Editor’s note: This oped is by Hal Cohen, the executive director of the Central Vermont Community Action Council. He writes on behalf of the statewide Micro Business Development Program operated by the Vermont Community Action Programs.
In Challenges for Change, those who deliver state-funded services to Vermonters have been asked to make delivery of these services more efficient and effective, and to achieve certain outcomes and goals. We have been asked to do more with less.
The Micro Business Development Program serves low-income Vermonters by providing them with the assistance and counseling they need to start businesses and become entrepreneurs. With this help, they create their own jobs, and move out of poverty.
Jobs created through tax incentives can cost upwards of $15,000 per job, while Micro Business Development Program-supported jobs ring up at less than $2,700 per job.
There are no outcomes directly related to moving Vermonters out of poverty in the Economic Development section of the Challenges for Change report (March 30, 2010; p. 23), which is perhaps why the Micro Business Development Program financing is cut entirely in the Administration’s proposal. It is also not included as a program outcome in the just-issued requests for proposal for regional economic development centers. However, moving Vermonters from public assistance to self-sufficiency can definitely be considered a positive economic development outcome.
And while the proposal references the need for jobs to be created, it does not specify a cost to create those jobs. Presumably the Challenges process is designed to uncover the ideal costs for Vermont to pay for job creation assistance. We can get a sense of the challenge when we consider that the jobs created through tax incentives can cost upwards of $15,000 per job, while Micro Business Development Program-supported jobs ring up at less than $2,700 per job.
Vermonters receive more than business advice from a Micro Business Development Program counselor – they are screened for social benefit programs, helped with financing, educated in financial literacy. We start with people at the very beginning of their business path, and help them move toward creating a business that provides income. They receive a full range of assistance through our unique approach, integrating human services support with business development.
During the Challenge for Change process, we have been asked to seek efficiencies and ways to partner. The independent evaluation conducted by the University of Vermont’s Center for Rural Studies tells us we are highly efficient already – but we know we could serve more Vermonters with more funding, and potentially reduce our cost per job even further. We partner effectively and well with the organizations serving larger businesses, and it is our goal for our clients to grow large enough to expand beyond the one to five employee limit of “micro.” We consistently refer – and accept referrals.
To suggest that the 830 Vermonters we serve each year could be effectively served by another business program, at no additional cost, is inaccurate at best and disingenuous at worst. And to eliminate state funding for the Micro Business Development Program will limit access to federal and other funding sources. It is a clear statement that Vermont is not interested in giving its low-income entrepreneurs the help they need.
So our response to the Challenge is this: We can do more, with more state investment. We will do less, if our funding is reduced. And Vermont risks doing nothing, if our funding is eliminated.
The facts are not in dispute: the Micro Business Development Program is integrated, statewide, coordinated and efficient. The outcomes are excellent, and the cost per job is low. Vermont citizens receive a dual benefit from their investment in this program: more businesses, more jobs, and fewer Vermonters in poverty. If these are not the outcomes that the government seeks from investment of state dollars, we question the decision, the process, and its goals. We’ve met the challenge of helping low-income Vermonters create their own jobs and move out of poverty; what would you like to change?
