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Advocacy Update – Week 3 – 2025

Thank you to this week’s sponsor of our Advocacy Update:

January 24, 2025

The pace is picking up in the Legislature this week, so let’s jump in and get right to it.  

  • Catch up quick: Last week, we covered how new political dynamics due to eroded supermajorities have resulted in Democratic leadership waiting for Governor Scott to serve up omnibus bills on the key issues of housing, public safety, and affordability, with his budget address scheduled for January 28. 
  • Drips and drabs: This week the Governor’s team rolled out previews of omnibus bills slowly while holding back the full picture for his budget address. 
  • Fiscal forecast: The state’s fiscal picture is a little bit clearer and a little bit better ahead of the Tuesday address, though the only thing certain with a Trump Presidency is uncertainty, and that could mean storm clouds in the state’s fiscal forecast.  
  • The Only Certainty Feels Like … Uncertainty: There is no shortage of things for Vermonters to feel concerned about as the new President threatens our neighbor to the north with 25% tariffs potentially by February 1st, threatens mass deportations, and more. 

In this week’s update; 

We strive to make these concise and easy to read. Feedback is not just welcomed, it’s encouraged – [email protected] 

SOLD OUT – LCC Legislative Breakfast Series 

Every year, we bring legislators, policymakers, and LCC members together to celebrate business ownership and entrepreneurship and advocate for economic opportunity in our region. Last year, we had a fantastic series highlighting our region’s outsized impacts on the global semiconductor and computing industries; this year, we’re turning our eyes to the skies to exhibit our aviation sector. 

  • Monday, January 27th, from 8:30 to 10:00 a.m. at BETA Technologies
  • Monday, March 24th, from 8:30 to 10:00 a.m. Patrick Leahy International Airport – Gate 9 
Thank you to our breakfast sponsor

Governor’s Team Previews Education Overhaul 

During an all-legislators briefing, we got more information on where the Governor wants the state education system to move. 

Catch up quick: This week’s big swings at changes are not unwarranted, 

  • An unprecedented 33% of school budgets were voted down last year at town meeting day, and despite that, property taxes climbed on average 14%.  
  • The Legislature’s response was to create a Commission on the Future of Public Education, however, a voter backlash is pushing the Legislature to act sooner than the two-year timeline they allotted.
  • The Agency of Education conducted a listen-and-learn tour outside of the Commission process to bring their own solutions forward this legislative session.    

The Governor’s proposal focuses on three policy levers to affect education changes: 

  • Scale – a simplified governance structure that collapses the state into five districts to simplify governance and lower administrative costs.
    • Justification: Vermont currently has 119 school districts and 52 superintendents, and the administration believes having larger districts would:
      • Significantly reduce inequity in spending per student 
      • Close the property wealth gap across districts 
      • Eliminate costly inefficiencies and duplication of effort 
      • Reinvest in teacher salaries by reducing administrative overhead 
      • Improve service delivery by operating at scale 
      • Increase educational opportunities for all students
  • Funding – The Governor hopes to achieve a simplified, fair, and predictable funding system through a foundation formula that provides a base grant for funding a school and then requires communities to fund additional spending beyond that. 
    • Justification: our current system has some of the most significant disparities in the country despite a constitutional obligation to provide educational equality and a court ruling asserting educational outcomes can not be a factor of a student’s zip code. 
    • Base grants are a conversation about adequacy, and the administration seems poised to rely on a somewhat controversial legislative report from a consultant this fall that found that the state of Vermont could spend $400 to $460 million less on education, or about $4,500 less per pupil and still get better outcomes for students.
  • Education quality – The plans emphasize academic rigor, enrichment, and whole-child support.
    • Justification: the state’s reading and math proficiency is dropping as is the graduation rate. 

