S 325

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No. 152. An act relating to regional planning and Act 250 Tier
jurisdiction.
                                      (S.325)
It is hereby enacted by the General Assembly of the State of Vermont:
                            * * * Act 181 Repeals * * *
Sec. 1. 2024 Acts and Resolves No. 181, Sec. 19 (road jurisdiction) is
amended to read:
   Sec. 19. [Deleted.]
Sec. 2. 2024 Acts and Resolves No. 181, Sec. 21 (Tiers 2 and 3) is amended to
read:
   Sec. 21. [Deleted.]
Sec. 3. 2024 Acts and Resolves No. 181, Sec. 114 is amended to read:
   Sec. 114. EFFECTIVE DATES
   This act shall take effect on passage, except that:
        (1) Secs. 12 (10 V.S.A. § 6001), and 13 (10 V.S.A. § 6086(a)(8)), and
21 (10 V.S.A. § 6001) shall take effect on December 31, 2026 January 1, 2028;
        (2) Sec. 19 (10 V.S.A. § 6001(3)(A)(xii)) shall take effect on July 1,
2026; [Deleted.]
                                       ***
Sec. 4. REPEAL
   2024 Acts and Resolves No. 181, Sec. 22 (Tier 3 rulemaking) is repealed.
Sec. 5. REPEAL
   2024 Acts and Resolves No, 181, Sec. 34 (Tier 2 area report) is repealed.
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                               * * * Act 250 * * *
Sec. 6. 10 V.S.A. § 6081 is amended to read:
§ 6081. PERMITS REQUIRED; EXEMPTIONS
                                      ***
   (t)(1) No permit or permit amendment is required for the construction of
improvements for an accessory on-farm business for the storage or sale of
qualifying products or the other eligible enumerated products as defined in
24 V.S.A. § 4412(11)(A)(i)(I).
      (2) No permit or permit amendment is required for the construction of
improvements for an accessory on-farm business for the preparation or
processing of qualifying products as defined in 24 V.S.A. § 4412(11)(A)(i)(I),
provided that more than 50 percent of the total annual sales of the prepared or
processed qualifying products come from products produced on the farm
where the business is located. This subsection shall not apply to
      (3) No permit or permit amendment is required for the construction of
improvements related to hosting events or farm stays as part of for an
accessory on-farm business of educational, recreational, or social events that
feature agricultural practices or qualifying products, or both, as defined in
24 V.S.A. § 4412(11)(A)(i)(II). Types of events may include concerts and
farm stays with five or fewer dwelling units. To qualify for this exemption, the
accessory on-farm business shall not:
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          (A) have noise exceed 70 dB at the property boundaries; and
          (B) have events that continue past 10:00 p.m.
      (4) For purposes of this subsection, “feature agricultural practices or
qualifying products” means that a host farm’s agricultural practices or its
qualifying products are a substantial component of any educational,
recreational, or social event the accessory on-farm business hosts.
                                      ***
   (z)(1) Notwithstanding any other provision of this chapter to the contrary,
no permit or permit amendment is required for any subdivision, development,
or change to an existing project that is located entirely within a Tier 1A area
under as established in section 6034 of this chapter.
      (2) Notwithstanding any other provision of this chapter to the contrary,
no permit or permit amendment is required within a Tier 1B area approved by
the Board under section 6033 of this chapter for 50 units or fewer of housing
on a tract or tracts of land involving 10 acres or less or for mixed-use
development with 50 units or fewer of housing on a tract or tracts of land
involving 10 acres or less.
      (3) Upon receiving notice and a copy of the permit issued by an
appropriate municipal panel pursuant to 24 V.S.A. § 4460(g), a previously
issued permit for a development or subdivision located in a Tier 1A area shall
remain attached to the property. However, neither the Board nor the Agency
of Natural Resources shall enforce the permit or assert amendment jurisdiction
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on the tract or tracts of land unless the designation is revoked or the
municipality has not taken any reasonable action to enforce the conditions of
the permit.
                                       ***
   (dd) Interim housing exemptions.
