Vermont Legislature SmartTranscripts:

[Rep. Kathleen James (Chair)]: We're live. Welcome everybody to House Energy and Digital Infrastructure. It's Wednesday, April 8, and we are here with Bella Scholl from the University of Vermont to hear about the study that she has done on C PACE programs across the country as we continue to consider S-one 138. So, I'm representative Kathleen James from Manchester.

[Rep. R. Scott Campbell (Vice Chair)]: Hi, Kathleen. From Saint John's. Right? Chris Morrow, Windham, Windsor, Bennington. Michael Southworth, Caledonia. Howland, Route 14.

[Rep. Dara Torre (Clerk)]: Torre, walking through 2.

[Rep. Bram Kleppner]: Ram Kleppner, Chittenden 13 Burlington.

[Rep. Kathleen James (Chair)]: Great. And joining us, I'm training Gleason, intern for Brian Kleppner. Great. I'm Bridget McLaughlin, intern for Vermont Junior McLaughlin. Super.

[Chris D’Elia (President, Vermont Bankers Association)]: Christopher Morrow, Vermont Bankers.

[Rep. Kathleen James (Chair)]: Great. Chris, you want to sit or you just

[Rep. R. Scott Campbell (Vice Chair)]: do I want.

[Rep. Kathleen James (Chair)]: Okay. Great. So, for the record, if you could identify yourself and we're anxious to hear about the work you've done.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Absolutely, Madam Chair and members of committee, want to say thank you for inviting me to testify. My name is Bella Scholl. I'm a senior at the University of Vermont. I am a legislative intern for senator Chittenden and a former student researcher for the Vermont Legislative Research Service. First, I wanted to tell you guys a little bit about what BLRS is and what we do there. It's a nonpartisan UVM program that receives research requests from legislators and delivers student authored research reports. My testimony today will broadly focus on regional states, commercial property assessed clean energy or CPAs programs, as well as a brief review of alternative financing mechanisms offered in Vermont. Within my work at BLRS, I co authored a report titled Commercial Property Assess Clean Energy Establishment Processes and Features. This report analyzed C PACE programs and between states, Maine, Connecticut, and New York. Our research focused on how these states implemented and administered C PACE programs, as well as exploring case studies of completed projects. I am happy to answer any questions throughout the testimony, and I would like to begin by briefly summarizing the research. So beginning with Maine, they authorized C PACE financing in 2021, and the program is overseen by the Efficiency Maine Trust. Within this trust, they established the Efficiency Maine Green Bank, which is a quasi public financing entity, which leverages public and private funds in pursuit of emissions reductions and clean energy improvement projects. The main legislature tasked the Efficiency Maine Green Bank with establishing program guidelines, reviewing applications, publicly listing registered capital providers, collecting fees to administer the program, and conducting an annual report. Registered capital providers refers to non governmental lenders that fund CPAs projects within the SLEEP. Before entering financial agreements, these registered capital providers are required to demonstrate a willingness and capability to fund and service the loans, including performing all accounting, reporting, billing, and collection required for CPA's assessments. Under Maine's CPA's program, financing may cover the full cost of a project, including audits, application fees, and development costs. Funds are available following the completion of an assessment agreement, which includes the estimated useful life of the project. This metric demonstrates the length of the financing term and the feasibility of the project. Moving on to Connecticut. Wait, let's Okay.

[Rep. Kathleen James (Chair)]: Oh, yeah. Do you guys wanna stop and talk about Nina a little bit, or do you wanna let her go through her testimony and?

[Rep. R. Scott Campbell (Vice Chair)]: Yeah. Do you mind taking questions along the way? Oh, Yeah. Yeah.

[Rep. Kathleen James (Chair)]: So Sorry. I'm probably the person on the committee who has the slowest pace of Slowest pace. Comprehension and digestion. Well as sleep days. Yeah. The slowest people. I mean, we don't have to stop if everybody else totally understands Maine. I'm Oh,

[Rep. R. Scott Campbell (Vice Chair)]: go ahead. Yeah.

[Rep. Kathleen James (Chair)]: Okay. Yeah.

[Rep. R. Scott Campbell (Vice Chair)]: I I have a question, but you're done.

[Rep. Kathleen James (Chair)]: Okay. So so is Efficiency Maine Trust Could you talk a little bit about the Green Bank?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yeah. So, the Maine Green Bank, which is quasi public, so it was created by the legislature within the establishment of their C PACE program, is basically like a government, I wouldn't say controlled, but created financing entity. A lot of states have green banks and their focus is climate financing.

[Rep. Kathleen James (Chair)]: So I've heard about Green Banks. I know we've we've talked about Dara, I feel like you know about Green Banks. Well, we kind of

[Rep. Christopher Morrow]: have our own hodgepodge via the three. Yeah. Long Bay.

[Rep. R. Scott Campbell (Vice Chair)]: Vida. Vida.

[Rep. Kathleen James (Chair)]: So there

[Rep. Christopher Morrow]: wasn't an appetite for green then?

[Rep. R. Scott Campbell (Vice Chair)]: Yeah.

[Rep. Kathleen James (Chair)]: Okay. So we have various entities, similar entities.

[Rep. R. Scott Campbell (Vice Chair)]: Yeah.

[Rep. Kathleen James (Chair)]: All of which probably do some all of which probably do some green financing, but it's not their sole vision. Okay. And then is Efficiency Maine Trust is that equivalent to Efficiency Vermont at all, or is that is it different? Okay. So we have the Green Bank. They're working with the trust, they are doing all of this sort of admin work on the C PACE. So they are basically the third are they the third part third party administrator? As the language in our bill states, they would be that third party administrator. Yes. Okay. Because we've been struggling with the concept of Mhmm. Yeah. Do we need a third and we'll get to that. But do we need a third party administer administrator? Who would it be? Nobody wants to be it. Yeah. I think that would oops.

[Rep. R. Scott Campbell (Vice Chair)]: Well and and I you the way you described the registered capital providers to sound like they were administering loans.

[Rep. Kathleen James (Chair)]: Yes.

[Rep. R. Scott Campbell (Vice Chair)]: Which, I guess, I thought was the role of the third party administrator in Vermont's version.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yeah, so under the way that Maine does the program, you've got the Efficiency Maine Trust, which is the quasi public institution. Yeah. And then they approve registered capital providers Oh. Which would be our third party financer. And under their legislature, those third party capital providers are required to kind of oversee the loan and the process.

[Rep. Kathleen James (Chair)]: So the efficiency trust is like approving providers. So they would approve Castle Green or some of these other lenders we've heard from or Vita to be like, okay, you're approved to participate in this program, but then the lender itself, it sounds like, is doing the nitty gritty The loan administration. Loan administration.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yeah. Yeah. So their duties would include

[Rep. R. Scott Campbell (Vice Chair)]: So that's the difference between Maine's approach of what Vermont is being what people approach Vermont.

[Chris D’Elia (President, Vermont Bankers Association)]: Yes. For the record, Christina, Vermont Bankers Association. So Maine Trust is our equivalent to Efficiency Vermont. Okay. And they are overseeing, as she just alluded to, the lenders that might participate in the program. The lenders actually do the underwriting and provide the financing to the borrowers.

[Rep. R. Scott Campbell (Vice Chair)]: Which is what the program administrator would be doing here. Mean, depending on how you write it. I mean, the bill is correct. Yeah. All right.

[Rep. Kathleen James (Chair)]: So we have somebody basically approving lenders to be eligible to lend, but then we have the lender doing the the the administration, which is no longer third party. It would just be admin.

[Rep. R. Scott Campbell (Vice Chair)]: So that's good to clarify that before we get providers.

[Rep. Kathleen James (Chair)]: Okay. I'm good with Maine. So registered capital provider, so that's the Castle Green in this scenario. And then they have it's an energy I'm just looking to see what kind of projects are eligible eligible. So energy savings, which we have in ours. That's energy efficiency projects. And then do you know I don't wanna put you on the spot. We're just finding our way this topic. Mhmm. Do you know if Maine so in our bill, there are three kinds of projects that would be eligible. Mhmm. Energy efficiency, renewable energy, and resilience. Yes. Do you

[Rep. Christopher Howland]: know if

[Rep. Kathleen James (Chair)]: Maine extends beyond energy efficiency into, like, renewable energy, like putting rooftop solar on?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: As far as I know, I think under the energy efficiency, a lot of renewable energy projects are allowed. Okay. Thinking back to the case studies that we used in Maine, looking at examples of things that have been funded. We've got heating and cooling systems, lighting systems. So, guess I don't have a direct example of solar, so I could not quite answer that aspect of the question.

