BRATTLEBORO — On April 30, Mike Pieciak, head of the Vermont Department of Financial Regulation (DFR), announced he was stepping down from the post “to pursue other opportunities.”
At the time, Pieciak, a 38-year-old Brattleboro native who now lives in Winooski, wasn't saying what those opportunities might be. All became clear on May 6, when he announced he was running for the Democratic Party nomination for state treasurer.
With the departure of longtime state treasurer Beth Pearce, who announced two days earlier that she was not going to seek another term due to health issues, Pieciak stepped forward.
In an interview with The Commons, Pieciak said it's not that much a stretch to go from running DFR to serving as state treasurer.
“That's what is so appealing [about the treasurer job] from a substantive standpoint,” he said. “There is obviously a political component, because you have to get elected, but it is very much a professional and substantive office.”
“At DFR, we regulate banks, insurance companies, and investment firms,” Pieciak said. “Just through that experience of the past six years, I know the banking industry and the investment industry really well. I think those fundamentals overlap well between DFR and the treasurer's office.”
The special pension task force is one example of that overlap, he said.
Over the past year, Pearce and Pieciak worked together on a major reform proposal to stabilize and continue to fund the state's retirement system. The Legislature passed the reform package in April, and both chambers overrode a veto from Gov. Phil Scott to make the proposal become law.
“I thought it was a really pretty important compromise that was achieved,” Pieciak told Vermont Business Magazine. “And it was really challenging to achieve it, because we were still in the middle of a pandemic.”
Pieciak noted the uncomfortable timing of Vermonters leaning on teachers and state employees who were “asked to do so much during the pandemic,” and then saying, “Now, let's talk about reforming your pensions.”
“It didn't seem like you'd get to any kind of compromise, especially in an election year,” he said. “But there was quite a bit of Covid money in excess revenue, and that helped fill out any sort of compromise. A true compromise was achieved.”
At Pieciak's official announcement of his campaign, Pearce said she was backing him because of his wide financial knowledge and his abilities as a consensus builder.
Pieciak said he knew Pearce would be stepping down but did not want to announce his candidacy until she made her announcement.
Data-driven responses to COVID-19, and the EB-5 scandal
When COVID-19 came to Vermont and the state was organizing its response, Scott was one of the rare governors who understood that science, modeling, and data would be essential for charting a successful course through the disease.
“I realize putting the commissioner of financial regulation in charge of this wouldn't necessarily be the first choice for most, but I knew Mike was the perfect person, who had the necessary skill set and talent to do the job and do it well,” Scott told Vermont Business Magazine.
“From my standpoint, he's exceeded my expectations and the information he's provided, in the hundreds of briefings over the last two years, has helped guide many of the tough decisions we've made,” Scott continued.
Pieciak, along with Scott and Health Commissioner Dr. Mark Levine, regularly appeared in televised briefings to present their findings for Vermont, the Northeast, and the nation.
Drawing upon DFR's data tracking skills, Pieciak's information was used to make decisions about if and when to open Vermont. Within that data, he tracked how many people were in a hospital, how many were in intensive care, and how much of hospital capacity was being used.
Pieciak also tracked travel data. During the first summer of the pandemic in 2020, his color-coded travel map visually communicated which places in the Northeast would be safer to visit.
The state used his data to decide when to open up the travel and tourism industry and allow stores, public buildings and businesses to reopen.
Thanks to Scott's decision to focus on data and science, Vermont had the fewest COVID-19 cases per capita, the lowest number of deaths, and one of the highest rates of vaccination in the country.
Before the pandemic came along, Pieciak was known for his work untangling the complicated web of lies that lay at the heart of the Jay Peak EB-5 pyramid scam.
Ostensibly, foreigners could invest in Vermont projects and get a green card if they created jobs here.
In reality, most of their investment money seems to have been pocketed by the perpetrators, some of whom received prison sentences.
When Pieciak was the deputy commissioner of DFR during the Shumlin administration, he had a central role in the state investigation of the EB-5 scam, and his findings in turn helped the federal Securities and Exchange Commission's investigation.
A post-pandemic landscape with pre-pandemic problems
Pieciak said that, before the pandemic, the major issues that Vermonters said they were most concerned about were the availability and cost of child care, rising housing costs, access to broadband, and trying to keep the economy going with an aging population and shortage of workers to fill many jobs.
“Those issues haven't changed,” he told The Commons, “but housing has emerged as the number one issue.”
“We've made a dent in the demographics issue because of the people who've moved here during the pandemic,” Pieciak said. “But we realized pretty quickly that the state is at full capacity in terms of housing.”
Housing is critical to the economy, “because you can't hire people if they can't find a place to live,” he said. “It's holding back the Vermont economy.”
Climate change is another issue that Pieciak believes will affect all the other concerns of Vermonters.
“We know it's going to impact Vermont, and we are already seeing its effects,” he said, citing agriculture and tourism as being two big segments of the state's economy already experiencing disruptions due to extremes in the weather fueled by climate change.
There has been pressure on the state of Vermont to divest its pension funds from fossil fuel companies. Pearce had resisted that idea during her tenure, but Pieciak said he is keeping an open mind.
“If you just look at it from a financial standpoint, fossil fuels are not going to be good long-term investments,” he said, adding that as Vermont and the rest of the world moves toward a low-carbon economy, fossil fuels such as coal, oil, and natural gas “are going to have a hard time competing” against renewable energy sources.
Vermont's high rating for its state bonds, Pieciak said “is a report card on how well we are doing,” and how Vermont deals all these challenges will determine the health of the state's finances for years to come.
If the state can effectively deal with these issues, he said, it will have no problem achieving its full economic potential.
“And if we reach our full economic potential, we will have no problem with our financial stability in terms of our bond rating,” Pieciak said.
On the campaign trail
Two Republicans briefly entered the race for state treasurer in that party's primary: Londonderry financial analyst Kevin Divney and perennial candidate H. Brooke Paige.
The Vermont Republican Party was backing Divney, but he dropped out of the race last week after he was arrested and charged with driving under the influence after a May 11 motor vehicle accident in Landgrove.
Divney entered a not guilty plea to the charge in Bennington District Court.
That leaves Paige, who is also running for secretary of state, auditor, and attorney general in the Republican Party primary.
Don Schramm is unopposed in the Progressive Party primary.
Despite being unopposed in his party's primary, Pieciak is taking nothing for granted.
“I want to run a hard race,” he said. “It's my first time running for statewide office, and you still have to earn the votes from the people.”
Pieciak, who plans to make a campaign appearance in every town in the state, says the response he had gotten has so far been positive.
“It's important to hear from people, because what they have to say is critical to making policy,” he said.