      (1) Notwithstanding any other provision of law to the contrary, until
January 1, 2027 2028, no permit or permit amendment is required for the
construction of housing projects such as cooperatives, condominiums,
dwellings, or mobile homes, with 75 units or fewer, constructed or maintained
on a tract or tracts of land, located entirely within the areas of a designated new
town center, a designated growth center, or a designated neighborhood
development area served by public sewer or water services or soils that are
adequate for wastewater disposal. Housing units constructed pursuant to this
subdivision shall not count towards the total units constructed in other areas.
This exemption shall not apply to areas within mapped river corridors and
floodplains except those areas containing preexisting development in areas
suitable for infill development as defined in 29-201 of the Vermont Flood
Hazard Area and River Corridor Rule.
      (2)(A) Notwithstanding any other provision of law to the contrary, until
July January 1, 2027 2028, no permit or permit amendment is required for the
construction of housing projects such as cooperatives, condominiums,
dwellings, or mobile homes, with 50 or fewer units, constructed or maintained
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on a tract or tracts of land of. To qualify, the housing project, including any
land incidental to the use of the housing project such as lawns, parking lots,
driveways, leach fields, and accessory buildings, shall be on 10 contiguous
acres or less, located entirely within:
               (i) areas of a designated village center and within one-quarter mile
of its boundary with permanent zoning and subdivision bylaws and served by
public sewer or water services or soils that are adequate for wastewater
disposal; or
               (ii) areas of a municipality that are within a census-designated
urbanized area with over 50,000 residents and within one-quarter mile of a
transit route.
                                          ***
      (3) Notwithstanding any other provision of law to the contrary, until
January 1, 2027 2028, no permit or permit amendment is required for the
construction of housing projects such as cooperatives, condominiums,
dwellings, or mobile homes, constructed or maintained on a tract or tracts of
land, located entirely within a designated downtown development district with
permanent zoning and subdivision bylaws served by public sewer or water
services or soils that are adequate for wastewater disposal. Housing units
constructed pursuant to this subdivision shall not count towards the total units
constructed in other areas. This exemption shall not apply to areas within
mapped river corridors and floodplains except those areas containing
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preexisting development in areas suitable for infill development as defined in
29-201 of the Vermont Flood Hazard Area and River Corridor Rule.
Sec. 7. 24 V.S.A. § 4460 is amended to read:
§ 4460. APPROPRIATE MUNICIPAL PANELS
                                        ***
   (g)(1) This subsection shall apply to a subdivision or development that:
          (A) was previously permitted pursuant to 10 V.S.A. chapter 151;
          (B) is located in a Tier 1A area pursuant to 10 V.S.A. § 6034; and
          (C) has applied for a permit or permit amendment required by zoning
regulations or bylaws adopted pursuant to this subchapter.
      (2) The appropriate municipal panel reviewing a municipal permit or
permit amendment pursuant to this subsection shall include conditions
contained within a permit previously issued pursuant to 10 V.S.A. chapter 151,
so that the conditions may be enforced as part of the municipal permit, unless
the panel determines that the permit condition pertains to any of the following:
          (A) the construction phase of the project that has already been
constructed;
          (B) compliance with another State permit that has independent
jurisdiction;
          (C) federal or State law that is no longer in effect or applicable;
          (D) an issue that is addressed by municipal regulation and the project
will meet the municipal standards; or
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          (E) a physical or use condition that is no longer in effect or
applicable or that will no longer be in effect or applicable once the new project
is approved.
      (3) After issuing or amending a permit containing conditions pursuant to
this subsection, the appropriate municipal panel shall provide notice and a
copy of the permit to the Land Use Review Board.
      (4) The appropriate municipal panel shall comply with the notice and
hearing requirements provided in subdivision 4464(a)(1) of this title. In
addition, notice shall be provided to those persons requiring notice under
10 V.S.A. § 6084(b) and shall explicitly reference the existing Act 250 permit.
      (5) The appropriate municipal panel’s decision shall be issued in
accordance with subsection 4464(b) of this title and shall include specific
findings with respect to its determinations pursuant to subdivision (2) of this
subsection.
