Financial Management

The House Committee on General and Housing advanced its omnibus housing bill by a 10 to 1 vote. The committee bill, newly named H.479, represents almost two months of collaborative and comprehensive work on a variety of housing policies by committee members. The committee heard from VLCT several times and included many of our requests in its final version. The bill supports many of our favorite housing programs, provides new investments in infrastructure, and authorizes a new 1% local option tax for short-term rentals. It also calls for several housing-related legislative studies and seeks to reduce municipal permit appeals for housing projects.  

Here is a quick rundown of what included in this 37-page Housing Bill:  

The bill also makes more than $55 million in appropriations to various state housing programs and amends some program criteria, including:  

Now, we don’t pick favorites, but we do want to commend the hard work of members on the House Committee on Government Operations and Military Affairs which has passed ten bills out of committee in time for crossover. The committee’s action-packed first half of the session started with the first act of the biennium, H.78, an act related relating to the use of the Australian ballot system in local elections, and ended on Friday afternoon with a unanimous vote (11-0) to advance the Flood Bill, H.397, an act relating to miscellaneous amendments to the statutes governing emergency management and flood response. 

The Flood Bill is considered a “must pass” for the session and includes three amendments proposed by VLCT, as well as a number of reforms targeting support to municipalities to enable the preparation, emergency response, and recovery from flood disasters and other all hazard events.  

The three amendments successfully advocated for by VLCT and our partners at the Vermont Bond Bank would expand municipal authority to: 

The bill also carries forward a proposal by Governor Scott, which VLCT supports, to appropriate up to $1 million from the current PILOT Special Fund surplus to municipalities that have lost grand list revenue from voluntary flood buyouts. This program would replace the lost municipal portion of property taxes in full for five years and would then step down reimbursements by half in five-year increments, giving communities time to undertake new development projects and restore the lost grand list value. VLCT supports this provision, considering the number of buyout-impacted communities that are also LOT contributors and/or eligible for PILOT.  

VLCT thanks Chair Matt Birong and Vice Chair Lisa Hango for their persistence and collaboration on a number of key priorities for local government this session.  

The Flood Bill will now head to the House Ways and Means Committee, where we expect further amendments, including the addition of VLCT’s proposed change to the LOT withholding formula from 70/30 to 80/20.  

Now that crossover is behind us, the legislature’s focus is all about the money. Committees of jurisdiction have more time to work out the details related to tax writing and appropriations, so in the weeks ahead there will be much debate on how to pay for the various policies and programs proposed in other legislation.  

Back in January, VLCT presented our 2025 Legislative Priorities to members of the Rural Caucus and asked for their support on three key initiatives: transportation funding, infrastructure for housing, and LOT/PILOT surplus reform. Last week the Rural Caucus decided what requests to include in their annual letter to the Appropriations Committees and chose to support VLCT’s request to level fund town highway and bridge and structure appropriations to FY25 levels.  

The House Committee on Environment passed H.481 on a 9-2 vote Friday afternoon. Some of the language in this bill originated in Senator Chittenden’s S.24, which we discussed in past Weekly Legislative Reports.  

This version by the House Environment Committee proposes to amend requirements related to the permitting of stormwater systems in the state. The bill would: 

Taken all together, the provisions in this bill are a step in the right direction toward a more cogent plan for the state to treat 3-Acre sites. However, VLCT continues to propose further reforms of the 3-Acre stormwater permitting rule to consider cost, feasibility, and the effectiveness of phosphorous reduction. As this bill moves toward the Senate, we will call for further amendment to:  

The House Ways and Means Committee has released another substantially revised version of their Reappraisal committee bill following a slate of testimonies earlier this month by VLCT and VALA members.  

The legislative intent of the new reappraisal proposal is to create a regional system for mass reappraisal on a six-year timeline to ensure that property values on municipal grand lists are kept up to date and accurate, that property data collection is consistent and standardized across the State, and that property valuation is conducted by professional staff – while keeping the authority and responsibility to perform regular grand list maintenance with local listers.  

The proposal creates 12 regional assessment districts that would be overseen by an employee of the Department of Taxes Division of Property Valuation and Review (PVR) who may contract for and oversee reappraisals conducted by outside firms, as well as creates regional boards of civil authority to hear appeals. This most recent draft also eliminates the annual equalization study, raises the per parcel fee for costs related to grand list maintenance to $9.50, eliminates the initial proposal to “claw back” these funds for the transition to regional districts, and eliminates the threat of withholding state funds for noncompliance currently in law. 

The new draft also introduces transition language removing the requirement to conduct ordered reappraisals (effective on passage), ending new reappraisals orders beginning on January 1, 2027, and creating a stakeholder group to be convened by PVR to “advise on the development of guidelines, procedures, and rules to effectuate the requirements of this act relating to property valuation and reappraisals”. 

On Wednesday of last week, the House passed the conferenced version of the annual Budget Adjustment Act (BAA), which was swiftly vetoed by Governor Phil Scott on Friday. In our March 3 Weekly Legislative Report we summarized the last-minute BAA showdown over a proposal by the Administration to strike $1.8 million for an extension of the current General Assistance (GA) cold weather shelter program and instead offer up to $2.1 million in block grants to municipalities to manage the wind down of the motel program.  

In his veto message, Governor Scott made clear that the continuation of the motel program until June 30 is a sticking point, and he expressed mounting concerns related to federal funding and potential future cuts to “critical programs”.  

Now, lawmakers can either attempt a veto override of the current BAA proposal or work toward a negotiated agreement with the Administration. Republican lawmakers have previously expressed support for the governor’s position, making an override unlikely. VLCT will continue to watch for a negotiated package to emerge and maintains that the management of the GA program specifically, and the delivery of human services generally, is a responsibility of state government – not local government.