Green’s Dictionary of Slang

Vermont charity n.

[? the meanness of that state’s authorities]

(US tramp) sympathy but nothing else.

[US]‘The Lang. of Crooks’ in Wash. Post 20 June 4/2: [paraphrasing J. Sullivan] To be offered sympathy while one is locked up is to receive Vermont charity.
[US]Monteleone Criminal Sl. (rev. edn).
[US]Wentworth & Flexner DAS 564/2: [...] Since ca. 1915; archaic.
[US]H. Rawson Dict. of Invective (1991) 293: Vermont, a symbol of cheapness, as in Vermont charity, which is what hobos call sympathy when it is accompanied by nothing else.