Lawmakers debate school construction aid, unclaimed-property changes, cannabis fees and energy decommissioning in multiple committee hearings
Legislative committees on Wednesday discussed proposals affecting school construction aid and education funding, changes to unclaimed property rules and the higher education trust fund, a package of cannabis regulatory and tax provisions, and creation of a decommissioning fund for energy facilities. The day’s hearings ranged across Education, Appropriations, Ways & Means, Finance and Energy & Digital Infrastructure committees and included fiscal details, statutory changes, and new or expanded administrative authorities.
Education — S.2, school construction aid, Act 60 and Act 73
Senate Education reviewed a proposal tied to S.2 that would use the state’s existing school construction aid program governed by Act 60 to support school capital projects. Committee discussion described the program as “generous,” with examples of district-level shares of capital costs under current law, including a cited figure that homestead taxpayers in one district would pay 46.2 percent of additional district spending on a bond example and a referenced 52 percent share for another district.
Members discussed replacing elements of the Act 73 foundation with the excess spending threshold as a cost-containment mechanism. Committee testimony described a phased lowering of that threshold: the Senate previously moved the threshold to 112 percent for an initial fiscal year, with language in the current proposal to lower it to 111 percent in the fiscal year after certain mergers and then reduce it by one percentage point per year until it reaches 105 percent. Speakers said 105 percent was chosen because it equals the statewide average weighted pupil spending for the year cited. The proposal would also establish a 90 percent lower floor for districts’ spending relative to the base, and allow districts to spend up to 105 percent without a tax penalty; spending above 105 percent would face increased tax consequences under the excess spending rules described.
Senators and staff described replacing small-school and sparse-school weighted long‑term membership measures with support grants under Act 73, explaining that support grants would act as offsetting revenue and reduce districts’ total reported education spending in some columns of the JFO analysis. Committee discussion also flagged sequencing issues for bonding authorization and supplemental district spending ballots, and a proposed ballot structure to estimate voters’ potential ongoing supplemental district spending tax (SDS) costs under different state-aid scenarios, including examples for 30 percent and 75 percent aid assumptions.
Committee members emphasized that the proposed school construction language would tie bond authorization to disclosure on ballots and to SDS tax mechanics, and that the school-construction division staffing and appropriation needs were part of related Finance discussion.
Appropriations — S.43, unclaimed property and higher education trust fund; penalties and retirement contributions
The Senate Appropriations committee reviewed provisions including changes to unclaimed property thresholds and rules affecting contributions to the Higher Education Trust Fund and VT Saves. Testimony from the deputy treasurer and JFO described current law that sweeps unclaimed property under $100 and over 10 years old into the higher ed trust fund. A cited figure for FY2025 showed “just shy of $148,000” from that source going into the trust fund. Committee materials included a table comparing recent contributions and what they would have been under a proposed $150 threshold versus the current $100 threshold.
Officials argued the proposal would not draw on the corpus of the higher‑education endowment and that, according to retrospective calculations presented to the committee, over the prior five years the trust fund had received about $624,000 and would have received $1,460,000 under the change — a difference the presenters characterized as a substantial increase. Projections presented to the committee also included lifetime and five‑year figures for VT Saves and the trust fund under the proposal.
Appropriations also considered statutory changes to allow the treasurer’s office to accept medical unclaimed property information and to update threshold and fast‑claims procedures for small unclaimed property values. Committee members discussed the requirement that the treasurer maintain reserves to meet expected payouts and transfer excess to the general fund, and a revision to allow the treasurer to request additional information about unclaimed medical‑insurance property.
The panel reviewed language authorizing the state treasurer to assess penalties against political subdivisions participating in the state retirement system that fail to provide required contributions. Members described the current absence of statutory mechanisms to assess penalties on those local entities and noted the proposal would authorize such enforcement.
Appropriations staff also identified other provisions with fiscal impacts, including anticipated per‑diem and expense reimbursements for expanded advisory council membership tied to bullying‑prevention work — estimated at about $21,000 annually and a corresponding fiscal year appropriation — and a possible undetermined fiscal impact tied to expanding the definition of cost‑saving measures under energy performance contracting.
Ways & Means — commercial cannabis legislation, event fees, municipal opt‑ins and tax provisions
The House Ways & Means committee reviewed a comprehensive cannabis-related bill discussed in the House and Senate as part of a larger regulatory package. Committee discussion identified an event permit fee of $500 for permitted cannabis events, with 50 percent of that fee to go to the municipality and 50 percent to the Cannabis Regulation Fund. Committee counsel described board discretion in issuing event permits and required equitable distribution of permits among cannabis establishment license categories.
