Department of Housing and Community Affairs Commissioner Noelle MacKay testified Thursday before the Senate Economic Development Committee. (Photo by John
Department of Housing and Community Affairs Commissioner Noelle MacKay testified Thursday before the Senate Economic Development Committee. (Photo by John Herrick/VTDigger)

MONTPELIER -- Developers are opposing the Shumlin administration's proposal to create tight-knit downtown areas surrounded by rural countryside, and have been lobbying against what they say is an anti-development bill.

But the administration pushed back Thursday, defending lawmakers' current proposal, H.823, as a "balanced, thoughtful way to move forward with development in this state."

"You know change is difficult, and for some people it is easier to kill something than to work on something new," Department of Housing and Community Affairs Commissioner Noelle MacKay told the Senate Economic Development Committee.

The administration last year drafted a plan intended to "revitalize" the state's downtowns by relaxing the state's land use and development permitting process for certain development.

Lawmakers have since added new criteria to the state's Act 250 permit to place tighter restrictions on strip development and encourage infilling rather than outward growth, which the administration supports. But the changes have attracted opposition from developers as the bill moves through the Senate. Now, they want it taken out of the bill.

"There is a concern that this is going to add additional delay and uncertainty for developers," Katie Taylor, a lobbyist representing the Lake Champlain Regional Chamber of Commerce and the Greater Burlington Industrial Corp., told the committee Thursday. "Time is money."

The bill requires development outside of downtowns to create efficient use of land, energy, and roads; be consistent with statutory planning goals; not extend strip development; and if a project is located on an existing strip, it must minimize or avoid contributing to the character of strip development.

Taylor said this is a big change to Act 250, and enhances the possibility of litigation from project opponents.

Tim Heney represents the Vermont Realtors Association. He supports the incentives to encourage downtown development in the bill. However, the bill does not include what his clients need most when searching for a location to build: parking.

After reviewing more than 80 locations, he recently found a place for one of his clients off exit 7 in Berlin - a location that could be considered strip development under the bill. The bill, he said, would place an added hurdle similar business in search of real estate.

"In the case like this, we really tried. And we could not find a downtown location that we could make work," Heney told the committee. "If you're going to try to get them located in a downtown, we're going to need to find a way to address some of those key issues and (the bill) doesn't address them at all."

MacKay said the bill does not limit strip development. Instead, it encourages efficient use of land in existing developed areas. This includes preventing long frontage roads and limited walkability.

"This is not about saying no to development; what it is saying is, if we're developing, how do we develop on an efficient manner," she said. "There are absolutely ways to develop in manners that are not characteristic of strip."

Supporters of the bill say it is a balanced approach between encouraging growth where the state wants it and conserving natural resources in rural areas of the state.

Ron Shems, chair of the Vermont Natural Resources Board, oversees the Act 250 review process. He said the bill would be good for the state's land use law.

"This doesn't block development. I think it encourages development consistent with Vermont's brand, and Vermont's brand has value," Shems said.

He said the state does not have the tools currently to address strip development.

"This modernizes Act 250 in a very balanced way," he said.

Senate Economic Development Chair Kevin Mullin, R-Rutland, will decide as soon as tomorrow whether to remove the provision from the bill, tweak it, or kill it in committee.

The Incentives for Downtown Growth

The bill also includes incentives for growth in the state's designated downtowns: it reduces the number of housing projects requiring a permit; sets up an expedited review process all projects; removes permitting fees; and a sets up faster sewer permitting process.

Still, developers want to see these incentives go further. This includes an outright exemption from the Act 250 process.

"We still think that for these designated areas, especially designated downtowns, the local and municipal bodies should be responsible for the majority of that permit review rather than Act 250," Taylor said. "It's a thorough process to become a designated downtown, so it seems that could happen at master planning level."

The Senate Natural Resources Committee voted 4-1 in favor of the bill Wednesday. Members changed the House version of the bill to scale back the expedited review process by upholding the current hearing process before environmental district commissions. (The Senate's version did not include a hearing process unless concerns were raised.)

"I very firmly believe that we shouldn't be taking stuff away from the district commission under Act 250," said Committee Chair Sen. Bob Hartwell, D-Bennington, this week.

"I admit that we've probably made it a little tighter, but I also think we made it a little bit more clear," he said. "It's designed to promote development on the inside and to discourage a lot of runaway development and sprawl on the outside of these growth centers."