Valuing Common Assets for Public Finance in Vermont

Summary

Valuing Common Assets for Public Finance in Vermont (November 2008) is a collection of asset-by-asset valuation studies produced by the Vermont Green Tax and Common Assets Project, a joint effort of the MPA Program and the Gund Institute for Ecological Economics at the University of Vermont, directed by Gary Flomenhoft. The papers were written by eleven students of UVM's Spring 2008 Public Administration 395 class, "Valuing Common Assets for Public Finance in Vermont" (Conor Casey, Jennifer Kenyon, Mark Kolonoski, Ida Kubiszewski, Colin McClung, William Murray, Beth Nolan, Ian Raphael, Ross Saxton, Susan Skalka, and Elliot Wilkinson-Ray), with Flomenhoft and Amos Baehr as instructors/editors; the project's sponsors included the Robert Schalkenbach Foundation, and the report thanks Peter Barnes, David Bollier, and Robert Costanza among others. It was written explicitly for lawmakers: after Senator Hinda Miller introduced S.44, the Vermont Common Assets Trust Fund Bill (drafted by legislative counsel Al Boright and "embodying the principles of Capitalism 3.0"), legislators "requested more information about potential revenue from common assets," and this report is the project's answer.

Its significance for this wiki is twofold. First, it is the pioneering state-level common-asset rent inventory in the United States — the template later followed by Prosper Australia's Total Resource Rents of Australia (2013) and Common Wealth Canada's Natural Common Wealth and Economic Rent in Canada (2023), which cites the Vermont study repeatedly and adopts its land-rent benchmark as one of its comparison rates. Second, it deliberately extends the Alaska Permanent Fund model to a resource-poor state: its premise is that even a state with no oil has substantial rentable commons once land, water, air, spectrum, and socially created assets are counted.

The Core Findings

The report's headline table, "Estimate of Total Revenue Potential from Common Assets in Vermont," tallies total new potential revenue of about $1.229 billion per year — "nearly half of Vermont's 2008 instate revenue of $2.84 billion (Joint Fiscal office)." Distributed "equally to all 623,050 (2005 estimate) Vermont residents, this would amount to $1972 per person annually" — a citizen's dividend about the size of Alaska's. The asset-by-asset estimates of potential new revenue (millions of dollars per year, with the proposed instrument):

* The report classes the stock/commodity markets and the monetary system as socially created common assets, noting that private banks create 93% of the money supply.

The largest single line is land. Conor Casey's chapter argues that property taxes "fail to collect all" of land's economic rent and conflate land with buildings; using the long-term 5% annual growth of median housing prices since 1980 as a proxy for economic rent "would have yielded $1.07 billion in land tax revenue for 2007... a 44% increase over the actual property tax revenue of $740,822,541 for 2007." Casey concludes: "Collecting economic rent from land is a perfectly viable way to fund most, if not all state obligations." The spectrum chapter (Murray) starts from a New America Foundation estimate of the total annual use value of US spectrum at $302 billion, computes Vermont's share at $625 million, subtracts $250 million as normal profit, and proposes annual (instead of one-time) auctions to collect $375 million in rent. The groundwater chapter (McClung with Flomenhoft) — written the year Vermont's legislature extended the public trust doctrine to groundwater — finds that leaving bottlers an 18% net profit margin "would still leave 70% of total revenue or $107.9 million for the people of Vermont." The carbon chapter (Kenyon and Nolan) models expanding the Regional Greenhouse Gas Initiative from power plants to all emissions including transportation and heating: $25.9 million at the then-recent auction price of $3.07/ton, $84.4 million at British Columbia's $10/ton, and $337.6 million at the then-recent European price of $40/ton, paired with a Barnes-style cap-and-dividend rebate. Other chapters cover fish and wildlife (Saxton), forests (Kolonoski), the internet (Kubiszewski), minerals (Raphael, who notes Vermont mining companies pay only surface property taxes — about $3.7 million against $96.8 million of annual mineral extraction), surface water (Wilkinson-Ray, who reports that 93% of surface-water withdrawals are by private companies "without any mandatory compensation," Vermont Yankee alone drawing 421 million gallons per day), and wind (Skalka).

