Vermont Legislature SmartTranscripts:

[Robin Scheu (Chair)]: Good afternoon. This is the House Appropriations Committee. It is Friday, 03/13/2026. It's about 01:20. We've just come back from a roll call, and we'll pick up where we left off. So this is, I can hear, another bill, H-seven 18 relating to building energy efficiency. So we'll have Ellen from Legis Council talk to us about the bill. We'll have James tell us about the fiscal impact. And then we'll have Representative Campbell, who's the reporter of the bill, House Energy and Infrastructure come and talk about all the pieces we missed in my other conversations. All right, Ellen, take it away.

[Ellen Tchaikowski (Office of Legislative Counsel)]: Thanks. Ellen Tchaikowski, Office of Legislative Counsel. So H718, draft 2.2 as voted out of Pouch Energy and Digital Infrastructure. So this is about building energy codes and building codes. On 3.1? I apologize.

[Robin Scheu (Chair)]: So we have or I have in front

[Ellen Tchaikowski (Office of Legislative Counsel)]: of Oh, because of the amendment. So the first section is a finding section. Section two is directing the Division of Fire Safety to complete an assessment they've already started on how the state should go about adopting a building resident, a residential building code. We already have a commercial building code. We do not have a residential building code. And they're going to report back on that by next January. Section three establishes a task force to advise the Office of Professional Regulation about their residential contractor registry. And so there are a number of members, 15 members of that task force, and they are to advise OPR on a number of things related to the contractor registry, including how the website works and how the website is able to be interactive for the public. Sections four, five, six, seven, eight all relate to energy education requirements for some of the professions and trades. So there is an existing requirement for a number of trades to have an energy efficiency module as part of their required training. And so currently there is a cap that it should be no more than two hours and explain the state's energy goals. That language for all of those professions is being updated so that it is more helpful and educational so that it can how the work of those trades and professions intersects with energy codes and affects energy, airflow, moisture management, dynamics of the buildings, and an integrated system. And so it's being changed for a number of professions, including architects, engineers, property inspectors, heating equipment technicians. It's being removed for commercial boiler inspectors, or emission boiler inspectors because it's not directly relevant to their work, as well as electricians and plumbers. I'm going very high level because this will take a little bit longer, but please feel free to stop me. And then section nine, still somewhat on this topic, is asking OPR to conduct a Sunrise report, a Sunrise process and issue report on whether home energy rating system raters and energy professionals should be regulated professions, and they are to report back on that by November 2028. Section ten and eleven and twelve have to do with the residential building energy standards and the commercial building energy standards. Sections ten and eleven both give clear authority to the municipalities to be able to enforce the residential building standards and commercial building standards within the municipality. And then Section 12 also directs that if a town wants to, they may incorporate by reference residential building energy standards and commercial building energy standards. These are existing codes that we have at the state level. The residential standard has existed since 1997 and the commercial building energy standards from 2006, a little bit later. There are long standing codes that are updated regularly by the Department of Public Service. They are required for, new construction. There has been some discrepancy about who has authority to enforce those codes. And so this bill is clarifying that municipalities, they enforce them as part of their process, but they have to incorporate them directly by reference. They're not allowed to change or adjust the codes themselves. They have to adopt directly state standards. The other thing that is happening in both Section ten and eleven is language related to creating a transitional safe harbor provision related to the governor's executive order on housing that was issued in September. The governor's executive order said that builders were allowed to comply with either the current standard or the RVs and the CVs, the 2024 standard, or the prior version, the 2020 standard. This directly conflicts with the statute, however. And because there is a citizenship provision in those statutes, it has created some legal ambiguity about whether people could sue based on if a builder used a different code than the current code. This is creating a provision in both sections ten and eleven protecting builders who, in good faith, opted to follow the governor's executive order and use the prior code in the building and prevent them from being sued. And then finally, section 13 is the appropriation. So there are two appropriations. They are both $200,000 from General Fund. The first one is to the Department of Public Service for the purpose of funding as part of the Energy Efficiency Utilities demand resource plans, consultation and technical support for municipalities that want to adopt and enforce the building energy codes. And then the second appropriation is again $200,000 from the general fund to the Office of Professional Regulation for the Contractor Registry Task Force with a goal of identifying a consumer oriented agency or organization to host a website to raise public awareness of the residential contractor registry, providing funding to that agency or organization to launch and manage the website on or before 12/31/2027, and supporting the Office of Professional Regulation in the development of voluntary certification. And so I will just say quickly, this bill was a collaboration by me, Damian Leonard, and Tim Devlin, because it is energy, building codes, and Office professional regulation. So while I am leading, I did have support. And so do you have any detailed questions about OPR or the building codes? I will need to phone a friend, or you'll need to hear from them.

