This bill would create a new sales tax exemption for building materials and supplies used in constructing "priority housing projects" as defined in Vermont law. It directly affects construction companies and developers building qualifying housing projects by eliminating the state sales tax on materials like lumber, drywall, and roofing. The exemption applies to all materials consumed during construction, including those physically incorporated into the building. The change would take effect on July 1, 2025, and requires vendors to maintain records of exempt sales.
Vermont's S.104 would replace the current education property tax with an income-based education tax starting in 2027, eventually applying to all residents (homeowners and renters) by 2030. The bill eliminates the homestead property tax but keeps nonhomestead tax on non-residential property, while creating new renter credits against the income tax and adjusting property tax credits to provide broader relief for lower-income households. It also establishes a new top income tax rate to offset revenue losses from these credit changes. The bill is currently in the Finance Committee after its first reading on February 28, 2025.
This bill, H.494, allocates $29.6 million in state bonding funds for capital construction projects across Vermont's government buildings and community initiatives over two fiscal years (2026-2027). It directly affects state agencies like the Department of Buildings and General Services, which will use funds for building repairs (e.g., Rutland building roof repairs, Burlington parking garage upgrades), and community grant programs. Key provisions include $1.8 million for historic preservation grants (like Bennington Battle Monument maintenance) and $3.9 million for community projects such as cultural facilities, recreational spaces, and agricultural fairs. The bill was signed into law by the Governor on May 22, 2025, and specifies exact project allocations with no new policy requirements.
H.148 requires Vermont's Secretary of Education to develop a proposal for transitioning the state to a single statewide school district by fiscal year 2028, modeled after Hawaii's system. The bill cites Vermont's unusually small school districts (averaging 315 students each, compared to the national average of 3,382) and aims to reduce administrative costs while improving educational equity for Vermont's declining student population. The Secretary must consider Hawaii's experience with this model, including impacts on special education funding, and submit a detailed plan with a timeline to the legislature by January 2026. This proposal would address Vermont's complex local school governance and funding system, which currently ties district tax rates to per-pupil spending. The bill does not implement the transition but mandates the planning process to begin.
H.307 establishes Vermont's Community Radio Grant Program to provide funding for nonprofit community radio stations. It directly affects Vermont's seven active community radio stations (eligible for up to $25,000 each) and three upcoming stations (eligible for up to $10,000 each), which serve rural and underserved areas and provide critical emergency information during disasters. The program funds equipment upgrades, backup generators, and operational improvements to enhance emergency broadcasting and station sustainability. Grants require a detailed implementation plan and annual reporting on fund use and impact, with $205,000 appropriated from the General Fund for fiscal year 2026. The bill takes effect July 1, 2025.
H 397 updates Vermont's emergency management and flood response systems. It requires the Division of Emergency Management to annually report on mitigation plans to legislative committees and revise the State Emergency Management Plan every five years to cover response coordination, preparedness, and local planning templates. The bill expands grant funding for flood mitigation projects, including voluntary buyouts for flood-affected properties, and mandates new assistance for municipalities to access river monitoring and weather alert systems. It also provides municipalities with greater flexibility to borrow funds for emergency-related expenses and manage unspent budget balances. These changes directly affect state agencies, local governments, and communities in flood-prone areas.
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Emergency Management
H.423 appropriates $1 million from the General Fund to the Agency of Agriculture, Food and Markets for the Vermont Working Lands Enterprise Board to fund projects from the Vermont Agriculture and Food System Strategic Plan (2021-2030). This directly supports Vermont farmers, food businesses, and local food systems by prioritizing initiatives that strengthen connections between producers, processors, and markets. The funding aims to improve food security, climate resilience, and community health through concrete project grants, as outlined in the Strategic Plan’s goals. The bill takes effect July 1, 2025.
This bill would establish universal Medicaid-equivalent health coverage for all Vermont residents, phased by age group starting in 2029. It requires coverage for under-26s beginning in 2029, then progressively older age groups through 2033, regardless of income. The state must seek federal funding approval for this expansion but will cover all costs with state funds if federal approval is denied. The bill mandates detailed cost estimates, an implementation plan, and a report on payroll tax options to fund the program, with key deadlines for these actions by 2026-2027.
This bill exempts U.S. military retirement income and survivor benefit income received by Vermont residents from state income tax. It directly affects Vermont veterans and their surviving spouses or dependents who receive these benefits. The bill amends Vermont's tax code to add these income types to the list of exclusions from taxable income under § 5811, specifically adding a new exclusion (vii) for military retirement and survivor benefits. The change takes effect retroactively for taxable years beginning January 1, 2026.
H 267 establishes the Vermont Hospital Security Plan, creating a state-administered program to provide hospital coverage for all Vermont residents regardless of insurance status or ability to pay. The plan requires hospitals to accept the state's negotiated annual payments (based on global budgets) for services provided to all patients, prevents balance billing for Vermont residents beyond set cost-sharing amounts, and includes out-of-state hospital coverage for Vermont residents. Key mechanisms include annual global hospital budgets limiting cost growth to the Consumer Price Index plus 3.5%, a dedicated trust fund financed by state transfers and federal Medicaid/Medicare funds, and appeal processes for denied claims. This directly affects Vermont residents seeking hospital care and Vermont hospitals receiving state payments.