[Rep. Kathleen James (Chair)]: Okay. I see your case studies though. So I do know that as far as I'm concerned, and as of the 2025,

[Bella Scholl (UVM; intern to Sen. Chittenden)]: New Hampshire is the only state that has added these resiliency aspects to C PACE.

[Rep. Kathleen James (Chair)]: Okay. Great. Okay, Maine. Okay,

[Bella Scholl (UVM; intern to Sen. Chittenden)]: moving on to Connecticut, we're all ready. So, Connecticut's C PACE program was authorized in 2011 and is administered at the state level by the Clean Energy Finance Investment Authority or CFIA, which is another quasi public agency. This authority was tasked with creating and financing a commercial energy program, developing financial guidelines, and using private and public sources for administrative support and financing. In Connecticut, municipal administration financing is handled by the Connecticut Green Bank, which issues, fills, remits, and collects funds on such debase loans. Third party lenders in the state are referred to as approved capital providers and have been approved by the Green Bank to provide funding, as well as entering into an administrative agreement between the lender and the Green Bank.

[Rep. R. Scott Campbell (Vice Chair)]: K. So all of this Pause. Yeah. See

[Rep. Kathleen James (Chair)]: You go. So

[Rep. R. Scott Campbell (Vice Chair)]: the Green Bank is handling the loan, but a third party another bank is is providing the funds for is that what you're saying?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yes. So in Connecticut, the Green Bank is acting as the program administrator. Yes. Okay. And then, again, we have that idea of the approved capital providers, which are the lenders for the law.

[Rep. R. Scott Campbell (Vice Chair)]: Through the Green Bank?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yes. So the Green Bank is the one who's accepting those applications and reviewing them from the property owners and then working with the third party lenders.

[Rep. R. Scott Campbell (Vice Chair)]: Now So what's, like, what's all the third party lenders? And is that contract are they is there a contract with Green Bank or with the or with the borrower?

[Rep. Christopher Morrow]: It's like a borrower on

[Rep. Dara Torre (Clerk)]: page six.

[Rep. R. Scott Campbell (Vice Chair)]: I haven't done really through this yet.

[Rep. Dara Torre (Clerk)]: We're doing it on the fly, me neither. Yeah.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Okay, so the capital provider would enter into a financial agreement with the property owner, after which they may enter into an administrative agreement with the Green Bank, and the Green Bank will then facilitate the benefit assessment lien and will work with the capital provider payments. And that's at the very top of the page. Yeah. I apologize. I wrote this paper back in October. Oh, That's not your paper.

[Rep. Kathleen James (Chair)]: I'm not scraping up. It's the concept.

[Rep. Christopher Howland]: So these green banks, do they have any seed money from the state? Are they buying down interest rates on these loans?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: I'm not exactly sure on that. I know that some of the green banks are known to be utilizing both private and public funds. As far as buying down interest rates, I'm not aware. I'm happy to get back to

[Rep. Kathleen James (Chair)]: you on that if you like. I think that was what Vida said they were gonna be able to well, actually, everybody said they would be able to do that. Right? That they were gonna be able to offer lower interest rates.

[Rep. Christopher Howland]: So this chunk of money, the upfront lien is at a lower interest rate. Yeah.

[Rep. R. Scott Campbell (Vice Chair)]: Because it's secured by the property. It's on the borrower. On the property, and it's a long term loan. Those are those things, I think, drive down the interest rate.

[Rep. Kathleen James (Chair)]: Right. Right. Because as I continue to try to boil this down in my mind, the fact that the the property tax bill is just the mechanism that attaches the loan to the property as opposed to the borrower. It's attached to the actual physical property, and that makes it more secure so they can get a lower they can offer a lower rate. I think I'm getting this.

[Rep. Christopher Howland]: With exception of if you have a business and you have to put in your personal equity, your personal financing to help protect the loan from the principal financer, in this case, the the original money. So sometimes you have if you're not if you're not a sometimes when you finance for a business, you obligate your personal wealth, not just your business equity. Yeah.

[Rep. Kathleen James (Chair)]: I think that they I was a very specific Well, if

[Rep. Christopher Howland]: you know, but it's anyway, it's it's pick the long term interest rates and the

[Rep. R. Scott Campbell (Vice Chair)]: The loan the loan the loan

[Rep. Christopher Howland]: is attached to the property, not the property. But even even the the old ARPAKES ARPAKES money that followed the similar mechanism, and there was very little pickup on that.

[Rep. R. Scott Campbell (Vice Chair)]: But there's other reasons for that. I don't think we can do it on

[Rep. Christopher Howland]: your radar. No. No. Okay. No. It's it's just the the interest whether the interest rate is subsidized or not It's not subsidized. By government money or or how it gets to 4% rather than

[Rep. R. Scott Campbell (Vice Chair)]: I don't think anybody has proposed that this be subsidized. That's as far as I can

[Rep. Christopher Howland]: If you're putting public money into your green bank.

[Rep. R. Scott Campbell (Vice Chair)]: It's not public money. It's private money. It's a quasi It's a it's a in the public entity, but it's private. And good thing Chris is here because he can correct me when I say something stupid, I think that's how it goes.

[Chris D’Elia (President, Vermont Bankers Association)]: Yeah, for the record, Christelios, so if they're using private sources of capital from the marketplace, you have to look at what that capital costs in the marketplace that will drive your interest rates that you're gonna lend out there. If you're supplementing it with public capital, for example, the 10% of Vermont program with Richard paycheck, he's willing to put that out at a lower interest rate so it would subsidize potentially some loans out into the marketplace. The

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: notion,

[Chris D’Elia (President, Vermont Bankers Association)]: I just wanna go back to the way they do it in Connecticut is the private entity puts the money up, but the public entity does the servicing on the loan. Just think about it that way. They're servicing that loan. Mhmm. The the public entity is not putting public money out there.

[Rep. R. Scott Campbell (Vice Chair)]: Yeah. Okay. But what what also affects the interest rate is the terms of

[Chris D’Elia (President, Vermont Bankers Association)]: the loan. But you're you're still you're it runs with the property, but the property is not an entity that's an eligible borrower. You so that that business is still being underwritten because that business is the one that is obligated to repay the loan. Property is just a it's real estate. The real estate doesn't I'm trying to describe it.

[Rep. R. Scott Campbell (Vice Chair)]: But whoever owes the real estate is responsible to pay the loan. Correct.

[Chris D’Elia (President, Vermont Bankers Association)]: But they're using the property tax vehicle as a way to recapture. But that entity is still responsible for paying that loan even though it property. Yeah. Is is it almost fair to say the property is being used as phantom collateral? Phantom collateral. Well, you could say that, but it's being used as the vehicle for collection on the loan. Yeah.

[Rep. R. Scott Campbell (Vice Chair)]: So if the owner of the property goes bankrupt or something Yeah. Then the loan isn't being paid as long as property taxes are being paid. But then presumably, the bank is taking the ownership of the property. Yeah. And so it's responsible for, you know, another bank, the mortgage the mortgage or mortgage bank, whatever that's called, is taking ownership of the property and and is responsible for the property taxes and the payslip.

[Rep. Bram Kleppner]: And repaying the payslip. Right. Yep. And they have to agree to take on the PACE loan to take possession of the property.

[Rep. R. Scott Campbell (Vice Chair)]: Yeah. Yeah. Correct. Yeah. So it is it is a a lower risk proposition for the PACE loan. And therefore a lower interest rate. Well, mean, a soon. It makes it all work.

[Rep. Bram Kleppner]: Mhmm. So it makes it all well, it makes it all useful. Yeah. Right.

[Rep. Kathleen James (Chair)]: Hey. New York.

[Rep. R. Scott Campbell (Vice Chair)]: Thank you for joining us.

[Rep. Kathleen James (Chair)]: Yeah. Thank you for Please. Indulging us. Oh, of course. We're just trying to

[Rep. R. Scott Campbell (Vice Chair)]: this is not the finance committee.