      (6) Any final action by the appropriate municipal panel affecting a
condition of a permit previously issued pursuant to 10 V.S.A. chapter 151 shall
be recorded in the municipal land records.
   (h) Within a Tier 1A area, the appropriate municipal panel shall enforce
any existing permits issued under 10 V.S.A. chapter 151 that has not had its
permit conditions transferred to a municipal permit pursuant to subsection (g)
of this section.
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Sec. 8. 2024 Acts and Resolves No. 181, Sec. 14 is amended to read:
   Sec. 14. CRITERION 8(C) RULEMAKING
                                      ***
   (c) The Board shall file a final proposed rule with the Secretary of State
and Legislative Committee on Administrative Rules on or before June 15,
2026 2027.
                                      ***
Sec. 9. PUBLIC ENGAGEMENT PLAN
   (a) On or before January 15, 2027, the State Natural Resources
Conservation Council shall contract with the Vermont Council on Rural
Development and the Vermont Association of Conservation Districts to
develop a report outlining recommendations for a public engagement plan, in
consultation with the Land Use Review Board and the Land Access and
Opportunity Board. The contractors shall:
      (1) ensure the engagement planning process does not presuppose
outcomes or take positions on policy and political issues;
      (2) utilize nonpartisan facilitation for statewide, democratic public
engagement;
      (3) ensure alignment with the core principles for community
engagement plans developed pursuant to 3 V.S.A. § 6006; and
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      (4) design the plan to inclusively and meaningfully engage a full range
of stakeholders, including Vermont residents and landowners and historically
marginalized communities.
   (b) The purpose of the public engagement plan would be to gather
statewide input from Vermonters to inform the General Assembly on:
      (1) the risks of losing working lands, both agricultural and forestland,
and the causes of those risks, and critical natural resources not already well-
protected by current land use policy, permitting programs, or other regulatory
tools, including agricultural soils, rare natural communities, forest blocks,
habitat connectors of statewide significance, and headwaters; and
      (2) equitable, efficient, and effective regulatory or nonregulatory tools to
protect these working lands and critical natural resources and the barriers to
land stewardship.
   (c) On or before January 15, 2027, the Council shall submit the report with
the recommended public engagement plan to the House Committee on
Environment and the Senate Committee on Natural Resources and Energy.
   (d) In fiscal year 2027, $30,000.00 is appropriated from the General Fund
to the State Natural Resources Conservation Council for the public
engagement plan design described in this section.
Sec. 10. 2 V.S.A. chapter 32 is added to read:
 CHAPTER 32. JOINT LEGISLATIVE ENVIRONMENTAL OVERSIGHT
                                 COMMITTEE
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§ 1031. CREATION OF COMMITTEE
  (a) Creation. There is created the Joint Legislative Environmental
Oversight Committee whose membership shall be appointed each biennial
session of the General Assembly. The Committee shall exercise oversight over
the Land Use Review Board and Agency of Natural Resources permitting
processes.
  (b) Composition. The Committee shall be composed of six members:
three members of the House of Representatives, who shall not all be from the
same party, appointed by the Speaker of the House; and three members of the
Senate, who shall not all be from the same party, appointed by the Committee
on Committees.
  (c) Procedure. The Committee shall elect a chair and vice chair from
among its members and shall adopt rules of procedure. The Chair shall rotate
biennially between the House and the Senate members. The Committee shall
keep minutes of its meetings. A quorum shall consist of four members.
  (d) Meetings. When the General Assembly is in session, the Committee
shall meet at the call of the Chair. The Committee may meet six times per year
during adjournment and may meet more often subject to approval of the
Speaker of the House and the President Pro Tempore of the Senate.
  (e) Compensation. For attendance at a meeting when the General
Assembly is not in session, members of the Committee shall be entitled to
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compensation for services and reimbursement of expenses as provided under
subsection 23(a) of this title.
   (f) Assistance. The administrative and legal services of the Joint Fiscal
Office and the Office of Legislative Counsel shall be available to the
Committee.
