Chester board to consider Act 250 ‘tier status’; rural areas to see tighter rules Initiative to spur village housing may make building more difficult elsewhere

By Shawn Cunningham
© 2026 Telegraph Publishing LLC

On Wednesday, the Chester Select Board will hold a meeting with only one topic to be discussed in the public: “Adopt Municipal Resolution on Tier 1B Status.” This is part of a new law that exempts downtowns and village centers from Act 250 regulations to increase the development of housing in denser areas. It’s intended to be one answer to the shortage of available homes.

What is still to come and should concern landowners is another “tier” that would “enhance” Act 250 regulations in rural areas and possibly result in some single-family homes requiring an Act 250 permit.

Tracks of our tiers

• Tier 1A: Moves jurisdiction for planned growth including housing to municipalities that have the the capacity to handle review and administration of such projects.
• Tier 1B: Moves Act 250 jurisdiction for housing development only to municipalities with zoning and planning but not the capacity to administer all development. 
• Tier 2: These areas will continue to have Act 250 as it exists now.
• Tier 3: These rural areas will have regulations based on rules written by the Land Use Review Board and Agency of Natural Resources. 

In 2024, the Vermont Legislature passed and Gov. Scott signed H687 making it Act 181. In addition to supporting the development of housing, it was intended to reform the state’s Act 250 framework, including the creation of  a new full-time Land Use Review Board, updated land-use maps and land use based rules for development.  One aspect of the Act 250 overhaul creates a tier system designating how areas within the tiers will be regulated.

And as drafts of rules and preliminary maps are put out, the outlook becomes confusing and the possibilities for problems arise.

The tiers of a town

In areas designated as Tier 1B — the one the Chester Select Board is considering — housing development will be exempted from Act 250. Act 181 requires easing some zoning restrictions in Tier 1, including on the amount of parking needed and allowing multi-family dwellings where single-family homes were only allowed.

The exemption is aimed at encouraging housing development in village areas that are walkable and bikeable and have municipal water and sewer. The town must also have planning and zoning and the staff capacity to support development review and zoning administration. The goal is a greater population density in these areas.

The current Act 250 exemption is temporary, but will become permanent when the state approves the regional plan put forward by the Mount Ascutney Regional Commission, said MARC Executive Director Jason Rasmussen. Adopting the resolution on Tier 1B status would put Chester on that map.

On the other hand, Tier 1A, designed for much larger towns and cities, requires a municipality to have greater capacity to handle planned growth in addition to housing, such as with large planning and zoning staff and robust zoning codes.

Nothing in Act 250 changes for areas designated Tier 2. It is essentially, the status quo.

Tier 3 is also the status quo for now, but new land-use rules are being written with a stricter Act 250 use. The overwhelming majority of land in Chester will be subject to Tier 3. But as the rules are currently being written, it is unclear which rural areas will have the greater Act 250 burden. Version 2.1 of the Act 250 Tier 3 rules says, “Act 250 jurisdiction attaches to the construction of improvements for commercial, industrial or residential purposes in a Tier 3 area.” Click here for Version 2.1 of the draft Tier 3 rules from October 2025

Part of the rationale for the changes is to preserve “critical natural resources” and wildlife habitats and connectors “of statewide significance.” So if a piece of property has any feature that falls under those or several other categories, it may also fall under Act 250 jurisdiction.

To find out whether a property falls under Tier 3, an Act 250 jurisdictional opinion may be necessary, which would come from staff in a district office. A group made up of members of the Land Use Review Board and the Agency of Natural Resources has generated maps of such areas, but with the caveat that the maps may not be granular enough to be used at “a parcel level.”

Fears of tiers on Act 250 applications

It remains to be seen if, under such rules, the Act 250 district offices could keep up with the requests for jurisdictional opinions and Act 250 applications for even minor alterations to property such as improvements farther than “50 feet from an existing structure,” which are in the draft rules.

And with long delays comes the specter of owners losing patience and going ahead with projects without approval. Noting the delay in action by Act 250 in the case of one of the Julian quarries (after it operated for more than a decade beyond its permit expiration) the enforcement portion of the law may further tax an already overtaxed compliance staff.

At a recent meeting in which Rep. Tom Charlton talked about current issues in legislation and took questions from constituents, he brought up Act 181 late in the meeting and suggested that people stay on top of what’s happening with the new rules.

Rasmussen says that Version 3 of the Tier 3 rules are expected by the end of February and that he is planning a public meeting with MARC and representatives of the Land Use Review Board in March or April. The deadline for the rules to be in place is Dec. 31, 2026. To find videos of meetings of the Tier 3 Working Group that is crafting the rules on Youtube, click here.

The Chester Telegraph will publish links to the new rules and maps as well as dates and locations of public meetings as they become available. To be sure you see these, sign up for our weekly news alert by sending your email address and first name to info@chestertelegraph.org.