Members reviewed municipal opt‑in language enabling a legislative body to hold a vote to allow retail cannabis establishments or to trigger a vote via petition by 5 percent of municipal voters. The bill would permit municipalities to adopt certain local regulations but include limits intended to prevent adoption of prohibitive rules that would effectively prevent establishments where a municipality has voted to allow them. The committee discussed changes to licensing categories, deletion of references to integrated licenses that had been phased out, and modifications to cultivator and manufacturer provisions, including eligibility for existing agricultural or tax treatments in some sections.
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The committee examined effective‑date language for multiple provisions: one provision changing the calculation of modified adjusted gross income to include cannabis business deductions was described as retroactive to January 1; an outdoor cultivator fee reduction would take effect January 1 of the following year only if the General Assembly appropriated or transferred $105,000 to the Cannabis Regulation Fund to replace anticipated lost revenue; and a change converting employee licenses from annual to biannual would take effect July 1 of the following year.
Ways & Means members also discussed tax‑and‑exemption provisions that would allow the tax commissioner to share confidential records with the cannabis control board for administration of excise, sales and use tax on cannabis, and provisions enabling cultivators to form cooperative corporations.
Finance — S.1 and school construction division staffing, ballot language for bonded school costs
Senate Finance reviewed school construction provisions in related bills and highlighted an appropriation in section 66 to staff the school construction division at an identified minimal staffing level. Committee discussion cited a staffing total of 55 positions for full staffing and referenced a staffing cost figure described in the hearing materials in the range of $1,500,000.
Finance members discussed statutory changes to ballot language for one‑time authorizations that would result in ongoing annual debt service obligations for school construction. The committee reviewed proposed requirements for warning and ballot text to include estimates of annual debt‑service costs under different state‑aid scenarios and to clarify that state funds may not be available at the time a district authorizes bonding. Finance also considered changes to the award percentages in the state’s school construction award formula and directives for annual reporting by the treasurer on bonding support and debt‑service subsidies.
Energy & Digital Infrastructure — H.740, decommissioning fund and rule authority
House Energy & Digital Infrastructure discussed H.740 provisions establishing an Electric Generation and Energy Storage Facility Decommissioning Fund to be administered by the Public Utility Commission. The bill would create a special fund to receive decommissioning surety fees and other monies drawn from decommissioning financial instruments and authorize the PUC chair to make disbursements to investigate or mitigate effects of abandoned, non‑operational or disclaimed generation or storage facilities, pay costs for third parties who complete decommissioning and site restoration where the certificate holder cannot be contacted or fails to act, and to investigate ownership.
Committee members noted prior discussions of initial funding for establishing a registry and database: an original $500,000 appropriation to set up the program had been struck in a House committee and the Senate had at one point considered a $300,000 budget construct. Witnesses described that ongoing database maintenance could require about $100,000 annually once established.
Members debated whether the PUC would need additional explicit fee authority to collect and deposit monies into the new fund and whether rulemaking would be required for collection and reporting mechanisms or whether the commission could adopt procedures without formal rulemaking. Supporters said the fund could simplify long‑term management of decommissioning financial instruments and reduce transactional burdens on projects and financial institutions.
Other hearings: housing, tax classification, government operations and corrections
Senate Finance also conducted an extensive review of tax‑classification and housing provisions, including proposals to treat long‑term rentals and second homes differently for tax purposes. Committee members debated definitions for long‑term rental thresholds (thirty‑, sixty‑ or ninety‑day tests and six‑month thresholds were discussed) and use of landlord certificates and homestead declarations as compliance and verification tools. JFO and tax staff discussed compliance rates for landlord certificates and enforcement approaches.
Government Operations considered municipal charter amendment language addressing recall provisions, including a petition signature threshold of 15 percent of registered voters to trigger a recall vote and related quorum and vote‑threshold rules. Members also reviewed proposed reporting, rule‑adoption and oversight provisions, including thresholds for issues of significant public concern tied to fiscal impact.
House Corrections & Institutions discussed S.193 and a feasibility plan tied to corrections and community monitoring; members asked agencies to return with budget and implementation proposals.
Conclusion
This report covers committee hearings held on May 13, 2026, including sessions of the Senate Education, Senate and House Appropriations, House Ways & Means, Senate and House Finance, House Energy & Digital Infrastructure, Senate Government Operations, and House Corrections & Institutions committees. The meetings addressed school construction aid and education funding mechanics, unclaimed property and higher education trust fund provisions, cannabis regulatory and tax proposals, energy facility decommissioning fund and authority, housing and tax classification issues, and various administrative and fiscal items discussed across the sessions.
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