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Committee hears clarifications on VHIP: eligibility, reimbursement and loan forgiveness terms
Summary
Legislative counsel and housing partners explained changes to the Vermont Housing Investment Program in S.127, including who eligible landlords must lease to, whether the program pays upfront or reimburses, and changes to rent and forgiveness terms for 5‑ and 10‑year forgivable loans.
Committee members sought clarifications on the Vermont Housing Investment Program (VHIP) provisions in S.127, which incorporate elements from both House and Senate housing bills and would continue a mixture of grants and forgivable loans tied to required tenant populations.
Cameron Wood, Office of Legislative Counsel, explained the VHIP draft language and noted the House General Committee incorporated a Senate change adding people displaced by natural disaster to the list of populations landlords must serve when they accept five‑year forgivable loans or grants. "There are populations that a landlord must lease the unit to if they are getting a five‑year forgivable loan or they're given a grant," Wood said.
Committee members pressed about how the program pays for renovations. Several speakers with local housing practice experience told the committee the program is structured to provide a portion of funds up front and to require developers to have capital in place for renovations. A Champlain Housing Trust representative summarized the award disbursement structure reported to the committee: awardees receive approximately 35% of the award at the time of award to start work, later disbursements of about 25% at intermediate milestones, and the final roughly 15% at project completion. Speakers described the program as requiring matching capital and, in many cases, collateral for loan products.
The draft also changes the 10‑year forgivable‑loan requirement so landlords in that program would only be required to lease units at HUD fair‑market rent (rather than a different statewide cap). The House General Committee retained a 30% set‑aside of VHIP funds for five‑year/grant programs serving populations such as those experiencing homelessness, refugee resettlement or natural‑disaster displacement, and added reporting requirements that counsel noted carry over from the House bill.
Committee members asked staff to provide written clarifications of the VHIP payment flow and forgiveness mechanics; no formal committee action on VHIP occurred during the hearing.
