In his prepared statement, the governor said even if the bill were to become law, federal benefits would still be denied to same-sex couples in Vermont. "This legislation does not address the inequalities espoused by proponents. Regardless of whether the term marriage is applied, federal benefits will still be denied to same sex couples in Vermont. And states that do not recognize same sex marriage or civil unions will also deny state rights and responsibilities to same sex couples in Vermont. This bill will not change that fact."
The full statement is here (PDF).
The Vermont House and Senate are expected to try to override the governor’s veto on Tuesday. Both Houses are controlled by Democrats. The Senate is expected to override the veto and it's unclear what the House will do.