Vermont Employment Growth Incentive

The State of Vermont offers an economic incentive program for business recruitment, growth and expansion. The Vermont Employment Growth Incentive (VEGI) program can provide a cash payment, based on the revenue return generated to the State by prospective qualifying job and payroll creation and capital investments, to businesses that have been authorized to earn the incentive and who then meet performance targets. Vermont also offers property tax stabilization and property tax allocation programs as further incentives to offset Vermont’s statewide property tax.

The VEGI program and the property tax programs are intended to provide incentives from the State of Vermont to businesses to encourage prospective economic activity in Vermont that is beyond the applicant’s “organic” or background growth and that would not occur, would not occur in Vermont, or would occur in a significantly different and less desirable manner, except for the incentive provided. The economic activity can be generated by a Vermont company or a Vermont division which plans to grow and expand, a company that is considering Vermont to locate a new business or division, or start-up business activity. Once authorized, the incentives can only be earned and installments paid if targets are met and maintained. Authorization for any of these programs occurs through application to the Vermont Economic Progress Council, who must determine if the company and project meet statutory requirements, including:

• Whether the proposed economic activity would not occur or would occur in a significantly different and significantly less desirable manner except for an incentive (But For).
• Whether the proposed economic activity will generate more incremental revenue for the state than is paid out by the incentive (cost-benefit modeling).
• Whether the company and economic activity meet a set of “quality control” guidelines.

If a company is authorized, the total amount of incentive available is determined by a cost-benefit model analysis that determines the revenue benefits and costs to the State based on the “qualifying” jobs, payroll, and capital investment projected by the applicant, for up to five years following approval. Only new, qualifying jobs (non-owner, full-time, permanent, paying at least 60% above the Vermont minimum wage at the time of application) will be considered qualifying jobs and only the payroll for those jobs will be considered qualifying payroll. Only capital investments that occur because of the incentive are considered qualifying capital investments. Annual targets, set by the applicant’s projections, must be met and maintained to earn and receive VEGI incentive installments and/or continue a property tax incentive.

IT IS VERY IMPORTANT THAT YOU UNDERSTAND THE VEGI PROGRAM BEFORE APPLYING. READ THE PROGRAM INFORMATION, APPLICATION INSTRUCTIONS, AND RULES BEFORE FILLING OUT AND FILING AN APPLICATION. APPLICATION INSTRUCTIONS MUST BE FOLLOWED OR THE APPLICATION WILL NOT BE ACCEPTED.