   (g) Duties. The Committee shall meet with the Land Use Review Board to
ensure strong communication and coordination regarding the interpretation and
implementation of the statutes amended as part of 2024 Acts and Resolves
No. 181, how the permitting process under 10 V.S.A. chapter 151 is working,
and how the new Board structure is working. The Committee shall also meet
with the Agency of Natural Resources to learn about Agency efforts to
improve and better coordinate its permitting processes and to coordinate efforts
for further improvements to the process for applicants and outcomes for
Vermonters.
   (h) Sunset. The Committee shall cease to exist on July 1, 2029.
Sec. 11. LAND USE REVIEW BOARD REPORTS
   (a) The Land Use Review Board shall deliver reports that collect the data
and analyze:
      (1) whether and how Act 250 jurisdiction over commercial activities on
farms should be revised, including accessory on-farm businesses on or before
November 15, 2026;
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      (2) the effects of Act 250 mitigation actions on primary agricultural soils
on or before July 1, 2027; and
      (3) the effects of jurisdictional triggers and criterion 9(L) on the
development of retail and service businesses outside village centers in
addressing sprawl and strip development, and how to improve the effectiveness
of criterion 9(L) on or before November 15, 2027.
   (b) The Board shall engage relevant stakeholders as part of the
development of this report.
   (c) The report shall be submitted to the House Committees on Agriculture,
Food Resiliency, and Forestry and on Environment and the Senate Committees
on Agriculture and on Natural Resources and Energy.
                         * * * Regional Planning * * *
Sec. 12. 24 V.S.A. § 4348 is amended to read:
§ 4348. ADOPTION AND AMENDMENT OF REGIONAL PLAN
                                      ***
   (b) 60 Sixty days prior to holding the first public hearing on a regional plan
adoption, a regional planning commission shall submit a draft regional plan to
the Land Use Review Board for review and comments related to conformance
of the draft with sections 4302 and 4348a of this title and chapter 139 of this
title and, if it is seeking an optional determination of energy compliance, to the
Department of Public Service for review and comments related to conformance
of the draft plan with section 4352 of this title. The Board shall coordinate
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with other State agencies and the Community Investment Board and respond
within 60 days unless more time is granted by the regional planning
commission.
   (c) The regional planning commission shall hold two or more public
hearings within the region after public notice on any proposed plan or
amendment. The minimum number of required public hearings may be
specified within the bylaws of the regional planning commission.
   (d)(1) At least 30 days prior to the first hearing, a copy of the proposed
plan or amendment, a report documenting conformance with the goals
established in section 4302 of this chapter and the plan elements established in
section 4348a of this chapter, and a description of any changes to the Regional
Future Land Use Map with a request for general comments and for specific
comments with respect to the extent to which the plan or amendment is
consistent with the goals established in section 4302 of this title, shall be
delivered physically or electronically with proof of receipt or sent by certified
mail, return receipt requested, to each of the following:
                                       ***
      (2) At least 30 days prior to the first hearing, the regional planning
commission shall provide each of its member municipalities with a written
description of map changes within the municipality, a municipality-wide map
showing old versus new areas with labels, and information about the new Tier
structure under 10 V.S.A. chapter 151, including how to obtain Tier 1A or 1B
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status, and the process for updating designated area boundaries. The regional
planning commission shall, if it is seeking an optional determination of energy
compliance, solicit feedback on its enhanced energy plan, including
consistency with section 4352 of this chapter and the enhanced energy
planning standards.
   (e) Any of the foregoing bodies, or their representatives, may submit
comments on the proposed regional plan or amendment to the regional
planning commission, and may appear and be heard in any proceeding with
respect to the adoption of the proposed plan or amendment.
   (f) The regional planning commission may make revisions to the proposed
plan or amendment at any time not less than 30 days prior to the final public
hearing held under this section. If the proposal is changed, a copy of the
proposed change shall be delivered physically; electronically with proof of
receipt; or by certified mail, return receipt requested, to the chair of the
legislative body of each municipality within the region and to any individual or
organization requesting a copy at least 30 days prior to the final hearing.
