2024 End of Session Report

2024 End of Session Report

VERMONT STATE BUDGET FY25:
“THE BIG BILL” – H. 883:
Vermont State’s FY25 of $8.6 B was one of the most important bills to pass this year. Every line in this bill represents a policy choice the Legislature has made to support Vermont and Vermonters. Every line impacts Vermonters in some fashion – whether it is supporting housing for our most vulnerable, our state parks, our public education system, our roads and bridges, the arts or our families in need – this bill has something for everyone. In this bill, all of State government comes together – it is where spending priorities are determined within a fiscally responsible and sustainable fiscal framework. This year the funding requests coming from other committees, the Administration, provider groups, and advocacy organizations exceed available revenues by hundreds of millions of dollars.
For Fiscal Year 2025, the budgetary priority was to first address the funding needs of the core services and functions provided by our State government. Adding new services, programs or benefits historically has come at the expense of adequately funding existing obligations. To that end, the following high priority areas for funding were as follows:
● Justice Investments & strategies to reduce court backlog – additional positions and/or funding provided to our courts, States Attorneys, Defender General, Court Diversion, Pre-Trial Supervision by the Department of Corrections, Community Justice Centers, and Network Against Domestic Violence
● Community Based Service Agencies – provided an inflationary increase in funding to these agencies that serve our most vulnerable Vermonters
● Housing – both emergency housing and the creation of permanent affordable housing received funding, expanded number and stabilized funding of Recovery Houses
● Workforce Development – funding for Serve, Learn and Earn Program provided to prepare more marginalized workers to enter workforce, free tuition for Community College of Vermont, and other forgivable loans and tuition benefits for identified workforce shortage areas
● Health – Implemented the Medicare Savings Program, which once operational, will significantly reduce health care cost burden for low-income seniors
● Climate, Flood Relief & Disaster Preparedness – The Budget included appropriations required to implement two Senate priority natural disaster-related bills – S. 213 Regulation of Wetlands, River Corridor Development and Dam Safety and S.310 Natural Disaster Government Response, Recovery and Resiliency. Funding was also allocated for the FEMA match and to assist municipalities and businesses recover from flood damage.

THE YIELD BILL: EDUCATION FUNDING FY25 – H.887:

There are two property tax classifications within the Yield Bill: homestead and non homestead.
Homestead applies to principal dwellings and surrounding acreage. Approximately two-thirds of
property taxpayers receive a property tax credit based on their income. Property tax credits are
lagged a year, so credits households see on their FY25 bills will be based on their FY24 property
taxes paid and 2023 income. Non homestead applies to all other properties, including apartments,
second homes, and businesses.The homestead property tax rate is affected by local education
spending decisions.The non homestead rate is set at the statewide level and not locally adjusted
by school district spending, although it does reflect total spending statewide.
The Legislature sets the “yield” annually; more specifically, the property dollar and income
dollar equivalent yields for the purpose of setting the homestead tax rate and the non homestead
property tax rate. JFO estimates that the yields and rates will correspond with an average
increase of approximately 13.8% for homestead property tax bills, income education tax bills,
and non homestead property tax bills. These yields and rates are set at a level estimated to be
sufficient to fully fund the Education Fund. The implications of not having a yield bill are
serious.
Property taxes are set to increase significantly this year; the Legislature worked to include
property tax relief, cost-containments and long-term structural reform opportunities for our
state’s education finance system. This includes:
➔ Buying down rates: The yield bill expands revenues to the Education Fund. The revenue
generated will be used to buy down property tax rates. The revenue sources are as
follows:
◆ Repealing the sales tax exemption for prewritten software accessed remotely
($14.7m in FY25, $16m annualized), also known as the “cloud tax exemption.”
Act 51 (2015) created an exemption for prewritten software accessed remotely,
otherwise known as cloud software. The yield bill repealed this exemption and
subject sales of these programs to the 6% Vermont sales and use tax. The repeal
of the exemption would primarily apply the sales tax to Software as a Service
(SaaS) cloud applications and custom software or IT services would continue to
be exempt.
◆ Including a 3% surcharge on short-term rentals ($11.8m in FY25 and $14.7m
annualized). Short-term rentals are defined as a “furnished house, condominium,
or other dwelling room or self-contained dwelling unit rented to the transient,
traveling, or vacationing public for a period of fewer than 30 consecutive days
and for more than 14 days per calendar year” and include both entire units and
single rooms if the rental is for less than 30 consecutive days. Currently, these
rentals are subject to the 9% rooms tax (10% in towns with a local option tax),
which is allocated to the General Fund (69%), Education Fund (25%), and the
Clean Water Fund (6%). The rooms tax allocation would remain the same but the
entirety of the surcharge would go to the Education Fund.

