What is a Chapter? I mean OA Lodges have chapters, but the BSA organization is by region, area, council, district, and finally unit. So, again, what is a chapter? I didn’t click on the link so not sure what they mean - it is pretty simple. If the Scout Executive of the Council in question openly defies BSA policy, they can and should be fired. That is a lot of salary to give up. If it is a unit, chartered by a permissive chartering organization, then the local Council can revoke the charter and all affiliated units are disbanded. That does occasionally happen. By the way, I am a District Commissioner (not in Vermont) so I am kind of informed on the matter.
Indeed, you sound very informed and are in a much better position to judge than I am. I did wonder what they meant by “chapter”; did they mean the entire state of Vermont? In any case, it sounds highly suspicious that they would be able to break with national policy set by BSA without repercussions, as you note.