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Closing Days of NH state Budget, ABC Encourages Funds for Construction of Housing
Additional funding for Housing could be a topic of debate. There is a section in HB 2 (page 128, section 392) that extends the lapse of the Housing Champion Designation and Grant Program from June 30, 2025 to June 30th, 2026. The sum is $5 million. Although a good move, not enough especially with the focus on Housing this session.
Deep cuts have been made to many agencies. The other day they announced the members of the Committee of Conference for the FY 26/27 State Budget. ABC sent a letter to encouraging support for housing (click here). The economic multiplier of construction work would be the most wise and prudent investment the state can make this year.
The Vermont Legislature is on its way to adjournment now two weeks past its scheduled end in May. The delay is due to three legislative priorities and negotiations to get to a “yes” from the Governor. The states housing crisis, education reform and attempts to energize legislators to override a veto of a program funding homeless staying in Vermont hotels.
As of June 13th, a deal has been reached to start repairing Vermont’s expanding school funding issues. The deal reached set targets with contingencies for consolidating schools, changing the funding formulas and changes to exemptions to the property tax for income earners under $115k/year. The full assembly still needs to vote on the bill, but if it passes the Governor has signaled that he will sign it. Of course, floor votes are riddled with amendment proposals and there will be dissent on the package itself which could ultimately kill the bill.
A housing bill has crossed the finish line and has become law with the Governors’ signature. The bill itself leaves many hoping that next year more changes will come that will significantly impact/limit the challenges from Act 250 Vermont’s development law cited as the number one reason for the housing shortage. The bill that passed expands significantly on the Community Housing Improvement Program (CHIP) which is one of the ways the state is trying to soften the cost of housing developments like permitting, engineering, and infrastructure by providing grants for different types of projects. While the grants will soften the blow of the cost, it does not directly change the causation of the high costs. Additionally, the bill would allow developers with approval from municipalities to use Tax Increment Financing (TIF) to fund infrastructure for projects by reducing the property tax on the development. These and a few other small policy changes are part of a larger effort to make housing more affordable in Vermont, while not addressing the giant elephant in the room: Act 250.
Another priority of the Democrats and Progressives in the legislature is the extension of a previously Federally funded program under COVID to place homeless families in hotels. Once the Federal funding ended legislators redirected some remaining CRF funds to the program which have since run out. Governor Scott is unwilling to extend the program citing, “Rather than continuing to fund a program that isn’t good for those in it, I believe we should focus on real solutions like building additional shelter capacity and requirements to engage in work, training, and treatment for those who need it,”. It is unlikely that the legislature will have the votes to override the veto as its unpopular with Republicans who would be needed to support it.
On May 22, 2025, ABC contractors met with the New Hampshire Department of Administrative Services (DAS) to discuss improvements to the state’s contracting process. The focus was on reducing the 110-day average timeline from bid opening to issuing a Notice to Proceed and ensuring more timely vendor payments.
Commissioner Charlie Arlinghaus acknowledged the need to address material price escalation and tariffs, which currently place a unique burden on contractors working with the state. Key concerns raised during the meeting included a lack of transparency in project budgets, lengthy inter-agency contract reviews, and poor communication—particularly around notifying contractors when contracts are ready for Governor and Council meetings.
Contractors proposed several solutions: announcing project budgets before bidding, allowing agencies to conduct contract reviews simultaneously, and exploring the use of electronic sign-offs to streamline approvals.
The DAS is actively working to improve these processes, and further discussions are planned.
ABC leadership is encouraged by the progress but notes that additional reforms are still needed, including better project documentation, change order management, and improved collaboration across agencies.
Vermont Government Affairs Update – June 3, 2025
The Vermont Legislature was scheduled to adjourn on Friday, May 30, but that deadline has been missed. One major issue remains unresolved: school funding and a sweeping miscellaneous education bill that includes significant changes to how services are delivered.
As previously reported, the Legislature has been exploring various ways to reduce school spending without cutting essential programs for Vermont students. The goal is to curb the rising statewide education property tax, which has surged in recent years due to multiple factors.
Governor Scott’s original proposal included several major reforms: reducing the number of school districts (initially down to five); replacing the current two-tier property tax system (homestead and non-homestead) with a single rate while preserving income-based relief for lower-income residents; eliminating student weighting formulas and instead allocating a flat $13,200 per student to school districts; setting a minimum classroom size of 25 students for grades 4–12 and eliminating programs with low enrollment; ending universal school lunches; and introducing a school choice program—an idea strongly opposed by many legislative Democrats.
In contrast, House Bill H.480 sidesteps most of Governor Scott’s recommendations. Instead, it prioritizes school safety, regulating cell phone and social media use in classrooms, and imposing a moratorium on new approved independent schools. It does not directly address the rising costs that concern taxpayers.
