March 18, 2026

Agenda:

• Welcome

• Local Option Taxes / Transportation

• Senator Rich Westman - Chair of Senate Transportation

• Vermont League of Cities and Towns

Minutes:

• Welcome

• Local Option Taxes / Transportation - Senator Rich Westman - Chair of Senate Transportation

  • Handout: PILOT Special Fund Update - FY27 Revenue

  • The PILOT Special Fund currently has a surplus of approximately $13.25 million raised by the 25% of Local Option Tax revenues that are deposited into the PILOT Fund each year. Expenses for specialized projects have been utilizing some of this money. Rich views that the money should be used equally across the State. The PILOT Special Fund is a growing revenue source and it is appropriate for the legislature to start talking about what is a fair use of this fund. Last year the fund was used to support flood impacted communities. This year House and Senate Transportation committees are talking about sending the surplus back to towns through highway aid, there is currently no proposal. Rich mentioned that 70% of municipal spending is on transportation related expenses and much of their funds are raised through property taxes. Additionally, many larger municipalities are implementing a local option tax for the purpose of raising more funds for their transportation related expenses. This proposal would support smaller municipalities. 

• Vermont League of Cities and Towns - Josh Hanford, Public Policy and Advocacy & Samantha Sheehan, Municipal Policy and Advocacy Specialist

  • Transportation related expenses are the single largest line item within municipal budgets. Revenue to support transportation has been in steep decline in recent years. 50 municipalities have a local option tax and it is a growing source of revenue to municipalities and to the State. Josh expressed disappointment that the surplus is being used for other purposes. The House Transportation is considering whether to put 50% of the surplus towards town highway aid, this is one of the only formulas in State government that is fair as it is based on road mileage.

The meeting recording will be added soon.