Since its inception, Act 250 has always been a balancing act between allowing the development of new housing while also conserving the natural resources and beauty of Vermont. However, as the housing crisis rages on, concerns have been raised by state government officials of a once-in-a-lifetime opportunity to create more affordable housing slipping away as time-sensitive American Rescue Plan Act (ARPA) funds race against the Act 250 permitting process. Among all of the ARPA funding that Vermont has received to spend by 2024, the Scott Administration has proposed $249 million to build and refurbish more affordable and permanent housing for low-income Vermonters and has requested that the General Assembly exempt Act 250 requirements in certain neighborhood development areas to guarantee all possible funding is spent before the federal deadline.
In response, the legislature has been deliberating over Senator Christopher Bray’s (D-Addison) S.234 which addresses a number of Act 250-related issues including: 1) promoting denser and expanded development in historical settlement patterns through Neighborhood Development Areas (NDAs), 2) making changes to the permitting process to promote efficiency and timeliness, 3) language around forest block fragmentation and natural resource mapping, and 5) mandating a number of reports and study committees including a DHCD report on Designated Areas in relation to Act 250 by 2023.
With overt cautiousness to balance housing and environmental impacts of Act 250 exemptions, senators have been keen to address both the immediate concerns of spending this unprecedented amount of money for housing while also looking to the future to make sure that permitting is more efficient and less costly - all while equally ensuring that the law remains a lodestar for sustainable and environmentally-minded growth. In the immediate short-term, S.234 would change the definition of Priority Housing Projects (PHPs) to apply to projects with more than 50 dwelling units instead of 25. Along with this, a floor of at least four dwelling units per acre would be set for municipalities that apply for Neighborhood Development Area (NDA) status and the permitting and tax incentives that come with them for developers. This would promote the construction of more housing units in areas that already see exemptions from Act 250.
Besides just increasing incentives for density in these designated areas, other provisions of the bill work to make the application process more expedient for developers so that they can construct ARPA-funded projects more quickly. For instance, timelines for permits would be extended for two years before expiration. Also, municipalities would be given up to ninety days to review and approve project applications before being presumably approved. Lastly, the bill would remove requirements for NDAs to have municipal sewer infrastructure, allowing developers the ability to build waste treatment sites in towns that lack the infrastructure in order to still receive NDA-related incentives.
In looking to the future of Act 250, and further deliberation after the immediate ARPA funding dilemma is managed, the bill has set aside funding for various reports and study committees on different Act 250-related matters in order for the General Assembly to have data and research to depend upon during discussions in the next biennium, Specifically related to housing, there is funding in the bill for the Department of Housing and Community Development to hire a private consultant to research and make recommendations on improving and modernizing the various designation zones along with strengthening incentives in these areas for economic development and public investment.
Overall, S.234 does much to ensure that the once-in-a-lifetime opportunity to take a dent out of the housing crisis through this federal funding becomes reality, while being mindful of the purpose and legacy of Act 250. Ultimately though, there is still a long road ahead before this happens. As of March 25th, the bill passed through its third reading in the Senate with a voice vote and will be making its way to the House for consideration. Once approved by the chamber and Governor Scott, we can enthusiastically expect permits to be submitted, shovels to sink into earth, and the availability of more safe and affordable housing for all Vermonters!