[Rep. Kathleen James (Chair)]: Yeah. In case you can't tell, we're

[Rep. Dara Torre (Clerk)]: not the commerce committee.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Okay, moving on to New York. New York State authorized CPACE legislation in 2009 and named the New York State Energy Research and Development Authority as the authoritative agency. NYSERDA's duties under such legislation were to provide implementation guidance, certify contractors to perform energy audits, establish energy efficiency criteria, and to approve financing. The program is administered at the municipal level, except for New York City, by the Energy Improvement Corporation EIC is a nonprofit local development corporation, and all projects approved by EIC must comply with New York's Municipal Sustainable Energy Loan Program and NYSERDA C PACE guidance. Additionally, New York has established a state sponsored investment fund. This kind of gets to the question you were asking earlier. So this investment fund within NYSERDA is called the New York Green Bank. This is publicly funded, and this Green Bank can be used for CPASE financing when traditional lenders are not available. All right.

[Rep. R. Scott Campbell (Vice Chair)]: It

[Rep. Christopher Howland]: has the same superior position in New York as we're envisioning in Sibilia? Yes. The PACE loan is superior, only junior to uncollected property tax.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yes, representatives. So in our research, we found that the financing terms, which is basically the bulk of the bill about the property lien and the priority and subordination and the moratorium consent, as well as some sort of municipal vote, are pretty consistent across most states that have implemented

[Rep. Dara Torre (Clerk)]: CPAs. And

[Bella Scholl (UVM; intern to Sen. Chittenden)]: then, if we have time, I did have an excerpt from a different memo that I wrote that goes over a few of the other commercial energy efficiency financing opportunities in the state. Yeah. Just to kind of compare and contrast. Okay. So for Vermont commercial and residential clean energy improvements, we have business energy loans offered by East RISE Credit Union. And I actually was able to check the interest rates this morning. So the interest rates would be 6.5 for energy projects and then 6.8 for solar projects, just as kind of a frame of reference. These kit loans can fund up to $50,000 and are offered at ten year terms. While this may be a more accessible route, the term length and funding cap are much lower than with C PACE loans.

[Rep. Kathleen James (Chair)]: Sorry, that was what was the term in the age? 6.5%?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yeah, 6.5%, and then 6.8 for solar. Okay. Yeah, I actually know someone who works

[Rep. Kathleen James (Chair)]: They have everybody's solar loan. Right?

[Rep. Bram Kleppner]: They've got my car loans. Yeah.

[Rep. Christopher Morrow]: My heating system loan.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Okay. And then, Vida offers a few different financing opportunities. So first would be the agricultural energy loan program. I mentioned this because farms are under the description of commercial entity in the bill and would be able to do seek lease financing. These loans are offered at market rates, and term length is determined on cash flow, useful life of assets, and project viability. And then VIDA also offers commercial a commercial energy loan program. These loans are offered up to $6,000,000 with a variable interest rate and $500,000 with the fixed market based interest rate. And the term of the loan is determined on a case to case basis, and the loan generally only covers 60% of the project cost. So to kind of highlight the comparison I'm making there, compared to conventional loans, C PACE has much longer term lengths up to thirty years in the bill as it's written now. We're reducing the individual payment amount because of that long term length. The financing is available for the entire cost of the project, which from what I've found, it's kind of greater for these types of loans, And the loan follows the property instead of the individual, which we've been discussing, which makes it a good option for large developers that may not wish to undertake the full value of the loan. Okay.

[Rep. Kathleen James (Chair)]: Again, not to put you on the spot. New Hampshire, have

[Rep. Dara Torre (Clerk)]: you looked into New Hampshire much? Very briefly. Okay. I was

[Rep. Kathleen James (Chair)]: just curious if you know how they defined resilience projects. Yeah.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: I did look into that a little bit because I knew that it was a question raised by the committee. Yeah. So it seems like their definition of resiliency is pretty broad, and then they also do water projects, like improving water efficiency, which is a separate section. Oh, They kind of follow a similar guidance of you just need to have somebody, a professional, say that it's a resilient improvement.

[Rep. Kathleen James (Chair)]: Okay. So, broader resilience projects, and then as as defined by a professional specific to that project. And then, reducing water usage?

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yeah. Let me pull it up just so I can make sure I'm correctly referencing. Okay. Yeah. So on the New Hampshire Business Finance Authority website, which is the administrator in New Hampshire, they define resilient just to be clear, this isn't within the bill that was passed. Oh, okay. They say resilience and improvements are improvements that increase the resilience of a property, including but not limited to air quality, snow and flood mitigation, energy storage and microgrids, alternative vehicle charging infrastructure, and fire and wind resistance. Okay. Which would be separate from a water conservation

[Rep. Kathleen James (Chair)]: improvement. Okay. And we have a definition that I have not gone to find. And

[Rep. R. Scott Campbell (Vice Chair)]: It's at the link around in the Great. Yesterday. Oh,

[Rep. Kathleen James (Chair)]: perfect. So it was Is it in my inbox?

[Rep. R. Scott Campbell (Vice Chair)]: Should be. Know. I didn't see it.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: You didn't see it?

[Rep. R. Scott Campbell (Vice Chair)]: I don't know.

[Rep. Kathleen James (Chair)]: I didn't see it either. Alright.

[Rep. Christopher Morrow]: Might be in your inbox.

[Rep. R. Scott Campbell (Vice Chair)]: Maybe I did do that. It's possible.

[Rep. Kathleen James (Chair)]: Okay. Alright. Well, that is excellent. Do we have any additional questions for the that was really helpful. Thank you so much. Of course. Yeah. Congrats on your word, and thanks for testifying. Yeah. That was that was really helpful. Okay.

[Rep. R. Scott Campbell (Vice Chair)]: What's the the heady I have an old heady email. Remember what the How is alright. Let's try this.

[Rep. Kathleen James (Chair)]: Okay. I know. That's the old one. Thank you. Thank you. Thank you so much for being here. Yeah. Appreciate it.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Good. With the opportunity.

[Rep. Kathleen James (Chair)]: Oh, I got it. It's in there. Yeah. Okay. Shifting gears. To h 600. I had mentioned yesterday that I wanted to this is this is a bill that I introduced that we haven't spent any time on at all. But I'm interested in walking through it and learning a little bit more about it and taking the committee's temp on whether we could add it to two zero two. So

[Rep. Richard Bailey]: Would you be able to explain why you brought this bill forward?

[Rep. Kathleen James (Chair)]: We did a walk yes. Why don't we do the walk through, and then I'm happy to talk about it. I did I did my little intro pitch, like, at the beginning in January, and I have all those notes. But in general, it's what I mentioned yesterday, which is that appliances sold, Ellen will be more helpful with this, but household appliances, basically, or commercial appliances have certain energy efficiency standards that are established at the federal level. And they, I guess, regulate or guide how energy efficient any appliance has to be. And last, during the last Trump administration, the Trump won, those standards were rolled back. But Vermont passed sort of proactive or responsive legislation to say, we're gonna stick to the current standards here in Vermont. And the legislature passed a bill and Governor Scott signed it. So this would contemplate doing it doing that again. So ensuring, I guess, that our market isn't flooded with cheaper, less efficient appliances. But, let's hear from Ellen. She's the attorney. And she can walk us through it. And like I said, we haven't taken any testimony yet. And I'm not an expert on this policy either. Just interested in learning more about it.

[Ellen Jakowski (Office of Legislative Counsel)]: Ellen Jakowski, Office of Legislative Counsel. I'm here today on H 600 as introduced, but the chair is also proposing H 600

[Rep. Kathleen James (Chair)]: amendment, which I think is posted under my name.

