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Introduced by Representatives Hutchinson of Randolph, Sweaney of Windsor, Anderson of Montpelier, Andrews of Rutland City, Aswad of Burlington, Audette of S. Burlington, Bissonnette of Winooski, Brennan of Colchester, Clark of St. Johnsbury, Donovan of Burlington, Dostis of Waterbury, Edwards of Brattleboro, Emmons of Springfield, French of Randolph, Gervais of Enosburg, Howard of Rutland City, Johnson of Canaan, Keogh of Burlington, Kitzmiller of Montpelier, Krawczyk of Bennington, Lorber of Burlington, Marcotte of Coventry, Martin of Springfield, Martin of Wolcott, Masland of Thetford, Milkey of Brattleboro, Minter of Waterbury, Monti of Barre City, Mook of Bennington, Moran of Wardsboro, Mrowicki of Putney, Nease of Johnson, Orr of Charlotte, Pearson of Burlington, Pellett of Chester, Peterson of Williston, Shand of Weathersfield, Trombley of Grand Isle, Valliere of Barre City, Weston of Burlington, Wright of Burlington and Zuckerman of Burlington

Referred to Committee on


Subject:  Taxation; property tax; PILOT; full funding; phased in

Statement of purpose:  This bill proposes to create a six-year process for transition to a more equitable system for reimbursing towns for hosting state property under the payment in lieu of taxes program by increasing PILOT funding by $800,000.00 per year until full funding is achieved; and proposes studies by the joint fiscal office to identify and analyze issues related to PILOT funding and to calculate the true costs of a fully funded PILOT program.


It is hereby enacted by the General Assembly of the State of Vermont:


     The general assembly shall appropriate to PILOT funding in each fiscal year the amount appropriated in the prior fiscal year, plus $800,000.00, in each of six fiscal years beginning with fiscal year 2009.


(a)  By January 2009, the joint fiscal office (JFO) shall calculate the cost of operating the agency of natural resources PILOT and corrections PILOT programs using the same reimbursement formula as the state buildings PILOT program with the reimbursement for state-owned lands in the current use program based on the use values established in that program.  To the extent such calculations show that a municipality’s reimbursement would be higher or lower than its current property tax rates would provide, JFO shall recommend how to phase in that difference at the same rate as the phase-in of full funding for the state buildings PILOT payments.

(b)  By January 2009, JFO shall also identify any separate agreements between a town and the state for payments from the state related to

state-owned property in that town.  JFO shall recommend how to treat equitably these agreements.

(c)  By January 2011, JFO shall calculate the cost of including in the state buildings PILOT program the value of the land on which state buildings are located, the cost of removing the $750,000.00 cap on the PILOT payment with respect to University of Vermont property, and how to phase in these two changes.

(d)  By January 2013, JFO shall report on additional changes to the PILOT program and additional funding needed to base the reimbursement formula on full fair market value, or use value where applicable, of state buildings and lands.

Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont