House concurs in Senate changes to flood-response bill; adds buyout authorization, dam-drawdown rules, local-tax split change

Representative from Vergennes presented the Senate proposal of amendment to House Bill H.397, a package of miscellaneous amendments to statutes governing emergency management and flood response.

The Senate amendment requires Vermont Emergency Management (VEM) to report annually to the House and Senate government operations committees on actions under the all-hazards mitigation plan and narrows a House provision to require VEM to consult with relevant stakeholders prior to adopting the comprehensive state emergency management plan. The amendment expressly authorizes the existing voluntary buyout program by allowing grant awards to be used for voluntary buyouts of flood-impacted or flood-prone properties and requires the division to assist municipalities, upon request, with access to a statewide river-observation and modeling system and an enhanced statewide weather-forecasting and alert system.

H.397 adds a needs-assessment requirement and directs VEM to submit a written report on staffing and resource needs to House Appropriations, House Government Operations, Senate Appropriations and Senate Government Operations on or before Nov. 15, 2025. The bill authorizes municipalities to establish an unassigned fund balance to carry forward unexpected end-of-year funds for public purposes and allows a municipal legislative body to approve indebtedness to pay expenses or public improvements associated with an all-hazard event for a period not more than five years or the reasonably anticipated useful life of the improvements.

The Senate amendment restores a provision allowing municipalities to choose level debt-service payments when repaying bonded municipal debt; the House Ways and Means presentation noted the provision was originally in Ways and Means but removed for crossover deadlines and later reinstated by the Senate. On dam drawdowns, the amendment authorizes the governor, in consultation with the Secretary of the Agency of Natural Resources (ANR), to waive permitting requirements under state water-pollution control statutes and Vermont water-quality standards to allow an advanced drawdown when an all-hazard event is likely to cause substantial damage, but only after the director of emergency management determines the drawdown will reduce hazard risk. Dam operators must communicate with downstream communities, provide a drawdown and refill plan that meets minimum modeling and monitoring standards, and have an approved drawdown plan before executing a waiver.

H.397 also revises local-option tax revenue sharing from a 70/30 split to a 75/25 split in favor of municipalities; the change is effective Oct. 1, 2025, and the bill ties charter provisions for Burlington, Montpelier, Middlebury and Williston to the new general-law revenue share so future increases apply to those charters. Committee remarks said the bill would shift approximately $2,800,000 annually out of the pilot special fund and would transfer $621,479 from the General Fund to the Education Fund to correct overpayments from software errors. The bill directs refunds to the city of Barre ($437,028) and the town of Milton ($84,451).

The House Ways and Means, Government Operations, and Appropriations committees reported favorable straw-poll results on the amended package. After debate, the House concurred in the Senate proposal of amendment by voice vote. Representative from Poultney moved to suspend rules to take up H.397 for immediate consideration; the House then voted to concur and the measure was messaged to the Senate.

Effective dates noted in committee remarks: the rule to preserve federal regulations incorporated by reference is effective on passage; the local-option tax revenue-share increase is effective Oct. 1, 2025; all other sections generally take effect July 1, 2025. The needs-assessment report is due by Nov. 15, 2025.