Week 5 of the Vermont Legislative Session – February 8, 2019
The Legislature veered into a variety of controversial matters this week. Most, if not all House committee schedules were juggled around to accommodate the lengthy floor debate over the proposal to extend the deadline for the required merger of school districts. The House voted on two amendments to H.39. Rep. Heidi Scheuermann, R-Stowe proposed language to allow a statewide delay for forced school mergers by one year, but that amendment failed after several hours of debate. One of the reasons for the unwillingness to delay, was Act 46 is a plan going forward and all districts must stay on track to accomplish this complex problem. The discussion continued into a second day with another amendment being proposed to allow certain school districts to have a one-year extension. For towns that haven’t yet put together a merger plan for voters to weigh in on, the deadline could be postponed for one year. This language was brought forward as an amendment Thursday and passed.
Another highly emotional bill which proposes to preserve the right to abortion (H.57) has topped the list for editorials and news outlets and carries with it a very tense and sensitive tone. A public hearing attracted hundreds of people to the statehouse late Wednesday afternoon. Those trying to maneuver their way through the halls to the coat room were asked if they wanted to wear a button supporting one position or another or whether they would sign up to speak. H.57 appears confusing and complicated, some stating nothing needs to be done to protect Roe V. Wade, others wanting to clarify and codify Vermont law to ensure the Trump Administration wouldn't preempt current law. Codifying current law was perceived as an extension of current law allowing abortion at or after birth. Both H.57 and H.39 gave the week an anxious feel but neither topic aligned the legislature decisively along party lines.
At this point the House Democrats think they have a path forward to pass a legal cannabis sales bill this session. What they may lack is enough votes to override a potential veto from Gov. Phil Scott. We will see some negotiating over the next couple months to garner Governor Scott's approval. The bigger question is; will the Senate, who has passed legislation before, accept a compromise with the Governor? The Governor’s staff has requested upward of $6 million for school education programs or roadside testing initiatives. That might be a show stopper for the 2019 session.
REGULATION ACT 250
Changes to Act 250 Draft Bill (Click here to view the bill)
A focus of testimony this week on revisions to Act 250 was on development and construction at higher elevations and in critical resource areas. The bill would reduce the elevation threshold for permit requirement from 2,500 feet to 2,000 feet and would increase regulation below 2,000 feet elevation in “critical resource areas.”
The impact of these two changes:
House Agriculture & Forestry Draft Wetlands bill
An act relating to regulation of farming in wetlands (Draft 1.1) This bill proposes to clarify and expand those lands that are not wetlands subject to regulation by the State because of the conduct of farming on the land.
In response to changes to the Agency of Natural Resources wetland rules, the House Agriculture & Forestry committee draftbill includes clarifying language that does the following:
WATER QUALITY
Water quality legislation has been proposed in the House. Rep. George Till (D-Jericho), coming off pressing for a large tax on electronic cigarettes, is attacking certain sectors to pay for water quality. Till's bill, H.171 An act relating to water quality funding, proposes to establish an impervious surface fee on all parcels in the State.
The bill would:
The fee on manufacturers of asphalt, again, is a cost shift onto all Vermonters for transportation infrastructure projects. If you have driven a Vermont road lately, pot holes are plentiful and discouraging road repairs is not something Vermonters will appreciate.
Governor Scott’s plan for Clean Water Budget, lukewarm reception
House Ways and Means heard from Vermont Center for Geographical Information. This in the context of understanding the available information on parcels and water quality. The Scott Administration also provided some context for the Committee to consider. Trying to understand what current funding is, what is new funding, and if other programs will not be funded by diverting money to the Clean Water Fund.
Current law revenues dedicated to the Clean Water Fund include:
Governor’s FY20 Clean Water proposal is to allocate the $28.35 million as recommended by the Clean Water Board as well as reduce the reliance on the Capital Bill by $2.85 million. The Capital Bill has been the primary source of funding over the last 2 years.
Proposal of state revenue sources to fund the $28.35 million allocation are as follows:
The House Ways & Means Committee will look at the Estate Tax as proposed by the Governor as well as other ideas on how to generate $25+ million per year for another 18 years. The House Natural Resources Committee will be working on the policy around water quality simultaneously.