                                       ***
   (h)(1) Within 15 days following adoption, a regional planning commission
shall submit its regionally adopted regional plan to the Land Use Review
Board for a determination of regional plan compliance with a report
documenting conformance with the goals established in section 4302 of this
chapter and the plan elements established in section 4348a of this chapter and a
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description of any changes to the regional plan future land use map. The
regional planning commission shall also at this time, if it is seeking an optional
determination of energy compliance pursuant to section 4352 of this chapter,
submit the plan to the Department of Public Service for review with a
description of conformance with the enhanced energy planning standards and
with a summary of any comments received during the public hearings.
                                      ***
   (j) Minor amendments to regional plan future land use map. A regional
planning commission may submit a request for a minor amendment to
boundaries of a future land use area for consideration by the Land Use Review
Board with a letter of support from the municipality. The request may only be
submitted after an affirmative vote of the municipal legislative body and the
regional planning commission board. The Land Use Review Board, after
consultation with the Community Investment Board and the regional planning
commissions, shall provide guidance about what constitutes a minor
amendment. Minor amendments may include any change to a future land use
area consisting of fewer than 10 acres. A minor amendment to a future land
use area shall not require an amendment to a regional plan and shall be
included in the next iteration of the regional plan. The Land Use Review
Board may adopt rules to implement this section.
                                      ***
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   (n) Regional plan amendments, nonminor future land use map
amendments, and Tier 1B area status requests. Regional plans may be
reviewed from time to time and may be amended in the light of new
developments and changed conditions affecting the region. Nonminor future
land use map amendments shall be processed as part of a regional plan
amendment. Tier 1B area status requests may be made separate from the
regional plan approval or amendment process.
      (1) Process.
          (A) To amend a regional plan, which may include a nonminor future
land use map amendment, a regional planning commission shall hold one
public hearing. At least 15 days in advance of the hearing, the regional
planning commission shall provide notice of the public hearing to the parties
listed in subdivision (d)(1) of this section and the Land Use Review Board.
The public hearing notice shall include a description of changes to the plan,
including nonminor amendments to future land use maps, or any changes to
Tier 1B area status.
          (B) After adoption of the regional plan amendment, the regional
planning commission shall submit a request to the Land Use Review Board for
an affirmative determination of regional plan compliance for the regional plan
amendment.
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          (C) Stand-alone requests for Tier 1B area status shall be submitted to
the Land Use Review Board after the public hearing required under
subdivision (A) of this subdivision (1).
          (D) The Land Use Review Board shall hold a public hearing within
30 days after receiving the request for an affirmative determination of regional
plan amendment compliance or approval of Tier 1B area status. The Land Use
Review Board shall issue its determination within 30 days after the hearing.
      (2) Expiration date. Adoption of a regional plan amendment, nonminor
future land use map amendment, or Tier 1B area status request or amendment
shall not change the expiration date of the regional plan.
                                      ***
Sec. 13. 24 V.S.A. § 4348a is amended to read:
§ 4348a. ELEMENTS OF A REGIONAL PLAN
   (a) A regional plan shall be consistent with the goals established in section
4302 of this title and shall include the following:
                                      ***
      (12) A future land use element, based upon the elements in this section,
that sets forth the present and prospective location, amount, intensity, and
character of such land uses in relation to the provision of necessary community
facilities and services and that consists of a map delineating future land use
area boundaries for the land uses in subdivisions (A)–(J) of this subdivision
(12) as appropriate and any other special land use category the regional
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planning commission deems necessary; descriptions of intended future land
uses, consistent with the smart growth principles in section 4303 of this
chapter; and policies intended to support the implementation of the future land
use element using the following land use categories:
          (A) Downtown or village centers. These areas are the mixed-use
centers bringing together community economic activity and civic assets. They
include downtowns, villages, and new town centers previously designated
under chapter 76A and downtowns and village centers seeking benefits under
the Community Investment Program under section 5804 5803 of this title. The
downtown or village centers are the traditional and or historic central business
and civic centers within planned growth areas, village areas, or may stand
alone. Municipalities may have more than one center, including planned new
or emerging centers that anchor planned growth or village areas. Village
centers are not required to have public water, wastewater, zoning, or
subdivision bylaws.
