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Every week, Vermont Public's politics team provides a succinct breakdown of some of the biggest issues at the Statehouse.

Capitol Recap: With competing bills, road to Act 250 compromise remains unclear

People sit around a table in front of a large window where a snowy slope can be seen outside
Glenn Russell
The House Environment and Energy Committee takes testimony on a land use bill that would affect Act 250 at the Statehouse in Montpelier on Wednesday, Jan. 31, 2024.

This story, by Report for America corps member Carly Berlin, was produced through a partnership between VTDigger and Vermont Public.

Before lawmakers descended on Montpelier in January, they appeared poised to make sweeping changes to Act 250, the signature land-use law that has governed and guided development in the Green Mountain State since 1970.

Lawmakers convened this session with an influential proposal in hand, calling for loosening Act 250 regulations on housing development in some areas and strengthening rules for building in sensitive habitats. The report — crafted by planners, engineers, attorneys and housing proponents at the Legislature’s request — represented a delicate compromise between two camps historically at loggerheads over the law: those seeking stronger environmental protections and those pushing for housing and economic development.

The report was light on details, though, and left plenty of room for lawmakers’ interpretation. They have responded with a spate of bills aimed at tackling Act 250 reform. Some place more emphasis on lowering barriers to housing development; others focus on bolstering ecosystem preservation.

As lawmakers approach a key mid-March deadline — when bills must cross from one chamber to the other in order to advance — the path forward for major Act 250 change looks murky.

“There are many irons in the fire,” said Senate President Pro Tempore Phil Baruth, D/P-Chittenden Central, in an interview Tuesday. The fact that there are at least four Act 250 bills circulating around the Statehouse is a positive sign, Baruth said: It means there’s good “juice” behind the idea.

But it makes it challenging to predict the contours of a potential compromise.

“What might be maddening for people outside the building is trying to follow and sequence those bills,” Baruth said. “I feel for them, because I’m having difficulty myself.”

A series of tiers

The working group’s report called for chopping Vermont into a series of “tiers,” where some downtowns and villages “with the capacity for growth” would get full or partial exemptions from Act 250 review (so-called “Tiers 1A and B”), and other “ecologically important natural resource areas” would trigger automatic consideration under the law (deemed “Tier 3”). Areas that fall between those two categories – or “Tier 2” – would more or less stay status quo in the eyes of the law.

The House Environment and Energy Committee has been working on H.687, a sprawling bill that aims to further define those tiers — and how their boundaries ultimately get decided.

It sets up detailed guidelines for municipalities to apply for a new “planned growth area” designation with the state — essentially, Tier 1A — where development could bypass Act 250 review. Those requirements would include things like zoning bylaws, water and sewer capacity that can accommodate more development, wildlife habitat planning rules, and adequate staff capacity to review development locally.

Gov. Phil Scott opposes this approach, however, calling the exemptions in the bill “narrow, stringent, and geographically limited” at a press conference in early February. Some critics within the Legislature view the proposed requirements as too arduous.

This week, the Rural Caucus sent a letter to the committee’s chair and House leadership saying 39 of its 43 members would not be able to support a bill that includes “unnecessarily restrictive capital, infrastructure and staffing requirements” for municipalities to clear the hurdle for Act 250 exemptions.

Rep. Katherine Sims, D-Craftsbury, who co-chairs the influential caucus, said in an interview Tuesday that the group of lawmakers wants to assure “every town has an opportunity to make decisions about if, and when, and how that town might grow.”

A woman sits at a table
Glenn Russell
Rep. Amy Sheldon, D-Middlebury, chair of the House Environment and Energy Committee, listens as the committee takes testimony on a proposed land use bill that would affect Act 250 at the Statehouse in Montpelier on Wednesday, Jan. 31, 2024.

The House Environment and Energy Committee is still tweaking what, exactly, these requirements will be — and is considering what capacity towns have to review development on the local level, said Rep. Amy Sheldon, D-Middlebury, the committee’s chair.

“At a bare minimum, you need zoning and subdivision bylaws, and a plan, and the staff to oversee a permit program,” Sheldon said.

Exemptions now or later

Instead of setting the different tier definitions in stone now, Sims said the caucus wants to see more opportunities for members of the public to weigh in on them first. She pointed to the working group report’s proposed timeline, which calls for the Natural Resources Board — the body that administers Act 250 — to draft rules by the end of the year and implement them in the summer of 2025 or 2026.