S.37 An Act relating to medical monitoring damages
This bill proposes to hold any person who releases a toxic substance strictly, jointly, and severally liable for any harm resulting from the release. The bill also proposes to establish a private right of action for medical monitoring damages incurred due to exposure to a toxic substance.
Increased insurance costs and the expense incurred to defend baseless claims were just a few of the concerns raised by Central Vermont Chamber of Commerce, the Vermont Chamber of Commerce, and business owner James Bolduc of Bolduc Salvage. The Senate Judiciary Committee appears committed to moving the bill with the “strict liability” and “medical monitoring” language included.
The committee is expected to vote out the bill with language similar to “as introduced” within the next couple weeks.
S.55 An act relating to the regulation of toxic substances and hazardous materials
This bill proposes to establish an Interagency Committee on Chemical Management to evaluate chemical inventories in the State and identify potential risks from the inventories. The bill would also do the following:
S.54 An act relating to the regulation of cannabis
This bill proposes to establish a comprehensive regulatory system for the production and sale of cannabis and cannabis products in Vermont via the following:
In response, the House introduced its own bill (H.196) to regulate the cannabis industry. The House plan proposes a combined 20% tax rate: 11% excise tax, 6% sales tax, 3% local option tax
The Governor has said he would support tax and regulate legislation if lawmakers agreed to fund additional cannabis education and prevention programs, and roadside safety initiatives.
S.23 Minimum wage bill considered in Senate committee
The Senate Economic Development, Housing and General Affairs Committee heard testimony this week on S.23, a bill to increase the minimum wage to $15.00 by 2024. Current law would increase the minimum wage to $12.04 by 2024.
Below is the proposed path to increase to $15.00:
2020 - $11.50
2021 - $12.25
2022 - $13.10
2023 - $14.05
2024 - $15.00
Many advocates testified in favor of a minimum wage increase, out numbering those that worry about the pressure to increase prices for products and services or reduce the overall workforce. This appeared to not be compelling to the committee. Various advocates represented that the buying power of $1 has declined over time and will continue unless an increase is passed.
Both the House and Senate stated early in the year that they will pass a $15 minimum wage this year. It is expected the Senate Economic Development Committee will pass S23 as early as next week.
BUDGETS
Transportation FY20 Proposed Budget (Government Recommend)
Agency of Transportation presented the annual budget to the House Transportation Committee. The proposed $617.5M budget is an increase of $6.6M from FY19.
Included in the FY20 Budget:
The focus of the FY20 Budget is to grow Vermont’s economy and provide transportation choices. Also included in the budget is an $8M investment in protecting Lake Champlain and other waterways and funding for several projects to improve downtowns.
The Transportation Committee began work on the draft transportation bill which adopts the State’s annual Transportation Program and makes miscellaneous changes to laws related to transportation.
Cheri L. L'Esperance
William Shouldice & Associates LLC
The Legislature veered into a variety of controversial matters this week. Most, if not all House committee schedules were juggled around to accommodate the lengthy floor debate over the proposal to extend the deadline for the required merger of school districts. The House voted on two amendments to H.39. Rep. Heidi Scheuermann, R-Stowe proposed language to allow a statewide delay for forced school mergers by one year, but that amendment failed after several hours of debate. One of the reasons for the unwillingness to delay, was Act 46 is a plan going forward and all districts must stay on track to accomplish this complex problem. The discussion continued into a second day with another amendment being proposed to allow certain school districts to have a one-year extension. For towns that haven’t yet put together a merger plan for voters to weigh in on, the deadline could be postponed for one year. This language was brought forward as an amendment Thursday and passed.
Another highly emotional bill which proposes to preserve the right to abortion (H.57) has topped the list for editorials and news outlets and carries with it a very tense and sensitive tone. A public hearing attracted hundreds of people to the statehouse late Wednesday afternoon. Those trying to maneuver their way through the halls to the coat room were asked if they wanted to wear a button supporting one position or another or whether they would sign up to speak. H.57 appears confusing and complicated, some stating nothing needs to be done to protect Roe V. Wade, others wanting to clarify and codify Vermont law to ensure the Trump Administration wouldn't preempt current law. Codifying current law was perceived as an extension of current law allowing abortion at or after birth. Both H.57 and H.39 gave the week an anxious feel but neither topic aligned the legislature decisively along party lines.
