance, diversification, artificial intelligence, sustainability, and the growing importance of regional supply chains.

At present, we have a severe workforce labor shortage and skills gap in manufacturing, which is being worsened by the “Great Reshuffle, Resignation, and Retirement.” When commercial aviation rebounds in 2023 and 2024, we will need a skilled and trained workforce in aerospace and aviation, including engineers, maintenance, repair, and overhaul (MRO) technicians, assembly and fabrication, cabin crew, and, importantly, pilots. 

  • Manufacturing Our Future Workforce

In support of Governor Phil Scott’s Comprehensive Blueprint for Economic Growth and Make Vermont a Supply Chain Hub and Strengthen Our Relationship with Québec (page 17), we have an opportunity to really put Vermont on the map with the Aerospace Trade Corridor and transform the State into an Aerospace & Aviation Supply Chain Hub by:

  1. Training the next generation workforce, including maintenance, repair, and overhaul (MRO) technicians, manufacturing and assembly, and pilots for both traditional fixed-wing and rotator and electric vertical take-off and landing (eVTOL) and vertical take-off and landing (VTOL) aircraft.
  2. Growing, marketing, and promoting Vermont’s maintenance, repair, and overhaul (MRO) cluster, an important part of Vermont’s $2 billion aerospace manufacturing and civil aviation industry and leverage the 6% aviation sales tax exemption as an economic development recruitment tool for MRO on parts, equipment, and machinery for commercial charter and private aircraft.
  • According to Aviation Week, “over the next ten years, 53,987 aircraft will be delivered, 32,196 aircraft will retire, and the total MRO spend is anticipated to be over $2 trillion.
  1. With the above in place, recruit new aerospace manufacturers to the State just like New York did with Norsk Titanium to the former Plattsburg U.S. Air Force base.
  • How We Get There

To help accomplish this, and, along with other important efforts, the Vermont Chamber of Commerce has partnered with the The Burlington Technical Center to submit a $10 million federal earmark for an Aviation Tech Center filed with U.S. Senator Patrick Senator Leahy.

The Burlington Technical center is an FAA Part 147 approved Aircraft Maintenance Technician School which educates and trains the next generation of aviation technicians in airframe and powerplant, avionics, maintenance, repair, and overhaul.

If secured, and, with this project, Vermont will be able to retain and propel Vermont’s combined $2 billion aerospace and aviation industry forward with graduates ready to apply their relevant, current skills and capabilities with an array of employers, including aircraft manufacturers, such as Beta Technologies, Tier 1,2, and 3 aerospace suppliers, such as G.S. Precision (Tier-1), airlines (major, national, regional, and scheduled), cargo companies, charter operators, such as Boutique Air, flight schools, government agencies (FAA), MRO manufacturers, FAA Part 145 Repair Stations, Vermont Air National Guard, and the Vermont Army National Guard.   

Educating and training the next generation of aviation technicians in airframe and powerplant, avionics, and MRO is an investment in our future workforce and will help address Vermont’s workforce labor shortage and skills gap in civil and commercial aviation and aerospace manufacturing. Graduates will be able to enter careers in commercial, military, government, and private aviation. Graduates will also be able to work in Vermont airport facilities and replace a generation that is on the verge of retirement across the state.    

To learn more, please contact Chris Carrigan at ccarrigan@vtchamber.com.

Highlights From Manufacturing Summit

Highlights From 2021 Manufacturing Summit
At the Vermont Chamber Virtual Manufacturing Summit last month, we hosted 250 B2B participants, 25 OEMs, Primes, and Government Agencies, hosted 400 B2B meetings (representing 100 hours of quality meeting time for buyers, suppliers, and partners), facilitated workforce development with University of Vermont and Vermont Technical College students for jobs and internships, expanded the Aerospace Trade Corridor to Ontario, welcomed international trade delegations from Québec, Ontario, and Canada, and much more
 
Please find additional highlights and results from the Summit below:
  • Expansion of Aerospace Trade Corridor to Ontario

In support of our work to inter-cluster our aerospace and defense industries and provide our participants with access to new markets, contacts, shared best practices, and supply chain innovation and transformation, the Vermont Chamber, in partnership with the Ontario Aerospace Council, signed a new Memorandum of Understanding (MOU) at the recent 2021 Manufacturing Summit and officially expanded the Aerospace Trade Corridor to Ontario’s $6 billion aerospace and defense sector. The MOU will provide the additional framework going forward for collaboration and partnership, which will foster the development of new, cross-border contacts and business opportunities as we reconnect and rebuild our supply chains.

