Vermont housing officials tell Hawaii appropriations panel continued state subsidy, tax credits and federal leverage are critical to preserve affordable homes

Vermont Housing and Conservation Board officials told the Hawaii Legislature’s Appropriations Committee on Feb. 18, 2026, that sustained state subsidy and federal leverage are central to preserving affordable housing, expanding shelter capacity and advancing conservation projects across Vermont.

Gus Selig, VHCB’s executive director, and Paulie Majer, the agency’s director of policy and special projects, outlined how the board combines housing and conservation work and recommended the committee support the governor’s FY27 proposal to fully allocate transfer‑tax revenue to VHCB. Selig said the Clean Water Board had also recommended $2,800,000 for conservation activities tied to water quality work.

Why it matters: VHCB said state subsidy routed through the board acts as the scarce, catalytic capital that attracts federal funds, tax‑credit equity and private investment. Without that steady base of funding, presenters warned, developers are less likely to commit to predevelopment work and projects can stall.

Selig offered examples of recent and pipeline projects that illustrate the agency’s dual mission. He described a Saint Albans effort that includes 33 units of elder housing and roughly 150 apartments produced in a TIF district, saying VHCB aims not only to build units but to catalyze local economic activity. He highlighted the Muddy Moose project in Morristown — converting vacation homes into eight year‑round residences, six of them permanently affordable — and described farm, floodplain and stream protections tied to the conservation work.

Majer walked the committee through VHCB’s depiction of "leverage," explaining that the agency’s per‑unit funding often sits beneath federal dollars and other sources. "The blue at the bottom, that's the state investment that's run through VHCB. Those are the most precious and limited dollars," Majer said. She added that other leverage includes federal grants VHCB administers, philanthropy and equity from low‑income housing tax credits (LIHTC).

On tax credits, Selig contrasted the 9% and 4% LIHTC programs: "9% credit has a certain value, a 4% credit has less than half the value," he said, noting the state receives a fixed allocation of 9% credits that can produce roughly $25 million in equity, while 4% credits are more widely available but yield less leverage per project.

Funding context and recent appropriations: Selig reviewed last year’s additional funding the legislature provided — $7,800,000 in total, characterized in his remarks as approximately $5,000,000 for general housing and $2,800,000 for a project serving people with intellectual and developmental disabilities. Majer said VHCB and partners have invested roughly $50,000,000 in Vermont’s shelter system over the past five years, which she said doubled the state's shelter capacity and added beds while improving quality.

Need and outcomes: Majer cited a HUD‑required housing needs assessment that estimates Vermont needs about 30,000 homes to meet current and projected demand. She told the committee that many households in LIHTC‑supported housing have annual incomes near $17,000 and that permanent affordability policies protect mixed‑income communities from future market pressures.

Pipeline and budget pressure: Selig warned that VHCB’s pipeline has softened because developers are cautious about spending on engineering or option agreements when state budgets tighten. He urged steady, predictable funding to keep projects moving and pointed to potential large developments in Burlington and Bennington that would depend on available capital.

Examples and social services: Presenters cited a range of projects and programs — historic building rehabilitations, farm and forest viability assistance, the SASH program supporting seniors to age in place, recovery residences, and partnerships that brought shelters online by converting other facilities. Selig noted the Bennington High School redevelopment will include affordable apartments and a childcare center; Majer and Selig described efforts to support people exiting homelessness and build workforce housing tied to local employers.

What’s next: The Appropriations Committee took a break after the presentation; the chair scheduled the next briefing at 2:30 p.m. with ADS on the day’s agenda. The presentation did not include any committee votes or formal actions on VHCB’s request.

(Reporting based on testimony by Gus Selig, executive director, Vermont Housing and Conservation Board, and Paulie Majer, director of policy and special projects.)