At this point the House Democrats think they have a path forward to pass a legal cannabis sales bill this session. What they may lack is enough votes to override a potential veto from Gov. Phil Scott. We will see some negotiating over the next couple months to garner Governor Scott's approval. The bigger question is; will the Senate, who has passed legislation before, accept a compromise with the Governor? The Governor’s staff has requested upward of $6 million for school education programs or roadside testing initiatives. That might be a show stopper for the 2019 session.
REGULATION ACT 250
Changes to Act 250 Draft Bill (Click here to view the bill)
A focus of testimony this week on revisions to Act 250 was on development and construction at higher elevations and in critical resource areas. The bill would reduce the elevation threshold for permit requirement from 2,500 feet to 2,000 feet and would increase regulation below 2,000 feet elevation in “critical resource areas.”
The impact of these two changes:
- Vermont will add approximately 513,000 acres of land to Act 250 jurisdiction. Agency of Natural Resources is trying to determine how much of this would be viable forest, farm or develop-able land
- “Critical resource area” is defined as a river corridor, a significant wetland as defined under section 902 of this title, land at or above 2,000 feet, and land characterized by slopes greater than 15% and shallow depth to bedrock.
House Agriculture & Forestry Draft Wetlands bill
An act relating to regulation of farming in wetlands (Draft 1.1) This bill proposes to clarify and expand those lands that are not wetlands subject to regulation by the State because of the conduct of farming on the land.
In response to changes to the Agency of Natural Resources wetland rules, the House Agriculture & Forestry committee draftbill includes clarifying language that does the following:
- Farming activities in wetlands excluded match the federal standard
- “Farming” shall have the same meaning as defined in Act 250
- Repeals the sunset of fee for pipelines and permanently sets the cap for maximum fee at $200
- Requires the construction of a new farm structures in a significant wetland or buffer zone of a significant wetland to be subject to wetland regulation
WATER QUALITY
Water quality legislation has been proposed in the House. Rep. George Till (D-Jericho), coming off pressing for a large tax on electronic cigarettes, is attacking certain sectors to pay for water quality. Till's bill, H.171 An act relating to water quality funding, proposes to establish an impervious surface fee on all parcels in the State.
The bill would:
- repeal the sunset of the Clean Water Surcharge on the Property Transfer Tax
- establish a Water Quality Occupancy Surcharge on the rent of each occupancy in the State
- impose on milk handlers a fee per pound of fluid milk purchased from a milk producer for the purpose of bottling, manufacturing, processing, distribution, or sale of dairy products in the State
- require a manufacturer of asphalt to pay an assessment per ton of asphalt sold in the State each year.
- from the impervious surface fee, the Water Quality Occupancy Surcharge, and the asphalt assessment would be deposited in the Clean Water Fund
- from the milk handling fee would be deposited in the General Fund
The fee on manufacturers of asphalt, again, is a cost shift onto all Vermonters for transportation infrastructure projects. If you have driven a Vermont road lately, pot holes are plentiful and discouraging road repairs is not something Vermonters will appreciate.
Governor Scott’s plan for Clean Water Budget, lukewarm reception
House Ways and Means heard from Vermont Center for Geographical Information. This in the context of understanding the available information on parcels and water quality. The Scott Administration also provided some context for the Committee to consider. Trying to understand what current funding is, what is new funding, and if other programs will not be funded by diverting money to the Clean Water Fund.
Current law revenues dedicated to the Clean Water Fund include:
- Approximately $5 million per year generated from a 0.2% surcharge on the property transfer tax (PTT); and
- Approximately $2 million per year ($1 million in FY20 because only 6 months) in unclaimed beverage container deposits remitted to the State.
Governor’s FY20 Clean Water proposal is to allocate the $28.35 million as recommended by the Clean Water Board as well as reduce the reliance on the Capital Bill by $2.85 million. The Capital Bill has been the primary source of funding over the last 2 years.
Proposal of state revenue sources to fund the $28.35 million allocation are as follows:
- $12.15 million in Capital Funds
- $15.1 million in Clean Water Funds
- $1.1 million in the Transportation Bill
- With an additional $19.26 million in federal funding being leveraged by our state dollars, approximately $47.61 million in state and federal funds are allocated to clean water projects.