The framing is consciously an Alaska-model and commons-trust argument, drawing on Peter Barnes's Capitalism 3.0: "In terms of its resources, Vermont resembles an economic colony more than a sovereign state" — minerals owned by a foreign corporation, groundwater bottled by out-of-state companies, hydropower owned by TransCanada, 98% of spectrum given away free — while "citizens and businesses are subject to taxation of earned income... while resource owners collect massive amounts of unearned income." The proposed remedy is rent recovery into a common-assets trust (sovereign wealth fund) with dividends: "There is no reason Vermont cannot have a sovereign wealth fund funded by its common assets, as do Alaska, Abu Dhabi, and Norway."

In Flomenhoft's later peer-context restatement of the study — his chapter "Applying the Alaska Model in a Resource-Poor State: The Example of Vermont" in the Widerquist–Howard volume Exporting the Alaska Model (Palgrave Macmillan, 2012, pp. 85–107) — the results are presented as a range: a conservative estimate that Vermont's common assets have a yearly rental value of about $2.01 billion, of which about $790 million is already captured by existing taxes and fees (mainly the land portion of property taxes), leaving ~$1.2 billion of new revenue and the $1,972 dividend ("nearly $8,000 for a family of four — about the same size as Alaska's Permanent Fund Dividend"); and a high estimate of $6.45 billion (28.31% of Vermont's GDP), which "if all of that revenue were devoted to a dividend... could be as large as $10,348" per person per year.

Relation to the Georgist Case

The report is a direct descendant of the Georgist programme, generalized from land to the commons: it proposes "charging economic rent on unearned income from enclosure of 'the commons', and distributing this revenue directly to everyone in society, as done by the Alaska Permanent Fund," and its land chapter is an explicit single-tax revenue calculation. Its distinctive contribution to the land rent could fund a large share of government question is granularity and jurisdictional realism: instead of a national aggregate, it works asset-by-asset within one small, resource-poor state's actual legal setting (public trust doctrine, RGGI membership, an actual bill — S.44 — before the legislature) and still finds uncollected rent equal to nearly half of state own-source revenue, with land alone able to exceed the entire existing property tax. It is also the earliest of the three sister inventories (Vermont 2008 → Australia 2013 → Canada 2023) that together form the modern movement's empirical case that rentable commons are large everywhere, not just in petro-states. And by costing out a per-capita dividend for a state with no oil, it widens the applicability argument for resource-rent dividends beyond Alaska's peculiar endowment — though as an ex-ante estimate it is evidence of potential, not of an operating program.

Nuances and Limits

• This is an advocacy-adjacent student project, not peer review. The chapters were written by MPA/undergraduate students in a single semester, edited by the project director; the report itself says of the estimates: "By no means are these the final word on the value and management of the 'common wealth' of Vermont; they merely begin the conversation..." Individual chapter methods vary widely in rigor. The most defensible use is as an order-of-magnitude inventory and as the methodological ancestor of later inventories, not as precise revenue scores. (The core Vermont analysis did, however, later pass into the peer-reviewed literature: Farley, Costanza, Flomenhoft & Kirk, "The Vermont Common Assets Trust," Ecological Economics 109, 2015.)
• The land-rent proxy is unusual and contestable. Casey's $1.07 billion land figure applies the ~5% long-run median house-price growth rate to statewide land valuation as a stand-in for annual economic rent — a capital-gains-based proxy rather than a rental-value assessment. Common Wealth Canada's Natural Common Wealth paper adopted the same family of method (with explicit caveats) before presenting alternative benchmark rates; assessment-based approaches (e.g., Larson's US land value estimates) can give materially different numbers.
• Some line items stretch the definition of rent. The Tobin-tax ($269M) and seigniorage ($35.7M) items — nearly a quarter of the headline total — tax socially created financial commons, and the internet item rests on defining all ISP/telecom profit above the Fortune-1000 average 7% as rent. A reader who restricts "common assets" to nature would trim the total accordingly; the report is transparent about the classification (the table stars both items).
• Price sensitivity. Several estimates scale directly with assumed prices (carbon at $3.07 vs $40/ton spans $25.9M–$337.6M; wind spans $6.9M–$172.5M), which is why the later book-chapter version reports a low–high range of $2.01B–$6.45B total rental value rather than a point estimate.
• Proposal, not implementation. S.44 did not become law (the VCAT bill was introduced twice without passage), so unlike Alaska the Vermont scheme provides no operating evidence on collection, incidence, or durability.

