This story, by Report for America corps member Carly Berlin, was produced through a partnership between VTDigger and Vermont Public.
MONTGOMERY — Standing near the main crossroads in this eastern Franklin County town of 1,200, Charlie Hancock made his pitch for the town center’s first-ever municipal sewer system. It’s one the longtime selectboard chair has had plenty of time to refine — it’s been six-plus years since community wastewater emerged as a key objective for the town.
Businesses in the bustling ski-resort-adjacent town can’t grow, Hancock said, pointing to the Main Street cafe owner who wants to add seats — meaning more dishwater down the drain, more toilets flushed — but has little space to expand a septic system on a lot that borders the Trout River. Then there’s the high cost of septics that fail, Hancock noted, gesturing across the road toward a restaurant whose owner remortgaged the building in order to finance an expensive replacement when his system started spilling sludge.
Adding much new housing to the town is a challenge – and so is maintaining old homes. There are structures in the heart of town that have sat unused for years, the limited septic capacity or specter of a high price tag hindering redevelopment, Hancock noted. He motioned toward a stately red building that once housed a restaurant and a few apartments, now empty and decaying.
“Those are the challenges that are keeping places like that vacant,” he said.
But getting pipes in the ground in Montgomery has been anything but straightforward.
Community enthusiasm propelled the wastewater project forward in its early stages. Residents approved a bond request in 2020, and the selectboard lined up hefty state and federal grants to keep costs limited for locals. But finding land away from the river for large community leach fields proved to be an uphill battle, and after one key landowner pulled out, the town cut the scope of the project in half. Meanwhile, inflation and design challenges drove up the price tag from about $12 million to $16 million.
And recently, public opinion has curdled.
A vocal group seeking to quash the wastewater project has forced a referendum vote, which will be held later this spring. They allege a lack of transparency in town government and point to the elevated cost. But their chief objection is less about how the project came to be, and more about what a future wastewater system might allow: more affordable housing.
“My main concern is that we are cornering ourselves into housing initiatives created by Scott – Gov. Scott’s administration – whereby a wastewater system becomes a linchpin for affordable housing development,” said Peter Locher, who chairs Montgomery’s planning commission. He moved to Montgomery from New Jersey a decade ago. “Nobody moved here for a more dense population,” he said. “People came here to leave dense population, and all the associated issues that go along with it.”
That sentiment has boiled over at recent public meetings about the project. A late January selectboard hearing devolved when one board member described her support for the wastewater system — audibly holding back tears — and a member of the public, John Johnson, interjected, asking if the wastewater system would allow buildings with “Section 8 people” to come to town.
“Can you guarantee that when you do this — if this plan goes through, and then buildings go up — that it’s not going to be all this riff raff coming in from the city that the governor already said he wanted to put up here?” Johnson posed.
Montgomery is not the only town where opposition to the prospect of future housing has tanked — or threatened to tank — a wastewater project in recent years. Such local resistance may serve as a cautionary tale for Gov. Phil Scott and other state officials who are increasingly pushing for such projects.
Hancock said he’s baffled that a debate about municipal infrastructure in his town has become this bitter.
“We had no idea it would take this long, it would cost this much, it would be this complicated, or, frankly, that it would lead to this level of divisiveness in segments of the community,” he said.
‘Just on paper’
Over the last few years, state leaders have tried to boost housing growth in areas that already have key infrastructure in the ground.
Gov. Scott’s administration and lawmakers have championed legislation that aims to encourage more housing in areas already served by municipal water and wastewater systems. The 2023 HOME Act mandated that such areas allow triplexes and fourplexes, and affordable housing at higher densities than what local zoning dictates. An Act 250 reform bill passed last year carved out exemptions to the state land use law for new housing in certain areas served by water and sewer systems.
But large swaths of Vermont lack any municipal drinking water or sewer infrastructure. Without also investing in building more infrastructure across the state, some housing proponents say the recent laws are “purely academic.”
“They’re just a theory of growth,” said Samantha Sheehan, a lobbyist for the Vermont League of Cities and Towns. “Without expanding the real infrastructure needed to hook up a new housing unit to a municipal sewer system and water system — it’s just on paper.”
This year, the Scott administration has made funding for infrastructure a pillar of its housing agenda.
“We need to strengthen and expand infrastructure that’s critical to housing,” said the Republican governor while rolling out a housing omnibus bill last month.
The package includes about $9 million for a new revolving loan fund intended to “provide low-interest funding for infrastructure to enable housing production,” and would set up a new tax-increment financing tool aimed at helping smaller towns cover the costs of creating new infrastructure.
The lack of critical infrastructure across the state means developers trying to create housing sometimes have to build out new water, sewer and road systems themselves — and then roll that cost into the price of the homes, said Alex Farrell, commissioner of the Department of Housing and Community Development.
“We’re a rural state, and we don’t have this infrastructure everywhere. That’s actually helping to drive up the costs right now, and we’re trying to reverse that trend,” Farrell said.
