This Update is Created by the Lake Champlain Chamber for Distribution by
May 5, 2023
There is a lot of confidence in a May 12th adjournment date, however, you don’t see the expected corresponding hustle in the State House to meet that date. Things feel like they are going at a casual pace. Additionally, this week brought new business to the legislative session as Governor Scott made good on his promise to veto the clean heat standard, and Speaker Krowinski announced the beginning of impeachment proceedings for the Franklin County State’s Attorney. That said, even if it is not in the public eye, we know that the Committee chairs are working their way toward closing the gaps between the House and the Senate. A quick note: we will not be posting an update on Friday, May 12th, the day the legislature has planned to adjourn. Expect an update soon after adjournment summarizing the session.
In this week’s update;
- The road to adjournment
- Housing bill moves forward with some mixed feelings
- Does Vermont need a Housing Solutions Act next session?
- Childcare bill is still being discussed in the money committee
- One problematic employment bill stalled, and another continues to move
- Bill covering VEGI and TIF passes House
- The laundry list
Road to Adjournment
Last week, we covered the gaps that need to be closed between the House, Senate, and Governor before adjournment. This week, we’re taking a look back at those in more of a high-level overview to assess how adjournment might play out.
- Budget – the Committee of Conference appointed to sort out the differences between the House and Senate versions of the budget continues to meet. The budget conference committee is really a venue for the resolution of almost every other issue to some extent which creates a watershed moment when suddenly the Legislature is ready to adjourn.
- Childcare – The House Committee on Ways and Means continues to work through their massive package of taxes to pay for increased subsidies for childcare to cover the increase in childcare workers’ wages in S.56.
- Paid Leave is out of the picture this session, the Speaker of the House confirmed to the media this week, though the Senate still thinks a slimmed-down version of parental leave is in play in the childcare bill. The House is adamant that they’ll wait for their full package next year.
- The Housing bill is on the move, with some mixed feelings about what was done. We cover that in more detail below.
- A new item on the to-do list before adjournment surfaced this week when the Speaker announced the House would be moving forward with the impeachment process for the Franklin County Sheriff and State’s Attorney. While the process will take some time and will require the Legislature to return in the off-session, this is a historically unprecedented process, and the Legislature will still need to pass an initial resolution to get it moving.
- As promised, the Governor has vetoed S.5, the Clean Heat Standard. It remains to be seen if the Legislature will attempt to override the Governor’s veto before they adjourn or if they will wait to do so at their pre-scheduled veto session in June. Their decision might be an indication of how they feel about their vote count.
S.100, the Housing Bill, Passes Committee
As we highlighted in our coverage of the gaps between the House and Senate last week, the Housing bill started with great promise and slowly became more conservative as it advanced through the Legislature. In terms of what we need to spark housing development in the state, the housing bill of the early session felt like a double shot of espresso on a sunny Saturday morning, whereas the current version of the housing bill now feels more like a gas station decaf coffee on a rainy Monday morning. The bill is still good, however, it’s hard not to feel as if the bill could be so much better.
This Monday, the House Committee on Environment and Energy passed S.100 out with a need to make some changes after the fact. In the language they passed, they expanded the definition of those who may appeal a municipal permit to any person aggrieved, whether or not within the municipality, as opposed to the status quo in which “any ten persons who may be any combination of voters or real property owners within a municipality ….” This required a subsequent amendment from the Committee after pushback on that definition. The bill now returning to the 10-person standard while also allowing any “resident” and limiting them from using the character of the area.
In municipalities with zoning and subdivision, the construction of four or fewer housing units does not count toward determining jurisdiction over any other project. S.100 instead provides that the construction of four or fewer units in an existing structure located entirely within a designated center would count as one unit toward the total number of units.
This developers who build ten units of housing in five years, within five miles of each other, to go through Act 250. S.100 increases the threshold to 25 units within five years in designated areas, including a village with zoning and subdivision regulations, only until July 1, 2026. In order to secure the exemption, by June 30, 2026, a person must request and receive an Act 250 jurisdictional opinion that construction will be substantially complete by June 30, 2029. The 10/5/5 rule remains in effect outside the 31 square miles that comprise designated areas.
One item of promise that did not move was a plan pushed by Chittenden County municipalities, spearheaded by Mayor Miro Weinberger, in which the legislature would delegate Act 250 criteria review to local governments that adopt bylaws addressing Act 250 criteria and demonstrate the capacity to administer Act 250 locally. This would eliminate duplicative and expensive permits that cost developers time and money as an alternative to the longstanding ask of removing designated areas from jurisdiction. Instead, the bill creates a report by December 31, 2023, from the Vermont Association of Planning and Development Agencies with a proposed framework for delegating the administration of Act 250 permits to municipalities.
Does Vermont Need a Housing Solutions Act Next Session?
In 2019, convinced that the state had not done enough to address the climate crisis and would not meet our goals, the Vermont legislature passed the Global Warming Solutions Act (GWSA). The legislation put greenhouse gas emission reduction targets in statute and created the ability for an affected party to bring a lawsuit against the state if the goals were missed to compel them to take action to reduce emissions.
As we come to the end of this legislative session and leave with a housing bill that is very limited in reach, we’re asking; do we need a Vermont Housing Solutions Act?
Housing is the limiting factor in everything we are trying to achieve in Vermont. Every conversation, including our issues meeting the goals of the GWSA, comes back to housing people. People can’t find childcare, healthcare, or other essential workers because they’re struggling with issues around housing availability, affordability, and/or dependability.
