Committee reviews recent housing laws, zoning reforms and program changes in Jan. 6 briefing

On Jan. 6, 2026, a legislative committee convened the first day of a multi‑day inquiry to review housing legislation passed in recent sessions and to ask which provisions have worked and which need legislative follow‑up. The committee’s chair framed the inquiry as a review of enacted law rather than a general diagnosis of the housing market: “There’s not enough of it. It’s too expensive. It’s hard to permit. It’s hard to finance. We don’t have enough money for subsidy,” the chair said, explaining the committee’s focus on what legislation has produced in practice.

Cameron Wood, of the Office of Legislative Counsel, walked members through Act 181 and related changes. Wood said the act’s housing provisions are extensive and highlighted programmatic changes to the Vermont Home Improvement Program (VHIP), including administrative clarifications that allow the Department of Housing and Community Development (DHCD) to subgrant funds and charge an administrative cap of up to 5 percent. Wood also described the statutory distinction between 5‑year and 10‑year forgivable loans/grants tied to affordability restrictions and noted expanded beneficiary categories, including people exiting homelessness, some participants in refugee resettlement programs and certain people with disabilities receiving Medicaid home‑and‑community‑based services.

Wood flagged several appropriations enacted with the housing package: $1,000,000 for a first‑generation homebuyer program administered through VHFA, $1,000,000 to the Land Access and Opportunity Board through the Vermont Housing and Conservation Board (VHCB), $400,000 to Champlain Valley Office of Economic Opportunity for rental housing stabilization services, a $1,000,000 tenant‑representation pilot grant awarded to Vermont Legal Aid (limited in statute to two counties), and $2,500,000 to the Vermont State Housing Authority for a rent‑arrears assistance fund. He said the tenant‑representation pilot began as a two‑county pilot and that funding timing placed it in fiscal year 2025.

On VHIP specifics, Wood described statutory changes that expand eligible populations and set program reporting requirements, and he said last year’s Act 69 restored a prior rule requiring 10‑year loan recipients to rent units at fair‑market‑rent as set by HUD. The committee also discussed program set‑asides: at least 30 percent of VHIP funds must be reserved annually for 5‑year forgivable loans or grants, with unused portions becoming eligible for 10‑year loans after a nine‑month period. Wood noted the act created annual reporting duties but did not specify a precise report due date in the statutory text; staff offered to add a date if the committee wanted it fixed.

Ellen Chaykowski, also of the Office of Legislative Counsel, summarized municipal zoning and Act 47 (the HOME Act) changes. She said Act 47 limits how municipalities can regulate parking and housing types in sewer‑ and water‑served residential districts: municipalities may not require more than one parking space per dwelling unit in those areas, and they must allow duplexes and multiunit dwellings (including up to four‑unit buildings) where sewer and water service exists. Chaykowski also described a density standard that requires bylaws to allow five or more units per acre in sewer/water areas and a density bonus of up to 40 percent for qualifying affordable housing projects.

Chaykowski outlined procedural changes that affect appeals and Act 2 50 jurisdiction: in certain designated areas (downtowns, growth centers and neighborhood development areas), the statute narrows the grounds on which neighbors can appeal a project’s “character of the area,” and it establishes a tiered Act 2 50 jurisdiction system. Under the tier system, compact settled areas (Tier 1A/1B) will see reduced Act 2 50 oversight (with Tier 1B allowing certain projects up to specified unit counts to proceed under municipal permits) while Tier 3 will retain Act 2 50 triggers for critical‑resource areas. Chaykowski also listed temporary exemptions from Act 2 50 (for example, hotel/motel conversion to affordable housing, accessory dwelling units, and small conversions) with varying sunsets through 2027–2028.

A notable statutory change described was the removal of a cap on the number of "priority housing projects" that may be exempt from Act 2 50 if they meet affordability and location requirements. Chaykowski said the 20 percent affordability floor for priority housing projects — with affordability tied to a statutory definition and minimum affordability term (15 years) — remained in place.

Committee members asked staff to provide follow‑up materials: (1) a concise list of one‑time appropriations from prior years and their current status, (2) a breakdown of historical appropriations for the mobile/manufactured home repair program, and (3) a consolidated list of Act 181 exemptions and their sunset dates. Wood agreed to supply the act summaries, a funding history, and to check inconsistent figures in the record.

The session closed for a short break; the chair announced the committee would reconvene before 2:30 p.m. for the next witness. No motions or votes were recorded during this opening hearing segment.

Sources: Committee hearing transcript Jan. 6, 2026; presentations by Cameron Wood, Office of Legislative Counsel, and Ellen Chaykowski, Office of Legislative Counsel.