A Facebook post from Governor Scott last week signals a likely veto:
"Since Vermonters saw significant property tax increases last year, I’ve been clear: we can’t continue with the status quo because it’s not serving our kids or taxpayers well.
Both the House and Senate passed versions of the education bill spend too much money and implement the transformation too slowly. But I believe we can find a path forward and reach a compromise.
The plan I outlined in January aimed to make Vermont’s education system more equitable, transparent and effective. It focused on student needs and efficient governance, providing better opportunities for every child in Vermont, while also creating a funding structure that is clear, affordable, and sustainable.
These will remain my objectives when evaluating a final bill when it reaches my desk."
We’ll see what happens next—and whether lawmakers are truly hearing Vermonters’ calls to get school spending under control.
Vermont Government Affairs Update – May 20, 2025
As we reach the halfway point of May, it appears the Vermont Legislature is on track to adjourn by the end of the month. It has become clear which bills will make it through and which won’t—but that doesn’t mean the action is over. Expect a flurry of amendments and the use of “must-pass” bills as vehicles to advance favored policies. A scheduled veto session in June also leaves room for late-stage negotiations and influence from both sides of the aisle.
Last November, voters turned out in large numbers to support a reasonable state budget, fixes to the education funding system, and increased housing. The Legislature has listened—somewhat.
The state budget has cleared a conference committee, landing at $9.01 billion. While modest compared to Governor Scott’s proposal for fiscal year 2025, it still represents a significant increase in state spending since the COVID-19 pandemic. Federal funds created new programs that the state is now responsible for maintaining. For context, the 2019 budget was $5.8 billion. While many sections of Governor Scott’s budget were increased, there has been no clear indication yet of a veto.
A bill proposing major changes to the delivery and funding of education has passed the House and is currently being reviewed by the Senate—though it’s not generating much enthusiasm from education advocates. Notably, two Senate Democrats on the Education Committee voted “no,” signaling concern. The bill incorporates some of Governor Scott’s recommendations, sets a base payment per student, and introduces a “foundation formula” to give the state more control over school district appropriations. It also addresses classroom sizes and calls for a redistricting committee to evaluate potential district consolidation. The bill now moves to the Senate Appropriations Committee, where changes are expected. Whether it passes this year remains to be seen, but many see it as a preferable alternative to doing nothing—which last year contributed to sharp property tax increases.
Vermonters did score a win on taxes this year. The “yield” bill, which sets the statewide education property tax, was adjusted to result in only a 1% increase over last year—far lower than the 14% hike the year before.
Meanwhile, meaningful housing development legislation appears to be on life support. Governor Scott sharply criticized the Legislature last week for delaying action on this critical issue. Vermont is currently short 22,000 housing units—a shortage linked to rising homelessness, a shrinking workforce, and young people leaving the state. While some bills offer modest incentives to developers and repeat half-measures of the past, they fail to address the state’s primary obstacle to building more homes: Act 250, which allows small groups to block developments—often for capricious reasons.
Vermont Government Affairs Update- May 5, 2025
As we enter May there has been much discussion in and around the state house related to date of adjournment, will the budget get vetoed, housing, education funding and more. Adjournment seems to be one up in the air but as of the date of this article most pundits and politicians see May 30th as being the day everyone goes home for the summer The only exception being a veto session scheduled in June to deal with the budget adjustment act that did not make it past the Governors desk.
Last Monday ABC NH/VT and partners opened the Vermont Construction Academy and were lucky to have many political leaders and politicians in to see the property.
Governor Phil Scott, a former contractor, spoke before the audience of over 120 contractors, press and interested members of the public. In his speech he outlined the challenges to the workforce due to Vermont’s demographics that he has explained hundreds of times. We are losing more and more students, workers and young adults to other states with better economic outcomes and opportunities for housing. Scott addressed the workforce shortage and commended the participants in the building of the facility and training programs for taking the lead on such an important issue.
Lieutenant Governor John Rogers was also in attendance greeting and congratulating the organizations who built the facility. Rogers also a masonry contractor shared his views and story about how the industry helped him achieve his persona goals and looks forward to seeing VCA prop up youth and others entering the industry.
Many Senators and Representatives were also in attendance. They were impressed by the efforts that industry has made to improve the workforce while not asking for handouts or someone else to do it for them. One Senator was particularly impressed by the fact that zero state or federal funds have been used to build the facility. Her realization that industry, well THIS industry, has taken the reigns and will lead their own pathway towards successful recruitment.
Also in attendance were the Commissioner of Department of Labor, Michael Harrington as well as many from his staff and other departments. Other workforce development and building sector people also joined the grand opening. The energy was felt by all.
The results of opening the Vermont Construction Academy and the memory that industry stood up to build their own way out of the workforce shortage will be remembered and aid in future political endeavors for ABC NH/VT.
