S.79 AN ACT RELATING TO IMPROVING RENTAL HOUSING HEALTH AND SAFETY - HOUSE AMENDMENT

PASSED
in the State Senate
on June 24, 2021, by a vote of
20-10

Purpose: To create a statewide registry of rental properties and establish a new program for incentivizing housing owners to improve their rental housing stock, with an expanding bureaucracy for good measure.

Analysis: S.79 creates the “Vermont Rental Housing Investment Program.” The Department of Housing and Community Development is ordered to “award funding to statewide or regional nonprofit housing organizations to provide competitive grants and forgivable loans to private landlords for the rehabilitation and weatherization” of housing units that are one of the following: 1) vacant, 2) in violation of code, 3) one-bedroom apartments on the same property as a single-family, owner-occupied home. The sources of this funding are not listed.

Second, S.79 allocates $200,000 towards a new 5-person, full-time task force charged with maintaining a registry of Vermont rental properties. These are defined as “any condominium or multiple unit dwelling using a common roof.” Landlords can only rent housing if it has been registered and inspected and is “prohibited from renting the affected unit to a new tenant until the violation is corrected.” The registry would be funded by an “annual registration fee of $35 per rental unit,” with an administrative penalty of $200 for failure to register by January 1, 2023 (a delay from the previous version of S.79).

S.79 as amended, creates the Vermont Homeownership Revolving Loan Fund, through which nonprofit housing organizations will issue no-interest loans to homebuyers who would have difficulty buying their first home or making their first home habitable. The bill also allocates $5 million for the Vermont Rental Housing Investment Program, which would “incentivize private apartment owners to make significant improvements to both housing quality and weatherization.”

S.79 as amended, increases privacy protections for information given to the registry, while carving out exceptions for those who don’t need to register: units offered to family or friends but not the general public, homesharing arrangements and personal caregiving situations.

Vermont already has rental safety codes, which health officers (registered with the Vermont Department of Health) from smaller towns use to oversee the safety of rental properties. Under this bill, the local officers would no longer have “rental inspection” duties.

Those voting YES believe the bill “is about rental housing health and safety, creating a rental registry for all rental housing (short and long-term) and creating a Vermont Rental Housing Investment Program to encourage landlords who own blighted or vacant rental properties to bring them up to code, weatherized and back online … we need as many affordable rental properties as possible” (Sen. Clarkson). S.79 advocates say a lack of a strong enforcement system has contributed to widespread problems in rental properties in recent years. A study last year found that an estimated 7,000 rental households were considered "substandard," that is, homes with incomplete kitchen, plumbing or heating systems, homes worth less than $75,000, or mobile homes built before 1979.

Those voting NO believe this would cripple Vermont’s short-term rental industry, such as Airbnb’s. Fewer homes will be worth renting out and fewer guests will choose such rentals as a result. Vermonters already do a good job of “caring for people’s safety,” especially their own house guests. By registering your rental, the state may call you to house those who can’t find long-term housing. Individuals who refuse may “face discrimination lawsuits.” If you continue to operate a short-term rental and “the government (comes) knocking at your door, you had better let them in” (Sen. Ingalls).

Increasing housing regulations risks reducing Vermont’s housing supply, raising rent on properties, shrinking Vermont’s economically significant tourism industry, and diminishing the rental tax base. According to Airbnb, hosts in Chittenden and Rutland Counties received 123,700 guests in 2018, generating $20 million for hosts. Airbnb reports that 55% of hosts were better able afford their own homes from the additional income. Airbnb guests spend 41% of their spending occurs in the neighborhood where they stay, further benefitting host towns, according to the Vermont Short-Term Rental Alliance. The Vermont Department of Taxes estimates that the state receives at least $15 million in taxes from short-term rentals.

As Recorded in the Senate Journal, Thursday, June 24, 2021: "Thereupon, the pending question, shall the Senate concur in the House proposal of amendment?, was decided in the affirmative on a roll call, Yeas 20, Nays 10." (Read the Journal p. 1428 - 1451).

Read the Joint Fiscal Office's fiscal note.

Watch the floor debate.

How They Voted

Becca Balint (D-Windham) – YES
Philip Baruth (D-Chittenden) – YES
Joseph Benning (R-Caledonia) – NO
Christopher Bray (D-Addison) – YES
Randy Brock (R-Franklin) – NO
Brian Campion (D-Bennington) – YES
Thomas Chittenden (D-Chittenden) – YES
Alison Clarkson (D-Windsor) – YES
Brian Collamore (R-Rutland) – NO
Ann Cummings (D-Washington) – YES
Ruth Hardy (D-Addison) – YES
Cheryl Hooker (D-Rutland) – YES
Russ Ingalls (R-Essex-Orleans) – NO
M. Jane Kitchel (D-Caledonia) – YES
Virginia Lyons (D-Chittenden) – YES
Mark MacDonald (D-Orange) – YES
Richard Mazza (D-Chittenden-Grand Isle) – NO
Richard McCormack (D-Windsor) – YES
Alice Nitka (D-Windsor District) – NO
Corey Parent (R-Franklin) – NO
Chris Pearson (P-Chittenden) – YES
Andrew Perchlik (D-Washington) – YES
Anthony Pollina (P/D-Washington) – YES
Kesha Ram (D-Chittenden) – YES
Richard Sears (D-Bennington) – YES
Michael Sirotkin (D-Chittenden) – YES
Robert Starr (D-Essex-Orleans) – NO
Joshua Terenzini (R-Rutland) – NO
Richard Westman (R-Lamoille) – NO
Jeanette White (D-Windham) – YES

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