Vermont Legislature SmartTranscripts:

[Marc Mihaly (Chair)]: You're live. Welcome everybody back to what should be the Committee on General and Housing, and actually is in a moment, today is still Thursday, 02/05/2026. We're taking up four fifty nine, which is an act relating to parental and family leave, which came to us as a short form, I believe. And this is discussion with our council. This is not a vote. So please, Sophie, you want to identify yourself for the record

[Thomas "Tom" Charlton (Member)]: and take it away.

[Sophie Sedatney (Office of Legislative Counsel)]: Sophie Sedatney for the Office of Legislative Council. Is it okay if I go ahead and share my screen?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Please. I said there was not a

[Sophie Sedatney (Office of Legislative Counsel)]: So as noted, this is currently in a short form, and the bill proposes to prohibit employers from acquiring employees to take parental and family leave for a compensable work related injury or illness. And last session there was some confusion around what was intended by the bill, and I think there's been some clarification since then, with the goal being that employers not run if a worker is out on workers' compensation, their entitlement to unpaid leave under the parental family leave at not run concurrently. So I thought I would just do a very quick presentation just to hopefully just situate everybody in what we're talking about.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I'm taking it back. Thank you.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Oh, no.

[Mary E. Howard (Clerk)]: Well Okay.

[Sophie Sedatney (Office of Legislative Counsel)]: Well, the front is terrible. I think you decide it's not so that I'm gonna it. It's just pain. Okay. Looks like it was bad for that to hear it. I'm sorry. What

[Marc Mihaly (Chair)]: happened? Welcome, Saudia.

[Unidentified committee member]: So I just wanted

[Sophie Sedatney (Office of Legislative Counsel)]: to run through. So workers' compensation I'm sorry. Workers' compensation is essentially a non fault system that provides a remedy, the goal is that it be quick and it's independent to prove a fault. So if someone's injured at work, they don't need to go through litigation to prove that they were injured at work and the employer was negligent or whatever. It's just an understanding that if you have an occupational illness or injury related to your workplace, you go through the workers' compensation system. The quid pro quo for that is that then the employee, unless there's something really egregious that happens, doesn't file a lawsuit against the employer. So it's a way to balance that out and to provide something that works for both employers and employees. And again, if you have a workers' compensation injury, employers pay the expenses for the treatment that you need, you could receive replacement wages, usually that's two thirds of what you were earning pre injury. And if you're permanently injured, you may receive an award for impairment, if know, it's something that's, you're never going to be 100% afterwards. And then Vermont's workers compensation law provides for reinstatement within two years and protects workers from retaliation. I just flag that because that's not necessarily true in other states. Sometimes there is no protection for reinstatement included. Then the Parental and Family Leave Act covers the serious health condition of the employee. It does not need to be work related injury. The cause of your injury, your health condition is irrelevant under the Rental and Family Review Act. The definition is, this is just how it's defined, accident, illness, injury, disease, or physical or mental condition that poses an imminent danger of death, requires inpatient care, requires continuing treatment by a healthcare provider and then it also covers rehabilitation which includes treatment for a substance abuse disorder and then unpaid leave is for up to twelve weeks in a twelve month period. So these are two separate things and I was also flagged there's lots of different kinds of leave. So we're just talking here about parental, family leave at in Vermont and workers compensation, but there are other entitlements to leave that end up as a disability accommodation, it's just a variety of other things. So the responsibility for human resources if someone needs leave is to sit down with them and figure out what do you need the leave for. And it could be under, they might be entitled to it under state law, federal law, a union contract or an employee's handbook. So just to be clear, this isn't an entire universe of leave, we're just talking about these two here today. So the issue in this is around concurrent leave. So typically what might happen is if somebody's out on workers' compensation leave, an employer could say, we're going to run the clock on your Parental and Family Leave Act leave as well. And that's pretty common. No state prohibits that, and federal law even encourages it. And I think one of the reasons it's encouraged is because there are benefits, and at the federal level, it would be under the Family Medical Leave Act, but there are benefits in terms of job protection, continuing your health insurance, etcetera. So there can be a benefit to workers to have it run concurrently. And so in order to have the leads run concurrently, the employee has to meet the eligibility requirements for each type of leave. Obviously it would have to be a work related injury, etcetera. And so I think this is the situation that is sought to be addressed by the short form is currently an employee receiving workers' compensation benefits may have the time off, if they're not working and they're receiving replacement wages, counted against the employee's twelve week entitlement to either under the state or the federal Family Medical Leave Act, and that effectively reduces the amount of protected leave that an employee is entitled to receive. So that's just the general context of where I understand this short form request to be coming from. Happy to answer any questions, if anyone has any.

[Marc Mihaly (Chair)]: Wait, you said, if I understand, find get injured on the job. So, a way that I'm entitled to workers compensation benefits, and I have to be away from work for a month. Under workers' comp, I'm paid for my medical costs, not am I paid for my lost wages?

