While Vermont families and businesses continue to struggle during this economic recession, our state must prepare itself for an eventual, albeit unfamiliar, recovery.  But, this cannot be done in a casual way in which we do what we've always done and hope for the best.  Rather, it must be a focused, determined, and thoughtful approach to encouraging private sector job growth.  Most importantly, it must be our number one priority.

Vermont has a great many assets at its disposal that lend themselves to job creation and prosperity, including a creative and hard-working people and a natural environment in which many would love to live, work, and raise a family.  However, our state also has signficant challenges, and this is clearly evident by our modest economy - modest even in the boom times.

From our relatively high (and overly complex) tax code and our unpredicatble regulatory processes, to the two extremely risky endeavors of creating a single-payer health care program and a long-term energy plan in which the sole focus is on the development of very expensive renewable energy sources, with virtually no consideration of cost and reliability.

It is time to rethink our state's mission and to eliminate the barriers to job creation.  It's time to strengthen our educational system to provide more and better opportunities for our children; to reinvest in our manufacturing sector; to significantly increase our tourism efforts; and to open our state to new, entrepreneurial activity.  We must encourage our businesses to succeed, rather than challenging them to survive. 

Manufacturing - While many in Vermont seem to have given up on manufacturing, manufacturing is the largest sector of our economy.  Not only should we not give up on it, but it is clear from our current manufacturers that there are things that, if done, would produce growth in the sector.  While we may never compete with the likes of China and Costa Rica, we can compete with our neighbors and states throughout the country.

First, we must have an extraordinary focus on in-state manufacturing.  Taking a proposal from the long-time Director of the Vermont Manufacturing Extension Center, I proposed last year (and will again in 2012) the creation of a Division of Manufacturing within our Agency of Commerce and Community Development, using existing personnel.  This person's sole focus would be on our state's current manufacturers and on bringing additional ones into the state.  No other state in New England has this kind of resource, and it would go a long way to ensure manufacturers throughout the country know we are committed to the sector.

Second, we must change the corporate income tax structure for exporters to a "Single Sales Factor."  This proposal would modify the current apportionment formula for the corporate income tax from the current mixture of property, payroll, and the double weighting of sales, to one based on the sales of a Vermont corporation.  I also proposed this last session, and will do so again in 2012.

Tourism - The tourism sector of our economy has been one bright spot throughout the last few years.  While it certainly has had its struggles, as anybody in the industry will tell you, the overall performance has been steady.  Bi-partisan support for state funding of tourism and marketing has helped the industry weather the storm, though more can always be done.

One critical development for this upcoming winter season is the agreement with Canadian airline, Porter Air, to start a non-stop service route between Burlington and Toronto.  While the idea had been explored in the past, it was never brought to fruition, so as Chair of the House Tourism Caucus, I brought the proposal back to the forefront in January 2011.  Throughout the winter and spring, I continued to reach out to Porter and others with knowledge of the Toronto business community.  Then, this summer the Vermont Department of Tourism and Marketing and the Vermont Ski Areas Association, along with many individuals, worked diligently to make it happen.

While the current commitment is a Thursday/Sunday route from December 15, 2011 - April 8, 2012, the hope is that it will be successful and routes will continue to increase.  Ultimately, this development would not only benefit our tourism industry, but could be a key component to additional economic opportunities.

Independent Contractors - Throughout the last two years, a significant number of problems have arisen with regard to the interpretation by the Vermont Department of Labor of employers and employees, specifically when considering worker's compensation and unemployment insurance coverage. For that reason, Rep. Chip Conquest (D-Newbury) and I began working together to try to address some of these critical issues.

While I introduced a bill early in the 2011 session, H. 247, that would provide for a common definition for worker's compensation and unemployment insurance with regard to employees, it is clear that this effort is going to be a longer process than I had hoped.

In the meantime, therefore, Rep. Conquest and I have been working with employers, independent contractors and the Department of Labor to see if there are ways to move the discussion forward. As part of this process we have held numerous meetings and have had countless conversations with the Department of Labor, Vermont employers, and independent contractors, the goals of which were to find consensus on three items: 1) that there is a role for independent contractors in Vermont and that they are an important sector of our economy; 2) that there is a problem being experienced by Vermonters right now in this regard that needs to be address; and 3) that if legislation is needed to resolve the issues, it will be completed by the end of the 2012 legislative session.

Given the difficulty of the issue, the final goal might be considered ambitious, but it is clear that something needs to be done. Rep. Conquest and I both believe that we can find common ground and ensure there is a clearly defined path for independent contractors to work and for employers to hire independent contractors in Vermont.