[Ellen Jakowski (Office of Legislative Counsel)]: I think. Alex, did we post that yet? No. So, I'll start by giving some overview, though, of appliance efficiency. Would be helpful. So, Vermont adopted appliance efficiency law in 2006, and initially it was a fairly short list of products that needed to have efficiency standards adopted for them by the Commissioner of Public Service. So, the Department of Public Service is the agency involved here at Chapter 74 of Title IX set up the intent of creating an efficiency program for appliances, as well as the procedure and setting up the standards and protocols that the Commissioner needed to adopt for these products via rule. At the time, the federal program didn't cover any of those products, and then later, the federal program, when it came into effect, covered those products. The federal law, the Energy Policy and Conservation Act, has a preemption clause that says if no state law can regulate the same products as the federal government. Then as the chair just mentioned, in 2017, the law was updated to include an additional set of products that are covered under the federal law and then incorporated by reference into the rule, but it also added a provision to address the preemption, which is in 2796 F. The rules exist in Vermont, but they do not come into effect until the federal government itself takes action to repeal, revoke, or void the rules, and so they exist as a backstop for if there's federal action to get rid of the rules. Additionally, in 2018, another bill on appliance efficiency was passed in Vermont, adding another set of products that were not currently covered by the federal government. In the last twenty years, Vermont has gone back and forth of having products that were not covered by the federal government, but then also having products that are covered, and then adding more products as products that will be covered by the Vermont Efficiency Standards. The Department of Public Service updates its rule based on that and if there are federal changes. But again, the things that are covered by the federal law are not enforced at the state level. In the 2017 bill, a specific date was added of January 1937 to establish a date by which the code will be referenced if the federal law goes away. So that is what would be the law controlling moving forward if the federal government decided to no longer enforce the federal appliance efficiency standards. So, H600 as

[Rep. Kathleen James (Chair)]: introduced Sorry, can stop? Yeah. Okay. So to try to boil this all down, since 2006, Vermont has had its own efficiency standards. Our first law was passed in 2006 saying these are the standards for a wide range of appliances. And DPS does the rule making on that. And we can have a whole list of products that are covered. And those might be the ones that are listed at the federal level or we can add additional products that are not covered at the federal level. And the only consideration there is that if a product is listed at the federal level, we can't contravene or Contradict that. Or contradict that. And we also So we can we can match the federal list or we can add more, but we can't go against the federal list. And so the last action we took on this was in 2017 to say, hey, if these laws get rolled back or repealed at the federal level, we're gonna keep our standards in place. And the reason that's okay is because if they get repealed, we're not contradicting federal standards. There is no more federal standard. Correct. Okay. Great. And do you know if that happened? Were the federal standards rolled back during the It Trump

[Ellen Jakowski (Office of Legislative Counsel)]: is a complicated procedural history that I am not an expert on. There was litigation over it. I think there was initially an attempt in the first Trump administration to roll things back and there was litigation. So, I don't think they were actually formally rolled back as initially proposed. And then there was additional litigation specifically around light bulbs. And so there was there were multiple yes. There were multiple litigations under these provisions at the federal level.

[Rep. Kathleen James (Chair)]: So this is essentially it would be a it would be a backstop in case something happens. Some of it. Yes. Some of it

[Ellen Jakowski (Office of Legislative Counsel)]: is additional standards that the federal government does not. Alright.

[Rep. Kathleen James (Chair)]: So, sum of age 600 was included.

[Ellen Jakowski (Office of Legislative Counsel)]: Yes. I'm talking about the current law as a victim.

[Rep. Kathleen James (Chair)]: Oh, the current law.

[Ellen Jakowski (Office of Legislative Counsel)]: Okay. Yeah. Okay. Yes.

[Rep. Kathleen James (Chair)]: I'm caught up. Yeah. Rick Campbell? So

[Rep. R. Scott Campbell (Vice Chair)]: I sorry. I didn't really

[Ellen Jakowski (Office of Legislative Counsel)]: I also didn't finish explaining either what was going on, but if

[Rep. R. Scott Campbell (Vice Chair)]: you Alright. Maybe you should

[Rep. Richard Bailey]: I should let you

[Rep. R. Scott Campbell (Vice Chair)]: do that. So because I'm trying to understand what the difference between what what we're doing here, but do have to tell me?

[Ellen Jakowski (Office of Legislative Counsel)]: Yes. So the federal statute is required to be updated every eight years, I believe, and so the most recent update happened in 2025. And so age 600 as initially introduced was doing two things. It was first striking through the list of products that were initially added to the statute that are now covered by the federal statute. So striking their reference because there is a catch all category that cites to the federal law itself. And so most of what was in H600 as introduced is cleanup, because it's redundant. And then the only substantive change is updating the date to reference the most recent update to the code. And that includes changes that were made to the code in 2025.

[Rep. Kathleen James (Chair)]: So right. So referring back to the did you say August? I'm I'm sorry. I did.

[Ellen Jakowski (Office of Legislative Counsel)]: I just said 2025 because that'll I made up. Oh, alright.

[Rep. Kathleen James (Chair)]: So the substantive language links back to this 2025 update.

[Ellen Jakowski (Office of Legislative Counsel)]: Yes. And so I think you did not make up August. So in the bill as introduced, it changes the date, which currently is the code as it existed on 01/19/2017. Age 600 as introduced is referencing changing it to July 01/19/2025. However, the 2025 update did not take effect, I believe, on January 19. And you should definitely hear from the advocates on this because there's some complicated history on when the updated regulation was formally adopted. I think it may have also been litigated. So August was a date that I think the advocates are also considering if

[Rep. Kathleen James (Chair)]: using it

[Ellen Jakowski (Office of Legislative Counsel)]: as August 2025 would be more appropriate, but you can hear about that. Okay. I'll just say I have not worked on amending the appliance law before, and it is a little bit complicated with the overlay of the federal law. I have been doing a lot of research on this, but there are questions I potentially can't answer about appliance efficiency.

[Rep. Kathleen James (Chair)]: So the last time we did this was in 2018. 2017.

[Ellen Jakowski (Office of Legislative Counsel)]: Was that Erin? It was Erin because that was my first year. So in '27 there was a pair of bills. This is very annoying, but there was a pair of bill four eleven and four ten. Four eleven was passed in 2017, and then four ten was in 2018. Four eleven was the the provision that created the federal backstop, so created the provision that said these will only take effect if to be repeated at the federal level, they're repealed or voided. And then the 2018 update added additional products that are currently not part of the federal system. Is that a question or a statement?

[Rep. R. Scott Campbell (Vice Chair)]: No, I'm not asked. I just want to make sure I'm looking at the right hand.

[Ellen Jakowski (Office of Legislative Counsel)]: Yes. So 2018, it was four ten became act 139. In 2011, it was age four eleven that became Act 42. And both sets of those laws had, purpose statements. So if you look them up, they have purpose statements that basically Okay. What I just said.

[Rep. Kathleen James (Chair)]: I will look that up. Alrighty. Okay. So, right. So let's let's walk through. As you mentioned, the h 600, as I introduced it, was, like, 12 pages long and had a lot of cleanup language, which could certainly be an option. But I also wanted to look at a draft that rolled it down to its core nubbins, which is the the date

[Ellen Jakowski (Office of Legislative Counsel)]: we have. So, shall we walk through the short version, basically? Okay. Sure.

[Rep. Kathleen James (Chair)]: Do you and I'm sorry. I don't think that I'm not sure I have it. I'm not sure that you can answer. Which is my fault. Okay. May I ask? Yeah.

[Rep. Laura Sibilia (Ranking Member)]: I apologize for coming in late, but I'm sure so if I missed this already, I definitely would follow-up afterwards. But this is very similar to the backstop I mean, backstop language from 2017. We're just kind of felt some suspend. Right?

[Ellen Jakowski (Office of Legislative Counsel)]: Just updating the date. Just updating the date for the backstop. Right.

[Rep. Kathleen James (Chair)]: Yeah. So taking what we did last time and putting in the new date.

[Ellen Jakowski (Office of Legislative Counsel)]: Well, this was. This this was a current. Yeah. I'm I'm sending the amended version. It's posted under my name today. Oh, great. It's draft 1.1 data four seven point six. It's all in three pages. Great.

[Rep. Kathleen James (Chair)]: Okay. So this is the 2018 bill essentially with you. I mean, this is that statute with new dates. Right?

[Ellen Jakowski (Office of Legislative Counsel)]: The 2017 bill and 2018 bill amend the same statute. Okay. But in 2017, that is when you created the federal backstop with the date provision. So it is amending what happened in the 2017 bill.

[Rep. Kathleen James (Chair)]: Okay. I think we may have achieved walk through status. Walkthrough commencement.

