by Cory Dawson
Experts lay out what’s in store, and at stake, after Act 250’s biggest overhaul since its inception
Act 250, Vermont’s landmark land-use law, is getting a makeover.
More than 50 years after landing on Vermont’s books, lawmakers in Montpelier have made the most sweeping changes to Act 250 in decades.
Passed in 1970, Act 250 was designed to give Vermont a way to review large development projects based on environmental, community, and infrastructure impacts. It created a set of criteria for permitting projects like subdivisions, industrial parks, and ski resort expansions — and established a system of regional citizen commissions to review them.
The law has long been credited with preserving Vermont’s rural character, ridgelines, and small-town scale, even as it has faced criticism for slowing development.
Now, after years of debate, two new pieces of legislation, the HOME Act in 2023 and Act 181 in 2024, are reshaping how Act 250 functions. Together, they tackle Vermont’s urgent housing shortage while strengthening protections for forests, wildlife habitat and other critical natural resources.
The policies are the direct result of many years of legislative studies, including a Commission on Act 250 Report from 2018, and previous attempts to pass legislation, which were vetoed.
One of the key differences in passing Act 181 was it relied on a stakeholder process that brought together diverse groups including the Chamber of Commerce, VNRC, regional planning commissions, affordable housing advocates, engineers, state agencies, and many other groups to develop a consensus framework to overhaul Act 250.
Act 181 also passed because dedicated legislators and chairs of influential committees, including Reps. Amy Sheldon and Seth Bongartz, as well as Sens. Chris Bray and Kesha Ram Hinsdale, along with House Speaker Jill Krowinski, Senate President Pro Tem Phil Baruth, and many other lawmakers believed in the need to tackle land use reform in a comprehensive way.
Act 181 sets the stage for a tiered, location-based review system that will apply stricter scrutiny in certain sensitive natural resource areas while relaxing state review in designated zones. In particular, it will reduce regulation in areas primed for growth, such as downtowns and village centers — areas that largely now have developed local zoning policies that were in their infancy when the original Act 250 was developed.
The new reforms aim to address long-standing gaps in environmental protection. Act 181 introduces new permitting standards to review projects with long roads or driveways and mitigate the effects of projects in environmentally sensitive areas, including addressing forest fragmentation and the piecemeal development of undeveloped forest blocks that had often gone unchecked.
The law also replaces the Natural Resources Board with a new professional Land Use Review Board to oversee Act 250 to improve administration of Vermont’s landmark program. The next few years of mapping and rulemaking will be critical, experts say, in determining how Vermont’s statewide land-use policies will continue to shape the state’s future, as it has in its past.
Fighting fragmentation
The revamp of Act 250 takes head-on a major threat to the state’s forests: fragmentation.
“We’ve seen the continuous breaking up of our forests into smaller and more disjointed parcels,” explains Jamey Fidel, General Counsel and Forest and Wildlife Program Director at the Vermont Natural Resources Council. “That undermines the integrity of ecosystems and the viability of working forests.”
Forest fragmentation – it is what it sounds like – occurs when large, contiguous forests are broken up into smaller patches by roads, driveways, and subdivisions. While each project may be minor on its own, depending on how development occurs, the cumulative effect can be devastating for wildlife, water quality, and climate resilience.
“As roads and driveways and utility lines and other infrastructure are put in place, and then homes are built, there’s certain wildlife species that will no longer use an area,” Fidel says.
Fragmented forests lose their ability to store carbon, mitigate floods, and provide habitat for species that need large, connected areas to survive. Climate change makes the problem worse, as species need to move across landscapes to adapt to shifting temperatures and ecosystems.
Vermont’s forests have remained more intact than those in many other states, a fact environmentalists credit to the state’s long history of conservation and thoughtful land-use planning. But cracks have emerged.
Fidel describes how the majority of subdivision projects were not triggering Act 250, with various studies finding that projects were developed in such a way as to not fall under the auspices of the law.
“Oftentimes it’s not just one project, it’s the cumulative impact of development over time that leads to forest fragmentation,” Fidel notes.
Act 181 addresses this by incentivizing good site design in forests. It creates a new criterion to specifically evaluate and minimize impacts on forest blocks and wildlife connectivity areas. In addition, a new “road rule” ensures that roads longer than 800 feet built into undeveloped forest areas will now trigger state review.
Eric Sorenson, an ecologist and author who for many years was a community ecologist with the Vermont Department of Fish and Wildlife, says that these changes are vital for maintaining the state’s natural character.
One of the successes of Act 250 has been maintaining “a state that feels green and forested and relatively unfragmented,” particularly compared to some of our neighboring states, Sorenson says.
The value of Vermont’s large woodlands extends beyond wildlife habitat, Sorenson says, as they play a crucial role in the state’s ability to deal with climate change.
“Large, connected forest blocks are climate resilience infrastructure just as much as culverts and roads are transportation infrastructure,” Sorenson continues.
Growth, Housing, and Reputation
As Vermont struggles with a severe housing shortage, as does the rest of the country, Act 250 has become an easy target for critics who say it slows down needed development. But those who have worked within the system argue the facts don’t support the blame.
“There’s been this narrative developed over the last few years that Act 250 is the primary cause of the housing crisis in Vermont,” says Ed Stanak, a former longtime Act 250 district coordinator who started work in that position in 1980. “I think that’s just demonstrably false.”
