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State auditor: S.127’s CHIP approach shifts risk to towns and lacks affordability safeguards
Summary
Vermont State Auditor Doug Hoffer told the House Committee on Commerce & Economic Development that S.127’s project‑specific tax‑increment financing (CHIP) departs from traditional TIF, transfers financial risk to municipalities, omits affordability requirements and lacks a reliable fiscal note.
Vermont State Auditor Doug Hoffer told the House Committee on Commerce & Economic Development on April 16 that the version of S.127 creating the CHIP (a project‑specific tax‑increment tool) is “a radical departure” from traditional TIF and shifts risk from private developers to host municipalities.
Hoffer said the bill, as drafted, contains no requirement that housing built under CHIP be affordable and no statutory means test to show a developer needs taxpayer assistance. “There is no presumption that every developer that comes forward with a proposal needs taxpayer assistance, and that's what this is,” Hoffer said. He added that the bill’s plan requirement does not specify how towns will ensure new units remain primary residences.
Why it matters: Hoffer warned the committee that if the incremental property tax revenue generated by a CHIP…
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