Comments to Business & Non-profit Leaders at Lake Champlain Chamber

I’ll start with a question: How is it that a small state with a $5B budget, half of which is for the social safety net, a philanthropic community that contributes $275M to the non-profit-sector for community reinvestment and a business community that spends significant time and money addressing shared socio-economic problems cannot together substantially eliminate our 70,000 poor, our 1500 homeless, our 83,000 hungry, our 21,000 medically uninsured, and 20,000 unemployed? If we were to assume that 25,000 Vermonters are in extremis and divide that number into $3B we get $120,000 per Vermonter in need. Where is this money going and why is our progress so incremental?

I would suggest that, with the best of intentions, we simply don’t know what we’re doing, how we’re doing it, what results we’re achieving at what cost, or how we’re measuring success or failure. There’s lots of buzz around results-based accountability but do we have a common understanding of how to implement it and a common commitment to apply it across the three sectors?

Much of our problem is cultural. The State, the non-profit sector and business look at challenges very differently.

The State is more responsive to politics and public opinion and tends to evade budget detail, measure results their own way, react rather than plan, and is often beset with the political challenge of choosing competent leaders and dealing with management failures.

The non-profit sector is divided into organizations that are both mission-driven and ego-driven. Some still compete rather than collaborate on shared missions. Too many are careless about good governance, putting their revenue sources at risk. For the most part, I believe this sector delivers on mission more cost-efficiently than government but it lacks the weight of law and the power of tax dollars. It has only the much-discussed tax deductibility of charitable giving to generate revenue.

By way of example, do we know objectively who helps “at-risk” kids better: The Agency of Human Services (AHS), The Burlington Boys and Girls Club, or Laraway Youth Services?  Until we know this and share objective outcome metrics, we will continue to waste our investment in people. Another key element of this will be implementing in AHS a cost-efficient decision logic that determines whether AHS contracts to other sectors for services or tries to meet challenges themselves.

The larger issue for me is that we are generally navigating over the stern and too often arguing over small fixes. We must look over the bow at oncoming trends and challenges and plan ahead for inevitable change.

I will highlight a few.

Like the rest of the world Vermont is urbanizing. We were overseas a few weeks ago and were surprised to see ads offering whole empty villages in Spain and Italy for sale for less than the price of a London flat. The migration crisis provides further evidence. Vermont’s urbanization is less extreme but real nonetheless. Our tiny population – less than El Paso, Texas – appears relatively stable, but most growth is in Chittenden County. Rural counties and Rutland, our second biggest city, are either just holding their own or losing population. Rutland is projected to lose 12% between 2010 and 2030.

Our population is ageing, the fastest growing age cohort is 75-79. Increasingly, we will struggle to afford housing, sustenance, and health care for many in that population who can’t afford their retirements. Vermont and New England in general, have one of the lowest birth rates in the nation at 10.5 per 1000 live births. The national average is 14.3 and the high is 21 per 1000.

Retail commerce is migrating up and out. Sixty years ago, Morrisville, where I grew up, had a thriving downtown with two department stores, two movie theaters, three drug stores, and a hardware, appliance and jewelry store. Its sidewalks were bustling with people. That picture is very different today. We drove the two hours to Burlington twice a year to buy what we couldn’t in Morrisville. Today the big-box stores in Williston and even the outlets in Manchester are struggling, as increasingly they become mere showrooms for online purchases.

We are nearing the top of the charts on a per-capita basis for states plagued with opiate addiction and, like the rest of the nation, we are over-incarcerating our citizens. We are clearly at a loss as to how to parse the burgeoning challenge of addiction, incarceration, and inadequate recovery and mental health facilities. As deteriorating social and economic conditions inflate mental health statistics, we’re struggling with the infrastructure and maintenance costs of offering mental health care rather than merely free-ranging or jailing this fragile population. We are taking important steps to address these issues but the cost to 320,000 Vermont income-tax filers and philanthropists will be daunting.

Is our $80,000 per woman/per year a good investment to lock up generally non-violent women who have committed property crimes or fallen prey to drugs in over-crowded cells in So. Burlington the best use of our money when we must then consign their children to state care? What if we were to shift half of our $130M incarceration budget into mental health and addiction treatment and recovery? Our mission must be return offenders, addicts and the mentally ill to productive roles in society where possible as well as to protect the public from violent offenders. Our average price to incarcerate is about $48,000 per prisoner per year. Is that the best use of our socio economic investment?

You will note that not one of concerns I mention is unique to our state, these are changes affecting the nation if not the world.

This raises the difficult issue of the art-of-the-possible. Over what challenges do we have some control and what must we simply plan for and accommodate? We revere our Vermont myths and exceptionalism but in reality we will continue to be buffeted by winds of change from all over the globe.

The good news is we can still talk with civility to one another, we have clean air and open spaces, a good, if sometimes inequitable, educational system and a committed workforce.

We must find better ways, however, to deploy our resources. Part of that will be talking across sectors with a focus on transparency, measurement and organizational accountability. We have no choice but to collaborate. Competition in this case is too expensive. We must agree on priorities, outcomes, measurements and commit to working together across sectors to maximize our investment in Vermonters.