          (B) Planned growth areas. These areas include the high-density
existing settlement and future growth areas with high concentrations of
population, housing, and employment in each region and town, as appropriate.
They include a mix of historic and nonhistoric commercial, residential, and
civic or cultural sites with active streetscapes, supported by land development
regulations; public water or wastewater, or both; and multimodal transportation
systems. These areas include new town centers, downtowns, village centers,
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growth centers, and neighborhood development areas previously designated
under chapter 76A of this title. These areas should generally meet the smart
growth principles definition in chapter 139 of this title and the following
criteria:
                                        ***
               (iii) The area is generally within walking distance from the
municipality’s or an adjacent municipality’s downtown, or village center, new
town center, or growth center.
                                        ***
               (vi) The area provides for opportunity for development, infill
development, and redevelopment that is needed to meet the regional and
municipal housing targets that meets meet the present and future needs of a
diversity of social and income groups in the community.
               (vii) The area is served by planned or existing transportation
infrastructure that conforms with “complete streets” principles as described
under 19 V.S.A. chapter 24 and establishes pedestrian access directly to the
downtown, or village center, or new town center. Planned transportation
infrastructure includes those investments included in the municipality’s capital
improvement program pursuant to section 4430 of this title.
            (C) Village areas. These areas include the traditional settlement area
or a proposed new settlement area, typically composed of a cohesive mix of
residential, civic, religious, commercial, and or mixed-use buildings, arranged
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along a main street and intersecting streets that are within walking distance for
residents who live within and surrounding the core downtown center or village
center. These areas include existing village center designations and similar
areas statewide, but this area is larger than the village center designation.
Village areas shall meet the following criteria:
                                         ***
                (iv) The municipality has either municipal public water or
wastewater. If no public wastewater is available, the area must have soils that
are adequate for wastewater disposal.
                (v) The area has some opportunity for infill development or new
development areas where the village can grow, support the development of
housing to meet the regional and municipal housing targets, and be flood
resilient.
                                         ***
             (J) Rural; conservation. These are areas of significant natural
resources, identified by regional planning commissions or municipalities based
upon existing Agency of Natural Resources mapping that require special
consideration for aquifer protection; for wetland protection; for the
maintenance of forest blocks, wildlife habitat, and habitat connectors; or for
other conservation purposes. The mapping of these areas and accompanying
policies are intended to help meet requirements of 10 V.S.A. chapter 89. Any
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portion of this area that is approved by the LURB as having Tier 3 area status
shall be identified on the future land use map as an overlay upon approval.
                                     ***
   (d) With the exception of preexisting, nonconforming designations
approved prior to the establishment of the State Community Investment
program, the areas eligible for designation benefits under that program upon
the Land Use Review Board’s approval of the regional plan future land use
map for designation as a downtown center or village center shall not include
development that is disconnected from a downtown or village center and that
lacks an existing or planned pedestrian connection to the center via a complete
street.
                                     ***
Sec. 14. 24 V.S.A. § 4303 is amended to read:
§ 4303. DEFINITIONS
   The following definitions shall apply throughout As used in this chapter
unless the context otherwise requires:
                                     ***
      (43) “Smart growth principles” means growth that:
          (A) maintains the historic development pattern of compact village
and urban centers separated by rural countryside;
          (B) develops compact mixed-use centers at a scale appropriate for the
community and the region;
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            (C) enables choice in modes of transportation;
            (D) protects the State’s important environmental, natural, and historic
features, including natural areas, water quality, scenic resources, and historic
sites and districts;
            (E) serves to strengthen agricultural and forest industries, including
homesteading, small-scale agriculture and forestry, and the housing that
supports these activities, while minimizing conflicts of development with these
industries;
            (F) balances growth with the availability of economic and efficient
public utilities and services;
            (G) supports a diversity of viable businesses in downtowns and
villages;
            (H) provides for housing that meets the needs of a diversity of social
and income groups in each community; and
            (I) reflects a settlement pattern that, at full build-out, is not
characterized by:
               (i) scattered development located outside compact urban and
village centers that is excessively land consumptive;
               (ii) development that limits transportation options, especially for
pedestrians;
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            (iii) the fragmentation of farmland and forestland;
            (iv) development that is not serviced by municipal infrastructure
or that requires the extension of municipal infrastructure across undeveloped
lands in a manner that would extend service to lands located outside compact
village and urban centers; and
            (v) linear development along well-traveled roads and highways
that lacks depth, as measured from the highway.