[Robin Scheu (Chair)]: Sounds good. So here we'll ask for clarifying questions about the legislation, not the impacts or the whatever, because we'll get to the rep for that. Go ahead. The second,

[Unidentified Member (House Appropriations Committee)]: at the very end, appropriations, the number two one. Some of $200,000 appropriated support

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: get the name.

[Ellen Tchaikowski (Office of Legislative Counsel)]: If they have a task force.

[Unidentified Member (House Appropriations Committee)]: Yeah. It's for the goal is to to host a a website. I'm just wondering this is not to stand up a website or do anything like that. It's just I'm wondering why they don't why they can't already do that without the extra money.

[Ellen Tchaikowski (Office of Legislative Counsel)]: I think perhaps representative can I can start to answer this question and maybe representative Campbell can too? So they have an existing contractor registry on their website. It is very simple and not necessarily easily searchable, or it has been described as not very user friendly and it could potentially become more user friendly. And that is not necessarily an OPR's wheelhouse. So I think there is interest in seeing if they can work with another organization to either host this website to make

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: it

[Ellen Tchaikowski (Office of Legislative Counsel)]: more user friendly. So there is a website to start, but they need additional

[Unidentified Member (House Appropriations Committee)]: Right. And so my question was, it seems like the $200,000 is just for them to find somebody to do it. It's not to do it.

[Robin Scheu (Chair)]: So why don't we hold that question till we get Representative Campbell up? So we'll ask Ellen if there's clarifying questions about the legislation itself. And if you don't leave, why don't we have James come up and talk to us about the fiscal note. We're ready to do that.

[Stephanie (Joint Fiscal Office)]: Stephanie joined fiscal. Fiscal note is posted on the website. You have copies in front of you, also on the screen behind me. This is a relatively straightforward fiscal impact. The bill would establish the residential contractor registry task force. Would be composed of 15 members. Those members would be entitled per diem and expense reimbursement and compensation based on the number, the minimum number of potential meetings in fiscal year twenty seven that would come at a maximum, sorry, a cost up to $19,000 in fiscal year twenty twenty seven. That number would vary depending on the actual composition of the task force, who's eligible for reimbursement, how far they drive, etcetera. So 19,000 is kind of a I would call that a ceiling on the fiscal year twenty twenty seven costs. Reimbursement and expenses for DMs would come from funds appropriated to the office of professional regulation, which brings us to the following section with fiscal impact, which would be section 13 where the appropriations reside. Section 13 would appropriate a total of 400,000 from the general fund that would consist of $200,000 to OPR and a $200,000 appropriation to the Department of Public Service. The $200,000 appropriation to OPR would support the residential contractor registry task force. And it would also support the office in implementing the recommendations of the task force as they pertain to public outreach and the development of voluntary certifications. Dollars 200,000 appropriated to the Department of Public Service would be for the provision of technical support to municipalities that elect to adopt and enforce the residential and commercial building energy standards.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: That's all I've got for you on this one. Questions?

[Robin Scheu (Chair)]: On the money part, go ahead, John.

[John Kascenska (Member)]: Yeah, just a quick question here. So the 200,000 in Department of Public Service right, technical support. Is that paying for a person to

[Stephanie (Joint Fiscal Office)]: do that part of things here? The bill doesn't mention or authorize any new positions to the department. As currently constructed, that would be to support the work but without position authorization.

[John Kascenska (Member)]: Okay. I'm just thinking out loud here a little bit. So that means funding probably a current person to do that in context of offsetting what they're already employed by public service to do work.

[Stephanie (Joint Fiscal Office)]: Is that I would assume so. And the bill text also specifies that that work is to be done as part of the energy efficiency utilities 2027 and 2029 demand resource plans. And so the Department of Public Service has a role in overseeing that process. And so the staff members who are responsible for overseeing that process would likely be engaging But in this I don't know if the extent to which the department has testified on staffing demands and their ability to absorb this.

[Robin Scheu (Chair)]: But it says consultation and technical support. So I think that's how they're using it. It may not be new staff, which is fine.

[John Kascenska (Member)]: Right, which is fine. That's fine.

[Robin Scheu (Chair)]: Exactly. So maybe this would be a good time to get Rep. Camilo up to talk about the bill, because I think some of the questions are leaning more towards needing to hear from him. Thank you, James.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: Thank you, and thank you for picking up this bill.