◆ In addition to the above, $25m in surplus General Fund revenues were dedicated
to the Education Fund to have an even greater impact on buying down property
tax rates for FY25.

➔ Long-term structural reform: The yield bill also establishes the “Commission on the
Future of Public Education in Vermont,” and the “Education Fund Advisory Committee.”
The Commission on the Future of Public Education in Vermont to study and make
recommendations for a long-term statewide vision for Vermont’s public education
system. The Education Fund Advisory Committee to monitor Vermont’s education
finance system, conduct analyses, and make recommendations on multiple considerations
of Vermont’s Education Fund. The Committee is composed of 12 members.
➔ Cost-containment measures: The excess spending threshold is a provision that adjusts tax
rates so that districts spending above it are taxed a second time on the excess spending
amount. The excess spending threshold was amended so that it is calculated as the
statewide average per pupil spending in fiscal year 2025, increased for inflation,
multiplied by 116%. It includes an exemption for increases in voter-approved bond
payments year over year.

ACT 250 UPDATE AND HOUSING DEVELOPMENT H.687:

Vermont’s signature land use law, Act 250 is more than fifty years old – it was developed during
a time when most Vermont towns had no zoning or regulations. Act 250 has been an important
check on development that has helped preserve the Vermont we know today. However, our
state’s chronic housing shortage has made it abundantly clear that Act 250 could be improved to
both protect our critical natural resources and make it easier to build much-needed affordable
housing. This bill’s intent is to strike a balance between increasing protections for Vermont’s
most ecologically sensitive areas while allowing for increased flexibility to build housing and
other infrastructure in designated downtowns and village areas.
By transitioning to a tier location-based jurisdiction model, it will essentially be easier to build in
designated downtown areas and village centers, and more difficult to build in environmentally
sensitive areas. The tier designation process of this bill divides all of Vermont into four tiers:
Tier 1A, 1B, 2 or 3. A municipality may apply for a Tier 1A area if they have robust zoning and
development, and thus receive full Act 250 exemption, while Tier 1B areas are designed to be a
more accessible, lower threshold for village centers with existing water or sewer infrastructure.
Tier 3 are ecologically sensitive areas, where even putting a shovel into the ground may trigger
Act 250 review. Tier 2 designation would be everything remaining, which is the majority of
Vermont.
Each town will have the opportunity to work with its Regional Planners to designate areas it
wants to develop and those areas they want to protect or limit development. This is envisioned
to be a ‘ground up’ process, with towns invested in their final tiered map.
One major reform of this bill is increasing tax credits available for housing projects that
prioritize flood mitigation and building code improvements. Additionally, specific flood-impacted properties will be temporarily exempt from state and municipal property taxes.
Property transfer taxes will now be exempt on the first $200,000 of a property’s value, and
instead will be imposed as a 3.4% tax on the sale of second homes.
This bill aims to create a meaningful balance between environmental conservation and
infrastructure accessibility, particularly our dire need for more affordable housing.

CLIMATE RESILIENCE/FLOOD SAFETY – S.213:

After the devastating floods of 2023, and with climate projections indicating worsening and more
frequent future flooding, the Legislature aimed to adopt policies to build climate resilience and
reduce flood-related damages to Vermont’s communities. As Vermont continues to rebuild and
recover from this summer’s devastating flooding, we must guarantee that Vermont is rebuilding
smarter and stronger with resilience against future flooding events at the forefront.
This bill takes important steps toward reducing the risk of future flood damage by addressing
dam safety, improving the state’s approach to development in river corridors and wetlands, and
making watersheds more resilient in the face of the climate crisis. Dam safety will be improved
by strategically removing dams that exacerbate flooding and are a public safety risk. River
corridors will now be regulated by our state to create a stronger buffer between floodwaters and
future development, which will help reduce flood-related damages and costs for Vermonters.
Finally, there is now a 2:1 wetland net-gain policy to reverse historic wetland loss through
protection and restoration.

THE CLIMATE SUPERFUND BILL – S.259:

This bill establishes a process for requiring fossil fuel companies to pay the State for the
damages and costs associated with climate change. These climate change costs include
infrastructure renewal, ecosystem adaptations, public health investments, and more. In turn, this
source of revenue will fund climate adaptation projects in Vermont. Companies that sold more
than 1 billion tons of fossil fuel between 1995 and now will be held liable. The Agency of
Natural Resources and the State Treasurer will report back to the Legislature by January 15,
2025 about the feasibility and progress of implementing the processes of this bill, and how to
move forward most effectively.

