Lawmakers, recovery official review H.397 text on flood preparedness, buyouts and financing

State lawmakers and the State of Vermont’s chief recovery officer on Friday reviewed H.397, a bill that would create a clearer statewide framework for flood preparedness, response and recovery and add financial and technical assistance for municipalities.

Douglas Farnham, chief recovery officer for the State of Vermont, told the House Committee on Government Operations & Military Affairs that his office has begun talks with agencies implicated by the bill — the Agency of Natural Resources (ANR), the Agency of Transportation (AOT), Public Safety and the Agency of Human Services (AHS) — but has not yet received detailed agency analyses. “I would say I’ve started to talk with all of the agencies that are implicated by this bill,” Farnham said, noting the conversations are ongoing.

The committee heard that some H.397 provisions overlap with changes enacted in Act 143 (2024), which created a State Emergency Management Plan in Title 20, Section 41. Farnham recommended the bill explicitly build out the plan’s recovery element, saying the existing statute is “pretty high level” and that recovery roles and responsibilities are more ambiguous than preparedness and immediate response.

Why it matters: The bill would affect how Vermont coordinates and pays for medium- and long-term recovery after floods and other disasters. Committee members pressed on how the bill would interact with federal programs and state funding capacity, and Farnham warned several provisions could be costly.

Key funding and program notes

Farnham said the state and related entities have already deployed emergency financing after recent floods: about $5 million through emergency board authorization and more than $15 million of short-term lending through the municipal bond bank and the treasurer’s office to help towns access capital after disasters. He cautioned that asking the state to cover the full nonfederal share of federally supported projects would be expensive and could disincentivize local risk reduction.

“Covering all nonfederal share would be a very expensive proposal,” Farnham said, adding that in one recent event the legislature covered 78% of the nonfederal share but that the typical policy links state match to local mitigation measures and usually ranges between 30%–70% depending on local actions.

FEMA cost-share and thresholds

The committee reviewed FEMA cost-share mechanics. Farnham said most disasters in Vermont fall under the 75/25 federal-state split and that the July 2024 floods produced nearly $100 million in damage, which he said was below the per-capita threshold that would shift the federal cost share to 90/10. He estimated the 90/10 per-capita threshold for 2024 at roughly $115 million, and said it is unlikely Vermont’s current events will exceed that level once all projects are negotiated.

Buyouts, the Community Resilience and Disaster Mitigation Grant Program, and ARPA funds

Farnham explained that Vermont Emergency Management already operates a state-managed voluntary buyout program through the Community Resilience and Disaster Mitigation Grant Program, which grew out of the Flood Resilient Communities Fund (FRCF) created with state fiscal recovery funds from the American Rescue Plan Act (ARPA). He urged aligning any statutory buyout language with the existing grant program and expressly allowing the state to waive state requirements when federal funding necessitates federal conformity.

On funding amounts, Farnham said the General Assembly appropriated $12.5 million of general fund and authorized conversion of $26.4 million of ARPA funds into general fund, for about $38.9 million available in the community resilience and disaster mitigation fund. He said a large portion of that has already been designated as the nonfederal match for mitigation projects and that only about $8–10 million might remain for state-only projects. Farnham cautioned that the state may not sustain covering full nonfederal shares going forward.

Housing, elevations and relocation

The committee discussed homeowner assistance elements in the bill, including elevations and relocation. Farnham said elevation can be feasible in some inundation zones but may be inappropriate where swift-water erosion dominates because elevating a structure can place it at greater risk. He noted federal programs provide some relocation benefits but that the limiting factor has often been the availability of housing for displaced households rather than the existence of the federal benefit itself.

Debris, rivers and equipment

Farnham described changes in state debris management after recent floods, including a more aggressive approach in 2024 to remove river debris and, in some narrow cases, remediate altered riverbeds. He also said the Administration and AOT are examining provisions on road reimbursements and flood-response fleet vehicles, noting that shared regional equipment can be cost-effective where municipalities cannot sustain specialized machinery on their own.

Other operational issues

Farnham said Vermont’s VTAlert system is available statewide for warnings but that coordination and communication after disasters — sustaining an active emergency operations center and municipal follow-through — has been a recurring challenge. He also signaled the need to evaluate baseline staffing at Vermont Emergency Management once federally funded, limited-duration positions expire.

Next steps and timing

Farnham told the committee he would return language suggestions, particularly to reconcile state statutory requirements with federal funding conditions, and that some sections will require additional input from AOT, ANR, Vermont Emergency Management and BGS on property-specific language such as the Randall Meadow site in Waterbury. Committee members noted calendar constraints and planned to refine priorities and work with Senate counterparts on outstanding elements.

Ending

Committee members thanked Farnham for the walkthrough and said staff and the bill’s sponsor would continue to refine statutory language before the bill’s next consideration. No formal votes or amendments were recorded during the committee’s review in the provided transcript.