House panel hears $500,000 transfer for cannabis equity grants and update on Business Emergency Gap Assistance Program

Brett Long, deputy commissioner of the Department of Economic Development, told the House Appropriations Committee that language in the proposed Budget Adjustment Act would move a $500,000 appropriation tied to cannabis social equity grants from the administrative section of the Agency of Commerce and Community Development to the Department of Economic Development.

"We are the recipients of funds that ... provide grants to cannabis people interested in cannabis business or pursuing a cannabis business, that have a social equity issue," Long said, describing the proposed transfer of spending authority from ACCD administration to DED. He said the change is largely administrative and aligns the appropriation with the office that manages and disperses the grants. Committee staff and members referenced the draft language and located it near section 60 of the proposed budget adjustment documents; no committee vote was recorded at the hearing.

Lindsey (Lucy) Kerley, secretary of the Agency of Commerce and Community Development, confirmed the committee's understanding and said the newly appropriated $500,000 had not yet been spent. "The first tranche of money is just being finally spent down. So we're about to start spending this next appropriation," Kerley said, adding that the agency will seek to move the appropriation cleanly to DED because ordinary intra‑agency transfers are limited to small amounts.

Long and Kerley then described the Business Emergency Gap Assistance Program (BGAP), a program of grants for businesses, farms, landlords and nonprofit organizations that suffered physical damage in Vermont's 2023 and 2024 flooding events. Key program points the committee recorded:

- Eligibility is limited to physical damage at a Vermont location; applicants must intend to reopen at the same or a relocated site. Nonprofits that are eligible for FEMA assistance are generally excluded. Awards cover net uncovered damage (damage less insurance proceeds, other grants or donations).

- Award limits and recent program totals: the earlier 2023 program (BGAP 1.0) was funded with $20 million plus about $436,000 from related license‑plate and sock sales, produced roughly 560 awards with an average award around $36,000. The 2024 program (BGAP 2.0) was appropriated $7 million (plus a separate $5 million top‑up to address remaining 2023 needs); DED reported about 139 awards totaling roughly $4 million with an average award around $25,000. Award caps differ by tranche: an applicant may receive up to 30% of net uncovered damage capped at $50,000 in the 2023 tranche, and awards in the 2024 tranche may go up to $100,000 in some cases.

- Equity and set‑asides: provisos required that 40% of certain funds be set aside for agricultural businesses until a specified date and 10% be reserved for BIPOC applicants.

- Administration and monitoring: Central Vermont Economic Development Corporation provides technical assistance for applications. Awardees must submit progress reports and DED is conducting monitoring; if recipients cannot substantiate that funds were used to repair or reopen as certified, DED said it will pursue clawbacks and repayments.

Long and Kerley said a small number of applicants either withdrew or were later found ineligible because insurance proceeds, subsequent sales of property, or other changes removed eligibility. The department expects to complete pro‑rata supplemental payments to eligible 2023 applicants from remaining funds in the coming weeks.

Committee members asked clarifying questions about eligibility, whether awards are upfront grants (they are), caps, and clawback processes. No formal committee vote on the language was recorded in the transcript of the Jan. 22 hearing.