Based on the projections of the 2020 housing needs assessment, Vermont will need to increase the state’s total housing stock by about 5,800 primary homes before 2025 to meet expected demand among new households while also housing the state’s homeless and replacing homes likely to be removed from the stock. Our state has the oldest housing stock in the country, which was recently highlighted. The Vermont Housing Finance Agency testified that since the 2020 housing needs assessment, further analysis actually puts the number of new primary homes needed at 30,000 to 40,000 units by 2030.
So, we clearly have a crisis, and it’s clear that the legislation that we’ll likely get out of this session won’t go far enough, so let’s deal with this crisis the same way the Vermont legislature dealt with another; let’s set the goals, put them in statute, and hold everyone accountable for meeting them.
What do you think? Let us know.
Childcare Still in Ways and Means
The House Committee on Ways and Means continued their work on S.56. We noted in the road to adjournment section that this bill is part of the much larger budget discussion. The bill will likely move the bill on Monday, and it will need to go to the House Committee on Appropriations.
As we come into the home stretch, the best summary of this session’s tax policy might have come from the Commissioner of the Department of Taxes, Craig Bolio, as he joined the House Ways and Means Committee to discuss the childcare funding package. The Commissioner highlighted that Vermont is a small state with a small tax base that is already highly burdened, with Vermonters currently paying 13.6% of their income in state and local taxes, the highest in the country after New York, Connecticut, and Hawaii, with this session’s policy pushing us above Hawaii he noted. He remarked that the childcare bill envisions a $178 million income tax increase, there is an $80 million property tax increase, and even though paid leave will not happen this session, it will likely bring a $107 million payroll tax increase next session. He noted that all these tax increases on Vermonters come at a time when food and housing costs are high, and the country is facing potential economic downturns such as bank failures and U.S. defaulting due to the debt ceiling fight. Additionally, April revenues missed the forecast by $43 million, led by personal income decreases, leading to concerns about the fiscal future of the state.
One Problematic Employment Bill Stalled, Another Continues Advancing
The Lake Champlain Chamber joined the House Committee on General and Housing to share perspective on the litany of issues with S.102, which prevents “captive audiences” in which an employer can compel an employee to attend a meeting on issues perceived as political or religious. The legislation is aimed at making it easier for unions to form by preventing employers from holding meetings in which they share their perspectives on how unionization can change the workplace. The bill can also be construed and potentially used by employees that do not want to participate in meetings that involve topics they deem political, such as those around diversity, equity, and inclusion (DEI) or environmental, social, and governance (ESG) policies or metrics.
LCC explained that the change this bill would make is already being challenged in court by Florida and Connecticut. Connecticut has a law that is very similar to the one proposed in Vermont, while Florida tried to enact a law that would prevent employers from hosting meetings on important topics such as DEI training. This exemplifies how trying to regulate speech is a double-edged sword that creates unintended consequences.
The bill also creates the ability for unions to form new bargaining units without a full election and instead collect petitions signatures from 51 percent of the employees in a process called “card check.” LCC walked the committee through examples of how this seemingly harmless proposal is like allowing politicians into the polling place and letting them look over a person’s shoulder while they fill out their ballot, or worse yet, how some employees could be purposely excluded from the conversation.
The Committee gained an understanding of how complex and difficult this legislation is and will postpone further work on the bill until next year.
The other problematic labor bill, S.103, moved back to House General this week after the House Education Committee stripped from it the language that would have applied to schools. It is expected that the Committee will move the bill, and we will soon see it on the floor. The bill removes the severe and pervasive standard from discrimination and prevents no-rehire agreements.
VEPC Bill Covering TIF and VEGI Passes the House
After a long meandering journey, the House passed S.94, which extends sunsets needed to operate programs by the Vermont Economic Progress Council. S.94 extends the sunset on the Vermont Employment Growth Incentive program a year while creating a study to look at the state of economic incentives to assess what changes might be made to VEGI. You might remember the work on VEGI taking place in the context of H.10 earlier in the year, however, that bill missed crossover, and the House Ways and Means Committee added its contents to S.94, which extended the deadline for the Barre Tax Increment Financing district. The bill now also contains changes to the TIF program we’ve previously covered, as well as a study on alternatives to infrastructure funding.
The bill hasn’t moved in the last few weeks because of a lack of funding for the studies, so it will be getting to the Senate very late. The Senate Committee on Finance is likely to say that they do not have time to review the whole bill and will likely seek only extensions on the two programs, though that remains to be seen. This Committee is inundated at this point in the session with bills that they need to review by rule.
The Laundry List
There are many moving pieces, and we do our best to add the ones that don’t get a section in the newsletter yet should be on your radar here. On any given day in the State House, there are about 175 hours of committee time outside of floor time, and then the hallway, cafeteria, or other time spent legislating.
- Read past updates here – week 1, week 2, week 3, week 4, week 5, week 6, week 7, week 8, week 9, week 10, week 11, week 12, week 13, week 14, week 15, week 16, and the last session’s wrap-up.
- Joan Goldstein, the Commissioner of the Vermont Department of Economic Development, published an op-ed this week outlining the challenges facing Vermont businesses and the potential strain that will be added by the work of the legislature this year. Read it here.
- The Senate passed this week H.127, which legalizes sports wagering in Vermont. We’ll cover this in more detail in the final update.