Send this to your HR Team – Unpaid Leave Expansion Considered

The House Committee on General and Housing is considering H.33, an act relating to expanding employee access to unpaid leave

  • This bill proposes to expand access to unpaid family and medical leave and provide job-protected leave from employment for reasons related to domestic violence, sexual assault, stalking, bereavement, and a qualifying exigency. 
  • This bill also proposes to eliminate barriers for LGBTQ+ families in accessing caregiving leave and to establish reporting requirements to track the impact of expanded access.

Governor’s Team Previews Plan to Reach Vermont’s New Housing Targets 

Vermont is building only 25% of the new housing needed annually. Vermont’s new targets show a need for over 41,000 additional homes by 2030 and 172,000 by 2050 to meet demand, ease homelessness, attract workers, fill schools, and encourage population growth. 

At this week’s press conference, the Governor and his team previewed elements of his housing omnibus bill and rolled out Vermont’s new housing targets.   

  • Strategic Projects for Advancing Rural Communities (SPARC): A new financing tool, similar to TIF but on a smaller scale, allowing developers or municipalities to borrow for single, smaller infrastructure projects to support homebuilding.

  • Regulatory Reforms: Proposed changes include reducing frivolous housing appeals, requiring appellants to cover legal fees, and revising Act 250 tiers to make development more accessible.

  • Focus Areas: Revitalizing rural downtowns, supporting mobile home parks, and expanding opportunities for small-scale developers.

Have a new year’s resolution? 

A new year means the start of a new session and many ways to engage with our advocacy team. 

With this many opportunities, why not make engaging in policy the easiest resolution possible?

In the Shadow of National Politics

As we start a new Vermont Legislative session with legislators looking down at their work, they must also look up and survey the national scene. 

The Elephant in the Room 

  • Second time’s a charm- make no mistake, this is not the same Trump we witnessed last time. His team is experienced, loyal, and organized. Expect a Trump who is much more engaged in the House, where the margins are some of the tightest in history (217-215). 
  • He’s effectively a lame duck starting now, as he can’t seek another term, which means he will go for broke. 
  • We saw evidence of both of these things in the 200+ executive orders he’s already signed. 

The Next 100 Days in Congress 

  • The next eight months are important to the GOP. It will affect the midterms and the reconciliation, an expedited budget process that can be passed with just the votes of the party in power, it’s make-or-break for Republicans.
  • They will try to address extending provisions of the Tax Cuts and Jobs Act as well as other GOP priorities, which include additional, massive tax cuts within the narrow rules of the reconciliation process. 
  • This could mean between $2.5 trillion and $3 trillion of spending cuts and budget savings to fund Republicans’ reconciliation package, as reconciliation does not allow for deficits to be increased. 
  • Unforced error: when Republicans punted on government spending last month, they put the new March deadline in the middle of Trump’s first 100 days, meaning they’ll need to work with the Democrats to keep the government open when they were already sure to resist massive spending cuts and were just slighted in the reconciliation process.  

SALTy Treat for Blue States 

  • One TCJA provision that could have major implications for Vermont is the state and local tax (SALT) deduction, which benefits high-tax, democratic-majority (hey, that’s us!) states. 
  • The “Majority Makers,” as the Republicans who won in blue states such as New York and California this past election are being called, are in the driver’s seat and want an increase in the SALT cap desperately. 

Vermont Congressional Delegation Shuffled: The last time Vermont dealt with a Trump presidency, we did so with the most senior member of the Senate. While we won’t have Patrick Leahy, our delegation will represent us well. 

  • Sen. Bernie Sanders: Now the ranking member of the Senate HELP Committee, Sanders retains influence but no longer chairs it. He also serves on Finance, Budget, and Veterans’ Affairs Committees.
  • Sen. Peter Welch: Now serves on the Judiciary, Agriculture, Finance, and Rules Committees, expanding his portfolio in key areas.
  • Rep. Becca Balint:  Now serves as vice ranking member of the House Judiciary Committee. 

The Only Certainty Feels Like … Uncertainty: Vermonters have no shortage of concerns as the new President threatens our neighbor to the north with 25% tariffs, potentially by February 1st, threatens mass deportations, and more. 

