By Maggie Lenz and Gwynn Zakov (on behalf of Atlas Government Affairs and Garnet Government Relations)

This is the end, my friend.

The 2026 Vermont legislative session ran past its expected close, and the reason wasn’t a mystery. The three biggest issues, education reform, the statewide property tax rate and the FY27 budget all needed to be untangled. None of them could really land without the others, and all three had to clear a bar that mattered more than any vote count in either chamber. They had to be something Governor Scott would sign.

Scott had made his position clear months ago. He wanted an education reform bill that actually implemented Act 73, not a study of it. He wanted a budget that didn’t spend money Vermont didn’t have. And on property taxes, he wanted real relief, not a token gesture. The legislature had its own ideas about what was sound policy and what was possible. The extended session was the product of those two positions finding each other slowly, over weeks of negotiation.

What emerged at the end of session was a set of compromises that neither side would call perfect but both could live with. H.949, the yield bill, uses $104.9 million in one-time general fund money to buy down property tax rates in FY27, bringing the average statewide increase to about 3.5 percent. That’s a significant improvement over the 7 percent increase projected back in December, and it’s the number Scott was pushing hard to reach. The circuit breaker, which helps low-income homeowners offset their property tax burden, got its first update since 1997, raising the income limit from $47,000 to $50,000 and increasing both the municipal and education property tax credits. Renters received a temporary boost to the renter credit as well, with the maximum jumping from $2,500 to $3,250 for one year. Neither of those changes is flashy, but for the Vermonters they reach, they matter.

The FY27 budget, H.951, passed its committee of conference with a unanimous 6-0 vote. The final conference agreement totals roughly $9.4 billion in non-duplicate funds, up from $9.2 billion in FY26, with the general fund portion landing at about $2.57 billion. The committee prioritized primary care, food assistance, housing, and economic development. That translated into funding for free and referral clinics, Meals on Wheels, the Vermont Food Bank, the Vermont Housing Improvement Program, and rural economic development programs, among others. The budget also sets aside contingency funds specifically to respond to federal funding shortfalls, a precaution that reflects the uncertainty coming out of Washington right now.

The transportation bill, H.944, wrapped up in the final days as well, totaling roughly $360 million when combining the Transportation Fund and Transportation Infrastructure Bond Fund appropriations. Its most significant policy change is a mileage-based user fee for battery electric vehicles, taking effect January 1, 2027, at 1.4 cents per mile. The Transportation Fund has been under serious pressure for years, with fuel tax revenues stagnating as vehicles get more efficient and move Vermonters and visitors drive EVs. The fee is designed to make sure EV owners contribute to the roads they drive on, replacing the existing flat infrastructure fee with a charge tied to actual miles traveled. Plug-in hybrids are expected to be folded in by 2029, with the Agency of Transportation tasked with bringing a plan back to the legislature. The bill also directed an additional $1.7 million into state highway paving, a small but important response to a backlog that has the state paving roughly a third of what it should be each year.

When the work was done, Governor Scott came to the House floor to address the chamber, as is tradition at the close of session. Scott’s broader message was consistent with what he has said all session. Vermonters want affordability, practicality, and common sense. They want to feel safe, have good schools, access to health care, and enough left over at the end of the month to get by. He acknowledged that neither he nor the legislature got everything it wanted, but said that is how compromise works. On education in particular, he said this biennium marked the first time the state had honestly confronted the long-term sustainability of the system rather than treating its problems as something another year of additional spending could manage. Structural problems, he said, require structural solutions.

It was a fitting close to a session that tested everyone in it. The hard work isn’t finished. The one-time money used to buy down property taxes this year won’t be there next year, education reform has many unknowns ahead, and the Transportation Fund’s structural problems remain largely unsolved. But the session ended with the governor and the legislature having reached agreement on the things that mattered most, and with a shared acknowledgement that the work ahead is going to be just as hard.