Vermont's HOA bill was stripped down to a study
Vermont's HOA bill was stripped down to a study
2026-09-19 · Vermont · Legislation
The most ambitious bill Vermont has ever written about community associations passed, was signed, and does almost nothing.
S.328, An act relating to housing and common interest communities, was introduced by the Senate Committee on Economic Development, Housing and General Affairs on January 30, 2026 and signed by Governor Phil Scott on June 18, 2026 as Act 179. Of the four covenant overrides it carried into the Senate, none survived to the statute book.1
What was in the bill as introduced
Secs. 4 through 7 of S.328 as introduced would have:
- added 27A V.S.A. § 3-125, “Prohibited Uses Disallowed”, voiding any covenant, deed restriction, bylaw or rule that “effectively prohibits or unreasonably restricts” leasing a residential unit — preserving sublease bans, the § 3-120(f)(3) rental restrictions, and short-term-rental controls — and any provision doing the same to a family child care home;
- added 27A V.S.A. § 3-126 on electric vehicle supply equipment, with a 60-day deemed-approval window, a $1,000 civil penalty for an intentional violation, and prevailing-plaintiff attorney's fees;
- amended 27A V.S.A. § 1-204 to push both new sections back onto pre-1999 communities for events after June 30, 2026;
- amended 10 V.S.A. § 6252 to bar a mobile home park owner from even proposing a lot rent increase more than one percentage point above the housing component of the Consumer Price Index.
None of that is in the enacted act.2
What survived
Two sections of a large omnibus housing act touch common interest communities.
Sec. 1 adds 3 V.S.A. § 119, “Common Interest Community Resources”, in its entirety: “The Secretary of State shall provide on its website or otherwise distribute to the public information about Vermont's common interest communities. This information shall include the governing statutes.”
Sec. 10 is the study, and it is the part with a date attached:
“On or before November 15, 2026, the Office of Legislative Counsel shall provide a written report to the House Committee on General and Housing and the Senate Committee on Economic Development, Housing and General Affairs outlining any legal, conventional financing, and funding compliance issues related to requiring common interest communities to: (1) authorize leasing of residential units; (2) authorize commercial purposes within a dwelling unit; (3) permit the construction of accessory dwelling units on land reserved for the exclusive use of a unit owner; and (4) permit the installation and use of vegetable gardens within a unit owner's designated exclusive use space.”
Subsection (b) directs the Office to “work with and identify external partners with knowledge and expertise in common interest communities across the State.”
That four-item list is the bill, reorganised
Read the study list against the stripped sections and the mapping is exact. Leasing is Sec. 4(a). Commercial purposes within a dwelling unit is the family-child-care provision at Sec. 4(b), generalised. Accessory dwelling units and vegetable gardens come from elsewhere in the 2026 session — the garden item is H.537, which passed the House on March 20, 2026 and died in Senate committee.
The phrase doing the most work is “conventional financing”. That is a reference to secondary-mortgage-market project eligibility: an association compelled by statute to permit leasing may fail investor-concentration or rentals tests that Fannie Mae and Freddie Mac apply when they decide whether to buy loans in a project. The Legislature asked its own drafting staff whether the override it wanted would make Vermont condominiums unfinanceable.
The path through the building
The Senate committed the bill back to Economic Development on February 3, reported it favorably with amendment on March 17, and passed it on third reading on March 26, 2026 with no roll call recorded — a voice vote. The House passed it in concurrence with a proposal of amendment on May 20 with rules suspended for all remaining stages, again without a roll call. The Senate concurred with a further proposal of amendment on May 26; the House concurred on May 27.1 Most CIC provisions were gone before the first floor vote.
What to watch next
The 2025–2026 biennium adjourned sine die on May 29, 2026, which means every unpassed bill is dead and must be reintroduced from scratch with a new number in January 2027. The Legislative Counsel report lands November 15, 2026 — roughly seven weeks before that session opens, which is exactly where a report intended to produce a bill would be scheduled.
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