  • State Treasurer Mike Pieciak announced he’s co-chairing a new task force assessing the potential impacts of Trump-era federal policy changes focusing on areas including federal funding for state programs, flood recovery, immigration policies affecting farms, and tariffs’ effect on housing construction.
  • Attorney General Charity Clark announced that Vermont and 19 other states and jurisdictions are challenging President Donald Trump’s executive order ending birthright citizenship. 
  • Changes to the federal tax code ripple through the Vermont tax code, and the Legislature will need to respond to changes to everything from income tax brackets to SALT deduction caps. 
  • Federal Health Insurance Tax Credits: During the pandemic, federal tax credits helped 27,000 Vermonters afford health insurance through Vermont Health Connect, reducing their costs by an average of $2,660 per person annually however, these tax credits are set to expire at the end of 2025 unless Congress acts to extend them. 
    • Timing is critical, as Congress has until the end of 2025, while Vermont’s legislative session ends much earlier, leaving limited time for the state to respond if federal action doesn’t remedy the situation.
  • Federal Funding Flow: Finding trillions to cut from the federal budget means that programs used by Vermonters will likely be contracted as Republicans float everything from Medicaid work requirements and cost-sharing for SNAP benefits, as well as rolling back signature policies of the Inflation Reduction Act. 

An Unhealthy Healthcare System 

Unless you’re living under a rock, you might have noticed that the state’s healthcare system does not have a clean bill of health.

Catch Up Quick: 

  • BlueCross BlueShield of Vermont warned of financial peril, citing $100M losses over six years and escalating healthcare costs. Vermont’s premiums, the highest in the U.S., can’t cover expenses, fueling unsustainable hikes. Read more via VPR. 
  • Although Vermont has a low 3% uninsured rate compared to the national average of 10%, Vermont’s plans cost more due to expansive coverage of services.
  • A recent report by a consultant for Vermont’s healthcare regulator, the Green Mountain Care Board, highlighted the impact of Vermont’s lack of housing as well as its aging population which will exacerbate current strains on the healthcare system due to increasingly complex care needs. 

What are legislators looking to do?

  • Keep small and group markets unmerged: The House Committee on Healthcare is poised to keep unmerged individual and small group insurance markets permanently.
  • This is good news for small businesses as re-merging would result in a 7% or $23.2 million rate increase for small businesses.
  • Possibly Respond to Federal Changes in ACA tax Credits: During the pandemic, federal tax credits helped 27,000 Vermonters afford health insurance through Vermont Health Connect, reducing their costs by an average of $2,660 per person annually however, these tax credits are set to expire at the end of 2025 unless Congress acts to extend them 
  • Help with medical debt: Treasurer Mike Pieciak announced a plan to erase up to $100 million of the estimated $155 million in Vermont medical debt using $1 million of federal funds to buy the debt for pennies on the dollar and forgive it.  
  • Streamlining Certificate of Need Approvals: Simplifying new health care facilities’ costly and time-consuming process.
  • Improving Electronic Medical Records: Enhancing system compatibility across providers.
  • Strengthening Emergency Medical Services: Building on recent reforms to improve training and funding.
  • System Optimization and Oversight: Explore regional hospital service consolidation, adjust regulatory structures, and evaluate existing programs like mental health urgent care and Blueprint for Health to enhance efficiency and effectiveness.

The Laundry List

Hundreds of hours of committee discussion each week culminate into our advocacy update, so not everything makes it into the overall update; however, we often cover what is left on the cutting-room floor here for our most dedicated readers. 

  • Read previous updates: Week 1, and Week 
  • Medicaid to Fund Housing Supports – Starting in 2026, Vermont can use Medicaid to fund housing supports, including short-term rent, medical respite care, and $10.9 million for service capacity. This builds on existing housing efforts like the HOME Act and shelter expansions. Medicaid funds cannot replace current state programs but add tools to address homelessness and improve health outcomes. Read more here.

Hey! You read the whole update. You probably have some thoughts on the content or how we delivered it. Feel free to reach out with those at [email protected]