Capstone and partner agencies ask Vermont House committee for larger, steady funding for financial coaching, micro-business and tax-assistance programs

Representatives of Capstone Community Action and other Vermont community action agencies told the Vermont House Committee on Commerce & Economic Development on Feb. 18 that state funding for financial coaching, micro-business development and Volunteer Income Tax Assistance (VITA) is insufficient and unevenly distributed across the state.

Capstone director Liz Sharp urged lawmakers to increase the line-item funding that supports financial coaching and related services, saying current state support is roughly $34,000 per agency and that the statewide network is asking for $1,650,000 for the three programs combined in FY26.

The ask, Sharp said, represents a $593,000 increase over fiscal year 2025, with about $358,000 of the increase earmarked for financial coaching so agencies can hire full-time coaches without relying on fragile philanthropic dollars. "the amount of money that we get from the state for this program is about $34,000 per agency that we're currently getting to fund this program," Sharp said.

Nut graf: The testimony framed the request as an investment in basic financial stability and small-business creation for low- and moderate-income Vermonters. Sharp and financial counselor Rosie Manning Gray described one-on-one coaching, classes on savings and fraud prevention, credit-builder partnerships with local banks, and microbusiness training as interventions that help clients secure housing, reduce debt and start businesses.

Details and evidence presented - Financial coaching and workshops reached 858 unique people statewide (state fiscal year reporting), according to the presenters; Capstone and CDOEO reported higher caseloads than some rural agencies. - Capstone described historical private grants (including multi-year gifts from the Northfield Savings Bank Foundation and a private family foundation) that helped scale services but said such philanthropy has declined. - Micro Business Development Program (MBDP) statewide figures given in testimony: just under 700 unduplicated participants; 73 business startups; 53 business expansions; 60 full-time-equivalent jobs created; and about $700,000 in leveraged capital (primarily owner equity and grants). - VITA results cited for tax year 2024: roughly $4.6 million in tax returns secured for clients, including about $2.4 million in refundable tax credits.

Committee discussion and concerns Committee members pressed for clarity on how a larger appropriation would be distributed among the five community action agencies and noted uneven capacity across agencies. Matthew DeRobe, a staff member working with the Marketing Action Partnership at the Statehouse, told the committee that the governor's budget recommendation had the financial coaching line level-funded. "the financial coaching is level funded," DeRobe said during questioning; testimony cited a governor's figure of about $107,300 total (roughly $34,000 per agency under current distribution).

One committee member, who identified herself as Edie, raised the question of efficiency and consolidation: "it's 5 organizations doing the same work across the state. ... it could be done more efficiently," she said. Sharp and other witnesses said the five-agency network reflects Vermont's geography and local service needs but acknowledged uneven grant-writing and administrative capacity among the agencies; they described mentoring and regular coordination across agencies to build capacity.

Program mechanics and examples Rosie Manning Gray described coaching topics and methods used in Capstone's program: debt and credit counseling, matched saving pilots, multi-week classes and a paid-to-save program for Head Start families. "start with $5," Manning Gray told the committee as an example of introductory savings coaching.

Sharp gave examples of client outcomes tied to coaching: raising a credit score sufficiently to become "renter ready," helping clients exit student-loan default into affordable payment plans, and assisting some clients who were unhoused to secure housing after targeted interventions and coordination with housing teams.

Next steps and follow-up Witnesses told the committee they would provide additional budget-distribution detail on how FY26 request funds would be allocated across the five agencies. Sharp said she would send a snapshot showing current funding by agency and what each would receive if the full request were approved. Committee members asked for data on program reach and on businesses that started with agency assistance and later failed or persisted; Capstone staff said they will follow up with additional reporting.

Ending No formal vote or committee action occurred during the hearing. Committee members left the session with requests for more granular allocation data; lawmakers will consider the testimony as part of the larger budget process. Capstone and partner agencies urged the committee to weigh the request as an investment in household stability and small-business formation in Vermont.