Bears On

• Outcome: Land rent could fund a large share of government — supports, at state scale: uncollected common-asset rent ≈ 43% of Vermont's in-state revenue on the conservative estimate, with land rent alone 44% above the existing property tax take.
• Outcome: Resource-rent dividends are workable and durable — related (not listed as support): it extends the Alaska dividend model to a resource-poor state as an ex-ante costing ($1,972/person conservatively, up to $10,348 on the high estimate), but contributes no operational evidence.
• Concept: Resource Rents / Economic Rent — a working application of Ricardian rent, broadened to water, spectrum, air, and socially created assets.
• Concept: Citizen's Dividend and Sovereign Wealth Fund — the report's proposed disbursement architecture (a Vermont Common Assets Trust).
• Concept: Land as Commons — the report's framing of enclosure and public trust doctrine is a legal-institutional application of the idea.

See Also

• Gary Flomenhoft — project director and editor
• Total Resource Rents of Australia — the Australian sister inventory (2013)
• Natural Common Wealth and Economic Rent in Canada — the Canadian successor (2023), which cites this study
• Alaska Permanent Fund — the institutional model
• Capitalism 3.0 — the Barnes commons-trust paradigm the project applied
• Alaska's Permanent Fund Dividend: Examining Its Suitability as a Model — the Widerquist–Howard volumes; Flomenhoft's Vermont chapter appears in the Exporting companion

Sources

1. Vermont Green Tax and Common Assets Project (2008), Valuing Common Assets for Public Finance in Vermont, MPA Program and Gund Institute, University of Vermont, November 2008. Director: Gary Flomenhoft; instructors/editors Gary Flomenhoft and Amos Baehr; eleven student authors (PA 395, Spring 2008). UVM PDF — the full report and its executive summary were fetched and read directly for this page; all figures and quotations above (the revenue table, $1.229B total, $1,972 dividend, 623,050 population, $2.84B in-state revenue comparison, and the chapter-level estimates) are verbatim from this text. A copy is also hosted by the Vermont Legislature's Joint Fiscal Office (ljfo.vermont.gov).
2. Gary Flomenhoft (2012), "Applying the Alaska Model in a Resource-Poor State: The Example of Vermont," in Karl Widerquist & Michael W. Howard (eds.), Exporting the Alaska Model: Adapting the Permanent Fund Dividend for Reform around the World, Palgrave Macmillan, pp. 85–107. DOI: 10.1057/9781137031655_6 — author's preprint fetched and read directly; source for the $2.01B conservative / $6.45B (28.31% of GDP) high range and the $10,348 high-end dividend.
3. Farley, J., Costanza, R., Flomenhoft, G., & Kirk, D. (2015), "The Vermont Common Assets Trust: An institution for sustainable, just and efficient resource allocation," Ecological Economics 109, 71–79. DOI: 10.1016/j.ecolecon.2014.10.016 — bibliographic details verified via Crossref; cited as the peer-reviewed continuation of the project (not read in full for this page).
4. Common Wealth Canada (2023), Natural Common Wealth and Economic Rent in Canada — wiki summary — used for the Vermont study's downstream influence (it benchmarks land-rent capture against the Vermont 5% rate and acknowledges Flomenhoft's input).