Lawmakers Hear Push for Supported-Housing Advisory Council, Warnings on Condo Financing in S.328

The House Committee on General and Housing heard competing evidence April 1 as lawmakers took testimony on S.328, a wide-ranging housing bill that would create a supported-housing advisory council, expand statutory treatment of common-interest communities and propose changes to municipal zoning and financing tools.

Kirst Murphy, executive director of the Vermont Developmental Disabilities Council, told the committee the Act 69 “Road Home” report includes a 13-point plan to expand permanent, affordable, service‑supported housing for roughly 3,400 people who receive developmental-disability services in Vermont. Murphy said the bill’s section 6 — which would establish an 11‑member advisory council — would help align housing and human‑services actors, push administrative reforms and oversee a needs assessment the committee has directed be completed by next November.

"We want to work ourselves out of a job on this council," Murphy said, describing the council’s goal to coordinate programs until a stable mix of housing options exists.

Murphy emphasized the data gaps that drive the proposal: she told lawmakers the distribution of living situations in the population served includes about 39% living with family members and about 39% in shared‑living arrangements, and that the developmental system has not historically tracked caregiver age — a gap the council would address by collecting finer‑grained housing and caregiver data.

The testimony drew immediate questions from committee members about scope and design. Members pressed Murphy on whether the bill’s definitions capture people in precarious or temporary beds and on whether a full‑time housing specialist (written into the House budget in the bill) could coordinate across home‑and‑community based service programs. Murphy said improved data collection and coordination through the advisory council would be essential to plan county‑level responses and to avoid overreliance on aging family caregivers.

Representatives of the housing and real‑estate sector urged caution on other parts of S.328. Peter Tucker, director of advocacy and public policy for the Vermont Association of Realtors, said municipal volunteers could be overburdened if the bill imposes extensive new housing‑needs assessment requirements and advised aligning any municipal work with regional plans.

Tucker and later witnesses warned the committee that broad statutory changes to common‑interest community rules — especially language that would require associations to permit rentals, subleasing, or vaguely defined commercial uses — could run afoul of Freddie Mac and Fannie Mae underwriting thresholds. Tucker recounted early condominium disclosure struggles and cautioned that if a project exceeds secondary‑market thresholds for leased or commercial space, it can lose eligibility for conventional financing, which would hurt buyers and projects in the resale market. "We don't have to do this," he said, paraphrasing how some small volunteer boards reacted in early implementation years; he urged legislative counsel to add explicit financial and lending review language to the report the bill requires.

George Deus, general counsel at the Vermont Housing Finance Agency, repeated the financing concern and urged careful drafting. Deus also made the case for restoring earlier down‑payment assistance authority (allowing VHFA to sell state housing tax credits to fund the program) for five additional years. He explained the agency’s down‑payment assistance loans are zero‑interest loans repaid when homeowners refinance; because refinancing activity has slowed in the past three to five years as mortgage rates rose, repayment flows have not replenished the fund as expected. "They're zero interest loans, but they are repaid when you refinance your house," Deus said, arguing an extension would help VHFA continue the program until repayment cycles return.

Committee members probed whether refinancing trends are cyclical and asked about alternatives such as a separate first‑generation buyer grant; Deus said the first‑generation grant remains of interest but the immediate priority is preserving the agency's ability to run the DPA program while market conditions normalize.

The hearing also included technical drafting concerns. Deus and other witnesses flagged a simplification introduced by legislative counsel to language governing interagency financing that could unintentionally bar projects that use complementary VHFA and other agency funds. Legislative counsel (identified by name during the hearing) will work with agencies to restore the intended narrower limits.

No votes were taken. The committee instructed legislative counsel to prepare markups reflecting the testimony and signaled it will reconvene after the floor session to finish deliberations, including whether to fold any provisions into other vehicles such as H.775. The panel also agreed to seek additional testimony from HOA experts and to explore a Secretary of State website tab to host HOA/common‑interest legal information for the public.

What happens next: committee members said they will present draft language to counsel for technical edits and return to the issue after the floor; the committee will separately consider whether to include extreme‑temperature provisions in S.230 at a later session.