Industrial revenue bonds in Vermont
Volume cap, active issuers, the local buyer base and the steps to finance a manufacturing, recycling, water or housing project in Vermont with tax-exempt bonds.
State facts verified October 2026Key takeaways
- $397.6M of volume cap in 2026 — the $397.6 million small-state minimum, or $621 per resident against the federal $135; rank 36 of 51 by size.
- 15 Vermont issuer entries appear in SEC-registered fund holdings, $139.9M in total, +$13.3M over the latest quarter (filers report some issuers under more than one name).
- 8 FDIC-insured banks headquartered in the state hold $337.4M of municipal securities — the natural direct purchasers for small issues.
- No single-state municipal fund focuses on this state (single-state funds exist mainly where residents pay state income tax), so placements rely on national high-yield funds, banks and separately managed accounts.
Issuers whose bonds funds already hold
Registered funds’ holdings show which Vermont issuers buyers already know. The tables cover all conduit and private activity issuers in fund holdings — including transportation, housing, nonprofit and pollution-control issuers — so they are context for demand, not a list of issuers that do manufacturing bonds.
| Issuer | Held by funds | Funds | 1 quarter | 4 quarters |
|---|---|---|---|---|
| Vermont Economic Development Authority | $56.3M | 40 | −$276K | +$13.3M |
| Series | Held | Change |
|---|---|---|
| Vermont Economic Development Authority | $56.3M | +$13.3M |
| VERMONT ECONOMIC DEVELOPMENT AUTHORITY | $23.2M | +$1.9M |
| VERMONT ST ECON DEV AUTH SOLID WST DISP REVENUE | $13.5M | −$7.8M |
| VERMONT ECONOMIC DEVELOPMENT AUTHORITY (VT) | $12.2M | +$12.2M |
The local buyer base
Banks
8 FDIC-insured banks are headquartered in Vermont, together holding $337.4M of municipal securities in the latest call reports. Banks often buy small industrial issues outright (direct purchase) or provide letters of credit that let money market funds buy variable-rate bonds.
Funds
National high-yield municipal funds are the core buyers of unrated industrial bonds. No single-state fund focuses on the state.
How Vermont allocates volume cap
Allocating agency: Vermont Emergency Board (apportions the state ceiling under 32 V.S.A. sec. 992), on recommendations from the State Treasurer (sec. 994). 100% of the state ceiling is allocated to the State, and by January 31 each year the Emergency Board apportions it among the issuing authorities, keeping a contingency allocation available to all issuers at its discretion; it may delegate reassignment of unused cap after December 20 to the Governor. The Treasurer, with the Secretaries of Administration and of Commerce and Community Development and eligible issuers, surveys demand each year and makes allocation recommendations to the Board.
Issuer fees. VEDA issuance fee: 0.625% of bond for new Small Issue Manufacturing Bonds; 0.25% for refunding VEDA bonds. These are the issuing authority’s own fees, not a state allocation fee.
| Milestone | Date |
|---|---|
| Treasurer recommendations to Emergency Board on next year's allocation (32 V.S.A. 994) | December 1 (annual) |
| Emergency Board apportions state ceiling (32 V.S.A. 992) | January 31 (annual) |
Issuers that do manufacturing bonds
| Issuer | Type |
|---|---|
| Vermont Economic Development Authority (VEDA) | statewide conduit issuer |
State approvals
Emergency Board apportions Vermont's private activity bond ceiling among issuing authorities by January 31 each year (32 V.S.A. 992), on State Treasurer recommendations due December 1 (32 V.S.A. 994); VEDA Board gives inducement and final approval.
Incentives that commonly stack with the bonds
1 state programme verified on official pages. Eligibility and amounts are set by each programme; the bonds do not confer them.
- IncentiveVermont Employment Growth Incentive (VEGI).
Who to call
Sources: legislature.vermont.gov (1) · legislature.vermont.gov (2) · veda.org (1) · accd.vermont.gov · veda.org (2) · checked October 2026. Procedures and fees change; confirm with the agency and bond counsel.