Sheldon, though, said plenty of public input has already been gathered.

“There’s been at least eight years of public engagement on this conversation,” she said. While her committee is moving forward with definitions for Tier 1, though, she said it is considering a longer rulemaking process for Tier 3: areas that would be deemed so ecologically sensitive that putting a shovel in the ground would trigger Act 250.

Other Act 250 bills would give the state more time to create a tier system — while putting in place interim Act 250 exemptions in the meantime.

S.311, which the Senate Committee on Economic Development, Housing and General Affairs advanced in mid-February, punts on defining the new tiers in statute now, but proposes interim Act 250 carve-outs for new housing development until mid-2029.

During that time frame, development within some state-designated centers (and along their peripheries) would be fully exempt from Act 250. Additionally, in areas with zoning that are served by municipal water and sewer systems, a developer could build 75 units of housing within two years without triggering Act 250, and in areas with zoning but without that utility infrastructure, a developer could construct 30 units of housing in the same time frame.

Committee Chair Sen. Kesha Ram Hinsdale, D/P-Chittenden Southeast, said the interim exemptions are meant to encourage more housing development now – while a longer Act 250 rulemaking process plays out. She nodded to other bills that would place further regulations on building in flood-prone areas, and said Vermont needs to focus on allowing more housing growth outside of those regions.

“River corridors and floodplains — that’s where a lot of our housing is, that’s where we are living at our densest,” Ram Hinsdale said. “If we are going to move people out of those areas and onto dry, safe ground, we’re going to need to build to scale in populated areas — without building right along the rivers.”

S.311 has Gov. Scott’s blessing. The bill incorporates many measures from an administration-backed housing bill, which has not advanced. In a press release last week, Scott reiterated his position that the state needs to reform regulations in order to spur more investment in housing development from the private sector.

But not all are supportive of the interim-exemption approach. Jon Groveman, a lobbyist for the Vermont Natural Resources Council, wants to see smaller-scale Act 250 exemptions that were approved last year remain in place instead. He thinks S.311 would put in place even broader exemptions than those the working-group – which he participated in – agreed upon in the report.

“That is problematic to us,” he said.

The path from here

S.311 now sits before the Senate Committee on Natural Resources and Energy, where H.687 is likely to land after the crossover deadline. To further complicate matters, the committee has its own Act 250 bill — S.308 — though it hasn’t spent much time workshopping it.

Later this spring, the committee will need to work on reconciling the different takes on the basic Act 250 tier framework, said the chair, Sen. Christopher Bray, D-Addison.

“When we have all the ingredients on the table, then we’ll start cooking completely,” Bray said. “It’s gonna get hot in the kitchen in March, April.”

A green sign with yellow lettering reads "State of Vermont Agency of Natural Resources, Act 250"
April McCullum
Vermont Public
The Act 250 District 4 office is based in Essex Junction and helps review development projects under Vermont's land-use law.

In an interview last week, Bray said he was not up to speed enough to comment on the details of the various Act 250 bills in the works. But broadly speaking, he argued that Act 250 has become an easy target for Vermont’s housing woes when other factors, like inflation, continue to stymie housing development.

“It’s very hard to prove a negative, but the cases where Act 250 has really been problematic are far and few between,” Bray said. “It’s become a pretty convenient whipping boy for difficulties in development.”

Megan Sullivan, a lobbyist for the Chamber of Commerce who served on the working group, hopes to see lawmakers uphold the compromise the group found. To her, limiting redundancies in regulation by exempting some areas from Act 250 review is an important way to spur more housing growth.

“There’s an opportunity to say, let’s trust our regions and towns that have done this work to do the approval of development projects and not put a project through another timely and costly process,” she said.

Groveman, from the VNRC, said he thinks there’s an opportunity for the group’s consensus to infuse whatever bill or bills advance — and allow holistic changes to the land-use law that would allow for both more housing and stronger environmental protections.

But that doesn’t mean the road to get there is straightforward.

“I don’t think we’re off track — but it’s certainly not been smooth sailing,” he said.

Have questions, comments or tips? Send us a message.

Carly covers housing and infrastructure for Vermont Public and VTDigger and is a corps member with the national journalism nonprofit Report for America.
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