[Rep. R. Scott Campbell (Vice Chair)]: In

[Ellen Jakowski (Office of Legislative Counsel)]: the draft of the amendment on page one, substance, the only change in this language is on page one, on line 21. And so, the commissioner, in the rules, the commissioner shall adopt minimum efficiency and water conservation standard for each product that is subject to a standard under 10 CFR sections four thirty and four thirty one as those provisions existed on 01/19/2017, now changing it to twenty twenty five. So that's the existing federal law? So section four thirty and four thirty one are the code of regulations that identify the products and the standards for testing protocol for those products. Yeah, certainly. Yes. Okay. On pages two and three, no changes are being made, but that is the language that captures and describes what the federal preemption process is here. It establishes that if the federal preemption goes away, these are enforceable only if the federal government has them withdrawn, repealed, or otherwise voided. And so the standard for that is in there in the statute just to show. You don't need to include this in the bill if you don't want to, but I can walk through it if you

[Rep. Kathleen James (Chair)]: would like. Yeah, let's walk through because we we talked about that. And while it doesn't need to be in the draft because we're not changing anything about it, it provides clarity, which is helpful to me anyway, explaining that well, explain what it explains. Sure. It's the process by when

[Ellen Jakowski (Office of Legislative Counsel)]: you know something is no longer covered by the federal preemption. Okay. So, on page two, this is the 90 SA twenty seven ninety six implementation for the applying standards. When federal preemption under 42 USC six thousand two and ninety seven, so the Energy Policy and Conservation Act applies to a standard adopted pursuant to this chapter for a product, This standard shall become enforceable on the occurrence of the earliest of the following: The federal energy or water conservation standard for the product under 42 USC Chapter 77 is withdrawn, repealed, or otherwise voided. However, this shall not apply to any federal energy or water conservation standards set aside by a court of competent jurisdiction upon petition of a person who will be adversely affected. So, there are two primary ways that a law at the federal level can be voided. That is by the an act of congress, or through the the standard process. You go through amendment or repeal. Or a court could strike down a a law, usually because it's unconstitutional or has another issue. This is saying, the Vermont standards will only come into effect if the federal government itself takes action to withdraw, repeal, or void, not if a court strikes down the law as unconstitutional. Those are two different processes, and this is just being clear that it's if the federal government takes this action. The other occurrence could be a waiver of federal preemption issued under 42 USC 60 nine-seven. The preemption statute itself has a process by which a state can request a waiver of preemption, and there are a number of steps that a state could go through. I don't know how easy or hard that is, but I don't think that's really at play here in Vermont. I'm not sure. Okay. Next, the federal standard for general service lamps shall be considered to be withdrawn, repealed, or otherwise voided within the meaning of this subsection if it does not come into effect on 01/20/2020, pursuant to the action. So, This is another section that could actually be struck if you wanted to do more cleanup because this was a time sensitive provision about whether or not the general service lamps provision was going to

[Rep. Kathleen James (Chair)]: go into

[Ellen Jakowski (Office of Legislative Counsel)]: effect. General service lamps are classic light bulbs. It covers a couple different many different types of light bulbs, but it's the not the unusual ones.

[Rep. R. Scott Campbell (Vice Chair)]: Just a regular light bulb. K.

[Rep. Kathleen James (Chair)]: Alright. So, again, this entire section is existing law, which we included for context, which is perhaps from a confusing to all.

[Ellen Jakowski (Office of Legislative Counsel)]: Okay. Thanks.

[Rep. Kathleen James (Chair)]: Or to me. No.

[Ellen Jakowski (Office of Legislative Counsel)]: I get it. Alright. And then this is the last revision at the top of page three. When a standard adopted pursuant to this chapter becomes enforceable under this section, a person shall not sell or offer for sale in a state of a new product subject to the standard unless the efficiency or water conservation of the new product meets or exceeds the requirements set forth in the standard. So that's what what it's about. Yeah. Okay.

[Rep. Kathleen James (Chair)]: Okay. Yeah. I don't know if

[Rep. Christopher Morrow]: you can answer this, Ellen, but since the feds just updated in 2025, is it likely that the department doesn't have new appliances that aren't already independent of?

[Ellen Jakowski (Office of Legislative Counsel)]: The department of Vermont. Vermont.

[Rep. Christopher Morrow]: PST. I'm sorry. Don't I thought I heard something about appliances can get added, that you did that in 2017 for equipment that wasn't in the federal, and that they do it by rules, I think.

[Ellen Jakowski (Office of Legislative Counsel)]: So, there are additional provisions under chapter 74 that the commissioner does have authority to adopt. The commissioner has some authority to adopt additional rules for things that are not covered. I don't know at the top of my head, but there is a so the commissioner has the authority. I'm not sure how broad it is. In nine BSA section 2,797, the commissioner may adopt rules to revise efficiency standards for these products listed in 2794 in order to make the standards conform to standards in effect in other states where to do so is in the interests of the electrical energy consumers of the state. In considering increased standards, the commissioner shall set efficiency standards upon a determination that the increased efficiency standards would serve to promote energy conservation in the state and would be cost effective for consumers who purchase and use those products. No increased efficiency standards shall become effective within one year following the adoption of any amended rules establishing those increased standards. Commissioner may also apply for a waiver of federal preemption in accordance with the procedures for any product regulated by the federal government. So that is additional authority for them to adopt for other products. I don't think that the, Vermont rules have been updated since 2018, though.

[Rep. Kathleen James (Chair)]: Yeah. Rep. Southworth.

[Rep. R. Scott Campbell (Vice Chair)]: How does this tie in with

[Rep. Richard Bailey]: the federal federal energy start program?

[Ellen Jakowski (Office of Legislative Counsel)]: So I have some information on that. So I believe that the federal energy start program is voluntary and that some of the standards that are in Vermont law that are not currently covered by the Department of Energy's, the four thirty and four thirty one list, I do think they use the ENERGY STAR voluntary level of efficiency as part of Vermont standard. So they are incorporated by reference into the Vermont standard for products that are not covered by the other federal program, believe.

[Rep. Kathleen James (Chair)]: That's a that's a good question. It was something when I was first considering introducing this. I looked into them, took some notes, which I have.

[Rep. R. Scott Campbell (Vice Chair)]: Maybe because that

[Rep. Kathleen James (Chair)]: But we need to hear about that. I know The

[Rep. R. Scott Campbell (Vice Chair)]: program's been fully funded for this year.

[Rep. Kathleen James (Chair)]: Yeah. And I Plus

[Rep. Richard Bailey]: an additional amount too.

[Rep. Kathleen James (Chair)]: I think that the, yeah. We would have to take testimony. I know the the standards of the floor, like, cannot sell below this. And then Energy Star is the voluntary seal of approval, but I didn't know that any of the Energy Star stuff was incorporated into the Vermont standards. We'd have to learn more about that. Yeah.

[Ellen Jakowski (Office of Legislative Counsel)]: Okay. That's

[Rep. Kathleen James (Chair)]: what I know. Ellen, thanks for walking us through that. Appreciate it. Yeah, Rob Kleppner?

[Rep. Bram Kleppner]: Can I ask counsel a different Vermont energy question unrelated to this? Sure. Sure. When the federal 30% investment tax credit goes away from stuff that isn't safe harbor by July 4. Do you know is the per month the month ITC, I think, was 24% of the federal or something like that. Is that also going away?

[Ellen Jakowski (Office of Legislative Counsel)]: I don't know.

[Rep. R. Scott Campbell (Vice Chair)]: Thank you. All

[Rep. Kathleen James (Chair)]: right. Ellen, thanks for being here. Appreciate it. And you said that's posted already on the website.

[Rep. R. Scott Campbell (Vice Chair)]: All

[Rep. Kathleen James (Chair)]: right. Thanks for your time. So we have oh, hi. I I thought you might be Bob.

[Rep. Christopher Howland]: Yes.

[Rep. Kathleen James (Chair)]: So do you wanna just move on? You ready?

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: To you, folks.

[Rep. Kathleen James (Chair)]: Super. Is that okay with you guys if we just keep going? Probably. Okay. Great.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: I'll I'll

[Rep. Kathleen James (Chair)]: switch. So we are going to, as we often do, abruptly switch gears and go back to c pace.

