Why Vermont Still Ranks Dead Last for Vets—and the 9 Fixes to Flip the Script
Veterans across the state are hoping for more than a "thank you for your service" breakfast this time around when lawmakers return to Montpelier.
Vermont’s full support of veterans has been held back by two committee chairs for years, willing to make concessions only after gaining support for their personal priorities. Vermonters across the state expect more respectful conduct this coming session.
Introduction: Progress Made, Distance Remaining
In 2025, Vermont took a significant step forward in supporting its veteran population. The legislature passed Act 71, a bipartisan tax relief package that included two new benefits for veterans: an exemption for military retirement pay and a refundable tax credit for low-income veterans.
Under the new law, which takes effect for the 2025 tax year:
Veterans with federal adjusted gross income (AGI) of $125,000 or less receive a full exemption on military retirement and survivor benefit income
Those earning between $125,000 and $175,000 receive a partial exemption
Low-income veterans (under $25,000 AGI) with honorable discharges qualify for a $250 refundable tax credit
According to the Vermont Daily Chronicle, this legislation represents the culmination of years of advocacy, including a 2022 proposal from Governor Scott to eliminate the tax on military retirement pay entirely.
Vermont’s National Ranking: The Reality
Despite this recent progress, Vermont remains near the bottom of national rankings for veteran support. A 2025 WalletHub study analyzing economic environment, quality of life, and healthcare across all 50 states and the District of Columbia ranked Vermont 49th out of 51 for military retirees.
This is not a new finding. A 2022 Military.com report explicitly listed Vermont among the “10 Worst States for Military Veterans and Retirees.”
These persistent low rankings are driven by structural policy gaps across multiple areas: taxation, education benefits, employment programs, and healthcare infrastructure.
The Tax Gap: How Vermont Compares
Military Retirement Income
While Act 71 created a new exemption, its income-based limits make Vermont an outlier among states competing for military retirees. According to Military.com’s state tax analysis, over 30 states offer a full, 100% exemption on military retirement pay with no income caps. This includes not only states with no income tax (like Florida and Texas) but also states like Massachusetts, New York, Pennsylvania, and Wisconsin.
The Vermont Department of Taxes notes another limitation: taxpayers eligible for both the Social Security exemption and the new military retirement exemption may only claim one, not both. This “elect one” requirement does not exist in competitor states and creates a penalty for older veterans who have earned both benefits.
Property Tax: The Largest Policy Gap
The most significant difference between Vermont and top-ranked states lies in property tax treatment of disabled veterans.
Vermont’s current policy, according to the Vermont Office of Veterans Affairs:
Provides a reduction in assessed value, not a tax exemption
Sets a minimum reduction of only $10,000
Allows towns to voluntarily increase this to $40,000
Requires a 50% or higher VA disability rating
Places the burden on veterans to lobby their town for increases
This creates what can be described as a “geographical lottery”—a 100% disabled veteran in a wealthy town might receive a $40,000 assessed value reduction, while an equally disabled veteran in a neighboring town receives only the $10,000 minimum.
By contrast, top-ranked states provide constitutional-level guarantees:
Florida (Florida Department of Revenue): 100% property tax exemption on the homestead for veterans with 100% permanent and total (P&T) service-connected disability
Texas (Travis County Tax Office): 100% exemption on total appraised value of homestead for 100% P&T disabled veterans
Virginia (Virginia Department of Veterans Services): 100% property tax exemption on principal dwelling and up to one acre, established by constitutional amendment in 2010
South Carolina (South Carolina DVA): 100% exemption on home and up to five acres for 100% P&T veterans
Maryland (Maryland Veterans): 100% exemption from real property taxes on dwelling house and surrounding yard
Additionally, both Texas and Florida offer property tax reductions for veterans with disability ratings as low as 10%, while Vermont requires 50%.
Education Benefits: The Missing Generation
Vermont’s most significant competitive disadvantage may be the near-complete absence of state-funded education benefits for veterans’ families.
Vermont’s Current Programs
According to the Vermont Student Assistance Corporation, Vermont’s primary state-level education benefit is the Vermont National Guard Tuition Benefit Program, a forgivable loan program for Guard members.
The state also provides in-state tuition rates to qualifying veterans and their families, as required by the University of Vermont’s policies, but this is largely mandated by federal law under the Veterans Access, Choice, and Accountability Act.
The Vermont Office of Veterans Affairs notes that VSAC administers “a small number of private scholarships for veterans and their families,” but these are not state-appropriated funds.