  • Gov. Scott & Sen. Leahy at Vermont Chamber Manufacturing Summit

Governor Phil Scott and Senator Patrick Leahy were featured speakers at our 2021 Manufacturing Summit. Governor Scott discussed challenges presented by the pandemic, how the Vermont Chamber’s Manufacturing Summit benefits participants, and the economic importance of Vermont’s manufacturing industry. Senator Leahy noted the unique and important opportunity that attendees of the Manufacturing Summit had to learn from industry experts, convene, and build their networks.

  • Watch Governor Scott here.
  • Watch Senator Leahy here.
  • Workforce Development with UVM and Vermont Technical College

At our 2021 Manufacturing Summit, we provided important workforce development through partnerships with the University of Vermont College of Engineering and Mathematical Sciences (CEMS) and Vermont Technical College. The Vermont Chamber facilitated 20 interviews for students and soon-to-be graduates in STEM and advanced manufacturing with employer participants for jobs and internship opportunities.

  • Sponsor 2022 Manufacturing Summit

Our Annual 2022 Manufacturing Supply Chain Summit will be in held in September with a confirmed date to soon follow. To join us as a sponsor, please contact Chris Carrigan, (802) 223-0904, ccarrigan@vtchamber.com

Spotlighting HEB Manufacturing

Spotlighting HEB Manufacturing

This month, we are spotlighting Vermont Chamber member HEB Manufacturing.

They specialize in custom Fourslide Wireforms, Press Stamping Components, and Services. Incorporated in 1957 and employing 35 people, they are small enough to maintain a personal relationship with their customers but provide the flexibility of a small business, as well as the equipment, experience, and ability of larger corporations in meeting their customers’ individual requirements.

They have a modern plant of 35,000 square feet and have an ISO 9001 quality certification as well as WBENC certification.

Visit HEB Manufacturing’s website to learn more!

 

Legislature Adjourns After Passing Several Vermont Chamber Priorities

Legislature Adjourns After Passing Several Vermont Chamber Priorities

The Legislature adjourned Friday until October or January after passing bills that address several legislative priorities the Vermont Chamber worked to support over the past five months. A bill with a tranche of economic development proposals, including investments in tourism marketing, foreign trade, technology-based economic development, workforce development, and BIPOC business support was just one result of the session.

Other legislation that made it over the finish line includes additional economic recovery grants, the largest investment in broadband buildout in Vermont history, investments in child care, health care cost savings for businesses, and additional incentives to recruit workers to Vermont. While these actions will benefit the business community, regrettably the Legislature did not meaningfully respond to the reality of overwhelming unmet financial need in the business community as a result of the pandemic. Lawmakers advanced only $30 million in relief grants, despite the Agency of Commerce and Community Development identifying over $500 million in existing known unmet need. The Vermont Chamber’s lobbying team recognizes the challenges the business community has faced over the last 14 months and worked extensively to understand members’ individual policy needs and advocate for legislative outcomes with the goal of ensuring economic recovery and supporting Vermont’s economic future.

The Legislature passed a $7 billion budget that includes many unprecedented investments across state government, including in economic development. Some notable allocations are:

  • $20 million to the Agency of Commerce and Community Development (ACCD) to fund additional economic recovery grants
  • $20 million to Vermont State Colleges for system transformation over the next four years
  • $11 million to ACCD to be used in the same manner as the Brownfield Remediation Fund
  • $800,000 to ACCD for technology-based economic development grants
  • $1.5 million for the Better Places Program
  • $2 million to the Vermont Department of Tourism and Marketing in additional funds, beyond the agency’s regular budget for marketing and regional stimulus
  • $650,000 for additional funds for new and remote worker programs
  • $100,000 for adult CTE scholarships
  • $300,000 for adult CTE program improvements
  • $150,000 to ACCD for outreach and technical support for BIPOC-owned businesses
  • $300,000 to support foreign trade with Canada
  • $900,000 to ACCD to fund the Entrepreneurs’ Seed Capital Fund

Funds for much of the budget rely heavily on resources provided to Vermont in the American Rescue Plan Act of 2021 (ARPA). This massive injection of federal money allowed legislative leaders and the Governor to advance bold proposals that may have otherwise not come to volition for many years.  Please contact Vermont Chamber Government Affairs Director Charles Martin with questions.