ST. ALBANS — Gov. Peter Shumlin came to St. Albans City Tuesday to sign three bills related to economic development.

The governor’s visit also illuminated a new provision in state law that determines who pays for traffic improvements when new development takes place at busy intersections. The new approach provides for transportation impact districts (TIDs) and would have made a difference in the development near Interstate 89, Exit 19 in St. Albans Town.

All three new laws are aimed at discouraging strip development and encouraging development in compact urban centers.

The city was chosen for the signing because of its successful downtown revitalization efforts, described by Shumlin as “one of the most extraordinary comebacks of a downtown that I have witnessed.”

The signing took place in the St. Albans House. The Lake Street building’s owner, Jim Cameron, used historic and downtown tax credits to help pay for its renovation. The building, constructed in the 1840s, is now mixed use, housing residential and commercial uses.

Shumlin cited the numerous improvements that have taken place in downtown in recent years, including the streetscape project, the expansion of Mylan Technologies and the construction of the new St. Albans Cooperative Creamery Store.

“We’ve seen stores come back to downtown,” said Shumlin.

St. Albans City Mayor Liz Gamache, said, “We know how important our urban centers and our downtowns are to Vermont. … These are the hubs that bring people together, face-to-face. They matter.”

The revitalization of downtown St. Albans involved work by dozens of volunteers over years, said Gamache, as well as businesses willing to invest in the city, the city council and staff, and the support of state and federal officials.

“We know that strong downtowns make strong communities,” said Gamache. “And strong communities are what make Vermont strong.”

Each of the three bills signed by Shumlin encourages concentrated, downtown development in a slightly different way. The transportation bill, H. 740, makes it less costly to develop in areas with significant existing traffic.

Transportation

It addressed a long-standing concern among developers, which Shumlin referred to as the “last-one-in penalty.” Under Vermont law, a developer whose project triggers a need for traffic improvements must pay the total cost of those improvements, even though the upgrades will benefit other developers, both future and past.

In St. Albans Town, developers chose not to build a restaurant at Exit 19 because the required traffic improvements to the intersection made the development prohibitively expensive. Instead, the developer put in a carwash, which did not increase traffic volume at the intersection enough to trigger the need for improvements.

The new law gives the Secretary of Transportation the authority to create transportation impact districts (TID). When issuing an Act 250 permit, the district commission may require a developer to pay impact fees into a fund that will be used to make future transportation improvements within the TID. Thus, each developer will contribute to needed improvements based upon their projected impact on traffic.

Alternatively, the district commission may require the developer to pay for the traffic improvements. However, future developers would then be instructed to reimburse that developer, based on their own usage of the traffic improvements.

Currently, developers may hold off on projects until a large developer, such as Walmart, makes needed traffic improvements. In the case of Walmart in St. Albans Town, the improvements cost millions. Subsequent developers avoid paying for traffic upgrades by coming in after the upgrades have been made. Requiring reimbursement would bring an end to such practices.

Shumlin suggested the bill would help reduce sprawl by reducing the cost of developing in areas with significant existing traffic flows.

Rep. Patrick Brennan, R – Chittenden 9-2, who was present at the bill signing, said business and environmental groups worked together on the bill, often working out proposals together and then bringing them to the House Transportation Committee. “When you can bring the business community and the environmental community together, you’ve got a good bill,” said Brennan.

Rep. Mike McCarthy, D-St. Albans City, a member of the transportation committee, said the new law will “help development happen in the right way in the right places.”

Promoting development

Two other bills, H. 809 and H. 823, promote traditional settlement patterns by discouraging strip development and encouraging mixed-use development in which residential, commercial and public spaces are located side-by-side. The bills, now signed into law, also encouraged communities to plan for, and developers to include, multiple forms of transportation.

“It slows strip development … by requiring infill in strip areas rather than continually finding new farm fields to develop in,” Shumlin said of H. 823. The bill bars large-scale commercial development outside a designated center from extending development and encourages developers to locate within designated growth centers and downtowns.

Sen. Diane Snelling, R-Chittenden, said the two laws would help promote vibrant downtowns.

H. 809 clarifies the rules regarding the creation of new town centers and state-designated growth centers, in order to assist municipalities with planning.

In addition to discouraging strip development, H. 823 creates incentives for the construction of housing within state designated growth centers to help address the state’s housing shortage while improving pedestrian and cyclist accessibility.