House committee considers formula to tie town-highway grants to transportation fund or CPI

Legislative Council staff presented draft language Wednesday to change the way Vermont funds state aid for town highway structures and Class 2 town highways, replacing fixed base amounts with a formula that ties annual grants to either growth in Transportation Fund appropriations or to inflation as measured by the Bureau of Labor Statistics consumer price index (CPI).

Damian Leonard of the Office of Legislative Council said the draft removes the existing fixed “base” appropriation and instead directs that the appropriation for these grants “shall increase over the previous fiscal year's appropriation by the same percentage change as the following, whichever is less,” using a comparison of (1) the agency’s total appropriations funded by Transportation Fund revenues (excluding these grants) and (2) the CPI percentage change based on the two prior fiscal years. Leonard also told the committee the formula is written so the appropriation cannot decline below the prior year — "It may be level funded, but it can't go backwards," he said.

Why it matters: Committee members and agency staff said the move would make town-highway grant amounts track broad Transportation Fund trends and inflation, rather than rely on a…