Editor’s note: the authors are lobbyists in the Vermont State House.

By Maggie Lenz and Gwynn Zakov

Two weeks ago, we wrote about how grassroots pressure had moved Act 181 from a deadline-extension conversation into a repeal conversation. Last week, we wrote about how quickly leadership aligned behind that repeal, and what previous testimony revealed about the trust costs of regulating ahead of landowners.

This week, the committee began the harder work of writing what comes next. By Friday, the House Committee on Environment was already on its second draft amendment to S.325. The committee made good on the promise from Chair Sheldon and Speaker Krowinski. Sections 19 and 21 of Act 181, the Road Rule and Tier 3, are deleted outright. The Tier 3 rulemaking is repealed. So is the Tier 2 Area report. Discussions since that pivot have been candid, productive, and genuinely hard, as members try to keep what is working in Act 181 intact while pivoting away from what is not. What the draft adds is where the questions really begin.

The Senate version of S.325 had moved the interim housing exemption sunsets for designated new town and growth centers, village centers, and downtown districts out to January 1, 2030. The House draft pulls them back to January 1, 2028, a one-year extension from current law rather than the Senate’s three-year extension. It also strips the Senate’s expansion of those exemptions to subdivisions and mixed-use development, and removes the proposed new exemption for housing projects of 50 units or fewer in designated village centers where at least 20 percent of units are mixed-income or mixed-use.

The House draft likewise leaves the accessory dwelling unit and commercial-to-housing conversion exemptions at their current sunsets, rather than extending them to 2030 as the Senate did. Housing advocates on the committee are uneasy. The shortened runway puts pressure on the Tier 1A and 1B designation process to come online quickly, and the village-center exemption was, for some, the most concrete near-term housing tool the bill carried. Whether the final version restores any of that is one of the open questions heading into next week.

The draft also creates a new Joint Legislative Environmental Oversight Committee, five legislators with a 2029 sunset, charged with overseeing the Land Use Review Board (LURB), the Agency of Natural Resources, and the implementation of what remains of Act 181. The instinct is understandable. A standing oversight body is one structural answer to an implementation process that ran ahead of the people it affected. But the timing is awkward.

Asking Vermonters to trust a five-member off-session committee to watch the agencies on their behalf, in the same session those Vermonters told the Legislature that small groups making decisions in rooms they are not in is the problem, is a tension the committee will have to think through.

The most promising structural answer in the draft is Section 8. The LURB would contract with a non-governmental organization, one with documented neutrality, statewide democratic engagement experience, and a proven record in rural communities, to design a public engagement plan for the next round of conservation policy work. The plan would gather statewide input on the risks of losing critical natural resources not already protected, including agricultural soils, forest blocks, habitat connectors of statewide significance, and headwaters, and on what tools, regulatory and non-regulatory, could protect them. This reflects the lesson from earlier testimony written into statute: conservation policy succeeds when it is built with landowners rather than around them. Whether it gets resourced, whether the contracted organization is genuinely trusted in rural Vermont, and whether the engagement actually shapes the policy rather than running parallel to it, will determine whether this section is a foundation for something better or another report on a shelf.

The regional planning provisions are quieter but consequential. Regional Planning Commissions (RPCs) would be required to provide member municipalities with written descriptions of map changes, municipality-wide before-and-after maps, and information about the new tier structure at least 30 days before the first hearing. Plans expiring in 2026 or 2027 are extended to December 31, 2027, one year longer than the Senate proposed. On the formal review of RPC decisions, where the Senate repealed outright, the House draft instead directs the LURB to report by January 15, 2027 on whether repeal is warranted and what should replace it.

The committee received the second draft walk-through on Friday, and members are still absorbing it. Concerns voiced in the room included the shortened housing exemption runway, the removal of the 50-unit village-center exemption, and the structure of the off-session oversight body. None of those are settled. The committee takes the bill back up next week, and how it lands on each will tell us a lot about whether the lesson from this session, that the people most affected need to be at the table from the beginning, is being applied to the bill being written, not just the one being repealed.

The repeal of the “Road Rule” and Tier 3 was the easier decision, once the political math moved. What the Legislature builds in their place, and how it builds it, is the harder one. That work has just begun.

Authors write on behalf of Atlas Government Affairs and Garnet Government Relations.