In his experience, Stanak says, housing projects are rarely blocked or delayed by Act 250. The vast majority of permits for housing projects are approved without appeals. The bigger issues, he explains, are a lack of infrastructure, a shortage of skilled labor, and high construction costs.
A review of appeals and permit issuance data shows that Act 250 review rarely completely blocks development. In 2023, Vermont’s Act 250 program issued 392 permit decisions — and denied just two applications, according to the Natural Resources Board’s annual report that year.
Also in 2023, only 13 appeals were filed, representing just over 3 percent of total decisions. On average there are just 11 appeals per year out of several hundred applications, according to the board’s 2023 recommendations to the legislature on Act 250 updates.
However, going through the process is an impediment upon itself, as the Natural Resources Board notes: “The appeal of Act 250 decisions by applicants or parties with standing can result in considerable expense in time and money,” the report to the legislature states.
It’s still important to ensure that Act 250 doesn’t unnecessarily burden projects, especially in places where local planning and zoning are already strong, says Megan Sullivan, vice president of government affairs at the Vermont Chamber of Commerce and a member of a key Act 250 steering committee that helped underpin the new laws.
“Ideally, good regulation shouldn’t be overly burdensome,” Sullivan continues. “If you’re a good actor, doing the right thing, proposing a good project, you should be able to get through the process relatively efficiently.”
Act 181 includes interim exemptions designed to jumpstart housing construction. For example, multi-family housing projects in designated downtowns and village centers can now bypass Act 250 review until 2026, provided they meet certain standards.
Sullivan says these exemptions are critical to addressing immediate housing needs, while the longer-term tiered system is developed to identify new areas for streamlined review.
The public relations battle around Act 250 has largely been ceded to its opponents, Stanak says, since it’s easy to vilify regulations with benefits that come from the sum of slow work over decades.
“The benefits of Act 250 are often diffuse and long-term,” Stanak notes. “It’s hard to point to a specific thing and say ‘Act 250 did that’.”
In contrast, the costs or the perceived burdens are very immediate and concentrated on the applicant, he says. “So it’s an easier story to tell, the negative story.”
Regardless of the perceived benefits and costs, Act 181 offers the opportunity to try something new to address housing shortages and protect critical natural resources while examining opportunities to improve the Act 250 process.
Out with the old, in with the…old?
For decades, Act 250 was run by a nine-member Environmental Board, a citizen body that blended legal review with broader environmental policy interpretation. In 2004, that board was eliminated, and appeals were shifted to Vermont’s Environmental Court.
That change was pitched as a way to streamline decision-making, but some former officials say it stripped Act 250 of its living, flexible nature. And now, among the several studies that must be completed is an appeals study, set to be released in November, and designed to answer the question of where appeals should be adjudicated.
Experts interviewed for this article see benefits to removing appeals review from the purview of courts, and to, or rather back to, a board such as the newly-created Land Use Review Board.
The former Environmental Board decisions were a mix of law and policy, says Jon Groveman, policy and water program director at VNRC. The courts are more rigid, he notes.
“Judges are just looking at the narrow legal question before them,” explains Groveman, who before VNRC, was chair of the Natural Resources Board, which administers Act 250. “Does this meet the standard or not? They don’t look at the broader need to clarify how the Act 250 requirements work so that all Vermonters understand what is required to obtain an Act 250 permit.”
The appeals study offers an important opportunity to look at environmental permitting in Vermont, and make recommendations about how to craft a more efficient and effective process.
Mapping the Future
Over the next two years, Vermont’s land-use map will be redrawn — literally.
Act 181 calls for the creation of a tiered mapping system to guide future development. Areas best suited for growth, such as downtowns and village centers with existing infrastructure and strong local plans will fall into Tier 1, where Act 250 oversight will be reduced. Much of the state outside of these areas will fall into Tier 2 where Act 250 would stay the same. A smaller subset of environmentally sensitive areas, may be designated Tier 3, which would require environmental review.
The new Land Use Review Board, along with regional planning commissions, will oversee the mapping process.
Advocates say the integrity of that process will determine whether Act 181 succeeds in balancing development and conservation.
“What’s really gonna be important to how this all works out,” Groveman says, “is making sure those maps are drawn based on good science and good data rather than political pressure.”
Sullivan emphasizes that consistent standards across regions will be crucial for ensuring fairness and predictability, and an agreed-upon map can help.
“There’s some concern now that there can be different outcomes depending on the coordinator,” Sullivan says. “So hopefully this will help create some consistency.”
The tension between Vermont’s twin goals — promoting housing and protecting the environment — is not new. It has existed since Act 250’s inception in 1970.
What’s at stake now, advocates say, is ensuring that Vermont continues to grow without losing the rural landscapes, forested mountains, and small-town feel that have defined the state for generations. How the process of implementing these updates to Act 250 is fundamental, they say.
More than 50 years after the original law was put on Vermont’s books, cities and towns are far more able to review their own large projects in dense downtowns.
“Act 250 doesn’t operate in a vacuum,” Fidel says. “The goal is really to incentivize development towards areas that are suitable for dense development, that have the infrastructure, and won’t unduly affect our critical natural resources.”
The legislative work is mostly done, but the real test begins as the state draws its land-use map and implements the new tiered system. Success hinges on navigating the inherent tension between fostering development and safeguarding the environment during this critical implementation phase.
“The decisions we make now,” Sorenson says, “Are going to shape what Vermont looks like for generations to come.”