Vt. Stat. Ann. tit. 10, § 1632

For the purpose of constructing or substantially improving a water pollution abatement and control facility, any State administrative department as authorized in Title 3 shall be deemed a municipality under section 1623 of this title and subject to the terms and conditions applicable to municipalities; provided, however, that a State administrative department deemed a municipality shall only receive State assistance under this chapter if the Department has a surplus of funds at the end of each fiscal year after all municipal grant applicants have received committed funds.