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Senate approves bill that would extend motel program, send aid to flood-impacted towns

A brick motel building with red doors
Carly Berlin
Vermont Public and VTDigger
The Autumn Inn, a motel in Bennington that shelters unhoused people through the state’s motel voucher program, pictured on Jan. 31, 2024.

The Vermont Senate approved a mid-year spending bill on Wednesday that would, among other proposals, extend motel housing eligibility for unhoused Vermonters, and allocate millions of dollars of funding to areas hit hardest by last July's flooding.

Motel housing

The legislation includes nearly $12 million to extend motel housing eligibility for the approximately 1,600 individuals enrolled in the program now.

Waterbury Rep. Theresa Wood, the Democratic chair of the House Committee on Human Services, said the appropriation ensures that families with children, people with disabilities and other vulnerable Vermonters will have access to shelter until at least June 30. The program was previously scheduled to wind down on April 1.

“For the legislative body, we feel it’s imperative that we house people, especially vulnerable populations,” Wood said.

A group of older adults sit around a wooden table looking at documents.
Pete Hirschfeld
Vermont Public
House and Senate leaders finalized an agreement this week on a mid-year spending package that includes funding for emergency motel housing and flood relief.

Frank Knaack, executive director of the Housing and Homelessness Alliance of Vermont, said his organization appreciates the extension. And he said the bill includes new procedures for determining disability status that will result in more Vermonters being eligible for emergency housing.

Knaack, however, said he’s “deeply concerned” about a provision in the legislation that sets a new maximum daily rate cap of $80 on motel stays.

More from Vermont Public: Proposal for reining in Vermont’s motel housing costs creates uncertainty, anxiety

“What we’ve heard from our folks on the ground is that a great number of hotels in Vermont have said they will not do this,” Knaack said. “And what this means functionally is that, as of this Friday, when the rate cap would go into effect March 1, that people will be out on the street. And there’s no place for anyone to go. Our shelters are full. Our service providers are maxed out, and so we’re going to have a real crisis on our hands in Vermont starting as soon as this Friday.”

Advocates have been trying to sound the alarm over the rate-cap provision for weeks.

On Monday, the Chittenden County Homeless Alliance sent a letter to lawmakers urging them to shelve the cap. The Alliance said that seven of the 12 hotel owners participating in the shelter program had indicated they would withdraw if the state capped daily rates at $80.

“Those seven motels which may decline to participate in the program beyond this week currently provide 225 rooms for individuals and families who are unhoused,” the letter said.

Republican Gov. Phil Scott said that he’s far more optimistic about compliance with the new cap. He said the Agency of Human Services is enjoying “huge success” in negotiating lower rates with hotel and motel owners.

“We’re making tremendous gains right now,” Scott said.

Scott said the hotel owners who initially balked at the cap have become more amendable to contract renewals once it became clear that the legislature planned to proceed with the $80 limit.

“The closer we got to this reality that the cap is going to be in place … the more agreements we had,” he said. “And I expect we’ll have a few more over the next couple days, so I feel as good as I can feel at this point in time.”

Brenda Siegel, executive director of End Homelessness Vermont, expressed severe concerns about motels withdrawing from the program Tuesday.

“And that means that without any notice, and without any preparation of providers, potentially hundreds, maybe thousands, of people will end up outside,” Siegel said.

By Wednesday afternoon, however, Siegel said she’d talked with two hotel owners on whom the state is particularly reliant for rooms in southern and central Vermont and in Chittenden County. And she said they had both tentatively agreed to remain in the program despite the new cap.

Siegel said their decision was based in part on a provision in the legislation that allows the state to pay hotels additional fees for things like security or space for on-site services.

“So a lot of people who were backing out are now coming back to the table,” she said.

A shot looking down Main Street in Barre, with store fronts to the left and right and several feet of water on the road.
Peter Hirschfeld
Vermont Public
Under the spending bill, Barre City will receive a $1 million grant to aid in flood recovery.

Flood relief

City officials in Barre, Montpelier, Ludlow and Johnson are breathing a little easier after lawmakers finalized legislation that includes $3.25 million in aid for the four municipalities hit hardest by the summer floods.

The mid-year spending bill, known in Montpelier as the budget adjustment act, includes $12.5 million in direct aid for towns and cities that experienced flood damage last summer.

Half that money will help towns cover the federal match needed to draw down FEMA assistance to repair road, bridges, municipal buildings and other public infrastructure. The remainder is being doled out in block grants that municipalities can use for whatever flood-related purposes they deem most appropriate.

More from Vermont Public: Which areas in Vermont were hit hardest in the July flooding?

Barre City, which experienced more flood-related losses than any other jurisdiction, will receive a $1 million grant.

Barre City Rep. Jonathan Williams said he attended city council Tuesday evening to deliver news of the aid package.

“The sense of relief in city council chambers was palpable. There was applause. A few people got teary eyed, myself included,” Williams said. “The need … was so great. So many people there have suffered and struggled for so long to figure out how we’re going to move forward as a community that they were very, very, very relieved to hear this information. It was very moving.”

Williams said Barre is poised to use the money to offset a $1.4 million loss in municipal revenues, which would have otherwise required reductions in city services or a substantial increase in local municipal property taxes.

"So many people there have suffered and struggled for so long to figure out how we’re going to move forward as a community that they were very, very, very relieved to hear this information. It was very moving.”
Barre City Rep. Jonathan Williams

Johnson, Ludlow and Montpelier are all slated to receive $750,000 grants. Another 108 municipalities will get grants ranging from $10,000 to $75,000, based on a formula that takes into account the severity of flood-related damage municipalities experienced.

The legislation is set for a final vote in the Vermont House of Representatives later this week.

What’s next?

Gov. Phil Scott said he plans to sign the budget adjustment act into law when it reaches his desk, despite concerns that the bill includes more spending than he proposed.

Scott said the additional allocations mean that lawmakers will have to pare back spending in the fiscal year 2025 budget bill that’s currently in the House Committee on Appropriations.

“These aren’t easy decisions to make, and when you have a finite amount of money that you can’t exceed, from my standpoint, then you have to make choices,” Scott said. “The added cost has got to come out of something.”

Williams said Scott’s approach represents a “scarcity mindset” that lawmakers such as him aren’t inclined to accept. And while the governor might not be willing to consider increases in taxes or fees that would be needed to support state spending beyond next year’s current revenue forecast, Williams said he is.

“I don’t think it’s a zero-sum,” he said. “That’s only true if we’re not willing to consider, for example, a 3% income tax surcharge on those who make $500,000 a year or more.”

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The Vermont Statehouse is often called the people’s house. I am your eyes and ears there. I keep a close eye on how legislation could affect your life; I also regularly speak to the people who write that legislation.
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