Legislators weigh CHIP/TIF plan amid warnings it could shrink education tax base

The Vermont House Ways and Means Committee continued work May 8 on legislation tied to the education fund and housing incentives, hearing witnesses who warned a proposed CHIP tax-increment financing (TIF) approach could reduce the education tax base and increase local tax volatility.

Neil O'Dell, a Norwich school board member, told the committee that the combination of recent state changes and the CHIP proposal is straining his district. "With the stroke of a pen, with act 1 27, you and the governor changed our student count in Norwich," O'Dell said, and he added that an immediate drop in his district's weighted student count forced a large local tax increase. O'Dell also said, "The impacts on the education fund could remain for decades" if the CHIP TIF caps education revenue for areas over long periods, and he warned the senate version would make his district lose "$4,000,000."

Tom Cavett, the committee's legislative economist, told members he had not examined every detail of the bill but warned of a…