Vermont housing board tells House committee more funding, faster permitting needed to keep projects on track

BURLINGTON — Officials from the Vermont Housing and Conservation Board told the House Committee on General & Housing on Jan. 15 that the agency has helped leverage nearly $1 billion in affordable-housing investment but needs more state funds and quicker permitting to keep a pipeline of projects moving.

Gus Seelick, director of the Vermont Housing and Conservation Board, told committee members the board has deployed about $377.5 million in recent years and that those public dollars have helped attract roughly $700 million more in federal and private capital. “There’s been about a $1,000,000,000 investment in real estate as affordable housing that you’ve helped us make over the last four years,” Seelick said.

The testimony matters because board officials said remaining state and federal funds are limited while demand is high: the board currently is reviewing roughly $50 million in potential requests for the remainder of the fiscal year and has about $13.5 million available, Seelick said. Officials warned that if expected budget adjustments — including a previously discussed $30 million in ARPA appropriations — do not materialize, developers may slow or halt projects that are already underway.

Board officials outlined how public funding is used to lower construction costs and preserve long-term affordability. Polly Major, director of policy and special projects for the Vermont Housing and Conservation Board, described the board’s shared-equity homeownership model, in which a one-time public subsidy reduces initial purchase cost and future resale terms preserve a discount for the next income-eligible buyer. “If a home accrues $100,000 in equity and the buyer wants to sell, they, as per their agreement, walk away with that $25,000. And the other $75,000 stays in the home as a discount to the future buyer,” Major said, describing how the subsidy “recycles” public investment across generations of buyers.

Officials gave examples of projects the board has supported across the state — from small rural infill to larger downtown rehabs — and emphasized work in communities facing infrastructure constraints. Seelick said the board’s Rural Economic Development Initiative (REDI) provides quick planning grants that help small towns under 5,000 obtain federal and state grants; he described REDI as “probably the quickest money that is in existence” for planning support.

Seelick and Major summarized program results and targeted populations. Highlights they cited include: work touching 149 communities; roughly 400 households served by a home-access program; the conversion of 10 hotels to housing (which officials said reduced per-unit costs by roughly $100,000 in those cases); and four recovery-residence projects soon to open with about 58–59 beds. Major said the board’s portfolio serves renters and homeowners up to about 120% of area median income and that 37 years of publicly supported, perpetually affordable housing has repeatedly housed households that had been homeless.

Officials also described financing examples. Major cited Riverwalk in Hartford as a case where roughly $6.2 million in public HCD funds helped leverage about $8.6 million in additional capital, reducing the debt burden on the building so rents cover operations without full commercial debt service. She warned that private developers who rely on short-term equity returns commonly need to increase rents to exit investments, a dynamic that public funding can prevent.

The board highlighted cost drivers and barriers: rising construction costs, scarce labor, higher mortgage rates, infrastructure permitting delays and appeals, and policies that limit multifamily solar metering. Seelick asked the committee to press for faster corrective-action reviews at the Agency of Natural Resources; he estimated that cleanup approvals for certain sites can take 12–18 months and suggested a six-month target would speed development. For one new-neighborhood project he cited, permitting fees were about $620,000 and Act 250 fees about $103,000 — costs that create uncertainty and delay though they are not the largest single cost driver.

Seelick urged the committee to consider the consequences of shifting ARPA dollars back into general-purpose accounts, which removed prior spending deadlines and left the board with less available capital. “We moved forward over the holidays that it was not going to come to us,” he said of the $30 million in ARPA funds that had been expected; he warned that without clear funding signals, developers may stop optioning land and starting projects because they cannot assume costs will be reimbursed later.

Committee members asked about specific program details. Major and Seelick described the shared-equity resale mechanics, the property-tax treatment of shared-equity homes (assessed under state law at a lower percentage of fair market value, as one presenter noted), and how nonprofit partners such as Champlain Housing Trust and Twin Pines Housing Trust participate in acquisitions, resale counseling and portfolio management. A resident who had experienced homelessness and later obtained housing after motel-based sheltering spoke to the health impacts of stable housing: “Everything is good, but as long as I maintain my health,” he said. “It’s pretty incredible… six years ago they gave me only a 25% chance. That’s what housing can do.”

Seelick closed by listing projects that broke ground or opened recently — redevelopment and new construction in Windsor, Bennington, Shelburne, Morrisville, Burlington and Berlin — and again asked for help on the fiscal-year budget adjustment so the board can meet near-term preservation and acquisition opportunities. He said the board expects to review about 500 homes and apartments in the remainder of the fiscal year and that five preservation projects recently on the market could lead to displacement without timely intervention.

The committee took no formal votes during the presentation; members signaled interest in follow-up briefings and additional data on town-level fiscal impacts and permitting timelines. Board staff said they will return with further information and thanked the legislature for prior investments that they said produced the recent project pipeline.