IBM sale to GlobalFoundries
Months of rumors proved true in October when International Business Machines announced a deal to unload its semiconductor business, including the roughly five-decades-old manufacturing plant in Essex Junction. The news, accompanied by the message that new owner GlobalFoundries intended to keep the Vermont site operational, gave way for a collective sigh of relief: With about 4,000 employees IBM remains the state’s largest commercial employer and the backbone of Chittenden County’s economy. IBM essentially paid a competitor about $1.5 billion to take the resource-intensive division off its books. The new owner GlobalFoundries indicated no imminent changes were in store in Essex Junction, but the Emirati-owned firm also made no long-term promises.
Revenue downgrade, budget rescission and still more cuts to come
In late March, with less than two months left in the legislative session, administration officials and some lawmakers were wondering about what to do with the revenue surplus they expected at the end of June, when the fiscal year ended. By May, just days before Vermont’s $5.5 billion state budget would be finalized, state officials were scrambling to make up a shortfall.
The momentum changed when personal income tax revenue came in far below par in April, a trend that’s continued every month since. In August, lawmakers approved $31.3 million in budget cuts after the state’s revenue forecast was officially downgraded. The rescission hit hardest in the Agency of Human Services, which comprises about one-third of the state’s total spending. And still more budget cuts are on the table, as personal income tax receipts have dropped below the new downgraded forecast.
Jobs in Vermont
Everybody talks about jobs — especially in a campaign year. In 2014, VTDigger showed looked at where Vermont’s jobs are, how much they pay and how they’ve changed. Our series of interactive data visualizations harnessed more than a decade’s worth of employment and unemployment data to compare counties and job sectors and how Vermont’s unemployment ratings stack up to other states around the country.
We found trends and surprises in the process, including this July data analysis that shows how Vermonters’ reliance part-time work cast a shadow over low unemployment rates.
EB-5 is big business in Vermont, and 2014 was a big year for EB-5. The federal immigration program provides conditional visas and eventually green cards for foreigners whose U.S. investments spur stateside job creation. Owners of the Northeast Kingdom’s Jay Peak ski resort have leveraged the program more than any business in Northern New England, but their momentum was knocked off-course in the summer.
As VTDigger reported, word got out that Ariel Quiros had essentially bought out the investments of Jay Peak’s first EB-5 investors with an IOU — without their knowledge. Quiros and resort officials said the transaction was in the investors’ best interest, and state officials maintained it was entirely legal. But disillusioned investors came forward, questioning the state’s accountability and saying they felt betrayed.
And Jay Peak’s planned development in downtown Newport suffered a blow, when real estate tycoon Antonio Pomerleau cut off negotiations for a key piece of waterfront property. But 2014 also brought some good news for the resort’s business expansions. Ground was broken on a new hotel at Jay Peak’s sister ski area, Q Burke Mountain. And a pending biotech campus in Newport won a key federal approval it needed to move forward.
Near the end of 2014, striking FairPoint workers and company executives remain at loggerheads. About 2,000 union members throughout Northern New England walked off their jobs on Oct. 17, and neither side appears willing to budge. Meanwhile state officials negotiated a complex relationship with the North Carolina-based telecommunications firm, which took over Verizon’s land lines in 2007. FairPoint won a five-year contract to manage Vermont’s E-911 system, but weeks later the company was blamed for a six-hour outage that left at least 45 people unable to reach 911. Ongoing service delays also have prompted an investigation by the Public Service Board.
Burlington city officials sealed a deal in 2014 to side-step a $33.5 million lawsuit that has plagued the city — and its credit rating — for years. Citibank agreed to settle for one-third of the money it was owed by Burlington Telecom, Mayor Miro Weinberger announced in February. The city is getting out of the public telecommunications business through a series of transactions, including an interim sale of BT to local businessman Trey Pecor.