[John Kascenska (Member)]: Introduce yourself and Oh, yes.

[Robin Scheu (Chair)]: It's been

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: a long journey. I'm representative Scott Campbell from Saint Johnsbury. I'm the sponsor of the bill and will be the presenter of the bill. This is a topic I've been working

[Unidentified Member (House Appropriations Committee)]: on for quite a long time.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: Guess I should just Kelly gave you a very good summary of what the bill does. I should tell you, I guess, just briefly the problem we're trying to solve. We have very low compliance with energy codes right now, especially the residential side, RVs, residential building energy standards, because even though both residential and commercial energy standards are mandatory or required by statute, there has never been any enforcement or or penalties. So as a result, on the residential side primarily, there's never been very much awareness. Consumers aren't aware that we have energy codes and even many builders aren't. And some builders who are aware of them ignore them. And it does introduce a competitive disadvantage to those builders who are interested in in observing the energy codes because they are, in effect, bidding against those who decide they don't have to and so don't include features in in a building that cost something upfront but save money in the long run. So the opposition to the bill or to this concept is really that concern about adding costs, Those upfront costs, which in our current housing crisis seem like a hurdle. There's also concern on the part of the Division of Fire Safety, which administers all the other building codes that we have, electrical, plumbing, heating, HVAC. Well, they actually don't have HVAC codes, but they don't have the expertise. They have said many times they don't have the expertise to take on energy codes, which currently are developed and promulgated by the Department of Public Service. And the other concern that has been expressed is that builders lack training. So the lack of training can lead to problems in the building. Primarily inappropriate management of moisture. And when you insulate a wall cavity or a building, when you make it more airtight, you've greatly reduced the ability of a building to cope with changes in air quality indoors and be able to handle moisture. So and the and of course, the other problem is that a more airtight building is is you get more indoor air quality issues and you need ventilation to cope with that. These are issues that we're trying to get at. Really, we're trying to get at builder training and education to make their new buildings and renovations much much better, they're not facing these problems in out years. Many of these problems don't turn up immediately. They present themselves years down the road. We saw actually, we don't have a database that accumulates instances of these problems, but we have got anecdotal descriptions and evidence from builders and architects about problems that they have seen. We saw some really dramatic pictures of entire walls where the sheathing has rotted and needs to be replaced. They had to take off all of the siding and the sheathing and insulation and replace all of that because of inappropriate management of the moisture. I

[Unidentified Member (House Appropriations Committee)]: have a brother that was in construction for years, now retired, built a lot of houses, but there were at a point in time when the banks were requiring to put plastic on and the everything rotted out. I mean, I don't know why they were requiring that as a condition of getting a home, but they were, whoever they were getting advice from. And I would suspect that depending on the building and the airflow in those buildings, that it would be variable depending on what kind of building you're building or the characteristics

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: of that building. So you're gonna need to address those variabilities. Yeah. So understanding what those dynamics are and whether whether plastic is a good idea or not, it's actually probably not a good idea in general. But that's that's that's what really what we're trying to get at. It's really so so the the the thrust of the bill is is to leverage the residential building, the residential contractor registry that has already been set up and is also required to leverage that to motivate builders to to get education and training by raising the visibility of this registry, making it much more consumer friendly, much more accessible for for anybody who's thinking about hiring a contractor. And that would, we hope, motivate builders to obtain voluntary certifications, energy, moisture management, and building science, basically, performance building, so

[Unidentified Member (House Appropriations Committee)]: that they can list those certifications along with their registration on their website. So really my only concern, I'm not concerned about the build itself. I'm concerned about whether the money is appropriate. Is the money gonna be spent of all 400,000? Should that be spent within this this the coming fiscal year? Do they need all that? Is there any capacity in public service to do any of the work without getting additional money or in either one of those locations or task force?