Notably absent is any significant state-funded benefit for the spouses or dependent children of Vermont veterans, particularly those who are disabled or were killed in action.
The “Gold Standard” States
Top-ranked states have created transformative, multi-generational education programs that function as both veteran benefits and family retention tools.
Texas - The Hazlewood Act (Texas Veterans Commission):
Provides up to 150 credit hours of tuition exemption at any Texas public institution
Allows veterans to transfer unused hours to one dependent child
Provides a separate 150-hour exemption for spouses and children of veterans who are 100% P&T, missing in action (MIA), or killed in action (KIA)
Virginia - VMSDEP (Virginia DVS):
Provides full waiver of tuition and mandatory fees for eight semesters (four academic years)
Includes a stipend for room, board, books, and supplies
Available to spouses and children of service members who are 100% P&T, MIA, or KIA
South Carolina (South Carolina Legislature):
Provides free tuition at any state-supported college, university, or technical school
Available to children of veterans who are 100% P&T, MIA, POW, or KIA
These programs represent benefits worth over $100,000 per child—a powerful economic argument for military families deciding where to retire.
Employment Support: From Passive to Active
Hiring Preference
Vermont uses a traditional “points-based” system. According to the Vermont Department of Human Resources, preference points are added to application scores for eligible veterans and certain family members.
However, this passive system provides no guarantee that a veteran’s application will be reviewed by a human or result in an interview.
South Carolina’s Model (SC DVA): Effective January 1, 2021, state law requires that at least one qualified veteran be interviewed for every full-time state government or higher education position, as long as a qualified veteran applied and meets minimum requirements.
Texas’s Model (UT Austin Human Resources):
If interviewing six or fewer applicants, at least one must be a qualified veteran
If interviewing seven or more, at least 20% must be qualified veterans
When two finalists are equally qualified, the veteran must be selected
Military Spouse Licensing
Military spouse employment is a critical factor in where military families choose to settle.
Vermont’s policy, according to the U.S. Department of Labor:
Offers a 90-day provisional license for spouses with out-of-state licenses
Waives application fees upon request
However, a 2020 Department of Defense report noted that while Vermont’s statute covers teachers, “no indication procedures have been implemented by the Agency of Education.”
Virginia’s Enhanced Model (Virginia DPOR):
Offers a 12-month temporary license (compared to Vermont’s 90 days)
Actively promotes federal reimbursement programs providing up to $1,000 for relicensing costs
Created the Virginia Military Spouse Liaison position within the Department of Veterans Services in 2021
The 12-month window, compared to Vermont’s 90-day window, allows spouses to begin earning income immediately while completing state-specific requirements, eliminating the income gap that often follows military relocations.
Veteran Business Support
While federal programs exist through the Small Business Administration to support veteran-owned businesses, Vermont has no significant state-specific programs.
Maryland’s Model (Maryland Business Express):
Military Personnel and Veteran-Owned Small Business Loan Program: Provides no-interest loans
Hire our Veterans Tax Credit: Provides state income tax credits to small businesses that hire qualified veterans
This “Hire our Veterans” model is particularly effective because it incentivizes the entire private sector to participate in veteran hiring, scaling impact far beyond government employment alone.
Healthcare and Long-Term Care
State Veterans Homes
Vermont operates one State Veterans Home in Bennington, according to the Vermont Veterans’ Home website.
The facility:
Is licensed for 130 nursing care beds and 8 domiciliary beds
Accepts honorably discharged veterans, their spouses, and Gold Star parents
Is located in Vermont’s southwest corner, making it geographically inaccessible for families from Burlington, Montpelier, or the Northeast Kingdom
Quality data presents concerns. While marketing materials tout “Best in Class” care, a detailed facility analysis reveals:
51.6% nursing staff turnover rate
40.9% RN turnover rate
Over $168,000 in federal fines
Centers for Medicare & Medicaid Services (CMS) rating of 3 stars (Average) overall, with only 1 star (Poor) for staffing
A facility with over half its nursing staff turning over annually cannot provide consistent, high-quality care.
Benchmark States:
Virginia (Virginia DVS): Operates four state-run Veterans Care Centers geographically dispersed in Richmond, Roanoke, Virginia Beach, and Fauquier County
South Carolina (Cherokee County): Operates six state-run veteran facilities distributed across the state
Maryland (Charlotte Hall Veterans Home): Operates a large campus with 444 beds, offering a full continuum of care including 126 assisted living beds and 318 skilled nursing beds
Mental Health and Peer Support
Many veterans are unwilling or unable to seek care from the federal VA system. Vermont has no dedicated, state-funded veteran mental health or peer support program. Instead, it relies on:
The federal VA system (White River Junction VAMC)
The Vermont Veterans Outreach Program, run by the National Guard
The Vermont Veterans Fund, which is not state-funded but rather supported by voluntary tax check-off donations
Virginia’s Model (Protect Our Defenders): The Virginia Veteran and Family Support Program (VVFS) is a comprehensive, state-funded program dedicated to helping veterans and families build resilience and cope with Traumatic Brain Injury and stress-related injuries, operating through regional consortia.