[Rep. R. Scott Campbell (Vice Chair)]: Give me a minute.

[Rep. Kathleen James (Chair)]: No problem.

[Rep. R. Scott Campbell (Vice Chair)]: I know. Signed

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: on to Zoom because I'm doing some showings.

[Rep. R. Scott Campbell (Vice Chair)]: I think I'm on, Alice.

[Bella Scholl (UVM; intern to Sen. Chittenden)]: Yes. You are. You're a co host. You can share now.

[Rep. R. Scott Campbell (Vice Chair)]: Okay. All ready for me?

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Well, appreciate you having having me in this morning. I'm Bob Flint. I'm the executive director of Springfield Regional Development Corporation. We're the RDC in Southern Windsor County, also representing Piper Murphy. RDC's of Vermont and here to support, s one thirty eight and talk specifically about a project that our organization is working on in Springfield that we believe could benefit from this, and this is gonna be the show and tell if I can

[Rep. Dara Torre (Clerk)]: make the tech work. Great.

[Rep. R. Scott Campbell (Vice Chair)]: There we go. How about that?

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Nice. Alright. So this is Park Street School, which was Springfield's original high school, part of which the part you're looking at was built in 1898. The part to the right was nineteen twenty ish. It served as the town's high school from 1898 until roughly, well, the late sixties, 1961. Then it became the town's great school until about 2007, 2008. Yes. I went there a long time ago. And it's and it's a building that's near and dear to the community. Okay. There's oops. That didn't switch. There we go. Didn't switch. So that's the back part of the school, and just giving you some sense of the magnitude, the architecture, and note the windows. And note the the part of the building with the trees on it. That's the current boiler house, which is gonna be the focus of what I'm I'm talking about here as it relates to s one thirty eight. As you can see, folks stretched out back in the day. This was a town meeting that was held in the historic auditorium that I'll give you, another shot of. This is from the forties, I'm guessing. And there's a shot of the auditorium. Beautiful. 500 seat, proscenium style auditorium, that hasn't really been used, well, since 2007, 2008, because it's not sprinkled, and capacity is limited, to 50 people, but it's a jewel, as is the gymnasium, which I commonly say is, like, right out of Hoosiers. Yeah. You know, you you can't build something like that now. So SRDC purchased this building in 2018 after the creation of Black River Innovation Campus, which is a project Matt Dunham, some of you may know, and and I created for, tech related incubation and and, entrepreneurship in Springfield. We thought the school, besides being a cool building, made sense because from a place making point of view, is just up the hill from Downtown Springfield and Main Street Springfield. So if we're successful, this building will be a center of activity that will flow down into the downtown. It's also a few 100 feet from the federally qualified health center at Springfield or Center Health. So since that time, we've amalgamated 7,000,000 plus in funding a variety of state and federal programs, and we're undergoing a variety of of site and code related improvements, such as sprinkler in the auditorium, for example. But the piece that's really vexed us is how to deal with the energy plant, how to deal with this guy and the one to the right. These are forty five year plus old boilers. The one you're looking at specifically right now is a coal boiler that was converted to oil. So and here's another shot of the two boilers. That the pictures don't really show the scale. You couldn't fit them in this room, for example. You could fit one of them in this room if you raise the ceiling. So sorry. Enough show and tell. So currently, we're burning over 30,000 gallons of oil a year just keeping heat on for the building and to allow for the current uses, which occupy about 10 of the building. Parks and Recreation Department still uses the gymnasium for for youth activities with under 50 people in there. The Blackbird renovation campus is in there, but that's it. They've got 85,000, 90,000 feet of empty space that we're preserving through at least maintaining some heat in there. There are no zones. I can't turn off heat here and have heat here. Wow. The distribution system is ancient and flawed, to be polite. So our energy consultants have shown us that if we were to convert this to, say, an all electric building, the annual carbon production would be roughly a million pounds a year, as well as the the economic benefit as well. So as I think it was Megan Sullivan the other day stated in her testimony, taking on something with a scale is tough enough when there were federal resources and incentives and so forth in place, but it's even more challenging now. But it's more than just replacing a heating system. You saw the building. You saw the windows. The building's a 100 years old. The windows are a 100 years old. Not a whole lot of insulation. So we could put in the most contemporary energy system in the world, and you're still just hemorrhaging energy. We need to update the building envelope to create an efficient HVAC system, including high density insulation, high efficiency windows, ceiling, and so forth.

[Chris D’Elia (President, Vermont Bankers Association)]: The town of Springfield is a

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: partner in this project, and it's a natural for them conceptually to be able to designate this building as a district under the legislation. They would continue to utilize the gym in that auditorium for public use. They are contemplating currently relocating some town services to the building, potentially including a senior center, for example. So we are partners in this project, and as we have gone through this adventure together, we have, tried to figure out a way to make the energy needs of this building work. S one thirty eight seemingly would allow for that. In terms of specifics, we agree with previous testimony about the need to utilize as completed value as opposed to the current assessment. There's no way the math works with the current assessment of that building, for example. We also support excuse me. Here's This week that Joan Goldstein of Vienna mentioned last week about projects meeting applicable code requirements or exceeding them through higher performance design and having our flexibility. So large commercial projects are inherently complicated anyway, but redevelopment of older facilities add other layers. It wouldn't be a surprise to see older school buildings redevelop in the future, depending on what happens with older school buildings, for example. The proposed pay structure would provide a mechanism to tackle this piece of redevelopment projects like ours in a way that's flexible enough to accommodate the rest of the eventual capital stack, which is kind of a work in progress. Right? We understand this is a tool that's been used effectively in other states, and I think it could be a great resource for us. Appreciate the committee's consideration.

[Rep. Kathleen James (Chair)]: Well, I won't ask you about the third party administrator. So can you speak to that? Okay. We've been having a I'm aware. We're stuck on the concept of who oversees this program and who serves as the administrator.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Yeah, so a couple thoughts on that. I don't have to be dangerous. Yeah. So I'm out of school or whatever.

[Rep. Kathleen James (Chair)]: We know. Yeah. We know enough to be supremely dangerous. So I wanna hear what you have to say.

[Rep. Christopher Howland]: So I I mean, I I think

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: when Joan was in, she probably spoke about project specific administrators.

[Rep. Dara Torre (Clerk)]: So for example, it's not

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: gonna be a spoiler alert that Vida will likely be involved in this project at some point. Right. So it would be logical for Vida to have that role for this specific project. Does that mean Vida is the third party administrator for everything in the state? I don't think they are interested in that.

[Rep. Kathleen James (Chair)]: Nobody's interested in it.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: The other logical dance partner, in my personal opinion, and I haven't spoken with them, so they can still have it outside, is efficiency per bond, who also has been involved in this and will likely be involved in this, and perhaps that is consistent with their vision. Again, I'm not representing whether they have an interest or not, and I don't think they do yet, but in my personal opinion, that would be a logical place to go.

[Rep. Kathleen James (Chair)]: What is the bill currently well, that's helpful.

[Rep. R. Scott Campbell (Vice Chair)]: We're looking for me here at breakfast, you know, if you haven't this.

[Rep. Kathleen James (Chair)]: Yes. I'm afraid we're gonna have to insist. Get

[Chris D’Elia (President, Vermont Bankers Association)]: my head

[Rep. R. Scott Campbell (Vice Chair)]: up. It's my fault.

[Rep. Kathleen James (Chair)]: Yep. No. It's it's not your fault. Okay. Alrighty. Do we have any more questions, about the economic yeah.

[Rep. Bram Kleppner]: So is this gonna

[Rep. Christopher Howland]: have some public bonding in it? Potentially. I think that I think there's

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: still some some moving parts in terms of what the town's role specifically is. Is it the condo? Do they take ownership of parts of the building? Is it a long term lease? What's the capital stack for the town speaks of this. We do have two CDS awards that are in this project that are addressing chunks of CDS. Sorry, congressionally directed spending, a. A. Earmarks. So we're trying to drive down the cost of what the town's participation would be, and then the town needs to determine whether or not they go for bonding later this year.

