House Commerce Committee reviews S.122, tying small-business, arts and trade programs to FY26 funding

The Vermont House Committee on Commerce and Economic Development on May 2 reviewed S.122, the Senate-passed bill that would increase the annual downtown and village center tax credit cap and authorize a range of one-time and ongoing appropriations for small-business supports, arts and creative media, outdoor recreation and international trade programs. Rick Stagle, Office of Legislative Council, led the committee through the bill and said the panel was “looking at S.122 as passed by the Senate.”

The bill would amend the statute governing the downtown and village center tax credit program to raise the annual cap from $3,000,000 to $5,000,000; Legislative Council staff estimated that awarding the higher cap would cost the state about $2,000,000 annually if fully awarded. Sections 2 through 5 of S.122 contain multiple appropriations aimed at small businesses and creative industries. Among the line items discussed were:

- $300,000 to support the Vermont Law and Graduate School’s public education offerings and free legal services to small businesses through the Vermont Small Business Law Center. - $350,000 for expansion of the BIPOC Vermont Professional Development Network’s business technical assistance services. - $688,889 for business advising at the Vermont Small Business Development Center (the transcript describes this figure as an increase, with $388,889 noted as the ongoing base and the larger number intended to expand advising capacity). - $100,000 to the Vermont Sustainable Jobs Fund to create a magazine-style business resource guide and companion website, with a report due by Dec. 1, 2026. - $581,000 from the general fund to the Office of Economic Opportunity to support a Vermont community micro-business development program. - An appropriation to the Vermont Arts Council of $1,071,000 (an increase noted as $68,737) and $120,000 to build and maintain an online film and creative media database and to support a part-time staff position to manage the project. - $250,000 to the Department of Forests, Parks and Recreation to support the Vermont Outdoor Business Alliance’s climate and circularity program. - $350,000 to the Department of Economic Development’s International Trade Division for international recruitment consultants, advanced site selection data and trade-show participation.

Pat Sitterton of the Joint Fiscal Office was scheduled to address the committee later to explain which appropriations made it into the Senate’s FY26 budget and how the fiscal numbers work. Multiple presenters and committee members flagged that several of the dollar amounts are one-time appropriations and would require the General Assembly to reauthorize funding in future years if the programs were to continue.

A key provision discussed was Section 10(a), which makes implementation of sections 1 through 5 contingent on an appropriation in fiscal year 2026. As explained in committee, that means the programs, positions and increases described in the bill would not be implemented unless the FY26 budget specifically provides funding for them.

S.122 also proposes structural changes around trade and trade-related entities. The bill would create a new Vermont Ireland Trade Commission to promote bilateral trade between Vermont and Ireland. Committee members and staff discussed how that proposed commission would interact with an existing, statutorily established Commission on International Trade that has not been active in recent years. Legislative Council staff noted that the existing commission’s statute currently has a different focus (examining how federal trade agreements affect Vermont) and that the proposed change would allow the commission to consider Vermont-specific trade arrangements as well. Committee members raised the possibility of adjusting effective dates or inserting review steps so any new, country-specific trade commission would be vetted against the existing commission’s responsibilities before becoming active.

Section 9 establishes a study (not a task force) to analyze barriers to capital for Vermont startups and early-stage businesses, to identify mechanisms to connect investors and lenders, and to evaluate the state’s role in improving access to capital. The study’s report is due Nov. 1, 2025, to the House committee and the Senate committee, with the intent that findings could inform draft budget requests by the December deadline.

Section 10 creates a task force to study the feasibility of constructing a convention center and performance venue in Vermont. The membership described in the bill includes a House member appointed by the Speaker, a Senate member, the secretary of the Agency of Commerce and Community Development (ACCD), the president of the Vermont Chamber of Commerce, the CEO of the Lake Champlain Chamber of Commerce or designee, and the presidents of regional development corporations or designees. The task force is to determine the state’s ability to support such projects through appropriations, bonding, tax instruments and other assistance; identify needed infrastructure improvements (water, sewer, transportation, lodging and food); consider management and operational options; examine attributes of recently successful facilities elsewhere; and evaluate anticipated economic impact and return on investment. The task force’s interim report is due Nov. 1, 2025; a final report is due Nov. 1, 2026; the bill requires the task force to hold its first meeting on or before July 15, 2025, and to cease to exist on Dec. 1, 2026. Committee staff noted that Senate Appropriations removed per diems from the task force as drafted in the Senate committee version.

No committee votes were recorded during the May 2 walkthrough. Legislative Council and JFO staff told members that the committee will hear JFO’s fiscal analysis and budget implications at a subsequent meeting before taking further action on S.122.