May 2, 2025

Hello Friends,

It was a relatively slow week on the House side, but the Senate was busy working on the education reform bill. It passed out of the Senate Education Committee and will now go on to the Finance Committee. The Senate made some major changes to the House bill, most notably,

·         Eliminating class size minimums

·         Changing the nature and composition of the task force charged with drawing the new district/supervisory union boundaries. Of note here is that the task force is to consider the, “continuation of a tuitioning system that provides continued access to independent schools that have served geographic areas that do not operate public schools at all grade levels.”

·         The House version limited tuition to approved independent schools located in Vermont that have at least 51% of their student enrollment composed of students attending on public tuition. The Senate draft changes the threshold to 25% of students attending on public tuition and also allows tuition to be paid to independent schools within 25 miles of the Vermont border in a bordering state or province (Canada).

There are other changes as well, but all of this is still up for negotiation in conference committee. A conference committee is comprised of three members from each chamber. They will come up with a compromise bill and each chamber will have to vote up or down (no amendments allowed). In typical sessions we would adjourn with passage of the budget, usually mid May. This year we are slated to stay the whole month to sort out this education reform bill.

As you know, one of the biggest issues facing the state is the ongoing and uncertain fallout from Federal decisions. This week the Rural Caucus, of which I am a member, heard from a few of the state’s key partners working on food systems, farmer support and food insecurity in VT. As of this week, over 16,000 US Department of Agriculture personnel have been cut. These cuts, combined with funding cuts, will have widespread detrimental effects on our food systems and farmers on many levels. Of grave concern is the threatened cut to SNAP (Supplemental Nutrition Assistance Program), which we administer as 3squaresvt – the programs SNAP funds are crucial backbones to the State’s food security system, especially for our children. Some of the programs that are important to Vermont and are impacted by the USDA cuts include:

·         Natural Resources Conservation Service (NRCS)

·         USDA Rural Development

·         USDA Farm Services Agency (FSA)

·         Animal and Plant Health Inspection Service (APHIS)

·         Vermont Association of Conservation Districts (VACD)

·         Northeast Organic Farming Association of Vermont (NOFA-VT)

·         Partnerships for Climate Smart Commodities (PCSC)

Some bills in process…

Housing -

S.127 - An act relating to housing and housing development.

This bill makes changes to Title 10 governing housing development. It makes technical changes to housing finance in order to encourage development and flood mitigation. The bill introduces the Community and Housing Infrastructure Program, a project based tax increment financing (TIF) program approved by Vermont Economic Process Council (VEPC). Basically, it is a way to use the future increase in property value to finance a project.

Taxation -

S.51 – The bill contains several exemptions and tax credits meant to put more money in the pockets of low- and moderate-income Vermonters.

Earned Income Tax Credit (EITC) – expands the Vermont EITC for individuals without children from 38% of the federal EITC to 100%

Child Tax Credit – raises the age limit for children who create a tax credit for their families from 5 to 6 years old

Expansion of Social Security income limits – the income limits for taxpayers who are eligible to receive an income tax exemption on their social security income are raised from $50,000 to $55,000 (with a phase out up to $65,000) for individuals and from $65,000 to $70,000 (with a phase out up to $80,000) for joint filers. (I was trying to raise this number much higher).

Expansion of Civil Service Retirement System (CSRS) income limits – the income limits for taxpayers who are eligible to exempt the first $10,000 of their CSRS income from income tax are raised from $50,000 to $55,000 (with a phase out up to $65,000) for individuals and from $65,000 to $70,000 (with a phase out up to $80,000)

Military Pension and Survivor Benefits Exemption – Military retirees and their survivors with income of $125,000 or less will be able to exempt their military pension and survivor benefits from income tax. For income above $125,000, the exemption phases out until at $175,000 of income, the benefits are no longer exempt. Military retirees will no longer have to choose between taking their military pension exemption or their social security exemption but can exempt both as long as they qualify under the income limitations.

Veterans Tax Credit – The means test for the military pension exemption was implemented in part to make room in the budget for a tax credit meant to help our most vulnerable veterans who typically do not qualify for military pensions. Veterans with income of $25,000 or less will be eligible for a $250 refundable credit, meaning that even if they do not have a tax liability, they are eligible for the credit. The credit phases out up to an income limit of $30,000.

Good news that we found out about in my committee this week -

You may have heard recently that the Trump administration is eliminating the federal office that administers LIHEAP, the Low-Income Home Energy Assistance Program. LIHEAP funds 100% of Vermont's Fuel Assistance Program averaging $28.5 million in FY24 and 25. VFAP includes: standard Heating assistance, Crisis Fuel (Dec-March), Heating System repair & replacement, and Fuel Tank repair & replacement. Last year VFAP provided an average of more than $1,000 in crucial heating assistance to about 16,000 low-income Vermont homeowners and renters who pay for heat; lesser benefit amounts were provided to some 24,000 others (e.g., heat included in rent).

However, LIHEAP itself was not eliminated, though Trump's draft FFY26 budget does zero out the program, as he threatened in every budget during his previous stint. But it's broadly popular and Congress always restored funding; everyone expects the same this time around. Reorganization of the Department of Health & Human Services is eliminating 10,000 jobs including Vermont's LIHEAP contact person.

I hope you enjoy this beautiful time of year. Please keep in touch.

Best,

Chris Morrow 

cmorrw@leg.state.vt.us