[Rep. Laura Sibilia (Ranking Member)]: Just wanna offer a comment. Thank you, Bob, for coming in. I think ten years ago, Commerce did a tour field trip to Springfield. It's just the amount of work that you all are doing and the amount of meetings for tools like this. I know. So thank you for No. Appreciate it. And could be actually, Springfield's

[Rep. Christopher Howland]: a great tool if we ever Well,

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: and you mentioned that at the meeting of the Congress Committee at that time, it was in the building where the Federally Qualified Health Center is a few 100 feet from what you just saw on the screen.

[Rep. Christopher Howland]: Okay. So Yeah. We're college. So if you got some money from the federal government, you're gonna have some municipal bonding perhaps. Mhmm. And then you're still gonna have this third party lender Correct. In there. And We're gonna have a lot of other stuff too. Right. And so the there's no question that the C PACE is superior to all other lenders. But then and subsequent lenders, do they each take equal positions, or do they I defer to people smarter than me if you could. Yeah. That just man, I

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: think some one of my terms is sausage making. You don't wanna know how somebody you just want the end result. So so some of the things you just cited are among the sausage. How the sausage is organized, I guess, is is a question. I kind of view to be honest, we were hoping that the CHIP program would allow for this kind of use, and, arguably, the statute was written in a way that it could have, but the rules have not to date gone that way. So to me, this is like a tip. And and some of the

[Rep. Bram Kleppner]: money would be collected by the

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: municipality irrespective of the debt service, and it stays with property from my understanding. Mhmm.

[Rep. Christopher Howland]: I'm not a banker.

[Rep. Kathleen James (Chair)]: So, we we've been trying to get Pepsi and talk about well, I I mean, I think to talk about the nobody wants to do it role. I mean, they do chip. Right?

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Yes. And I'm not efficiency Vermont makes more sense to me than Pepsi, personally.

[Rep. Kathleen James (Chair)]: Because?

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Pepsi's got it plenty to do already with chip and regular TIF and the veggie burger. Okay. Your With a staff of, you know, two to three people.

[Rep. Kathleen James (Chair)]: Brook Howland?

[Rep. Christopher Howland]: Does this building have the same restrictions on it that that some years ago, the one of the manufacturing people down by the river, federal government got involved, and the windows all had to be architecturally approved. And so you shot saw that picture Yeah. And you could make them energy efficient windows, but you couldn't reduce the size of the window.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: So I'm aware of the building you're speaking about. Fellows gear side. You're right. It is the one representative Sibilia was just talking about, where the FQHC is, with the original Fellows gear shaper. That project chose to take federal historic tax credits, which put that constraint that you're speaking about on about the tension between historic windows versus common sense. So we have elected not to take federal historic tax credits for that very reason. Obviously, an architectural aesthetic point of view, we wanna make sure the building still retains the character that I grew up with. Right? But it also needs to be practical. So that was a decision we made early on.

[Rep. R. Scott Campbell (Vice Chair)]: Smart decision, Okay.

[Rep. Christopher Morrow]: Yeah. Alright. So you might also do the chip, or you think

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: So right hand side of that building from the picture in the back would eventually be, hopefully, 25 housing units to support the entrepreneurship program. We are probably not going to pursue CHIP for that specific project because we've already done the stuff that Chip would pay before. I see. So if you saw a live shot of that that place today, and we all dug up, we've already done the storm water. We're putting a new electrical service. We're doing a lot of stuff. Brownfields with Springfield.

[Rep. Christopher Howland]: Brownfield meaning it's contaminated? Sure. Yeah.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: We had we had so, I mean

[Rep. Christopher Howland]: At some school, lot was contaminated.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: So a quick story if I just could indulge for a moment. So I talked I showed you the old boilers. The original heating plant for the school was was in a parking lot down below the perspective you saw there, and the pipes ran up. So when they were doing the excavating, even though we had emptied the tanks and cleaned those tanks and life was good, we thought, When they were digging the parking lot this past fall, they punctured some dry wells, which released number four sludge, which added to the existing ground field conditions on the site. I moved the suspected coal ash from the 2019 era. Yeah.

[Rep. Christopher Howland]: Not going forward. We haven't had that yet. Oh, no. But early oil. But no. So, anyway, yeah, we spent about

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: a million bucks on property to clean up on that site.

[Rep. Kathleen James (Chair)]: Thanks for coming in.

[Rep. Dara Torre (Clerk)]: Well, thank you for your consideration. Yeah.

[Rep. R. Scott Campbell (Vice Chair)]: Appreciate your time.

[Rep. Kathleen James (Chair)]: We're, yeah, we're excited about this. I think we're all excited.

[Rep. Christopher Howland]: So Milk? This is gonna so in your converting to electric heat, you're converting to heat heat pump type.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Yeah. With rooftop units and and And

[Rep. Christopher Howland]: But not resist it's not electric resistance heat. I don't believe so. No. That yeah. That's yeah. And we've also we have

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: explored geothermal. The site doesn't leak on itself to that.

[Rep. Bram Kleppner]: And the heating system now with those big boilers? No. Is it air or water? Steam. Steam. Yeah. The heat of conversions will be interesting.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: And so, anyway, I think I digressed that too. I I showed you the where it was. Right? It was that building with the trees painted on it. Yeah. That's coming down this summer because the new entrance for the building will be there. It's gonna dig down and come in at ground level on what's now the cafeteria. It was the cafeteria.

[Rep. Bram Kleppner]: Good for accessibility. Correct. It's the building elevators.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Funny you mentioned that. The old nonworking elevator is being decommissioned as we speak, and the new elevator has been ordered, to go into the building later this summer. You guys are spending some money, aren't you?

[Rep. R. Scott Campbell (Vice Chair)]: We are.

[Rep. Bram Kleppner]: That's great.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Wonderful. I mean,

[Rep. Bram Kleppner]: wonderful you found the resources. Well, we're

[Rep. R. Scott Campbell (Vice Chair)]: trying to find more. Yep.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: That's okay.

[Rep. Kathleen James (Chair)]: Okay. Thank you so much.

[Rep. R. Scott Campbell (Vice Chair)]: Thank you again.

[Rep. Kathleen James (Chair)]: Appreciate your time.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: Yes.

[Rep. Kathleen James (Chair)]: Alright. So, Alex, testimony discussion.

[Rep. Richard Bailey]: Yep. Thank you.

[Rep. Kathleen James (Chair)]: We have a resilience definition to talk about, so I don't think we need to hear from anybody on that. I think did VEPC, that's the Vermont Economic Progress Council. Yeah. Have they

[Rep. Christopher Morrow]: No. And I followed up twice now, so I don't know. Okay. I don't remember.

[Rep. Kathleen James (Chair)]: Can you write again and copy me? Yep. And then we definitely need to hear from

[Bella Scholl (UVM; intern to Sen. Chittenden)]: efficiency Vermont. I also reached out

[Rep. Dara Torre (Clerk)]: to him last week, Peter Walk. Okay. You said copy me. Okay. I'll reach out again. Great.

[Rep. Kathleen James (Chair)]: Is that it? So, oh, guess I've Okay, so we're trying to hear from Vepsie, not trying to hear. We will hear from Vepsie, we will hear from Efficiency Vermont. We have a definition of resilience to discuss. And my question is, should we all just read and discuss the follow-up testimony we had from Amanda Castle Green about a third party administrator, or should we ask her to come back in? So

[Rep. Richard Bailey]: I still really don't understand why we're continuing to take testimony when it's gonna go to commerce. And

[Rep. Christopher Howland]: Okay. Go ahead. On top

[Rep. Richard Bailey]: of that, when we get all of these people in and we

[Rep. R. Scott Campbell (Vice Chair)]: hear them, congress is gonna drag them back in too. Yes.

[Rep. Richard Bailey]: We all know what this bill is aiming for, which doesn't seem like an issue, but it doesn't really we can't really weigh in on the commerce side of it because they're gonna look at it and do what they do. Or it's for energy efficiency, and we we know that. Short of that, what are we doing today?

[Rep. Kathleen James (Chair)]: So we need to provide language to commerce that we've taken

[Rep. Dara Torre (Clerk)]: a straw poll on and that we think we're done with.

[Rep. Kathleen James (Chair)]: So I'm not there yet quite. I don't think we need to, like, overhaul this or beat it to death, but we are gonna need to it's our bill. And so we are gonna need to send language to commerce that that we stand up on the floor, maybe even to present and present the results of

[Rep. Christopher Morrow]: our struggle.

