Could special bonds help pay for Irene damage? - WCAX.COM Local Vermont News, Weather and Sports-

Could special bonds help pay for Irene damage?

November 30, 2011

As Vermont leaders hash out plans to pay for the millions of dollars in damage from Tropical Storm Irene, Chris Frappier hopes they'll look back at the flood of 1927 for ideas. Bonds were used following that storm to help clean up the mess.

"What that did is it reinvented Vermont with money. It created really the beginning of that Vermonters is self-reliant and take care of themselves," said Frappier of Middlebury.

Frappier wants the state to consider allowing taxpayers to invest in "Irene bonds." He says they could be issued in amounts less than $1,000 and would allow folks to have a hands-on role in helping the state rebound.

"The value is that it gives individual Vermonters an investment in their state and a real bond to the state and a feeling of being part of it," Frappier said.

State Treasurer Beth Pearce says Vermont already uses citizen bonds to pay for big projects. Last year they totaled $25 million. She says it's premature to say whether bonding will be used to pay for the storm damage. If it is, citizen bonds would be in the mix.

"As we look at the ultimate costs and the sources of funding, if bonding is necessary, we would certainly do it and incorporate a citizen's bond piece to that," said Pearce, D-Vermont.

Pearce admits there are a number of factors that need to be considered before a new bond program gets a green light. The governor, Legislature and her office will have to take a close look at the fees and administrative costs that come along with them and their impact on taxpayers.

"Ultimately bonds are a debt instrument, and it is essentially the state taking out a loan and we want to make sure we take that loan out in a cost-effective, prudent manner that ultimately serves the taxpayers," Pearce said.

Frappier admits he's no expert when it comes to getting the state back on track after the storm, but argues if there's a way for Vermonters to share in the bill it will send a powerful message nationwide.

"It tells the rest of the nation that we roll up our sleeves and take care of ourselves and this is a place where you want to be, this is a place where you want to invest," Frappier said.

Pearce says it could take a couple of months to hammer out the post-Irene finances and whether bonds could be in the mix.

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