VHFA: on‑bill weatherization program has funded 16 projects, will return $6M and keep $3M to continue pilot

Vermont Housing Finance Agency officials told the House Energy and Digital Infrastructure Committee that the state’s on‑bill weatherization pilot has produced 16 funded projects to date, far below the original target, prompting VHFA to return $6 million of its initial $9 million appropriation and retain $3 million to continue the effort through December 2025.

The program — Weatherization Repayment Assistance Program, or WRAP — was designed to finance comprehensive home weatherization and related measures by placing a repayment charge on a household’s utility meter. "The program funding is targeted to households earning at or below 120% of area median income," said Mia Watson, Central Programs Manager, Vermont Housing Finance Agency, during the committee briefing. Watson said VHFA and participating utilities have moved tariffs so WRAP is not tariff‑limited while the grant remains in place.

WRAP was intended to fill a “middle income” financing gap left between the federal Weatherization Assistance Program (WAP) and market loans, offering low‑cost capital (a 2% interest rate) with long terms (up to 15 years), no traditional credit underwriting and utility‑integrated energy efficiency incentives. Projects must include a Home Performance with ENERGY STAR–verified weatherization scope; WRAP may also finance heat pumps, water heaters and certain health and safety measures.

Committee members were given multiple program details and performance metrics. Watson said the program launched slowly after a 2021 appropriation and a December 2022 kickoff, and did not feel fully scaled until about September 2023. VHFA expected roughly 500 projects per year under the original design but has funded 16 projects to date. Average total project cost reported in the briefing was about $17,000; average WRAP financing per project was about $6,800. Incentives going into projects averaged about $6,500, and the average monthly WRAP charge has been about $50, though individual projects ranged widely.

Watson described several design and market constraints that VHFA and its utility partners cited as barriers to faster uptake: a smaller universe of homeowners willing to take on any financing post‑pandemic than planners expected; a statewide contractor shortage after recent floods; the variability of modeled energy savings (which depends on fuel type, home condition and scope); and a perception among customers that WRAP is “debt,” even though VHFA avoids traditional credit checks and the charge is tied to the meter. "If it's not affordable, it's not accessible," Watson said, noting the program was targeted at households up to 120% AMI with an aim that 75% of funding be used for moderate‑income households.

VHFA described several administrative choices and adjustments it has made: the Agency of Administration is the grant holder and VHFA bills the agency monthly; VHFA negotiated with utilities and the Public Utility Commission to remove WRAP tariff end dates so on‑bill charges aren’t time‑limited by tariff language; VHFA lowered its bill‑payment history requirement to permit enrollment so long as the customer is current and has not had a shutoff in the prior year; VHFA reduced its minimum WRAP financing floor from $2,000 to $1,000 to accommodate smaller projects; and the agency established a loan loss reserve to allow looser underwriting while protecting state funds.

Watson told the committee VHFA asked the Agency of Administration in July 2024 to return $6 million because the pace of projects made it unlikely the program would spend the full appropriation through the original grant term. VHFA retained $3 million for lending and program expenses and secured a one‑year extension to December 2025 to continue outreach and program adjustments. VHFA also said it is considering phase‑2 financing options if the pipeline grows — including USDA rural energy programs or VHFA bond financing — but said it has not yet developed the consistent project pipeline needed to access larger capital facilities.

Committee members pressed staff on renters and multifamily eligibility, landlord sign‑offs, coordination with existing weatherization suppliers and multifamily programs, and how utilities would show net savings given the WRAP charge is usually visible on the electric bill while savings frequently appear on a customer’s fossil fuel bill. Watson said WRAP permits renter participation where the meter is in the landlord’s name or with signatures from landlord and tenant, but VHFA had not yet seen enrolled renters and noted multifamily buildings pose attribution challenges unless a single meter is in the building owner’s name. She said VHFA has spoken with organizations such as 3E Thermal and Champlain Housing Trust to pursue landlord and multifamily leads.

On outreach, VHFA reported using targeted digital campaigns, Front Porch Forum posts and work with town energy committees but said the agency lacks direct control of much of the customer intake — customers begin with the program administrators at the energy efficiency utilities (Efficiency Vermont, Vermont Gas, Burlington Electric and Green Mountain Power) who perform energy scoping and contractor coordination. VHFA said it continues to explore non‑traditional outreach and local partnerships to build a pipeline.

Discussion and directions recorded in the committee hearing included: the need to explore landlord‑focused outreach and partnerships with multifamily weatherization programs; monitoring whether higher rebates for specific measures (for example, weatherization tied to heat pump installations) drive uptake; and continuing check‑ins with the Agency of Administration and the Public Utility Commission on tariff and grant conditions. Watson said VHFA will remain engaged through 2025 and report back on whether additional capital or design changes can materially expand the pipeline.

For now, the program’s administrators have not recommended other immediate statutory changes; rather, VHFA emphasized implementation tweaks, contractor engagement and focused outreach. VHFA cautioned that while WRAP’s design sought to remove common barriers to uptake — small or zero up‑front costs, meter‑tied repayment and inclusive underwriting — market realities and customer behavior have limited enrollment so far.

Next steps: VHFA will continue program operations through the retained $3 million and the extended grant term, coordinate check‑ins with the Agency of Administration and the Public Utility Commission, pursue targeted outreach (including to landlords and town energy committees), and report results to the committee. VHFA staff said they remain open to collaboration on design refinements if the committee wishes to pursue statutory or tariff changes.

Sources: testimony and slides presented to the House Energy and Digital Infrastructure Committee by Mia Watson, Central Programs Manager, Vermont Housing Finance Agency; VRFA implementation review and program slides provided to committee members.