It was a busy week at the Statehouse last week, with marathon floor sessions in both chambers after lawmakers pushed a tsunami of bills through their committees earlier this month. Notably, the House on Thursday advanced its draft of the Fiscal Year 2026 budget by a 104-38 vote, followed by a final voice vote on Friday. The spending plan now moves to the Senate for its inevitable edits.

Excluded from the budget draft were roughly $35 million in spending requests for housing initiatives. From first glance, this sounds bad. And it's not good. Housing Commissioner Alex Farrell at last week's gubernatorial press conference, for instance, told reporters that the House Appropriations Committee "gutted" major spending proposals to help address Vermont's housing backlog. One cold comfort is that the committee made similarly dramatic cuts to appropriations requests across the board -- not exclusively to housing policies, by a long shot. The through-line is: The chickens are coming home to roost, and the state has a limited amount of money it's able to spend this year, especially as the future of major federal funding currently hangs in the balance. Gone are the days of U.S. Senate Appropriations Chair Patrick Leahy and the American Rescue Plan Act, when it seemed as though Vermont had unlimited amounts of federal cash. AGC-VT will continue to fiercely make the case to lawmakers that investments in housing are investments in all of Vermont. At the same time, with fewer dollars to dedicate to the issue, we have an even stronger case to make for true regulatory reform to make building easier and cheaper, as well as potential alternate funding methods for development such as TIFs.

 

One positive note from the budget is that the House Appropriations Committee has agreed to a proposal from the Scott Administration to retain $20 million within the Transportation Fund, which is typically allocated to state police every year in what is called the "JTOC transfer." Here's a helpful letter from House Transportation Chair Matt Walker explaining the rationale behind this. This is one step toward stabilizing the T Fund, which is looking toward a shortfall in future fiscal years, as I've reported to you all in the past. Hopefully, Senate appropriators agree to keep this $20 million in the T Fund in FY26, as AGC-VT and other stakeholders continue to look toward systemic fixes for the fund down the line.

 

Speaking of: The Agency of Transportation on Wednesday presented helpful data to the Senate Transportation Committee on the implementation of a mileage-based user fee on electric vehicles, which could help, in part, make up for declining gas tax revenues. Thanks to more fuel-efficient vehicles — or those that don't consume any fuel at all, such as EVs — Vermont's gas tax revenues are on the decline, resulting in fewer dollars to dedicate to road maintenance. Here's AOT's presentation if you'd like to read through, or a recording of their testimony. This is very much a continuing conversation, and AGC-VT is at the table.

 

Also on the note of EVs, stakeholders this week testified to the House Transportation Committee on the potential fallout of California's clean car and clean fleet initiatives, which Vermont legislators previously adopted but have the power to put on hold as technology, industry and infrastructure race to catch up. Here is some helpful written testimony as provided by the Vermont Vehicle and Automotive Distributors Association. As Dave Malloy from Bellavance Trucking so aptly testified, emissions from fossil fuel-burning trucks have dramatically declined in recent years, thanks to great new technologies. And while Vermont's eventual goal to see zero-emissions trucking is admirable, "It's not as easy as flipping a switch."

 

That's all for now. Have a great week and don't be strangers.