Two Lawmakers Blocked Popular Veterans' Bill for Eight Years, Costing Vermont Workers and Economic Opportunities

Once S.17 was under the control of the House Ways and Means Committee, with two chairs who didn't consider honoring veterans important enough. The bill was never brought up for a vote.

For eight years, a widely popular, tri-partisan bill to exempt military retirement pay from state income tax languished in the Vermont Statehouse. Despite overwhelming support from lawmakers, a Republican governor, and a broad coalition of veteran and business groups, the measure was repeatedly stalled.

The delay, which cost Vermont dearly in both skilled workers and economic vitality, wasn't due to a lack of legislative will, but to the determined opposition of two powerful Democratic committee chairs who acted as legislative gatekeepers, effectively overriding the majority of their colleagues.

This is the story of how Senator Ann Cummings (D-Washington) and Representative Emilie Kornheiser (D-Brattleboro), citing principles of tax equity and fiscal caution, used their procedural power to single-handedly halt a critical economic development tool, exacerbating Vermont’s demographic crisis until a clever legislative maneuver finally forced their hand.

The battle ended in 2025 with the passage of S.51, a comprehensive tax relief package signed into law by Governor Phil Scott. But the eight-year standoff preceding this victory highlights a deep-seated ideological conflict within Vermont's progressive identity and underscores how procedural power can thwart the popular will.

The Overwhelming Support and the "Committee Bottleneck"

The push to eliminate the tax on military pensions was not a fringe movement. It was a top priority for Governor Scott since he took office in 2017. By the 2025 legislative session, the support was undeniable. A standalone bill in the House, H.43, garnered 72 co-sponsors—just three votes shy of a majority in the 150-member body. Its Senate counterpart, S.17, secured a decisive 21-sponsor supermajority in the 30-member chamber.

Proponents argued that Vermont’s policy was actively harming the state. As one of the last states in the nation to fully tax military pensions, Vermont was losing a critical demographic: military retirees. These individuals, often in their late 30s and 40s, represent a disciplined, skilled, and readily available workforce that a state with a shrinking labor pool desperately needs.

“We are in a workforce crisis,” Governor Scott repeatedly stated, framing the exemption as an “economic and workforce development tool.”

Despite the immense support, the bills were sent to the legislative "money committees" to die. H.43 was assigned to the House Committee on Ways and Means, chaired by Rep. Kornheiser. S.17 went to the Senate Committee on Finance, led by the long-serving Sen. Cummings. Once in their control, the bills were never brought up for a vote. Frustrated lawmakers complained that the chairs refused to “take the bills off the wall,” a colloquialism for killing legislation by never scheduling it for a hearing.

The Gatekeepers: A Clash of Philosophies

The two chairs, while united in their opposition, offered different rationales for the roadblock.

Representative Emilie Kornheiser, a Brattleboro Democrat, represents a faction of the party focused on using the tax code to fund robust social programs and correct economic inequality. A proponent of a wealth tax, Rep. Kornheiser’s public record shows a consistent focus on raising revenue, not cutting it. Forgoing the estimated $2.5 million from the military pension tax ran directly counter to her core belief in maximizing the state’s capacity for social investment. While her committee’s official reason for inaction was being preoccupied with education finance reform, this conveniently aligned with her ideological opposition to creating a new tax expenditure.

Senator Ann Cummings, a veteran legislator from Washington County, anchored her opposition in a more traditional argument of tax fairness. She publicly and consistently questioned why military pensions should be the only form of retirement income to receive a full exemption. Her stance was rooted in a belief that the tax code should be applied universally, without creating special “carve-outs” for one group, no matter how deserving. "We have to recognize all kinds of service," she famously stated, "not just the ones that come with uniforms."

This philosophical stand, however, ignored the unique economic imperative presented by the military retiree demographic and the near-universal consensus among other states that had already made this specific carve-out.

The Tangible Cost of Delay

The eight-year legislative standoff was not a victimless procedural debate. It inflicted quantifiable damage on Vermont’s economy and workforce.

According to data compiled by the Vermont Chamber of Commerce and the U.S. Department of Veterans Affairs (VA), Vermont's veteran population has been shrinking by 2.7% annually, significantly outpacing the national decline of 1.6%. The state has consistently ranked near the bottom in the nation as a destination for military retirees. This exodus is particularly damaging among veterans aged 40 to 64—the very individuals poised for a second career.

The economic outflow is stark. Vermont’s 3,900 resident military retirees bring approximately $90 million in stable, federally-funded pension income into the state each year. For eight years, as states like New Hampshire and Maine with full exemptions lured veterans away, Vermont lost out on millions in potential economic stimulus, property taxes, and income taxes from second careers.

The human cost is equally palpable. Stories shared in public forums tell of sixth-generation Vermonters who felt “betrayed” and were forced to move to states like Tennessee, where their financial fortunes improved almost instantly.

“I can’t count how many veterans I know who have chosen to leave Vermont for states that treat them with the respect they deserve,” then-Lt. Governor John Rodgers stated during the debate.

A Pragmatic Breakthrough

With the direct path blocked, supporters of the exemption engineered a legislative masterstroke. They took an unrelated bill, S.51, which originally focused on a small tax credit for unpaid caregivers, and hollowed it out in the House Ways and Means Committee. They replaced it with a $13.5 million omnibus tax relief package that included the military pension exemption alongside a host of other progressive priorities.

The new S.51 bundled the veteran tax cut with an expansion of the state’s Child Tax Credit, a major boost to the Earned Income Tax Credit for low-income workers, and increased tax relief for seniors.

This strategic maneuver made the bill politically invincible. A vote against it was no longer a vote against a veteran-specific benefit; it was a vote against tax cuts for working families, low-income Vermonters, and seniors. Faced with this new political reality, the opposition collapsed. Senator Cummings leveraged her position one last time to ensure the unpaid caregiver credit was included, but the core military exemption passed.

The bill sailed through the House 142-2 and the Senate 28-0 before being signed into law.

The passage of S.51 was a victory for Vermont's veterans and its economy. But the long, arduous path to its success serves as a stark case study. It reveals how a state that prides itself on progressive ideals was, for nearly a decade, held back by a few powerful lawmakers whose rigid adherence to a particular fiscal philosophy left Vermont at a profound competitive disadvantage, driving away the very people it needed most. The end result was a pragmatic realignment, forced by overwhelming economic evidence and a legislative coalition that finally became too broad to block.