Lawmakers, state agencies debate CHIP infrastructure financing, affordability and oversight

The House Ways & Means Committee heard detailed testimony May 7 on the Community Housing Infrastructure Program, or CHIP, a proposed tax-increment financing tool to help municipalities fund water, sewer, transportation and other infrastructure that supporters say is blocking housing development.

Committee members and agency leaders said CHIP could expand housing supply across Vermont, but they disagreed about how prescriptive the program—s affordability and project-eligibility rules should be and warned about administrative and monitoring burdens.

Alex Farrell, commissioner of the Department of Housing and Community Development, told the committee that decades of underbuilding left the state short of housing and that CHIP is meant to incentivize infrastructure so other housing programs can follow. "So that's my case for making sure tier 2 is is fully included, in this," Farrell said, arguing tier 2 eligibility is needed so smaller and rural municipalities without existing infrastructure are not excluded. He cautioned against making long-term income-restrictions a mandatory condition of CHIP, saying a requirement would create "a…