- Clean Water Fund: $25-28 million/year
- Capital Bill: $10-12 million/year
- Transportation Bill: $5 million/year
- Leveraged federal funds: $10-12 million/year
- The revenue sources that have been identified to ensure the Clean Water Fund is sustained at this level are:
- Property Transfer Tax (PTT) 0.2% surcharge: $5 million/year
- Unclaimed beverage container deposits (escheats): $2 million/year
- Estate Tax: $8-11 million/year
- Additional Property Transfer Tax (PTT) allocation to clean water: $10 million/year
The House Ways & Means Committee will look at the Estate Tax as proposed by the Governor as well as other ideas on how to generate $25+ million per year for another 18 years. The House Natural Resources Committee will be working on the policy around water quality simultaneously.
S.37 An Act relating to medical monitoring damages
This bill proposes to hold any person who releases a toxic substance strictly, jointly, and severally liable for any harm resulting from the release. The bill also proposes to establish a private right of action for medical monitoring damages incurred due to exposure to a toxic substance.
Increased insurance costs and the expense incurred to defend baseless claims were just a few of the concerns raised by Central Vermont Chamber of Commerce, the Vermont Chamber of Commerce, and business owner James Bolduc of Bolduc Salvage. The Senate Judiciary Committee appears committed to moving the bill with the “strict liability” and “medical monitoring” language included.
The committee is expected to vote out the bill with language similar to “as introduced” within the next couple weeks.
S.55 An act relating to the regulation of toxic substances and hazardous materials
This bill proposes to establish an Interagency Committee on Chemical Management to evaluate chemical inventories in the State and identify potential risks from the inventories. The bill would also do the following:
- Require a manufacturer of a children’s product containing a chemical of high concern to children (CHCC) to report the brand name, product model, universal product code
- Authorize the Commissioner of Health to add a chemical to the CHCC list
- Authorize the Commissioner of Health to restrict the sale of a children’s product or require labeling
S.54 An act relating to the regulation of cannabis
This bill proposes to establish a comprehensive regulatory system for the production and sale of cannabis and cannabis products in Vermont via the following:
- Creation of the Cannabis Control Board to adopt regulations and administer a licensing program
- Create five types of licenses: cultivator, product manufacturer, wholesaler, retailer, testing laboratory
- Implement a 10% sales tax with a potential 1% local option tax for municipalities that choose to host a cannabis retailer
- Allow municipalities to opt out of allowing cannabis retailer
In response, the House introduced its own bill (H.196) to regulate the cannabis industry. The House plan proposes a combined 20% tax rate: 11% excise tax, 6% sales tax, 3% local option tax
The Governor has said he would support tax and regulate legislation if lawmakers agreed to fund additional cannabis education and prevention programs, and roadside safety initiatives.
S.23 Minimum wage bill considered in Senate committee
The Senate Economic Development, Housing and General Affairs Committee heard testimony this week on S.23, a bill to increase the minimum wage to $15.00 by 2024. Current law would increase the minimum wage to $12.04 by 2024.
Below is the proposed path to increase to $15.00:
2020 - $11.50
2021 - $12.25
2022 - $13.10
2023 - $14.05
2024 - $15.00
Many advocates testified in favor of a minimum wage increase, out numbering those that worry about the pressure to increase prices for products and services or reduce the overall workforce. This appeared to not be compelling to the committee. Various advocates represented that the buying power of $1 has declined over time and will continue unless an increase is passed.
Both the House and Senate stated early in the year that they will pass a $15 minimum wage this year. It is expected the Senate Economic Development Committee will pass S23 as early as next week.
BUDGETS
Transportation FY20 Proposed Budget (Government Recommend)
Agency of Transportation presented the annual budget to the House Transportation Committee. The proposed $617.5M budget is an increase of $6.6M from FY19.
Included in the FY20 Budget:
- $100.7M for paving
- $74.4M for roadway and safety
- $62.7M for town highway programs
- $54.1M for bridges
- $32.9M for rail $9.3M for aviation
- $2.7M for park & ride facilities
- $13M for bicycle and pedestrian facilities
The focus of the FY20 Budget is to grow Vermont’s economy and provide transportation choices. Also included in the budget is an $8M investment in protecting Lake Champlain and other waterways and funding for several projects to improve downtowns.
The Transportation Committee began work on the draft transportation bill which adopts the State’s annual Transportation Program and makes miscellaneous changes to laws related to transportation.
Cheri L. L'Esperance
William Shouldice & Associates LLC