H.420 is a proposed bill designed to create a tax increment financing (TIF) project development program for municipalities in flood-impacted areas of Vermont. Administered by the Vermont Economic Progress Council, the program allows these municipalities to use increments from statewide education property taxes and municipal property taxes to fund necessary improvements. The bill introduces a new subchapter titled "Project-Based Tax Increment Financing," which defines key terms such as "affordable housing" and "improvements," and outlines the process for establishing a project and project zone, including the development of a project plan, public hearings, and the approval process.

The legislation sets forth criteria for municipalities to qualify for TIF, including being located in a disaster-affected county and demonstrating that projects would not proceed without incremental tax revenues. It establishes guidelines for managing tax increments, incurring indebtedness, and public information requirements prior to financing votes. Additionally, the bill mandates municipalities to create a reporting system for active projects and submit annual reports to the Vermont Economic Progress Council and the Department of Taxes. The Council is also given authority over project-based TIF decisions, which are not subject to judicial review, and the act is scheduled to take effect on July 1, 2025.

Statutes affected:
As Introduced: 32-3325