[Rep. Kathleen James (Chair)]: So

[Rep. Bram Kleppner]: In your mind, the two issues that aren't good enough yet to send over are resilience of third party administration?

[Rep. Kathleen James (Chair)]: Yep. Yeah. So if we can get these folks in, then we can just decide what we think. Then we take our straw poll, then we hand it off to commerce, and we go in there and present it. And say, Here's what we did. Here's what we changed. Here are the issues we think you should really take a look at, but here is our work. And we may get this additional testimony and decide we're

[Rep. Dara Torre (Clerk)]: not changing a word. I don't know.

[Rep. Kathleen James (Chair)]: Or we might add the definition of resilience and toss it over. But right now,

[Rep. Dara Torre (Clerk)]: I'm not I'm not sure

[Rep. Kathleen James (Chair)]: I I'm not ready to take a struggle personally because I feel like we've got a little bit more we need to think about. Yeah.

[Rep. Christopher Morrow]: Is there language that shared resilience? Is that in statute, or is that just something within the strategy?

[Rep. R. Scott Campbell (Vice Chair)]: That was just in the strategy. Although I sent around the new capture statute, which

[Bella Scholl (UVM; intern to Sen. Chittenden)]: That'd not helpful.

[Rep. R. Scott Campbell (Vice Chair)]: Look at that. Yeah. So,

[Rep. Kathleen James (Chair)]: look, if we do nothing else, we could add a definition of resilience.

[Rep. R. Scott Campbell (Vice Chair)]: And

[Rep. Kathleen James (Chair)]: I do think reps I I do think the if we're gonna designate a third party administrator, I would feel more comfortable handing that off over to Commerce. But I wanna at least say we wrap our heads around it.

[Rep. Richard Bailey]: Yeah. And I I just I don't like beating ourselves up or beating up people bringing them in here to testify in our committee when they're gonna have to do the same thing over there. Wow. And they are the ones who are specifically adept at doing these types of bills where we're not.

[Rep. Kathleen James (Chair)]: No. We're not.

[Rep. Laura Sibilia (Ranking Member)]: No. Finance. But But energy. Well,

[Rep. Richard Bailey]: is is only the topic. It's not the main part of the bill. Right. It's it's only the topic of what it is. Everything else is commerce. Yeah. And that that's where I'm struggling to understand why we're continuing to to go down this road on this when it is commerce and economic development that that bill is absolutely geared toward.

[Rep. Kathleen James (Chair)]: Yep. So not

[Rep. Laura Sibilia (Ranking Member)]: to open up a hornet's nest here, but

[Rep. Christopher Howland]: let me see

[Rep. Laura Sibilia (Ranking Member)]: if I can. Yeah. Think you want.

[Rep. Kathleen James (Chair)]: Exactly. I feel quite everybody put your protective bee hat on. Yes.

[Rep. Laura Sibilia (Ranking Member)]: But so I'm, you know, I'm I'm speaking off the cuff. I haven't really thought hard about this, but sorry. Pull that finger back also representative of self worth. But efficient so if Efficiency Vermont were, to be one of these I think there are tier three potentially tier three implications. Tier three of the res implications.

[Rep. R. Scott Campbell (Vice Chair)]: I think figures.

[Rep. Dara Torre (Clerk)]: Don't know if I actually, let me

[Rep. Laura Sibilia (Ranking Member)]: take it back. I don't think that there are. I wonder if there could be. And so, which I have not really thought about. So, that's just my way of saying I mean, I think it's okay for us to think about the financing because there's a lot of there's a lot of obligation and money that is being put forward. I don't think there are a

[Rep. Christopher Howland]: lot of commercial well, I'm

[Rep. Laura Sibilia (Ranking Member)]: gonna stop talking now. I just wanted to say, I think there's some relevance to us thinking a little bit about financing. I agree with you that commerce should, but we might want maybe want to provide some input or maybe we don't.

[Rep. Kathleen James (Chair)]: And we're almost done. Like, to be clear, I'm not envisioning eighty more hours of testimony. We get the final folks in, do a walk through, take a straw poll, and send it off to Congress.

[Rep. R. Scott Campbell (Vice Chair)]: Well and it was suggested by, what's a great name, mister Flint, and and also I talked to Chris Neillia in the hallway for a second, that maybe UNG would be an appropriate program administrator for a program that relies on efficiency and cost effectiveness calculations. And if that's the case, if they are the appropriate administrator, then that does it to energy policy, which is this committee's portfolio. So, yeah, we think this is exactly what we wanna hear from them. That their thoughts on performing that that role also seems like the administrator role is being the bureaucratic and the banking You know, making sure that you have the documents and that you're sending out bills. Know? It's yeah. It's about it. And then you can see why no one wants to do it. Yeah.

[Rep. Kathleen James (Chair)]: I'm not even looking at the language right now. Who do we have I'm sorry.

[Bob Flint (Executive Director, Springfield Regional Development Corp.)]: I'm It's

[Rep. Bram Kleppner]: I forgot the language out

[Rep. Kathleen James (Chair)]: there. Okay.

[Rep. Bram Kleppner]: And what it says about administrators?

[Rep. Kathleen James (Chair)]: Yeah. What it says now about administrators administrators. And I was interested to see that all three of the other states had an entity that was approving lenders. That actually felt important to me. Is that in our bill? Vetting and approving

[Rep. Bram Kleppner]: Yeah, section thirty two seventy seven, CPAs program administration. An entity that administers the commercial property assessed clean energy program or CPAs program under this subchapter shall be referred to as a program administrator. A municipality, a public agency, or a private entity may serve as a program administrator. However, we've talked about this. A capital provider or lender shall not serve as a program administrator municipality where it is also lending. A municipality that has adopted CPAs a CPAs district may enter into a contract with an entity to serve as the administrator or to administer the functions of the CPA program for the municipality municipality or serve as the program administrator itself to administer the function of the CPA program, including entering into agreements, etcetera. So

[Rep. Kathleen James (Chair)]: there's nobody like the other states have saying here's the approved list of lenders. Like, do we need that? And maybe that is a question for commerce. It could be it could be, Mike, that we don't tie every bow on this bill, that we turn it over and say there's a big issue that we haven't resolved.

[Rep. R. Scott Campbell (Vice Chair)]: Yeah. It just seems almost like we've done it backwards. Should've gone

[Rep. Richard Bailey]: to them first and then to us.

[Rep. Kathleen James (Chair)]: The Well

[Rep. Christopher Howland]: The bill does, they

[Rep. Richard Bailey]: couldn't figure it out.

[Rep. R. Scott Campbell (Vice Chair)]: So But I mean It just seems like we're trying

[Rep. Richard Bailey]: to fix stuff that congress is gonna address, and they change everything that we come up with or bill also They says

[Rep. Kathleen James (Chair)]: should build on our work. I mean

[Rep. Bram Kleppner]: The bill also says DFR shall consult with relevant stakeholders, including the League of Cities and Towns, VITA, Efficiency Vermont, and agencies from other states with CPA programs in order to identify appropriate entities to serve as program administrator.

[Rep. Kathleen James (Chair)]: That's right. We have a study in there, So

[Rep. Bram Kleppner]: it's on it's on DFR to

[Rep. Kathleen James (Chair)]: Figure that out. That's right. We do

[Rep. R. Scott Campbell (Vice Chair)]: Nothing to approve lenders. That that is something just to flag for commerce.

[Rep. Kathleen James (Chair)]: Yeah. Mhmm.

[Rep. R. Scott Campbell (Vice Chair)]: It sounds like there might be some questionable lenders out there that other states have been on the way to Yeah. Green out. Maybe.

[Rep. Kathleen James (Chair)]: Alright. So what is the arc of this? Well, I mean, I have markup for tomorrow, so maybe that's that.

[Rep. Christopher Morrow]: I I I appreciate that we got this go because it's really great to see that there's a tool out there. Yeah. And that it includes resilience. You know? Not not a lot of students doing that yet. So I I appreciate hearing that testimony directly. Yeah. Okay.

[Rep. Kathleen James (Chair)]: If it's okay with everybody, I know we have testimony at 10:30. Could we just take a five minute could we go up live and take

[Rep. Dara Torre (Clerk)]: a five minute break?