Sec. 15. REGIONAL AND MUNICIPAL PLAN EXTENSIONS
   Any regional or municipal plan due to expire in 2026 or 2027 shall have its
expiration date extended until December 31, 2027.
Sec. 16. REPEAL
   24 V.S.A. § 4476 (formal review of regional planning commission
decisions) is repealed.
               * * * State Community Investment Program * * *
Sec. 17. 24 V.S.A. § 5801 is amended to read:
§ 5801. DEFINITIONS
   As used in this chapter:
                                     ***
      (8) “Planned growth area” means an area on the regional plan future
land use maps required under section 4348a of this title, which may encompass
a downtown center or village center on the regional future land use map and
may be designated as a center or neighborhood, or both meeting the
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requirements of subdivision 4348a(a)(12)(B) of this title and that may be
designated as a neighborhood.
                                        ***
      (10) “Sprawl repair” means the redevelopment of lands with buildings,
traffic and circulation, parking, or other land coverage in a pattern that is
consistent with smart growth principles as defined in section 4303 of this title.
                                        ***
      (12) “State Designated Downtown and Center or Village Center” or
“designated center” means a contiguous downtown or village a portion of
which is listed or eligible for listing in the national register of historic places
area center approved as part of the LURB review of regional plan future land
use maps, which may include an approved preexisting designated designated
downtown, village center, or designated new town center established prior to
the approval of the regional plan future land use maps.
      (13) “State designated Designated neighborhood” or “neighborhood”
means a contiguous geographic village area or planned growth area approved
as part of the Land Use Review Board LURB review of regional plan future
land use maps that is compact and adjacent and contiguous to a center.
                                        ***
      (15) “Village area” means an area on the regional plan future land use
maps adopted pursuant to section 4348a of this title, which may encompass a
village center on the regional future land use map meeting the requirements of
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subdivision 4348a(a)(12)(C) of this title and that may be designated as a
neighborhood.
Sec. 18. 24 V.S.A. § 5803 is amended to read:
§ 5803. DESIGNATION OF DOWNTOWN AND VILLAGE CENTERS
   (a) Designation established. A regional planning commission may apply to
the LURB for approval and designation of all downtown and village centers by
submitting the regional plan future land use map adopted by the regional
planning commission. The regional plan future land use map shall identify
downtown centers and village centers as the downtown and village areas
eligible for designation as centers. The Department and State Board shall
provide comments to the LURB and the regional planning commission on
areas eligible for center designation as provided under in section 4348 of this
chapter title.
                                      ***
   (c) Exclusions. With the exception for preexisting, nonconforming
designations approved prior to the establishment of the program under this
chapter or areas included in the municipal plan for the purposes of relocating a
municipality’s center for flood resiliency purposes, the areas eligible for
designation benefits upon the LURB’s approval of the regional plan future land
use map for designation as a Center shall not include development that is
disconnected from a Center and that lacks a pedestrian connection to the
Center via a complete street. [Repealed.]
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                                        ***
Sec. 19. 32 V.S.A. § 5930bb is amended to read:
§ 5930bb. ELIGIBILITY AND ADMINISTRATION
                                        ***
   (c) Application shall be made in accordance with the guidelines set by the
State Board. The guidelines shall clearly indicate that only applications
located in Step 2 and Step 3 State-designated centers or Step 1 centers where a
portion of the designated center is listed or eligible for listing in the national
register of historic places shall be considered.
                                        ***
Sec. 20. 24 V.S.A. § 5808 is added to read:
§ 5808. ANNUAL REPORT
   On or before January 15 of each year, the Vermont Community Investment
Board shall submit a written report to the House Committees on Environment
and on General and Housing and the Senate Committees on Natural Resources
and Energy and on Economic Development, Housing and General Affairs.