But expanding municipal infrastructure — and, by extension, allowing for more homes — can only happen when towns get on board.
Pipe dreams
Even with money on the table, infrastructure projects have faltered in some Vermont communities.
During the Covid-19 pandemic, state leaders earmarked upwards of $30 million in federal relief funds for municipal water and wastewater initiatives in some of the state’s rural villages with the goal of promoting housing and economic revitalization. Eleven towns received grants, including Montgomery.
Some are now giving back that money.
In certain cases, opposition to growth has all but killed projects. In 2023, Westford voters shot down a bond proposal that would have helped fund a long-planned wastewater system, amid concerns over development and the loss of the town’s rural nature. The town had already spent part of its federal grant, but then gave the rest back to the state, according to Lynnette Claudon, senior water infrastructure program engineer for the Vermont Department of Environmental Conservation.
Other towns have simply been unable to lock down a location for a disposal site — basically, a large septic field where waste would be pumped from individual properties. Suitable land has to be well-drained and far from floodplains or wetlands, Claudon said, but it can’t be too far away from the properties it would serve. And the owner of the land has to be willing to sell.
Those have been difficult criteria to meet in a host of towns. Moretown gave back its grant after soil samples indicated none of four proposed sites were feasible, according to the Valley Reporter. Greensboro explored using a lot owned by a Catholic church, adjacent to its cemetery. But the church ultimately pulled out.
“They were worried that, if the project went forward, that they would have limited ability to expand the cemetery in the future,” said Eric Hanson, chair of the Greensboro selectboard.
Claudon, for her part, was not surprised to see so many well-funded projects hit roadblocks. When she was a young civil engineer, a boss handed her a big cardboard box full of documents, and told her to read them all.
“It was an infrastructure project that was in planning for 20 years and then never got built,” she said.
So often, projects get snarled in drawn-out political battles, Claudon said. The basis for those fights is often about the prospect of change.
“It’s not uncommon for people in our communities to not like change,” Claudon said. “In some instances, that change is really directly related to housing.”
Voters decide
Montgomery voters are about to decide on a slew of ballot items that could make or break the future of the municipal wastewater system there.
Over 100 residents successfully petitioned to force a referendum vote on the project, which will take place on April 1. Voters will decide on two charter change measures, which would need ultimate approval from the Legislature and the governor. One would allow property owners to opt out of connecting to the future system — something that could doom it, according to Hancock, the selectboard chair.
In order to keep costs down for users of the eventual wastewater system, all 100 or so property owners in the town center would need to buy into it, Hancock said. “If we have individuals dropping out of the system, we lose that critical economy of scale that makes the whole project viable,” he said.
Also on April 1, voters will decide whether or not to repeal a local options tax passed several years ago specifically to help fund the wastewater project.
In a response, the selectboard decided to bring forward what they’ve billed as an “alternative” ballot item, which voters will see on Town Meeting Day on March 4. That ballot measure would shave off the sales portion of the local options tax, while still maintaining enough revenue for the wastewater project, Hancock said. A “yes” vote would also suspend the local charter for a period of three years — basically deferring the implications of the April 1 vote. If voters ultimately give the project the greenlight, the town would put the project out to bid.
Opponents and boosters of a sewer system in Montgomery disagree on how impactful the project would be in spurring future housing density in town. To Hancock, adding wastewater to the town center would not radically alter how much new housing could be built there, based on the town’s current zoning.
“I think there’s some ties being drawn here that aren’t necessarily, you know, based on reality and more based on emotion or fear,” he said.
As this series of votes approaches, Hancock sought out some words of encouragement from a figure that has loomed large in the town’s debate over its future sewer system: Gov. Scott.
“Right now, we have a once-in-a-generation opportunity to use federal, COVID-era funds to make these investments at a minimal cost to locals,” Scott wrote in a statement in mid-February. “I hope the people who live in Montgomery will continue to support this important project, which will benefit the community for decades to come.”
In a town that voted for the five-term Republican in “a landslide” last fall, Hancock hopes that Scott’s positive messaging — which he plans to use in informational materials about the project — might help sway residents who are on the fence about municipal wastewater. Town officials in Wolcott got a similar appeal from Scott last year when a wastewater project there sparked concerns about future development. The hope is to “ride on the coattails of Phil’s political capital,” Hancock said.
But the value of that political capital remains an open question, when some Montgomery voters have come to equate Scott with more housing that they do not want. Since soliciting the letter, Hancock has had second thoughts about using it.
Farrell, the housing commissioner, recognizes the political blowback against the prospect of growth that has arisen across many towns looking to build out new infrastructure. In some cases, when residents hear of plans to build out a new wastewater system, “they start picturing a completely different community,” he said.
He sees a tension between the state’s goals to encourage more housing — and towns’ ability and willingness to grow.
“At the end of the day, we can make all the best changes at the statewide level, and we’re still going to be subject to what our municipalities do and the type of growth that they choose to enable,” Farrell said.
Disclosure: Eric Hanson is a board member of the Vermont Journalism Trust, which operates VTDigger.