Vermont Government Affairs Update- April 15, 2025
As April 15th arrives taxes are being filed, its getting warmer outside and legislators may be seeking an early exit this year. The legislative session in Vermont generally runs January through the end of May. Occasionally it creeps into the month of June if agreements on budgeting or other big-ticket items have completed and sometimes, they return in June to address gubernatorial vetoes. This year K-12 education funding and a housing crisis were the top priorities of most but as we lurch through the session it seems agreement on these are still far away. If the legislators are unable to continue with those larger items, its likely they’ll just move the “must pass” bills like the general budget, transportation funding and normal technical corrections.
The House passed a 176-page education bill that will significantly change the way education is funded and delivered across the state. The bill includes a timeline to impose school closing requirements, changes and consolidation of school districts, new property tax brackets and much much more. It took the house almost 4 months to craft the policy and technically it has not been passed prior to “crossover” so rules would likely have to be suspended for the Senate to take up the bill. As of today, the Senate Pro Tem has not signaled that they have enough time to take a deep dive into the bill which likely means it will be shelved until next year. Since the “yield bill” which sets the 2026 statewide property tax for education has already passed, nothing will change until next year regardless.
Housing has been a slow-moving policy as well. The same actors on behalf of housing and environmental protections are working hard together (and opposed) to expand on work that had been done to create different zones recognized under Act 250 Vermont’s landmark development regulation and find ways to financially support the “missing middle” income earners in home purchases. For those watching closely it consistently feels like one foot forward two feet back in terms of reaching a goal everyone can agree to.
The appeals process of Act 250 permitting has been at the most recent focus. The governor’s original proposition was to change the appeals process “standing” from 20 people in a community to 20% of the community to challenge a permit. Attorneys opposed to the 20% policy have suggested that changing grounds for standing from simply the current “allegation of harm” from a development to “realized injury” that would have to be proven would be the best solution to stop inappropriate appeals from the NIMBY (not-in-my-back-yard) population who has been blamed for a lack of smart development leading to the housing crisis.
Whether its dealing with disagreements to education funding or how to build more houses, one thing people are well aware of is that May is two weeks away. Will we see an extended legislative session to deal with these issues, or quick adjournment? Some would argue that swift adjournment and returning next year to deal with these issues would be best because they involve only 4-5 committees working on the policies. This would leave the other committees open, with more time, to cook up special interest bills that some may like, and others may not!
Vermont Government Affairs Update- April 1, 2025
As we roll into the second half of the 2025 legislative session its become clear that this is a unique year in terms of policy. The election November which gave more power to Governor Scott and the Republicans is truly forcing legislators to work hard towards compromise bills. Although compromise is the goal, it’s clear that there are still power struggles going on even within party lines. Today marks April 1, which many know to be April Fools Day, but there is very little joking to be had at the state house.
The “Clean Heat Standard” also known as the “Affordable Heat Act” was passed last biennium by a supermajority of Democrats seeking ways to reduce fossil fuel usage in Vermont. The policy would have required fuel dealers to encourage and assist their customers to move away from fossil fuels to heat their homes. If the dealer is not able or willing to report reductions by their customers, they would then be forced to apply a surcharge (some call a carbon tax) which was estimated to be between $2-5/gallon of fuel. With broad public opposition and recent political losses, the legislature seems to have heeded the public’s interest in cancelling the policy.
The heat act was passed with the caveat that the Public Utility Commission (PUC) begins designing the program and identifying fuel dealers in the state, but the reduction requirements would not begin until the 2025-2026 legislature approves the policy again by vote. This has been known as the “look back” policy within the bill that would allow legislators to find out exact cost estimates before enacting the regulations. A report from the PUC in the fall of 2024 prior to legislative session stated that the program would be overtly expensive and that the commission recommends scrapping the proposal.
This opposition was celebrated by opponents to the policy and has caused environmental advocates and Vermont’s Climate Commission to scramble to figure out next steps.
With several bills in play to repeal the heat standard, opponents are hopeful. However, that hope comes with concern as plans are being made to add another component to the bill which would give Vermont’s energy regulator Efficiency Vermont more authority to increase and spend ratepayer taxes on driving electrification goals. This “poison pill” may satisfy removal of the heat standard but will trigger possibly more costly additions to Vermonters electric bills.
In addition to the “poison pill” possibility, Vermont’s Climate Commission is preparing for a lawsuit against Vermont for not complying with Vermont’s Global Warming Solutions act which requires the state to reduce carbon emissions by preset requirements. The lawsuit plans to ask a judge to enact the “Clean Heat Standard” and a carbon “cap and trade” program without having to go through the legislature allowing them to push policy that a majority of voters oppose…..
I wish this was an April Fools joke, but unfortunately it is not.