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: Yes. So this this money sort of started as the idea was a start up cost. What what would it cost to to set up a website? Just talking about the website for a second. OPR does have a website. It's pretty unusable. In order to list forget a list of everybody who is on there, in order to be able to sort it for where they what locations they serve and that sort of thing, you have to download a spreadsheet. And that is really beyond the capability of many people, beyond the interest of many people to find out more information. So the concept is really something like Efficiency Vermont. I think it's a Energy Excellence Network or something like that. A website that they have set up that does allow you to sort and filter by what you're looking for, what kind of service you're looking for. OPR has said that that is not something that they're able to do. They are willing to to share the data that they have with the contractor registry with a private entity. I've been been trying to land a private entity who's willing to take this on, and and I think we're still we're still looking. So the intention of of the of the funding is to enable enable OPR to, first of all, pay for the cost of of supporting the task force and then also contract with a a private entity. It might be Vermont Builders and Remodelers Remodelers Association, or it might be, for example, the Associated Building Contractors of Vermont, New Hampshire, an organization that already has a presence in residential construction to to take this on and and be able to support it for the next Period of time, year or two until until it gets until it gets going. Opioid also said that the residential contractor of this whole process of registering residential contractors has taken considerably more resources than they allocated. And so they're they view it as in deficit. They're not willing to commit to any more expensive money. So that's the purpose of funding. The purpose of the funding for the Public Service Department is the second part bill, which is to enable municipalities that are interested in enforcing energy codes to be able to do that, to set up uniform procedures and have technical consultation with people who know what they're talking about. That is people who work for the energy efficiency, EVT, BED, and Vermont Gas, to help them, help contractors comply with the code. So it's really a technical support kind of role that we're looking for. I think one thing I wanna point out is what this bill does not do. It does not increase regulation on builders. The regulation already exists. It's just that many people are ignoring it. It does ask the division of fire safety to complete a process that they've already started assessing whether and how Vermont should adopt a residential building construction code. But that's, as I say, process is already underway. There are other reasons for Vermont to adopt a building construction code, one of them being accessing money in case of disasters. FEMA had a program set up for this. Of course, it was sort of put on ice this past year, but it still exists. So that would enable Vermont having a residential construction code would enable us to access federal money that we don't have access to now. And the other point to to point the other thing to point out that it does not do is it does not extend division of fire safety jurisdiction into single family owner occupied buildings, which they they don't have jurisdiction over those buildings now. They do have jurisdiction over what's called public buildings, which includes rentals, all rentals. And they apply their fire and building safety code to those structures. And the advantage, of course, of having a construction code is that it gives everybody something to refer to. Creates a standard of care and lets owners, lets builders, lets insurers, it lets bankers, lets in case of a dispute, courts have something to refer to as this is what construction should be. So that's the purpose of adopting the energy.

[Robin Scheu (Chair)]: I think that clarified a few things for me too. So great. Any other questions from folks here? No. So we're not going to vote on it at this moment. And we appreciate you coming in. And we will, as a committee, see where people's priorities land. And so the budget, because anything we do in bills, we take out from the budget, which is fine. We do that. And then if it doesn't end up that way, what we will do is we'll take the money out and say contingent upon the money or whatever we do, and then we'll send it to the Senate. So it will get out of this committee next week sometime. That makes sense to everybody. And we'll have that conversation about how we want to we'll see where people's priorities we're working on priorities now. We'll know that early next week.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: And money is very tight. And originally, I had made the funding come from the thermal efficiency and fuels, thermal energy process, fuels fund.

[Robin Scheu (Chair)]: Yeah. Rep Campbell did a really good job. He talked with me a few times along the way to try to figure out other places that weren't general fund to fund this bill.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: But there is great concern about about the precedent that sets.

[John Kascenska (Member)]: Exactly.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: So Okay. I I like to do it back here. So I think there is a a a breaking of a clear nexus to the other those other that other funding source because that primarily supports weatherization. And in effect, what we're what we're trying to do here is make buildings that don't

[John Kascenska (Member)]: get. Put it right

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: the first time. Do it

[John Kascenska (Member)]: right the first time.

[Robin Scheu (Chair)]: Great. Scott, thank you so much for your time.

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: Thank you. Those are things.

[Robin Scheu (Chair)]: Then I'll just ask Ellen, if we end up doing an amendment, which would be next week, that we we go to you and ask you for that. Okay. That'd be pretty easy. Okay, great. Thank you all. Thank you so much. So committee, a couple of things. We're not done for today, I think. Cameron has done an amendment for H775 that we listened to this morning that had the two positions, and he has an amendment that takes it out. And so I was sort of under the impression that otherwise, with that out, we'd be ready to vote. And if we can do that today, that would be great to get that off our plate. I also heard from Adam Gresham, who said DHCD didn't ask for the physicians in the first place. So it seems to be in alignment So on in that case, what we will do is we have to post this because we're going to vote. And we'll do that at 02:30 because a couple of us have another meeting at 02:00. So we'll do it at 02:30. And I think that's all I need to say online. And so let's go off live,

[Rep. Scott Campbell (Sponsor/Reporter, St. Johnsbury)]: Autumn.