Business & Economy

Lawmakers contemplate ‘third-rail’ reforms amid housing crisis

Many legislators say Vermonters sent a clear message ahead of the November elections: Housing must be at the top of the agenda when they return to Montpelier in January. Photo by Pixabay via Pexels

People are declining job offers in the state because they can’t find housing. Homelessness is rising. Vermont has the lowest rental vacancy rate in the nation.

Lawmakers who pounded the pavement throughout the summer and fall ahead of the November elections say Vermonters sent a clear message: Housing must be at the top of the agenda when they return to Montpelier in January.

House Speaker Jill Krowinski, D-Burlington

“I would say 99.9% of the conversations I had were about housing,” House Speaker Jill Krowinski, D-Burlington, said in an interview earlier in November, just days after the midterm elections.

There is no single solution to the state’s housing crisis, and varied constituencies have begun lining up to make their demands. Tenant groups want renter protections. Advocates for low-income Vermonters want more support for those experiencing homelessness. Nonprofit affordable housing builders want continued funding to keep building. Private developers, the business community (and nonprofit builders) want regulatory reform.

Sen. Kesha Ram Hinsdale, D-Chittenden, who is vying to chair the Senate Committee on Economic Development, Housing & General Affairs, said she’ll advocate for a four-pronged approach: improved tenant protections, more money to build or rehabilitate housing, zoning and regulatory reform, and tax changes. 

Ram Hinsdale says she isn’t sure that Vermont is ready for a statewide just cause eviction standard — although she says she favors one. But she said she does see “more of a path forward” for the Legislature to greenlight charter changes in towns and cities that decide to ban “no cause” evictions within their borders. 

Sen. Kesha Ram Hinsdale, D-Chittenden, speaks at a press conference to raise awareness about changes to the state's housing assistance program in November 2021. File photo by Mike Dougherty/VTDigger

Unlike in 2022, Vermont won’t have massive tranches of federal funding at its disposal in the upcoming legislative session to spend on affordable housing. But Ram Hinsdale said she would nevertheless like to find ways to continue some funding for existing programs aimed at creating affordable homes and rehabilitating rental units — including HomeShare Vermont and the “missing middle” development program championed by Gov. Phil Scott — many of which were started with one-time federal Covid-relief funds.

Rep. Emilie Kornheiser, D/P-Brattleboro

She also argues the General Assembly will have to take on some “third-rail” subjects, including taxing second homes differently than properties that are used for commercial purposes or rented out.

“If you want to have a vacation home in Vermont — a second home that’s open year-round to you and possibly only inhabited less than three months of the year — you can have that. But that should be a different rate of taxation than those who try to rent out their space,” Ram Hinsdale said. 

That’s a conversation that Rep. Emilie Kornheiser, D/P-Brattleboro, the vice-chair of the tax-writing House Committee on Ways and Means, is “absolutely ready” to have. In some towns, she noted, the tax rate on primary residences is more expensive than the rate those with second homes pay. And by some estimates, nearly a quarter of all homes in Vermont are vacant.

Sen. Ann Cummings, D-Washington

“We have more unused housing than anywhere in the country — and this enormous housing crisis,” she said.

Sen. Ann Cummings, D-Washington, who chairs the Senate Committee on Finance, struck a more cautious note. It’ll be tricky, she said, to figure out exactly what should count as a vacant property.

“I think it's worth looking at,” she said. “But if it was simple, we probably would have done it before.”

The zoning question

As America confronts a sprawling and acute housing crisis, the role local zoning has played in keeping supply low — and keeping certain communities from accessing housing — is increasingly taking center stage. And Ram Hinsdale said it’s time Vermont examine the “racist and classist” history and implications of certain zoning rules. 

“We have to take a serious look at the invisible factors that keep all Vermonters from being able to live where they choose to live,” she said.

Vermont could even look to California, she said, which banned single-family zoning last year, a move that will make it legal to build duplexes anywhere single-family homes are allowed.

Rep. Seth Bongartz, D-Manchester, said he’d been meeting with regional planners, nonprofit builders and representatives from Gov. Phil Scott’s administration throughout the summer and fall to work on a municipal zoning reform bill that he hopes to unveil soon. He declined to discuss specifics for the time being — the legislation is still in development — but said the bill would be aimed at enabling denser building and multifamily housing, particularly in the state’s downtowns.

“The reality is that much of our zoning is decades old,” he said. “We’ve realized that zoning can have discriminatory impacts, even if it wasn’t designed with that intention.” 

Seth Bongartz
Rep. Seth Bongartz, D-Manchester, in August 2020. Bongartz said he’s been meeting with regional planners, nonprofit builders and representatives from Gov. Phil Scott’s administration throughout the summer and fall to work on a municipal zoning reform bill that he hopes to unveil soon. File photo by Grace Elletson/VTDigger

Austin Davis, a lobbyist for the Lake Champlain Chamber of Commerce, said housing is a key priority for his members. Vermont needs “more units — period,” said Davis, and the chamber plans to keep beating the drum of regulatory and permit reform in hopes of increasing supply.

But Davis argues that lawmakers would be better off returning to the topic of Act 250 reform, not municipal zoning. In particular, the chamber will keep pushing that Vermont fully exempt housing projects in state-designated areas in downtowns and village centers from review under the landmark land-use law. 

While attempts to update Act 250 have for years fallen prey to squabbles among lawmakers, Scott and environmentalists, Davis thinks meaningful reform is more likely at the state, rather than local, level. In a state where municipalities jealously guard their local control, anything more ambitious than giving communities state-funded grants to work on voluntary municipal zoning reforms, he said, is typically “dead on arrival.”

The Congress and Main development in St. Albans on in March 2021. File photo by Glenn Russell/VTDigger

Bongartz said he’s “very sensitive” to anxieties a zoning reform effort could stoke in towns and cities across Vermont, and is trying to balance removing barriers to denser housing while still giving towns “flexibility.” But he also argues that the housing crisis is making people increasingly receptive to change.

“I am beginning to sense that there is a recognition that this needs to happen,” he said. His bill won’t deal with Act 250 reform, he said, because builders largely agree that it is most often municipal zoning regulations that get in the way.

Although Davis believes that Act 250 is an important impediment, he agrees with Bongartz that the biggest regulatory hurdles to development are usually local. But, he said, those are also “the hardest to tackle.”

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Lola Duffort

About Lola

Lola Duffort is a political reporter for VTDigger, covering Vermont state government, the congressional delegation and elections. She previously covered education for Digger, the Concord Monitor in New Hampshire and the Rutland Herald. She has also freelanced for the Miami Herald in Florida, where she grew up. She is a graduate of McGill University in Canada.


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