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Capstone and Community Action network urge funding to expand microbusiness support, VITA tax sites and financial counseling
Summary
Capstone Community Action and the statewide Community Action Network told the House Commerce committee that their microbusiness development, Volunteer Income Tax Assistance (VITA) and accredited financial counseling programs serve low-income Vermonters and leverage public and private funds, but are underfunded; they requested increases to sustain
Capstone Community Action and partners from the statewide Community Action Network told the Vermont House Committee on Commerce and Economic Development on Jan. 24 that three economic-development programs — microbusiness development, VITA tax preparation and accredited financial counseling — provide ‘‘ladders out of poverty’’ but need additional and sustained state funding to expand reach.
Liz Sharp, director of community economic development and food security at Capstone, described the network’s work across the state and presented statewide metrics: community action microbusiness counselors helped about 700 Vermonters last year with coaching and workshops, supporting 73 business starts and 53 expansions; the network reported filing more than 5,000 tax returns through VITA; and the microbusiness program has helped more than 2,100 Vermont businesses historically and leveraged roughly $15 million in financing, Sharp said.
“If you are someone who is interested in starting in small business and you were to visit a community action agency, there are income limits,” Sharp told the committee, describing eligibility at about 80% of area median income. She said community action agencies provide hands-on business coaching, workshops and referrals to other supports, and that many clients lack family wealth, access to credit or basic tax filing experience.
Sharp described the VITA program as a long-standing, statewide free tax-preparation service for households up to the IRS threshold used by the program (presenters cited $67,000 adjusted gross income as the income guideline for assistance). The network recently increased staffing and has received state treasurer funding to expand year-round services and outreach.
Sharp also described the Community Action Network’s accredited financial counseling (AFCPE-accredited counselors) used for budgeting, debt-management plans, fraud-prevention education and benefits navigation. She said the network refers clients to nonprofit debt-repayment services (for example, GreenPath) when credit-card debt is high and that counselors help clients set practical plans to avoid bankruptcy when possible.
Funding asks and sustainability: Sharp said the microbusiness base funding is $493,003.35 (as stated in testimony) and that agencies requested an inflationary increase of roughly $87,000. She said the network is also seeking funding to support five full-time accredited financial counselors across agencies and additional support to sustain workforce and weatherization partnerships that had earlier grant support.
Other points raised by speakers: presenters described ‘‘Embrace’’ microgrants created after the COVID relief gap (about $2.5 million disbursed to roughly 460 businesses), the difficulty of tracking long-term survival of businesses, the importance of local training partnerships (for example, Ready, Set, Grow Childcare Center and Northern Lights CCV), and concerns about reduced LIHEAP and other energy-assistance funding that affects weatherization demand and eligibility prioritization.
Committee follow-up and context: Committee members asked for more data and copies of program reports; several members thanked community action presenters and said they would seek budget materials during the upcoming appropriations process. Sharp said she has reports available, including the Embrace report, and offered to provide more data when requested.
Direct quote: Sharp told the committee, “We filed over 5,000 tax returns throughout the network,” underscoring the scale of VITA services. Members asked about outreach and fraud-prevention workshops; Sharp said the program works with the Department of Financial Regulation, banks and the Attorney General’s Office for education and referrals.
The network framed its economic development work as integrated: microbusiness support, tax preparation and personal financial coaching operate together to reduce financial fragility and to move clients into employment and business ownership.
