Vermont Chamber News

H.687 was the subject of lengthy, and at times fiery, House floor sessions this week. The bill establishes a plan and timeline to modernize Act 250 with a tiered and location-based jurisdiction, including exemptions in smart growth areas. The proposed changes for Vermont land use would take place over the coming years to allow for considerable public outreach and input. In total, there were 11 amendments to the bill with all but one passing. This included an amendment to extend Act 250 housing exemptions passed last year in the HOME Act. The bill was ultimately passed by the House on a split voice vote, sending a message to the Senate that further changes will need to be made if the bill is to garner enough widespread support to withstand a potential veto.

The bill will now go to the Senate, where the Natural Resources Committee has been reviewing S.311, the Senate’s housing and Act 250 omnibus bill, in anticipation of receiving H.687. The Vermont Chamber testified before the committee this week in favor of the approach to Act 250 appeals that S.311 makes, keeping appeals to Act 250 decisions in the court with increased support. The committee is likely to make H.687 the final vessel for Act 250 modernization this session.

In response to stakeholder concerns on the version of the House Act 250 modernization bill that was voted out of the committee last week, the House Energy and Environment Committee has taken up an amendment to that bill. It will include important provisions related to the timeline of how Act 250 changes are implemented and is based on the significant package of compromises made by stakeholders before the session in the Necessary Updates to Act 250 report. Changes in the timeline ensure that the growth and protection provisions move in concert with each other, as agreed upon by stakeholders. The Vermont Chamber remains concerned about language that would transfer the responsibility of hearing Act 250 appeals from the environmental court to the new Environmental Review Board.

Meanwhile, the Senate Natural Resources Committee took up the “Be Home” bill, S.311, this week which was passed out of the Senate Economic Development, Housing, and General Affairs Committee with changes to Act 250, local zoning, and housing programs. Builders and developers testified regarding regulatory hurdles and housing market dynamics. They emphasized the importance of regulatory clarity and streamlined processes to expedite housing construction while ensuring compliance with environmental standards. Bill sponsor Senator Kesha Ram Hinsdale also testified, reiterating the need for evaluation of Act 250’s efficacy. In particular, she emphasized the need to incentivize development projects that cater to various income brackets, creating more diverse housing options, from affordable rentals to multigenerational housing.

When the House Act 250 bill makes it to the Senate, pulling them together will be a focus of the Senate Natural Resources Committee for much of the remainder of this legislative session. The Vermont Chamber will be engaged and at the table to ensure businesses are represented in this process.

The House Energy and Environment Committee has spent much of the first half of this session working on an Act 250 modernization bill. As passed out of committee this week on an 8-3-0 vote, it incorporates some of the provisions within the Necessary Updates to Act 250 report. Unfortunately, it does not yet include other important provisions from the significant package of compromises made by stakeholders before the session. These compromises were based on exemptions in smart growth areas, which are implemented alongside protections. When it is presented on the floor, Rural Caucus members have indicated that they plan to propose amendments. After passing through the House, the bill will be considered by the Senate Natural Resources and Energy Committee, along with the Senate’s version of a housing and Act 250 bill. The five Senators on this committee have the responsibility to implement changes that more effectively balance the efforts invested in this historic compromise.

While there is no single solution to Vermont’s housing crisis, modernizing land use regulations is a crucial step to encourage housing development and meet workforce needs across all income levels. The version of H.687 that the House Environment and Energy Committee approved introduces a vital framework for a tiered, location-based approach to Act 250. However, the current criteria for a smart growth area to qualify for Tier One status are too stringent, likely limiting the number of communities that can receive the exemption benefits.

Additionally, the proposed “road rule” as a new jurisdictional trigger would come into effect years before any area exemptions are approved. This timing means the road rule’s broad application could pose immediate challenges to large-scale housing development in our downtowns, villages, and neighborhood development areas. Implementing this trigger before the Tier One exemptions undermines the compromise agreed upon by stakeholders, and would add additional trigger in places where there has been broad consensus that expedited growth is necessary.

Furthermore, the bill proposes the establishment of an environmental board to decide on appeals to Act 250 decisions, shifting this responsibility from the environmental court. While having a professional board is crucial to ensuring Act 250 becomes a regulatory program that is fair, predictable, and timely throughout the state, assigning it the additional role of hearing appeals may lead to complications, as it would review decisions made by its own staff. This concern echoes the backlash from mayors, town managers, developers, housing advocates, and community leaders when a similar proposal was put forward in 2022, highlighting fears that it could complicate essential housing developments.