Senate advances bill standardizing property tax abatements and delaying tax sales

Senator Madison, the reporter for H629, told the Vermont Senate that the bill would clarify and standardize municipal tax abatement and tax sale procedures to make them fairer for residents and predictable for towns.

"When residents are unable to pay their property taxes, two of the primary tools that municipalities use to deal with the situation are tax abatement and tax sales," Senator Madison said, summarizing the bill's aims. H629 would update municipal abatement boards' procedures, require written explanations for abatement decisions, permit class abatements for events such as floods and create a uniform notice form that towns must use when informing taxpayers of abatement options.

The bill bolsters notification about homestead/property tax credits included in tax bills and requires access to translated notices in the five most common non‑English languages in Vermont so limited‑English speakers can learn how to seek assistance. On tax sales, H629 would prohibit initiating a tax sale until a taxpayer is delinquent for at least one year and only after offering a written reasonable repayment plan and attempting multiple notification methods, which may include certified and first‑class mail, personal service, email and tack posting to a structure on the property.

On redemption, the bill preserves the current right to redeem a property for up to one year after a successful tax sale by paying the sale price plus 1% interest. Senator Madison acknowledged committee debate about whether that interest rate should change but said the committee retained the existing 1% figure and placed study of the matter with a working group.

The working group named in the bill would include Vermont Legal Aid, BLCT, the Bankers Association, VHFA, the Clerks Association, Neighborhood Works Alliance, CVOEO's Mobile Home Project, Vermont assessors and a real‑estate attorney. It would be unpaid, report back to legislative committees by December and cease to exist in June 2025.

Senators questioned implementation details on the floor. One senator asked how towns should proceed if a property owner cannot be located; Senator Madison said towns must make a "best effort" through multiple avenues and, if the owner cannot be found after those steps, may proceed with a tax sale. Questions about whether town clerks' contact information should include email were left open for a possible amendment at third reading.

The Senate adopted the Government Operations committee report on H629 by voice vote and then ordered the bill read a third time.

What happens next: H629 has been ordered for third reading; further amendments may be offered on third reading and the working group will report back as specified in the bill.