Vermont League of Cities and Towns Things are heating up under the golden dome as adjournment looms large. Last week, the “Big Bill” for state appropriations was passed and the year’s premier housing proposal hit a roadblock. In this Weekly Legislative Report, we update you on the budget, a rollback on the electrification of heavy-duty trucks, legal trails, and more – and make an urgent call to action to support CHIP.
$9.1 Billion State Budget Bill Awaits Governor’s Signature
The FY26 Appropriations bill, H.493, was passed and delivered to the governor for his signature on May 15. Governor Scott is expected to sign H.493, but always has five days excluding Sundays to sign, veto, or let passed bills become law without his signature.
UPDATE: Scott signed the bill on May 21.
Usually. the budget bill is controversial and one of the last bills to pass each session, but this year the House, Senate, and Scott administration reached compromise on the budget with time to spare.
The FY26 budget fulfills all statutorily required reserve requirements, meets all pension obligations, stabilizes several special funds, and makes essential investments in public safety, human services, housing, and other major areas. In addition, all fiscal year 2025 budget adjustments were incorporated into H.493.
The FY26 budget is nearly $360 million more than the $8.7 billion FY25 budget and consists of $2.5 billion of general funds, $3.2 billion in federal funds, $2.4 billion in education funds, $360 million in transportation funds, and $691 million in other funds. Notably, the FY26 budget transfers $77.2 million from the General Fund to the Education Fund to buy down property tax rates and sets aside $4.0 million to support education transformation. Some highlights from the FY26 budget are listed below.
Housing and Infrastructure
- Fully funds the Vermont Housing and Conservation Board (VHCB) at statutory level of $36.9 million
- $5.0 million General Fund to VHCB for additional housing initiatives
- $2.8 million General Fund to VHCB for developmental disability housing initiatives
- $4.0 million to DHCD for the Vermont Housing Improvement Program (VHIP 2.0)
- $2.0 million to the Department of Housing and Community Development (DHCD) for the Manufactured Home Improvement and Repair Program (MHIR)
- $16.1 million for the Vermont Housing Finance Agency (VHFA) Middle-Income Homeownership Development and First-Generation Homebuyer programs and the Rental Revolving Loan Fund
- Provides $29.7 million for the Housing Opportunity Grant Program (HOP) that assists homeless individuals in addition to $3.35 million added to support new shelters opened in fiscal year 2025
- Maintains $446,253 to address youth homelessness
- Maintains $8.1 million base appropriation for General Assistance Emergency Housing
- $30.5 million General Fund to DCF for General Assistance Emergency Housing
- $2.0 million General Fund to DCF’s Office of Economic Opportunity (DCF-OEO) for shelter bed expansion
- Sets aside $10.0 million to support Emergency Housing GA transition in H.91
- $235,000 General Fund to the Department of Disabilities, Aging and Independent Living (DAIL) for HomeShare
- Adds $1.6 million for the Land Access Opportunity Board
Municipalities
- $50,000 to DEC for Municipal Wastewater Connections Database
- Includes additional support for communities impacted by flooding events in 2023 and 2024
- Eliminates all MTAP funding, which had been proposed at $3M
- $7.5 million for the Vermont Bond Bank Infrastructure Sustainability Fund
- $12.2 million for payment in lieu of taxes (PILOT)
- $1 million for brownfield remediation and redevelopment
Education and Workforce
- Transfers $77.2 million to the Education Fund be used for property tax relief
- Sets aside $4.0 million to support education transformation
- $17.5 million for Universal School Meals
- $9.5 million for environmental contingency fund for polychlorinated biphenyl (PCB) testing and remediation in schools
- Provides a 3% increase to the University of Vermont (UVM), Vermont State Colleges (VSC), and the Vermont Student Assistance Corporation (VSAC)
- Adds $3.8 million to the Judiciary for Tech Fund revenue replacement and $200,000 for security services cost of living adjustment (COLA)
Public Safety and Justice
- Adds $650,000 to Sheriffs to restore vacancy savings, allowing existing transport deputy positions and one new transport deputy position to be filled
- Adds $650,000 to the State’s Attorneys to restore vacancy savings and adds one fiscal and IT staff
- Establishes two new positions at the Human Rights Commission
- $1.1 million to the Agency of Administration for the Truth and Reconciliation Commission
- $600,000 to the Department of Public Safety (DPS) for State match for a cybersecurity grant
- Adds funds to support a new canine trainer at the Criminal Justice Council
- Adds $450,000 for the Urban Search and Rescue Team
- $800,000 to DPS for mobile and portable radio equipment
Food Security and Agriculture
- $500,000 to AAFM for a grant to Vermont Foodbank for the Vermonters Feeding Vermonters program
- $500,000 to Vermont Local Food for Schools and childcare grants
- $850,000 to DEC for the Concentrated Animal Feeding Operation database project
- $17.5 million for universal school meals
This year’s bill also establishes a process to manage moderate reductions to federal funds when the General Assembly is not in session and establishes a contingent appropriations list including resources to help mitigate any changes in available federal funds.
Reference Sites
May 19,2025.
Vermont League of Cities and Towns
89 Main St.
Suite 4,
Montpelier, VT, 05602
802-229-9111
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