THE RENEWABLE ENERGY STANDARD BILL – H.289:

This bill updates Vermont’s existing Renewable Energy Standard, which was implemented in
2015. All utilities would require all utilities to transition to 100% renewable energy by 2035, and
20% of that energy must be generated in state. The RES bill allows utility companies to continue
purchasing nuclear power, and now requires utilities to purchase renewables like offshore wind
power within the region. The bill also restricts large scale hydropower and biomass facilities
from expansion.

IMPROVING GOVERNMENT’S RESPONSE TO NATURAL DISASTERS – S.310:

In the wake of Vermont’s 2023 floods, this bill was crafted to improve our government’s
response to natural disasters through improved planning, communications, emergency response
personnel, and prevention work. The bill creates a Community Resilience and Disaster
Mitigation Grant Program to award grants to municipalities to provide support for disaster
mitigation, adaptation, or repair activities. It also requires a flood after-action review and
expands and codifies the State Emergency Management Plan to include more entities in
emergency planning efforts at the state and local level. This bill clarifies the statutory
requirements and fee assessments for municipal stormwater utilities and creates the state Urban
Search and Rescue Team within the Department of Public Safety. Additionally, it requires
certain policies related to 911 and state emergency communications, including language
assistance services for individuals who are deaf, hard of hearing, or deafblind, and individuals
with limited English language proficiency. Finally, the bill updates the emergency powers of the
Governor.

CONSUMER PROTECTION; DATA PRIVACY – H.121:

This bill’s intent is to balance consumer protection with responsible business practices regarding
data collection. H. 121 puts a range of restrictions on companies who collect and sell sensitive
consumer data, such as social security numbers, or financial and medical information, by
ensuring that companies can only collect or distribute data that is necessary to deliver a good or
service. H. 121 broadens the allowed ways that companies can collect and utilize non-sensitive
data, like for catalog mailings, email lists, and advertising. If a company that processes more
than 100,000 Vermonters’ data annually violates an individual’s privacy rights, consumers
would have the right to opt out, request a cure, appeal, or sue companies (the “private right of
action” provision). The Kids Code provisions of the bill would require Big Tech companies to
have increased privacy protections for minors on their platforms and limit addictive features like
infinite scroll.

PUBLIC HEALTH:
THE PFAS BILL – S.25:

This bill enhances our work to limit exposure to toxic chemicals, particularly PFAS, through
consumer products. Thanks to this bill, cosmetics, menstrual products, textiles, athletic turf, pots
and pans, and other commodities containing PFAS and/or other toxins won’t be manufactured or
sold in Vermont. This bill mandates the Agency of Natural Resources and the Vermont
Department of Health to write a report and implement a comprehensive program to identify,
regulate and limit toxic chemicals in Vermont. Ultimately, both Vermonters’ public health and
our environment will be protected.

THE PRIOR AUTHORIZATION BILL – H.766:

This bill eliminates time consuming administration, paperwork and telephone calls, related to
prior authorization for most primary patient care. It would allow exemptions to step therapy
processes if a consumer’s drug is expected to be ineffective, have adverse side effects, if the consumer is stable on a cheaper substitute, or if the current drug may cause impairment. This will
increase access to care for patients and reduce costs for primary care providers.

THE OPC BILL – H.72:

This bill supports the creation of an Overdose Prevention Center (OPC) pilot program in
Burlington under guidelines developed by the Department of Health. Illicit substances can be
tested for potentially lethal contaminants. People seeking help for addiction can receive medical
care, clean needles, and referral for support and recovery services. In areas where OPCs already
exist, like New York, Canada and Europe, have all reported the reduced need for emergency
transport, decreased crime and public safety needs in areas near OPCs, an increase in those
seeking recovery, and most importantly, a decrease in overdose deaths.

REGULATING GHOST GUNS and PROTECTING POLLING PLACES – S.209:

Vermont currently does not regulate so-called “ghost guns,” which are do-it-yourself,
unserialized homemade guns made from often unregulated parts and kits. Because of loopholes
in federal regulations and state law, ghost gun sales have skyrocketed in recent years, allowing
convicted felons, violent domestic abusers, and other people who are legally prohibited from
purchasing firearms (such as children) to purchase them with no background check and no
questions asked.
This bill requires the core building blocks of firearms to be serialized if they can readily be
converted into fully functioning firearms, ensuring that they can be traced back to their source if
they are used in connection with a crime.
In addition, this bill prohibits carrying guns into Polling Places during early voting and elections.
The bill does not prohibit Vermonters from manufacturing homemade firearms, including
through the use of 3D printing technology, it simply requires them to go through a background
check and ensure the firearms they manufacture are serialized.
Critically, this bill would give Vermont law enforcement the tools to pursue individuals and
companies selling ghost gun kits into Vermont, allowing them to cut off the flow of ghost guns at
its source. Protecting the health and safety of Vermonters with commonsense provisions such as
those in this bill continues to be a top priority of the legislature.