Texas’s Model (Texas HHS): The Mental Health Program for Veterans is a formal partnership between the state’s Health and Human Services Commission and Texas Veterans Commission, providing peer-to-peer counseling to service members, veterans, and families statewide.
Legislative Roadmap: Closing the Gap
Based on this analysis, Vermont can move from 49th to a position of national leadership through a phased, multi-year strategy.
Immediate Priorities (2026 Legislative Session)
1. Pass a 100% Property Tax Exemption for Totally Disabled Veterans
Introduce legislation providing a 100% property tax exemption on the primary residence for veterans with 100% P&T service-connected disability and their unremarried surviving spouses. This state-level mandate would replace Vermont’s current town-variable system and align with policies in Virginia, Texas, South Carolina, Florida, and Maryland.
2. Amend Act 71 to Remove Income Caps and the “Elect One” Penalty
Remove the $125,000-$175,000 AGI cap on military retirement income exemption, bringing Vermont in line with the 30+ states offering full, unconditional exemptions. Eliminate the requirement forcing veterans to choose between Social Security and military retirement exemptions.
3. Pass H.103 (Consumer Protection)
According to BillTrack50, H.103 would prohibit unaccredited individuals from charging veterans for VA benefit claim assistance. This aligns with national priorities of the Veterans of Foreign Wars and provides crucial consumer protection.
Mid-Term Priorities (2-5 Year Plan)
4. Establish the “Green Mountain Dependent’s Scholarship”
Create legislation providing full tuition waivers at Vermont state colleges for dependent children and spouses of veterans who are 100% P&T or were killed in action. This would address Vermont’s most significant competitive gap and could be modeled on South Carolina’s program.
5. Mandate “Guaranteed Interview” for Veterans
Replace Vermont’s passive points system with an active guarantee that at least one qualified veteran applicant must be interviewed for every state position, following South Carolina’s model.
6. Extend Military Spouse Professional License Timeline
Extend Vermont’s 90-day provisional license to a 12-month temporary license, matching Virginia’s policy. Establish a state-funded reimbursement program for relicensing fees.
7. Create Veteran Business Incentives
Establish a no-interest loan program for veteran-owned small businesses and a tax credit for businesses that hire veterans, modeled on Maryland’s dual-program approach.
Long-Term Priorities (5-Year Infrastructure Plan)
8. Fund a Statewide Veteran Peer Support Network
Create a permanent, state-funded veteran mental wellness program modeled on Virginia’s VVFS, moving beyond the current donation-based model.
9. Address State Veterans Home System
Take a two-step approach:
Immediate: Direct the Vermont Veterans Home to report on plans to address the 51.6% staff turnover rate and associated quality concerns
Long-term: Commission a feasibility study for a second state-run veterans home in a central, high-population area (Chittenden or Washington County), following the multi-facility models of Virginia and South Carolina
What Happens Next
The 2026 legislative session, which convenes in January, will be the first opportunity for lawmakers to act on these priorities.
Several factors will influence progress:
Budget Considerations: Property tax exemptions and education benefits require fiscal analysis. The legislature’s Joint Fiscal Office will need to estimate costs and revenue impacts.
Local Control Questions: A mandatory statewide property tax exemption would override local decision-making, potentially facing resistance from municipalities and the Vermont League of Cities and Towns.
Federal Policy Changes: The incoming administration’s veteran policies may affect state-level calculations and priorities.
Advocacy Pressure: Organizations like the Veterans of Foreign Wars and American Legion, along with individual veteran advocates, will play a crucial role in keeping these issues before lawmakers.
The Vermont Legislature’s committee system will route these proposals through the House Committee on Government Operations and Military Affairs and Senate committees with jurisdiction over taxation, education, and healthcare.
Act 71 demonstrated that bipartisan cooperation on veteran issues is possible in Vermont. The question now is whether that cooperation can extend to the more substantial structural reforms needed to move Vermont from near the bottom to genuine national leadership in supporting those who served.
This analysis is based on publicly available state statutes, official government websites, and independent research reports current as of November 2025.