Democrats delivered progress for Vermonters
, on Jun 30, 2025
MONTPELIER — Vermont Democrats entered the 2025-2026 legislative session laser focused on delivering results that improve Vermonters' daily lives. Vermont Democrats have lowered the cost of your health care, made historic investments in affordable housing, strengthened protections for Vermont kids, and taken their first steps toward designing a public education system that prioritizes long-term stability, equity and sustainability for Vermont students, educators and taxpayers. Vermont Democrats made meaningful progress this session — but their critical work is far from over. Keep reading to get a glimpse into their 2025 legislative successes.
Easing the Burden on Vermont's Working Families
After the 2024 election, Vermonters sent lawmakers a clear message: the cost of living is too high. Vermont Democrats heard and centered your concerns — and took action to deliver real relief. The FY26 Vermont state budget now includes $77 million to ease your property tax pressure this year. Instead of a projected 7% increase, statewide property tax rates will rise, on average, just over 1%. These are meaningful savings for Vermont families who asked us to lower the cost of their living while improving the quality of their lives.
Vermont Democrats also passed a new tax relief package that will return $13.5 million a year to Vermonters by expanding the Child Tax Credit, boosting the Earned Income Tax Credit for workers without children, raising income thresholds for retirement exemptions, and delivering new tax breaks for veterans.
Education Finance Reform
Vermont is making one of the most significant changes to public education funding and property taxes in decades. This shift began with a proposal from Governor Scott, setting in motion a process that's now reshaping how we fund our public schools. At its core, the plan aims to make education funding more predictable, equitable, and sustainable for educators, administration and students. We know this plan has raised valid questions and concerns, especially about local control, fairness, timelines, and rural schools. This process will unfold over the next few years and Vermont legislators are committed to working together — no matter their politics — to ensure the changes serve students, support educators, and meet the needs of taxpayers.
- Under this plan, a new statewide funding formula would take effect in 2029, sending each district an "educational opportunity payment" of $15,033 per student, with additional funding for students who are English learners, receive special education, live in poverty, or attend small schools.
- Vermont Democrats will continue to take a thoughtful, transparent approach to school district consolidation. This summer, a new task force will propose district maps with recommendations due to the Legislature by this fall. This could reduce the 119 current school districts to between 12 and 25 districts. The Legislature will decide a mapping plan to take effect by July 2027.
- To ensure fairness and consistency across the state, Vermont will also introduce new quality and class size standards. Beginning in 2026, minimum class size guidelines would go into effect, with a gradual transition from 2027 to 2029 for districts to adjust. If a Vermont school couldn't meet class size minimums, local school boards can ask the State Board of Education for a waiver.
- This plan does not expand school choice in Vermont, rather it reduces public funding for independent schools and ends tax dollars going to out-of-state independent schools. To keep funding, Vermont independent schools must be state-approved by 2025, have at least 25% publicly funded students in 2024, and follow public school class-size rules starting in 2026 (or get a waiver).
- Finally, this plan changes Vermont's property tax system by creating three categories for non-homestead property: apartments, residential second homes, and nonresidential properties. This makes it possible to tax second homes at higher rates: a long-standing goal that helps shift the tax burden away from working-class Vermonters.
A lack of affordable housing is at the root of so many of our challenges, from increasing school budgets to the inability to attract younger people to live and work in our state. That's why Vermont Democrats passed S.127, the largest infrastructure investment in Vermont history, promising a $2 billion package over 20 years to build more housing and improve our roads and water systems.
This new law expands access to financing for low and middle income Vermonters to buy or rent homes, and offers grants to help landlords bring more units — including mobile homes — up to code. It also strengthens protections against housing discrimination for immigrant workers, helping support the farms, job sites, and small businesses that rely on them. It launches a new program to help towns and developers build the infrastructure needed to support up to 3,750 new homes per year across both rural and urban communities.
Reigning in Rising Health Care Costs
Health care continues to be one of the biggest cost drivers for Vermont families, schools, and employers. Vermont Democrats took bold steps this year to address our health care crisis – reducing the already strained burden on Vermonters' wallets.
With health care expenses driving up property taxes and straining school budgets, Vermont Democrats created a path towards a more sustainable health care system built around fairness, transparency, and prevention. S.126 overhauls Vermont's health care system by tackling the root cause of rising costs and failing access, especially in rural communities. It shifts Vermont toward reference-based pricing and global budgets and ties hospital payments to predictable Medicare benchmarks. This translates to more consistent and predictable costs for patients, lower insurance premiums over time, and stronger financial stability for local hospitals.
Vermont Democrats also took bold action to erase medical debt for working Vermonters. With the passage of S.27, Vermont will eliminate $100 million in medical debt for lower income Vermonters, without raising any taxes or imposing any fees.
Vermont has some of the highest drug costs in the nation, which is why Vermont Democrats passed H.266, which limits excessive markups on prescription drugs. This bill caps what hospitals can charge for certain medications at 120% of Medicare's average price starting in 2026 — a major cut from previous markups that sometimes hit 600%.
Protecting Our Values and Our Neighbors
At a time when federal overreach threatens the very foundations of our democracy, Vermont Democrats believe that the implications of Trump's presidency are an existential issue. It's not just about policy disagreements: it's about protecting the rule of law, safeguarding civil rights, and ensuring that Vermont's values of fairness, inclusion, and justice prevail. We must remain vigilant and engaged, because the decisions made in Washington reverberate here at home, shaping the future of our communities and the well-being of every Vermonter.
Keep Vermont Democrats Accountable to You
Every bill passed by Vermont Democrats this session is grounded in a simple but foundational truth: Vermonters deserve a future they can count on. Whether it's lowering your cost of your living, protecting our neighbors, or strengthening rural communities, Vermont Democrats are delivering for you.
All of your voices help guide Vermont Democrats' work ahead. As always, thank you for holding your legislators accountable. They thank you for keeping them focused, honest and hopeful.
Our best,
Liam O'Sullivan, House Caucus Director
Erin Stoetzner, Senate Caucus Director
Up Next: We'll highlight how Vermont Democrats are actively protecting Vermonters and fighting back against President Trump.
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