THE CAPITAL BUDGET BILL – H.882:

A major topic in this year’s capital budget bill was the replacement of the Chittenden Regional
Correctional Facility, Vermont’s only women’s prison. This section of the bill gave authority to
the Commissioner of Buildings and Grounds to evaluate potential sites for a new facility and to
purchase land in a location that meets certain criteria, which include being near support services,
work opportunities and transit. The bill also authorizes purchase of property to site a reentry
facility, which would be the first of this type in the State. A reentry facility is designed and
operated to help people prepare for transition back into the community, providing continual access to services and supports and allowing individuals to participate in work release and day
reporting.

CODE OF ETHICS UPDATE – H. 875:

This bill builds on the work of the last 6 years to establish an Ethics Commission and a code of
Ethics for Vermont’s state and local government. This year’s addition to that work is
encompassed in H.875 and has three main intentions: to add requirements for state and county
candidate and executive official financial disclosures, to expand the powers and duties of the
State Ethics Commission, and to create a Municipal Code of Ethics. This bill adds disclosures of
certain investments, loans, and trusts for candidates, certain executive officials, and their
spouses/partners, and imposes penalties for failure to comply. It expands the power of the Ethics
Commission to collect data, provide guidance, engage in investigations, and issue warnings and
reprimands regarding ethics complaints. Finally, the bill creates a Municipal Code of Ethics for
certain town officials, requires training, policies & procedures, enforcement, and reporting. This
bill also establishes whistleblower protections for municipal employees. These provisions are
phased in over the next two years.

MOVING TOWARDS PAY EQUITY – H.704:

The Vermont Legislature continued its work improving pay equity for Vermonters – especially
Vermont women and members of our BIPOC community. This bill requires Vermont employers
to disclose compensation or a compensation range, in job advertisements to prospective
employees. By providing greater information on compensation during the job application
process, people are empowered to negotiate on a level playing field. Currently, women in the
United States make 84% of what men make, and in Vermont, they make 93% of what men do.
When employers enter negotiations without a predetermined salary range, candidates tend to rely
on their past pay as a reference point. It’s common for applicants to request a salary 10-20%
higher than their previous earnings. However, given that women and people of color typically
earn less than white men in the same occupations, they would need to demand a much larger
increase to reach equity. Consequently, women and people of color often state lower salary
requirements during negotiations which means existing pay disparities are perpetuated.
Providing applicants with clear information about negotiation contexts significantly reduces
gender disparities in negotiations. With this information, gender-based differences in negotiation
diminish, leading to fairer outcomes.

OPEN MEETING LAW UPDATE – S.55:

Since the beginning of the COVID pandemic, we have temporarily permitted all public bodies to
meet fully remotely, without a physical meeting location. These provisions expire on June 30,
2024. Thus, S.55 will permanently update Vermont’s Open Meeting Law, requiring all state-
level non-advisory public bodies to meet in hybrid form, all local non-advisory public bodies to
meet with a physical presence, and all advisory public bodies to meet in the manner of their
choice. The bill requires public bodies to provide alternative access to members of the public and
establishes that public bodies may alter their meeting plans in the event of emergencies or certain
local incidents. The bill establishes a working group, chaired by the Secretary of State, to provide further recommendations for improving access to and participation in Vermont’s public
meetings. See this one-page summary for further details.

THE LITERACY BILL – S. 204:

This bill proposed to require the Agency of Education to approve universal reading screeners for
use by public school districts and approved independent schools and these entities would be
required to screen students in kindergarten through grade three using the universal reading
screeners. Reading interventions would be implemented for students who exhibited substantial
reading deficiencies, and families would be notified. Certain reading performance data would be
required to be reported from school districts and approved independent schools directly to the
Agency of Education.

THE LIBRARY BILL – S.220:

This bill mandates that library policies align with the First Amendment and anti-discrimination
laws, ensuring libraries remain safe havens for free speech, inquiry, and discovery. This bill also
requires school libraries to draft and maintain collection policies and reconsideration procedures
when developing their collection. With these clear policies and procedures, it is impossible to
simply ban a book because of someone's personal discomfort or bias.
Vermont libraries set a bold vision that will hopefully inspire other states to recognize and
support the integral role of libraries in fostering an informed and inclusive society, while
protecting an individual’s right to free access to information. This bill is an affirmation of the
essential role that libraries play in the cultural and educational landscape of Vermont.