The 2023 legislative session came to an end this week. While legislators are expected to return next month for a veto session, they passed a number of bills in the final days. These included the primary housing bill of the session and a major overhaul and investment in early childhood education. In a last-minute effort, legislators also invested in themselves, significantly increasing legislative pay and creating an entirely new benefits package.

The budget that emerged this week contained $8.5B in spending and included a new payroll tax that would be split between employers and employees (to fund the afore mentioned child care bill).

The Senate Economic Development Committee came back on Wednesday to review the House changes to S.100, which they did not yet possess, and the single House floor amendment that persisted with the bill (there were many other attempts to amend it).

The Senate Economic Development Committee finished reviewing changes to S.100 on Friday morning and brought the bill to the Senate floor for a vote. Funding was still pulled out and included in the budget. Currently it appears fairly significant (over $200M according to the Committee of Conference report) but the Governor is expected to veto the budget bill so things could change.

No new arguments were presented on the House floor Tuesday; the bill primarily deals with municipal zoning reform and feigned to address Act 250 issues, shy of a few time-limited exemptions. It focused on large lot sizes, excess parking requirements, excess setbacks, and other local zoning requirements legislators felt inhibited housing growth.

Critics of the bill argued that municipal reform should be paired with rollbacks to Act 250, the state’s major land-use and environmental law. However, since the bill passed third reading in House with a voice vote, incremental progress will have to be settled for. Amendments were introduced to limit energy requirement that could drive up construction costs by tens of thousands of dollars, but it was disagreed to. Other amendments would have moved up some of the implementation dates, add reviews of current processes for inclusivity, and widen the priority housing project exemption in Act 250. They were met with varying levels of success.

After passage, the Senate Committees began reviewing the bill.

The session’s major Housing bill, S.100, arrived on the House Floor Monday. Speaker Krowinski announced they would only receive the committee reports and then adjourn for committees of jurisdiction to consider amendments before returning. No votes would be taken during this floor session.

The House Government Operations Committee reviewed another round of amendments to S.39 that would later be voted on by the House. These included technical corrections to language in the bill and accountable reimbursement of expenses instead of per diems.

A number of amendments were reviewed by the House Government Operations Committee and then reviewed on the House floor later in the day. These included attempts to reduce health care coverage to just during the legislative session, looking at creating an independent commission to oversee legislative compensation, study appropriate salaries instead of new salaries instead of setting them now, and shortening the legislative session to 12 week (typically around 19 now).

Two different House committees reviewed S.39 on Monday, passing the bill quickly to get it back to the floor in time for Friday adjournment. The bill encompasses significant increases in salaries for legislators, an entirely new benefits package, and more generous expense reimbursements. Proponents claim it will make legislative service more accessible to members of the public by moving compensation more in line with median wages across the state.

The House took up S.5 on Thursday to override the Governor’s veto of the bill.

Representative Beck presented the bill on the floor Monday. Major changes from the Senate involved a slightly increased average tax increase and a reduction in the tax newly-created reserve to help buffer property taxes in FY2025. In the Senate version, this fund was reduced from $22M to $13M.

As the 2023 legislative session is winding down, legislators are rushing to give themselves a pay raise and a new benefits package. The effort would bring Vermont legislative pay closer to the $31,775 median for legislators across the country. We reported on this when the bill passed the Senate, at the time it looked like the bill would likely wait until next year, but the House is posturing to move aggressively on it.

The Senate Finance Committee reconvened on Wednesday to review their changes to H.492, which sets the annual property tax rate calculation. The draft changes would decrease the income yield to $17,537 and the property value yield to $15,443. It’s worth noting that decreasing the yield will increase local tax rates. The non-homestead property tax rate would be increased from $1.388 to $1.391.

Tuesday

The House Government Operations Committee took up the legislative compensation bill, S.39, on Tuesday, reviewing the Senate version of the bill.

Josalyn Williams (Policy Specialist, National Conference of State Legislatures) joined the Committee to provide testimony on legislative compensation across the country. Legislative salaries range from $0 to nearly $120k annually. The median pay is around $31,775 per year. However, for part-time legislatures, this number drops to $13,111 in annual compensation.

On Thursday morning, the House Environment & Energy Committee returned to review their committee amendment to the bill. The changes included the recommended amendment by Commissioner Hanford from the previous day. The amendment also included the language requested by Green Mountain Power, as well as a study on the distribution of utility projects, where they were occurring, and what permits were required. Finally, the amendment would change the 5-5-5 rule to a 10-5-5 framework.

Wednesday afternoon, the House Environment & Energy Committee returned to hear from Josh Hanford (Commissioner, Department of Housing & Community Development) on a draft amendment related to the appeals process in Act 250 that allows 10 unrelated persons to petition for an appeal. The language that he was proposing, and that the VNRC and others had agreed to, would prevent such a group from appealing if some component of the project included affordable housing. The previous language that the Committee had passed would allow any “aggrieved” person to appeal except for affordable housing projects.

After lunch on Tuesday, the House Environment & Energy Committee continued their work on S.100. They now had a Draft 5.1 from Legislative Counsel to review.

The new draft of the bill includes a section signaling a major policy shift. The new language would call for the Natural Resources Board to work with the Vermont Association of Planning and Development Agencies to develop a framework for delegating the Administration of Act 250 permits to municipalities. The Committee expressed interest in asking for consultation with an “environmental organization,” state agencies (presumably the Agency of Natural Resources), and possible public hearings.

On Monday, the House Environment & Energy Committee took up S.100, which is the main housing bill this session. The Committee was reviewing Draft 4.3 of the bill with Legislative Counsel. A number of provisions in the bill would override local zoning regulations that some consider discriminatory and may discourage growth.

On Tuesday, Chairman Campion brought up H.483 for the Senate Education Committee to see where members are at with the bill. He noted that the provisions related to discrimination were addressed in the 2200 rule series and “seemed to be working effectively.” He added that people had been asking about the moratorium on new schools receiving approval status. He thought it might make sense to move forward on that piece and then “assess” next year “how many [schools] are in the queue.”

Governor Scott has already promised to veto the Clean Heat Standard (S.5) passed by the Senate on Thursday. Senators voted 20-10 to concur with the House version of the bill that would create a carbon-pricing system for heating fuels based on their carbon intensity. This was one vote short of being able to sustain a veto, so one Senator would need to shift their position on the bill in order to Scott's veto to be successful.

In preparation for the vote, Campaign for Vermont sent a letter to the Senate Appropriations Committee explaining why the "check-back" provision was weak and they should strengthen it. One of the bill sponsors acknowledged in the floor debate that the original version of the bill "fully implemented the Clean Heat Standard,” and that the check-back was an afterthought. Essentially, the bill allows the Public Utility Commission to implement key pieces of the system prior to legislative approval and exercise enforcement powers for non-compliance.