The report shall include, at a minimum:
      (1) a summary of the Community Investment Program’s activities
during the preceding fiscal year, including which municipalities received a
designation or new Step, or other actions taken by the Board that confer
eligibility for or priority access to State funding, tax credits, and other Program
benefits;
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      (2) an analysis of the types of municipalities benefiting from the
Program by:
          (A) county;
          (B) population size;
          (C) future land use category or categories;
          (D) State designation status; and
          (E) whether the municipality contains areas eligible for Act 250
exemption through 2024 Acts and Resolves No. 181; and
      (3) any legislative, regulatory, or programmatic changes recommended
by the Board to improve the effectiveness, accessibility, and geographic equity
of the Community Investment Program.
Sec. 21. MUNICIPAL APPEALS AND DISCRETIONARY REVIEW OF
          HOUSING; REPORT
   (a) On or before January 15, 2027, the Department of Housing and
Community Development, after consultation with the Vermont League of
Cities and Towns, Let’s Build Homes, the Vermont Natural Resources
Council, the Vermont Planners Association, the Land Access and Opportunity
Board, the Vermont Association of Planning and Development Agencies, the
Vermont Bar Association, the Vermont Realtors Association, Vermonters for a
Clean Environment, and the Secretary of Natural Resources or designee shall
report on the following:
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      (1) mechanisms for limiting appeals of municipal permits while
allowing municipalities to address legitimate concerns with projects, including:
          (A) the most commonly raised issues on appeal; and
          (B) an evaluation of statutory or procedural tools to limit duplicative
or frivolous appeals and recommend legislative action needed, if any;
      (2) impacts of discretionary review on residential development,
      (3) the potential value of the federal Right to Build Zone legislation and
steps the State can take to maximize that value;
      (4) assistance the State can offer municipalities seeking to limit
discretionary review, including incentives, planning, and whether the State
should develop objective standards, including model codes;
      (5) data on housing that has been built in the areas exempt from Act 250
jurisdiction under 10 V.S.A. § 6081(dd), including the number of units; the
type of units, including the number of affordable units, market-rate units,
second homes, units for short-term rental, units for long-term rental, single-unit
dwellings, and multiunit dwellings; the price; and where the units were
constructed; and
      (6) a status update on the 802 Homes pilot program.
   (b) The report shall be submitted to the House Committees on Environment
and on General and Housing and the Senate Committees on Economic
Development, Housing and General Affairs and on Natural Resources and
Energy.
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                       * * * Environmental Justice * * *
Sec. 22. 3 V.S.A. chapter 72 is amended to read:
               CHAPTER 72. ENVIRONMENTAL JUSTICE
                                     ***
§ 6004. IMPLEMENTATION OF STATE POLICY
                                     ***
   (i)(1) Beginning on January 15, 2028 2029, and annually thereafter, the
covered agencies shall either integrate the following information into existing
annual spending reports or issue annual spending reports that include:
                                     ***
§ 6005. RULEMAKING
   (a) On or before July 1, 2027 January 1, 2029, the Agency of Natural
Resources, in consultation with the Environmental Justice Advisory Council
and the Interagency Environmental Justice Committee, shall adopt rules to:
                                     ***
   (b) On or before July 1, 2028 2030, and as appropriate thereafter, the
covered agencies, in consultation with the Environmental Justice Advisory
Council, shall adopt or amend policies and procedures, plans, guidance, and
rules, where applicable, to implement this chapter.
                                     ***
§ 6007. ENVIRONMENTAL JUSTICE MAPPING TOOL
                                     ***
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   (c) On or before January 1, 2027 2028, the mapping tool shall be available
for use by the public as well as by the State government.
                            * * * Effective Date * * *
Sec. 23. EFFECTIVE DATE
   This act shall take effect on July 1, 2026, except that in Sec. 6 (10 V.S.A.
§ 6081), subsection (t) shall take effect on July 1, 2027.
Date Governor signed bill: June 16, 2026
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