VERGENNES — With a land area of only 2.4 square miles, the city of Vergennes is one of Vermont’s smallest municipalities. But it nonetheless faces the same problems with sprawl and land use as some of its much bigger counterparts. 
This week, Vergennes will take part in a process designed to help municipal planners and zoners figure out how to refine their rules to allow more of the type of residential development that planners are seeking: affordable, low-impact and close to downtowns. 
Vergennes was one of six municipalities chosen to participate in the Vermont program aimed at modernizing local zoning codes. Right now, Vergennes limits most construction of new homes to lots that are at least a third of an acre. City officials know that encourages sprawl and prevents the construction of high-density affordable housing near the downtown area. 
But they don’t know exactly how to change it, said Shannon Haggett, the head of the city’s all-volunteer Planning Commission. Through a state program called Zoning for Great Neighborhoods, Haggett and other officials from Ludlow, Castleton, Middlesex, Fairfax and Brattleboro will work this week with the Washington, D.C.-based Congress for the New Urbanism (CNU) to come up with some alternatives. 
“We know that some of our dimensional standards in our regulations ought to be changed,” said Haggett. “In order to do that, we have to update the regulations, which is a very public process. It would be good to have technical expertise, and have Zoning for Greater Neighborhoods and CNU look at our stuff so we can go back to our planning commission and our community and it’s not just us saying, ‘This is what we need to do to get more people in new housing.’” 
One of the most critical economic development needs in the state is the construction of low- and medium-priced housing. Businesses and policymakers have been working on solutions to that problem for several years; in 2017, the Legislature approved a $37 million bond to pay for more affordable housing, and some lawmakers would like to pass another such bond next year. 
Employers like Southwestern Vermont Medical Center and the Sugarbush resort have started their own programs to directly provide housing as a way to attract workers; a nonprofit group in Woodstock is helping middle-income people buy homes so they can afford to live in the village. 
The state Agency of Commerce and Community Development has a stated goal of encouraging the development of high-density, walkable downtowns with mixed-use buildings that include housing. But developers have long said that zoning laws impede or discourage them from building that type of project. 
In a Zoning for Great Neighborhoods survey this summer about barriers to housing, developers listed municipal regulation as the second greatest impediment to construction of housing that meets all needs. 
Zoning is an emotional issue in municipalities, not just an economic issue. About 200 of the state’s 250 or so municipalities have zoning regulations. Existing residents often resist plans for high-density development, fearing it will change the character of the place they live. 
“It leads to difficult conversations in communities: What do they want their future to look like?” said Chris Cochran, director of community planning and revitalization for the state Department of Housing and Community Development. 
“Most people have bought into the idea that two-acre lots are the way it has always been, and they don’t want to see that change.” 
For this reason, the state plans to carry out its program slowly, Cochran said. 
“We are not talking about radically changing any community and making tiny lots everywhere and moving tiny homes into them,” he said. “But what are a few things you could change that would make a little more room, and you could get comfortable?” 
Cochran said cities in Oregon and California have been successful in changing zoning and also altering the conversation from NIMBY (“not in my backyard”) to the new YIMBY (“yes in my backyard”) to encourage sustainable housing development for all income levels. 
Several Vermont municipalities are still using suburban-style zoning that was established in the ’60s and ’70s, Cochran said. They adopted the rules used by neighboring towns. 
“It’s so complicated, this stuff, and people don’t realize the impact,” he said. “It makes compact downtowns and villages illegal; for the development everyone likes, people always have to get a variance. It’s not like we don’t want these things to happen; it has created a process that makes it hard.” 
Zoning is just part of the answer to the problem of market-rate housing, said Karen Horn, the director of public policy at the Vermont League of Cities and Towns. Developers are also deterred by things like land costs, construction costs, and permitting fees, she said. It’s expensive to bring in power, septic and roads. 
“That whole bundle makes it pretty difficult for people to actually build market-rate housing without some kind of subsidy,” said Horn. She noted that several towns in Vermont have reduced their lot sizes and setback requirements to encourage infill development. 
“They’re still not seeing housing construction,” she said. “I understand why the agency is focusing on zoning, but there are all these other issues that accompany your decision to build.” 
In Vergennes, where the largest landholder is the state of Vermont, there are developers who would like to build market-rate housing near downtown, Haggett said. They’re waiting to see if zoning rules will be changed. Meanwhile, the city has a new housing development in place with homes just north of the downtown area selling for about $300,000. Those homes each occupy about a third to half of an acre. 
“We’re committed to having housing available at all kinds of different income levels,” Haggett said. “More population is good for us. We’d like to see lots of different development going on here.”