The bill S.238 establishes the Housing Investments Special Fund in Vermont to enhance the creation, preservation, and improvement of housing stock, particularly for low-income households. To finance this initiative, the bill introduces a new two percent rooms tax surcharge on occupancy rents and utilizes the existing short-term rental surcharge. Additionally, it proposes a new sugar-sweetened beverage tax, which will contribute revenue to the Education Fund. The legislation emphasizes the urgent need for more housing units and public subsidies to address these demands, while also amending existing laws to incorporate the sugar-sweetened beverage tax into the Education Fund, replacing the previous short-term rental surcharge revenue.

The Housing Investments Special Fund will support various housing projects, including affordable and service-supported housing units, and will be financed through the new tax surcharges, General Assembly transfers, and interest earned. The bill mandates that any remaining balance at the end of the fiscal year will remain in the Fund, with expenditures requiring appropriations from the General Assembly. It expresses the intent to allocate at least $5 million annually to the Department of Housing and Community Development for the Vermont Housing Improvement Program, while the Vermont Housing and Conservation Board will receive the remaining funds for housing development projects. Furthermore, the bill requires the Board to submit an annual report detailing investments made from the Fund, and it appropriates $5 million to the Department and $14.5 million to the Board for fiscal year 2027, with the act set to take effect on August 1, 2026.

Statutes affected:
As Introduced: 16-4025