The Ways & Means Committee heard testimony on bill H178 to correct miscalculated tax increment financing (TIF) transfers that resulted in excess payments to education funds in multiple municipalities.

Carol Dawes, TIF administrator for Barre City, told the committee the state auditor’s TIF audit for the town of Milton uncovered a miscalculation in the NEMREC grand-list module used to transfer grand-list information between the Department of Taxes and towns. "The miscalculation led to more money being transferred to the ed funds than should have been," Dawes said, citing about $180,000 for Milton and about $437,000 for Barre City.

The nut graf: Dawes said the overpayments were confirmed with the Department of Taxes, the Vermont Economic Progress Council, and the state auditor’s office, and that the problem stems from the NEMREC software module rather than a local accounting error. The committee received Dawes’s written testimony and audit corrections; the Barre City TIF audit was amended by the state auditor and resubmitted to the legislature in December 2024, she said.

Committee members asked whether the software error has been fixed. Dawes said it has not been corrected within NEMREC because that module is being phased out; the Department of Taxes and Property Valuation and Review are transitioning to a new program called VTPi, and officials decided not to invest in repairing a module scheduled for replacement.

No formal action or vote on H178 was recorded at the hearing. Dawes told members that similar corrections in the past have been handled as part of other bills or folded into miscellaneous tax language. She also said she had shared the details with the senator who typically handles Barre City TIF corrections and with Senate Finance.

The committee did not vote on H178 during the hearing; staff and members indicated the issue may be folded into other tax legislation as the session proceeds.