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.
House Environment & Energy Committee
The Committee began reviewing floor amendments to S.100 on Tuesday morning. The first one up was an amendment from Representative Higley which would freeze the commercial and residential building energy standards until 2025. There is “a lot of talk” about legislation “driving up costs,” he said. There are concerns that the new building standards, which are headed to LCAR for approval, could drive up costs further. He is proposing they delay enforcement for two years.
He offered some comments by Huntington Homes that compliance with the 2015 residential codes was found to be only 54%. This lack of compliance was because there was no enforcement, no inspection, and no training. An 1800 sq. ft. home built today, based on the 2015 standards, would add $28K in construction costs but only provide $1,000 in annual energy savings.
Snyder Homes also supported a two-year delay and their estimates were similar to the ones above. The Vermont Homebuilders & Remodelers Association also agreed. Montpelier City Housing Committee sees these updates as cost drivers as well.
Representative Bongartz noted that he also serves on LCAR. He explained they have a limited role they play and that some rules can be enacted without LCAR approval. However, they do have the ability to postpone if it is needed.
Chairwoman Sheldon acknowledged the “enforcement issues” and added that they have authorized a study of this in the bill. However, she stated that retrofitting is more expensive than during addressing these needs during new construction, so she was dismissive of the point.
Representative Sibilia questioned what harm could be done from not delaying. Higley reiterated that it would drive up the cost of construction and that the associated returns to the homeowner are questionable. Sibilia asked whether there is a “fix” on the horizon in two years. Higley responded that there may be better technologies and also training and enforcement mechanisms may be better prepared following the delay.
Sibilia brought it back to the cost issue. The up-front costs were being converted into savings for “years and years” over the lifecycle of the building.
NOTE: Yes, there will be lifetime savings, it just may take decades for the owners to realize those savings. Because energy codes don’t generally influence the sale price of a home, the original owner of the property seems unlikely to recoup this expense.
Representative Satcowitz felt that the “industry always says what is in their interests” and have a “long history” of overestimating what regulations will cost them.
Representative Patt felt that this would “kick the can down the road and it’s overdue already.” There was a fair amount of debate on this point.
Sheldon argued that they “have a lot of dollars to build housing and is not the time to step away,” from their standards. Basically, saying they have leverage now because of the dollars they are spending.
Bongartz was “very reluctant to step into the process at LCAR. That is very rare.” He did not feel that it was a routine course of action for the legislature to get involved.
Sibilia agreed, they have interrupted the rules process before, but without further testimony “this is not the right time to do so.”
The Committee took a straw poll, which failed to support the amendment 2-9-0.
Representative Small introduced her amendment next, which would move the effective date for a provision related to municipal bylaw restrictions up to July 1, 2023. This change would make the dates coincide with General Assistance Emergency Housing Program. The amendment would not change any definitions, only the implementation date.
Bongartz noted that the current bill gives towns a year and a half to develop language as interim bylaws required under this provision. He expected that September 1st (currently in the bill) is “barely enough time” to draft and implement interim bylaws.
Sheldon more or less agreed but added that they don’t have language allowing emergency shelters in there yet and they would “mostly have no control.”
Karen Horn (Director of Public Policy, Vermont League of Cities and Towns) stepped up and said that they support keeping the compromise of September 1st intact and they are disappointed that the language they proposed about co-locating support services was not adopted.
Small asserted that Legislative Counsel told her only two weeks were necessary for “interim bylaws” to be implemented. Horn and others disputed that timeline.
The consensus was to keep the September date as they felt most towns could not achieve any practical progress before July 1st.
Next, Sheldon offered her own amendment, which would ask the Vermont Association of Planning and Development Agencies to consider “possible new methods of public engagement” that promote equity and expand opportunity for meaningful participation by impacted communities in the decisions (zoning or Act 250) affecting their physical and social environment. This amendment was found favorable.
Representatives Harrison and Beck were next to present their amendment, which would open up the current Act 250 exemption in the bill for projects under 25 units and have it apply to any zoned areas in the state. This would “greatly expand” the number of towns and communities which could “engage” in this program, they argued.
They noted that the current exemption only covers 0.5% of the state, whereas 53% of the state had some sort of zoning.
They attempted to explain that current the “10 units rule” now in play and the available land for 25-unit projects is so limited in downtown areas that builders are hamstrung. This is really what is happening in towns, they claimed.
Bongartz defended the current program, believing that the designated areas in Act 250 are working fine and that the change proposed would be “asking for sprawl.”
Representative Patt was interested in expanding the idea of the 25-unit projects but this particular proposal seemed a “bit expansive” and they have not taken any testimony on it.
Sibilia agreed with the sponsors of the amendment about the expansion of the areas, but they had “worked really hard to balance” the priorities here and she expected more work next year on Act 250. She would not support this move yet. Others on the Committee were also interested in looking more at this question but were not ready to support the proposal at this time.
Representative Smith argued that the committee is contradicting itself here, noting that the legislature has been pushing housing “like mad” and now they have something that would add more but won’t support it.
The Committee voted 2-9-0 against the amendment.
Representative Mulvaney-Stanak also had an amendment to the bill being offered but the Committee did not take it up Tuesday morning.
House Floor
The House returned to S.100 on Tuesday to pass the third reading of the bill 135-11 and send the bill back to the Senate. All amendments reviewed Tuesday morning by the Environment & Energy Committee were either withdrawn or disagreed to.
Appropriations are not currently in the bill but will be dealt with in the final budget, specifically it is expected that a generous amount of monies for affordable housing construction will be provided for in the budget.
Senate Natural Resources Committee
On Tuesday, the Committee dove into a side-by-side of S.100, comparing the House and Senate Versions of the bill. Chairman Bray shared that they were having a brief meeting to review “newer proposals” from the House regarding a Green Mountain Power request.
Peter Gill (Executive Director, Natural Resources Board) was up first and explained that they are working on identifying several “possible pathways” in current law to help utilities with weather and grid hardening. Traditional right of way (ROW) laws doesn’t necessarily cover this kind of work.
One step of this hardening process is to move current ROWs in closer to roadways to make them easier to access and repair line damage. The Natural Resources Board (NRB) has Rule 10 which waives the “traditional requirement of all landowners being parties to the application process.” However, it is more or less a requirement for the utility to already have “ownership and control” over ROW’s before going into the Act 250 process, which can be difficult.
Candace Morgan (Director of Corporate Affairs, Green Mountain Power) was up next and shared some of the same statistics from the House last week about the increasing severity of storms and their impact on the grid. “To move forward and storm harden” they need to move closer to roadways, she argued. One of the hurdles in these projects are that the Act 250 review process changes depending on whether they are a “10-acre town” or “1 acre town.” The 1-acre threshold “just adds to complexity.” Whereas the 10-acre towns “move along pretty well.”
Senator McCormack was not convinced, but Senator Watson felt the exemption they were asking for was “sufficiently narrow” but wanted to make sure it stayed that way.
Billy Coster (Director of Policy and Planning, Agency of Natural Resources) shared that his Agency appreciated the need for these resilience upgrades, and they are always open to tweak the review process when anyone comes forward with a unique issue. The NRB has done some “really good work” on this issue and the Agency of Natural Resources (ANR) has committed to do the screening of these projects as well. However, the real need, he said, is that the “existing system solution” is insufficient here.
That said, ANR is advising that regulatory relief be “as narrow and specific as possible” and the timeframe also limited and brief as possible. They would like to see a January 2025 study deadline, followed by an exemption structure.
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