Vermont Government Affairs Update- March 18, 2025
On Thursday, March 13, the Senate Economic Development, Housing and General committee took up a slew of bills related to labor laws. ABC NH/VT Vermont Regional Director, Matt Musgrave, was invited to give feedback on the bills introduced. The issues raised were for the most part perennial requests to the legislature from organized labor groups. The policies were introduced in the “11th hour” of the first half of the biennium. They had not yet received an official bill number, and little to no testimony was received.
For reference, the Senate Economic Development, Housing and General committee has had a history of starting big labor bills which generally do not make it through the rest of the legislative process but are nods to labor organizations from the committee.
One of the favorite requests from labor organizations is that Vermont turn away from a long tradition of “employment at will” which allows an employer to separate an employee for no reason to a new “just cause” termination law. Musgrave's testimony on this policy served as more of an education than position statement showing there is no need for a “just cause” standard. In fact, the Vermont unemployment system already recognizes terminations for no cause and requires employers pay into an unemployment trust fund for the benefit of those employees let go by no cause, or layoffs. In addition, Musgraves testimony pointed out that the unemployment trust fund that has more than $300 million would have to be redistributed to the payors who had built the trust fund which includes businesses that have closed in the past. The committee’s response was that there was not likely time to vet this policy, so they moved on. In the rare event that the language finds its way into a bill this year would most likely result in a veto by Governor Scott.
Musgrave began testimony on “right to sit” with some humor that was inspired by the sitcom Seinfeld. In the episode, one of the characters advocated to a retail security guard’s management that he should be allowed to sit while on the job. Management obliged and the security guard fell asleep. Aside from the appropriate amount of humor, Musgrave pointed out that OSHA and the Americans with Disabilities Act (ADA) already consider the need to sit. The OSHA 5A standard requires that employers keep employees safe from known hazards and if standing was causing undue injury they would need to be accommodated. ADA requires that reasonable accommodation must be made for someone with physical challenges preventing them from standing. Even with the clear explanation one Senator was strongly advocating for the policy, but the rest of the committee felt the policy went too far and left it behind.
A big policy change was introduced related to Vermont’s Prevailing Wage. The proposal would remove the existing system which is based on surveys of Vermont’s actual wages and replace it by tying the classification wages to that of the “closest” by geography union bargaining agreement. Musgrave testified that making this change would be unreasonable due to the fact Vermont’s construction workforce is less than 2% union so any local wages (which might not even exist) would be outliers not representing actual Vermont wages. Also, it was pointed out that due to the lack of unions in Vermont, northern New York, and most of New Hampshire would require wages to be tied to Massachusetts wages, or that of the unions operating in Portsmouth’s military installations with neither representing actual Vermont wages. The committee chair admitted this was not realistic to take up this year but stopped short of agreeing it was a bad idea.
Vermont Government Affairs Update- March 4, 2025
The Vermont Legislature has gone on recess for the week of March 3rd to return home for town meeting day. This is a time of the year that elected leaders stand before their localities to share with them the progress that they have made improving the lives of Vermonters. It is also the time where townspeople vote on their selectboards and other local initiatives. This year, however legislators will have very little progress to report to their constituents due to it being the first year of a biennium and the overshadowing priority of school funding.
In response to rapidly rising costs of education and soaring property taxes that fund it, Governor Scotts administration has presented a bill to change Vermont’s system completely. Vermont ended up in a statewide payer model after a lawsuit in the 1990s known as the “Brigham Case” which was brought against the state due to significant disparities between school districts funding which violated students constitutional rights. The system created a separation between voters deciding on their local school budgets and what the impact of taxes would be. Because the statewide property tax is a rate set by state government, it shields some communities from bad (expensive) decisions because they don’t directly pay the costs. This has ballooned over the years, handing Vermonters a 14% property tax increase in 2024.
The Scott administration’s bill proposes to do many things. Scotts “Stronger Schools” approach would make significant changes to funding and governance models. One major move would be to consolidate 119 school districts to just 5 to reduce administrative costs. It would also change the statewide property tax by eliminating a system that had both homestead and non-homestead tax rates and creating just one rate. It would still allow people below a certain income threshold to reduce their property tax burden. It would remove student weighting formulas replacing it with a flat $13,200/student to school districts. The policy also takes aim at classroom sizes, setting a minimum of 25 in grades 4-12 and proposes eliminating programs that do not have minimum populations of students. Two major sticking points for Democrats opposing the policy is the elimination of the COVID instituted universal school lunch program and creating a “school choice” policy the teachers unions fear the most. If the plan moves forward, which is yet to be clear, it will enact over several years completing in the 2028 school year.
While all the politicians at the table agree there is a school funding crisis, and that the voters overwhelmingly told them so last election it is to be seen whether real change will happen or the Democrat majority in the legislature will just try to wait out Governor Scotts proposals until they die at the end of the session. Education funding has plagued Vermont since the Brigham decision and Vermonters votes last election are proof its time for change.