House conference negotiators ask JFO to model cap options as $40M limit, $5M add-on debated

House conference negotiators on a housing bill asked the Joint Fiscal Office to run financial models showing how different cap levels would affect the program, saying the current $40,000,000 cap and a $5,000,000 add-on held by the governor and the Joint Fiscal Committee may not be sufficient.

The request came as participants debated whether affordable and moderate‑income housing should be included in the dollar cap, whether to set the cap by a dollar amount or by a target number of projects, and how tax increment and education‑fund shares would change project financing.

Negotiators said the program’s cap and the percentage retained for debt financing interact and that the group needed concrete modeling to test proposals. “We are sticking by our last question … we are still strong on the caps and still strong on the 10 years, not the 8 years,” Participant 1, Participant, said, repeating a position that the group described as its standing offer. Participant 3, Participant, noted an existing mechanism that would allow the Vermont Economic Progress Council to request additional funding through the governor to the Joint Fiscal Committee, saying that mechanism could be used to add increments beyond the $40,000,000 cap.

Participants asked the Joint Fiscal Office (JFO) to prepare a pro‑forma table showing how changing the education tax increment percentage affects the increment retained for debt financing and the amount flowing back into the education fund. One negotiator summarized the technical point: the column that changes when percentages change is the education tax increment, which feeds into retained increment and the education fund split.

A range of alternate dollar figures came up in discussion. One participant said a larger cap has been discussed in earlier internal conversations, citing figures such as $75.85 million and $80,000,000; another said the group had proposed exempting affordable and moderate‑income housing from the cap to avoid rapid growth of program payouts. “If the cap isn't sufficient, do you have an idea of what you think is sufficient, or is there a different way to approach it?” Participant 3 asked, and later urged a conversation about whether to focus on a dollar cap or on a target number of projects.

Speakers also discussed linking the program to Tax Increment Financing (TIF) practices and local infrastructure differences. One participant said infrastructure costs per unit vary widely by community and urged caution about translating a single dollar cap into a unit target. “We can look at the range of infrastructure costs … it's sort of 30,000 to 75,000 or a 100,” Participant 4, Participant, said, noting that rural and urban projects have different per‑unit infrastructure needs.

There were no formal votes recorded in the transcript excerpt. The practical next step recorded in the discussion was an agreement to ask JFO to run scenarios and to reconvene after reviewing those models. Several participants suggested meeting with JFO “tomorrow” or in a short follow‑up gathering to examine the numbers and determine whether to pursue increasing the automatic add‑on beyond $5,000,000 or to change the cap construct.

The session included repeated references to the education tax increment, the Vermont Economic Progress Council, the governor’s role, and the Joint Fiscal Committee as possible mechanisms to increase funding beyond the statutory cap. Negotiators also emphasized a policy question about whether moderate‑income housing should be treated differently than low‑income affordable housing in the cap calculations.

Next steps recorded in the meeting: negotiators will meet with JFO to ask for modeling of cap and percentage scenarios and return to the group with those results; no formal change to the cap was adopted during the discussion.