By Hilary Niles, vtdigger.org: http://vtdigger.org/2013/06/17/nek-today-and-tomorrow-development-drives-discussion/
Bill Stenger found more money than he knew what to do with when he started developing the year-round water park that opened at Jay Peak in 2011. So he dreamed up a new idea — a much bigger one that’s unfolding at a rapid clip before his very eyes.
Stenger choked back tears Saturday morning at Lake Region Union High School in Orleans as he concluded his presentation to local community leaders on the Northeast Kingdom Economic Development Initiative. The $600 million project includes five developments in Jay, Newport and Burke, and is expected to create or preserve 10,000 jobs.
The 110 to 120 people in attendance were like a “who’s who” of the Northeast Kingdom, said Tracy Zschau, the Vermont Land Trust’s Northeast Kingdom regional director.
But Charlie Browne, executive director of the Fairbanks Museum, underscored that those in attendance were “surrounded by people who live in dire poverty without even the resources to participate in this type of activity.”
“Every socio-economic metric is more challenging in the Northeast Kingdom,” Stenger said. The poverty and attendant issues caused by a weak economy are fueling his drive to bring this dream to life. “This is not about the money for me,” he said several times. “It’s about the opportunities for the community these economic outcomes create.”
The message of opportunity from presenters was clear: Lawrence Miller, secretary of Vermont’s Agency of Commerce and Community Development, underscored that Gov. Peter Shumlin, who was not in attendance, “wants to be sure that growth happens in a way that is for the Kingdom, not to the Kingdom.” Patricia Sears, executive director of the Newport City Renaissance Corp., challenged audience members to lead by taking risks and “have the guts to back your insights.” Katherine Sims, founder and executive director of Green Mountain Farm-to-School, envisioned a new economy in the Northeast Kingdom built on local materials, foods and arts. Grant Spates, member of the Derby Selectboard and president of the general contracting firm Spates Construction, relished the sight of construction trucks traveling from Burlington to the Kingdom instead of the other way around as they did when he started his career years ago.
And many audience members responded in kind, voicing their own hopes and wishes for strong village centers, livable wages, better public transportation, preservation of open land, more housing options, new business opportunities, improved education.
Beneath the hope, however, and behind the audience’s questions, lay some fears. Will the planned development bring opportunities to all, or a select few? And will a higher standard of living come at the cost of quality of life?
The summit, called NEK Today and Tomorrow, was a project of the Northeastern Development Association and Vermont Council on Rural Development. It was intended as a first step, bringing together stakeholders to map out a vision for the Northeast Kingdom’s future. Whether or not all those visions will line up, and which versions of hope the development plans and attendant policies are crafted to engender, remains to be seen.
Genesis of a dream
The Northeast Kingdom Economic Development Initiative is not so much one single project, but a set of five developments. It’s funded by the federal Immigrant Investor Program, better known as “EB-5,” whereby would-be immigrants invest $500,000 to $1 million in a commercial enterprise that will create or preserve at least 10 full-time jobs within two years.
Miller credited Stenger’s passion as the initiative’s most crucial ingredient, secondary even to the financial capital it requires.
Stenger, in turn, downplayed the role of money as his motivator. Nonetheless, the development initiative clearly was conceived in response to the swift flow of dollars through the EB-5 program.
Stenger tapped into EB-5 funds through Vermont’s Regional Center to fund Jay Peak’s water park. He told the audience Saturday that if he had pursued private financing for the $20 million project, he only could have borrowed 50 percent to 60 percent of the needed capital. He would have had to produce the last $8 million himself. With EB-5 funds, on the other hand, Stenger not only funded the entire capital investment without having to invest his own equity: He did it without having to acquire debt.
“You can compete in a special way when you’re not under the gun of a mortgage,” Stenger said. Hence, one advantage of EB-5.
And there appears to be no shortage of funds. Stenger recognized a choice when he saw that EB-5 capital still would be flowing even after his project was complete: “Do we turn out the light, pull down the shade and let the EB-5 capital go to any of the 38 other states with regional centers?” His answer was “no.” Hence, the Northeast Kingdom Economic Development Initiative.
It includes a wholesale renovation of downtown and waterfront Newport on Lake Memphremagog, major expansions and conference center construction at Burke Mountain, co-location of the Korean biotech firm AnC Bio to a new biomedical research park at Jay Peak, and leasing 40,000 square feet of that space to Menck Window Systems to establish the German company’s North American headquarters in Vermont.
From Miller’s perspective, the fact that the proposal is a set of projects rather than a single investment is part of its promise. He also likes that it’s geographically widespread, and diversified across multiple business sectors.
Stenger described the NEK initiative as reflecting a “TEAM Economy” comprised of Travel, Education, Agriculture and Manufacturing. Housing and health care, he reiterated many times, complete the picture of opportunity he hopes to paint on the Northeast Kingdom through development.
For more information
After about an hour of presentations by Stenger, Miller, Sears, Sims and Spates, the panel took questions from the audience for nearly another hour. The third part of the morning was spent in work groups organized by the predetermined topics of housing, education, tourism and the working landscape.
Following are primary action items reported back to the full audience by each work group. The summit organizers are collating all notes from the work group sessions into a report for distribution to attendees. Additional meetings will be organized either regionally or topically for further discussion and planning.
For more information on the summit and related planning, contact the Vermont Council on Rural Development at 802-223-6091 or [email protected].
1. Produce an assessment of the current housing stock and needs that gets “below the surface.”
2. Develop housing choices “for everyone” not just with affordable up-front costs but also with realistic energy and transportation costs.
3. Increase technical assistance to towns regarding zoning, and assist towns with building the capacity to implement these zoning plans.
1. Develop a strategic plan for transformation that includes not just educators, business leaders and community members but also families, who are in a unique position to know what is needed.
2. Collect and analyze data to better understand how education can meet cultural needs.
3. Positive PR regarding the Kingdom to convey that the pay scale may be low, but the quality of life is high.
4. Prepare students for participation in a global society.
1. Focus marketing on the unique character and cultural resources of the Northeast Kingdom.
2. Identify the “risk points” of overdevelopment in an effort to preserve the culture.
3. Open lines of communication with the U.S. Customs and Border Patrol to help make the border friendly and swift while still allowing agents the time and attention they need to keep the border safe.
1. Find and leverage access to capital for forestry and agricultural businesses.
2. Develop a coherent and unique Northeast Kingdom land ethic and vision to drive growth policy.
3. Work with other sectors of the TEAM partnership to develop the local food economy and agricultural support services.