Not found on an official page yet: state allocation fees; a published figure for cap remaining. We leave these out rather than estimate; ask the allocating agency.
How to finance a project in Vermont
- Confirm eligibility. Manufacturing projects up to $10 million under the small-issue capital expenditure election, or an exempt facility such as solid waste, water or qualified housing. See the guide.
- Choose an issuer. In Vermont, issuers with published industrial bond programs include Vermont Economic Development Authority (see the issuer table above). A county or city industrial development authority, a port authority or a statewide finance authority can serve; the fund-holdings tables are context, not a directory. How to choose an issuer.
- Obtain a declaration of official intent (inducement resolution). Costs paid up to 60 days before it, and any time after, can be reimbursed from bond proceeds (Treas. Reg. §1.150-2).
- Apply for volume cap to the state’s allocating agency, Vermont Emergency Board. Vermont’s 2026 ceiling is $397.6M; allocation is at the state’s discretion, by round, lottery or first-come, and the ceiling is not the amount still available.
- Hold the TEFRA hearing after at least seven days’ public notice (the issuer’s website may be used) and obtain the elected official’s approval. If the issuer sits outside the project’s jurisdiction, an elected official of the host jurisdiction must also approve; approval lapses if bonds are not issued within a year.
- State approvals, documents and closing. Some states add their own steps — attorney general review, court validation or a state commission’s approval. Bond counsel drafts the documents; a bank buys the bonds directly or a placement agent places them with investors.
The order of these steps varies by state: some require the public hearing and local approval before they allocate volume cap.
Questions borrowers ask
Do industrial revenue bonds in Vermont need volume cap?
Most do. Federal law (IRC §146) requires small-issue manufacturing bonds and most exempt-facility bonds to receive an allocation of the state’s annual cap, which for Vermont is $397.6M this year. Governmentally owned airports, docks and solid waste facilities, and qualified 501(c)(3) bonds, do not.
Who issues industrial revenue bonds in Vermont?
Issuers with published industrial bond programs in Vermont include Vermont Economic Development Authority. County and city development authorities, port authorities and statewide finance authorities issue depending on the state, and national conduits can issue with the host jurisdiction’s approval. The allocating agency (Vermont Emergency Board) can confirm who is active.
Who buys Vermont industrial revenue bonds?
National high-yield municipal funds, banks — including the 8 headquartered in the state — insurers and separately managed accounts.
How long does it take?
Typically three to six months from engagement to closing; volume cap rounds and issuer board calendars can add time.
Check whether your project qualifies Read the complete guide
Methodology
Volume cap is the 2026 federal formula — $135 per resident with a $397,625,000 small-state minimum (Rev. Proc. 2025-32) — applied to Census Vintage 2025 population estimates; where a state publishes its own figure, the state’s figure governs. It is the annual ceiling, not the amount still available. Issuer and bond figures are holdings reported by SEC-registered funds on Form N-PORT, classified by Securitief; bank figures are municipal securities in FDIC call reports for banks headquartered in the state.
Important information. Securitief Research is published by Securitief, operated by Applied America. Securitief is not a placement agent or underwriter and does not seek or receive compensation from any financing, including financings of issuers and borrowers discussed here. It is not acting as a municipal advisor and owes no fiduciary duty to any issuer or obligated person unless separately engaged in writing.
This material is general information. It is not tax, legal, investment or municipal advice, a recommendation, or an offer to sell or a solicitation of an offer to buy any security. Offers are made only by offering documents and only where permitted by state securities laws. State allocation procedures change; confirm current rules with the allocating agency and bond counsel.
Sources: SEC Form N-PORT and FDIC call reports (holdings), IRS and Census (volume cap and population), state agency publications. Issuer classification and aggregation are Securitief’s own and may contain matching errors; figures may be revised. No licensed index levels (MMD, BVAL, ICE) or EMMA trade data are used. Past holdings do not indicate future demand, pricing or the availability of financing. Interest on private activity bonds may be subject to the alternative minimum tax; tax treatment depends on the facts and the opinion of bond counsel.