Gov. Phil Scott delivered his first veto of the 2025 legislative session over a midyear spending package on Friday, setting up a showdown over Vermont鈥檚 motel shelter program.
The five-term Republican that he wants to hold off on increased state spending as state officials anticipate federal funding cuts to key programs. But beyond , Scott disapproves of the extension the annual budget adjustment bill gives to some unhoused Vermonters living in state-sponsored motel rooms.
Without the extension, nearly 600 adults and over 160 children could lose their access to motel-based shelter on April 1 alone, according to . Many more could become ineligible in the following weeks.
The governor said the extension would reverse progress the state made last year on reforming the program.
鈥淎fter nearly five years of experience, we know this approach is far too expensive and fails our constituents, communities and taxpayers,鈥� Scott wrote.
Advocates denounced Scott鈥檚 decision as 鈥渦nconscionable鈥� and called on lawmakers to overturn it.
鈥淏ecause of this veto, in less than three weeks we will be giving tents to families with young children, seniors, people fleeing domestic violence, and other vulnerable Vermonters as they try to navigate living outside,鈥� Frank Knaack, executive director of the Housing and Homelessness Alliance of Vermont, wrote in a statement.
Scott has long sought to wind down the motel program鈥檚 pandemic-era expansion, particularly since federal aid dried up two years ago. In his veto message, the governor referred to the program as 鈥渇ree,鈥� though an income contribution has been required for participants .
Last spring, lawmakers signed off on new restrictions for program participants, which resulted in over the course of the fall 鈥� including 378 children. That prompted a public outcry, .
When they returned to Montpelier this year, Democratic legislators attempted to head off another round of evictions slated to begin in two weeks, on April 1. The budget adjustment bill would keep the program鈥檚 looser winter rules in place until June 30, with a price tag of an additional $1.8 million.
Democrats no longer have a clear path to override Scott鈥檚 vetoes, after losing their supermajority in the Legislature during last fall鈥檚 elections. That means they would likely need to hash out a deal with Republican lawmakers and the Scott administration on a new budget adjustment bill, or go without the midyear spending package.
The budget adjustment isn鈥檛 a 鈥渕ust pass鈥� bill in the way the budget itself is, which means the government is not at risk of a shutdown if lawmakers and Scott can鈥檛 come to an agreement. But the bill does give increased spending authority to some programs, such as Medicaid, according to Conor Kennedy, chief of staff for Speaker of the House Jill Krowinski, D-Burlington. If a version of the bill does not become law, the program could run out of money, he said.
Local responsibility for homelessness?
Scott stands by a proposal his administration brought to lawmakers two weeks ago that would give municipalities $2.1 million in flexible grants, allowing cities and towns to set aside money for motel rooms or to expand shelter capacity when people leave the motels this spring.
鈥淭his compromise proposal, or something similar, remains on the table,鈥� Scott wrote in his veto message.
But thus far, Democratic leadership does not appear to have an appetite for the idea.
鈥淭he Governor鈥檚 proposal to shift the responsibility to municipalities would cost more, not less,鈥� Senate President Pro Tem Phil Baruth, D/P-Chittenden Central, wrote in a statement on Friday. 鈥淲e will continue to fight for the unhoused 鈥� the most vulnerable, as Governor Scott generally refers to them.鈥�
But while Democrats have panned Scott鈥檚 proposal to shift homeless services to municipalities, the idea of dissolving the motel program and giving more power to local communities has gained traction elsewhere in the Statehouse.
The House Human Services Committee , a bill that would get rid of the motel program as it currently exists, and instead give regional community action agencies funding and control over homelessness programs throughout the state.
The bill envisions a yearlong transition to this new system. Some local service providers have expressed concern that such a change would absolve the state of accountability and responsibility for the response to Vermont鈥檚 worsening homelessness problem.
But Rep. Theresa Wood, D-Waterbury, the committee鈥檚 chair, thinks the shift to more locally-controlled services will ultimately better help people experiencing homelessness.
鈥淒ecisions are best made closest to the individuals for maximum flexibility in meeting their needs,鈥� she said.
