Senate S.127 walkthrough spotlights project-based TIFs and infrastructure financing

Senator Keisha Ron Pinsdale, former chair of the Senate Economic Development, Housing and General Affairs Committee and the Senate majority leader, told the House General & Housing Committee on April 3 that financing and permitting reform remain central to producing more housing in Vermont.

Senator Keisha Ron Pinsdale said the Senate bill S.127 takes a serious look at tax increment financing and other infrastructure financing tools and that the Senate and House approaches are largely compatible. “I cannot see a, a problem in Vermont that doesn't have a lack of housing at its root,” she told members as she outlined the bill’s emphasis on financing and permit reform.

Nut graf: Lawmakers said project‑based TIF — narrower, single‑project districts as opposed to large area redevelopment districts — is a core new tool in S.127. Supporters argued project TIFs can be simpler and less bureaucratic for smaller towns, while critics and revenue committees worry about long‑term impacts on the education fund and the complexity of proving incremental growth.

In committee discussion, members and witnesses contrasted Vermont’s existing area‑based TIF program with the proposed project TIFs. Cameron Wood, staff presenting the bill text, explained that existing TIFs in Vermont are typically area‑wide and created by municipal vote; the project version seeks to limit scope to a single development so approvals require fewer steps and create fewer governance complexities. Members noted three other financing layers under consideration: bond bank loans, assessment districts and simple tax abatement as a lower‑friction option.

Committee members raised practical concerns. One member noted Vermont’s requirement that bond‑supported assessment districts trigger a town‑wide vote rather than a vote of only those assessed; Senator Keisha Ron Pinsdale said the Legislature is considering changing that requirement to make local financing more feasible. Revenue committee members were described as likely to press back because TIF effectively borrows against future grand list growth and can put pressure on the education fund when repayment assumptions prove optimistic.

Members also discussed the role of the Land Use Review Board and companion permitting bills (including S.133) that target environmental and ANR permits as part of an effort to reduce litigation delays and the cost of building infrastructure. Pinsdale said the Legislature hopes to pair financing reforms with permit reforms so that money for infrastructure is not consumed by litigation and delay.

Ending: The committee continued the walkthrough with staff and counsel and signaled further work with Senate Commerce staff on TIF design and with the bond bank on program details. No vote was taken on S.127 during the April 3 session.