[Sophie Sedatney (Office of Legislative Counsel)]: Right. So you would receive replacement wages, which usually is around two thirds of your pre injury wages.

[Marc Mihaly (Chair)]: Okay. And what you're saying is currently under federal and state law, in fact, it's encouraged under state law. Under federal law. My employer can say, okay, you're going to be gone for a month, that counts against your twelve weeks of parental and family leave.

[Sophie Sedatney (Office of Legislative Counsel)]: Right, you're out for a serious medical condition, so we're going to just run it concurrently. So you'll get paid, the PFLA is unpaid. So yes, you would run the leaves concurrently.

[Marc Mihaly (Chair)]: So the leave is twelve weeks a year?

[Sophie Sedatney (Office of Legislative Counsel)]: Under the PSLA, you can have up to twelve weeks.

[Marc Mihaly (Chair)]: Right, so,

[Unidentified committee member]: not always though. So you have up, sorry, that's fine. So you have up to twelve weeks, but hypothetically, and not like a workers' comp situation, but I'm trying to think of a good example. I don't know, you stub your toe and you break your toe, but you sit at a desk all day. Your doctor can say, You need to be out of work for two weeks, and then you would have the remaining ten weeks. Right, what's left? Yeah.

[Marc Mihaly (Chair)]: But when would presumably to use that extra time, it would be something else that happened.

[Sophie Sedatney (Office of Legislative Counsel)]: Right, and again, what happened in the last session was there were a lot of other reasons that somebody could use the parental and family leave act under state law. So it could be bereavement leave, safe leave, there were other things that were added in to that. And again, it could be your child is sick and needs to go to the doctor, your child or your parent is sick. So there are other uses. For the PSD-

[Marc Mihaly (Chair)]: So you've used, under the concurrent approach, you've used a part of your family leave.

[Sophie Sedatney (Office of Legislative Counsel)]: Right, that's available to you. Again, we're not getting you have to be eligible for people who work to assessment.

[Marc Mihaly (Chair)]: So what is this bill?

[Sophie Sedatney (Office of Legislative Counsel)]: So as I understand it, and again, it wasn't entirely clear last session, but as I understand it, what the short form bill is driving at is to not allow employers to run a workers compensation leave concurrently with parental and family leave or vice versa, run PFLA at the same time as you're running the workers compensation leave. That's what I understand the issue to be.

[Mary E. Howard (Clerk)]: Do have questions? Okay, that's a little bit off topic for that, but if someone is using bereavement leave, that would be workman's comment?

[Sophie Sedatney (Office of Legislative Counsel)]: No, no. Workers compensation is in one bucket over here and then parental family leave out is in a separate bucket. And right now, if you're out of work for a qualifying reason for both buckets, you can run that time concurrently. Okay. If you were out on bereavement leave for, I forget, I think it's up to two weeks, then you would have ten weeks left of PFLA. Then if you're out, and then if you had a workers' compensation injury, what an employer can do is say you're out for two weeks for your stubbed toe, broken toe, whatever, that would then be another two weeks that would come out of that twelve week bucket that you have under the parental and family leave that. So if you're out because of work on workman's comp

[Mary E. Howard (Clerk)]: or the bereavement, it's the same as if

[Sophie Sedatney (Office of Legislative Counsel)]: you were still employed. Right. So do you

[Mary E. Howard (Clerk)]: have all the benefits, like medical benefits and Right, so

[Sophie Sedatney (Office of Legislative Counsel)]: under the Parental Family Leave Act, it's unpaid leave, so essentially what that's doing is providing job security, that the employer will hold your job while you're out on that leave and that the employee can continue to receive medical benefits that they receive through their employment, they would still have to pay their share of the premium. Vermont, under the workers compensation statute, there's also a reinstatement provision that if you can return to work within two years, the employer will give you the next available suitable job for you. They don't have to create a position for you, but if you were doing some kind of job and they've got an opening for that, then you would get that job over anyone else that might. So there is some reinstatement provided for you under the workers' compensation statute, which is not true for all workers' compensation statutes around the country, because workers' compensation is done as a state by state issue. And I think that is the speed of the making. But I anticipate that being why the Federal Department of Labor actually encourages employers to run these concurrently, because if you run them concurrently then someone else on workers' compensation is getting those added job protection benefits that come from the Federal Medical Leave Act. And I just want to make sure the committee is aware that in Vermont there already is that protection in terms of having the ability to be reinstated within two years of your history.

[Mary E. Howard (Clerk)]: Thank you.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Think, Mary, I

[Mary E. Howard (Clerk)]: worked in the Human Resources Department for a utility, and I handled the insurances and the workers' comp, And just like President Bartley said, if you can come back to work, let's say within two weeks, you can either, if they filled your position, let's say while you're out, they will offer you a similar position. You won't lose your job, but you will have a different job. Same thing if you were on a maternity leave. When you came back, if they had a failure position, you would be offered something similar. I think this is a good bill. I think it should be separate. So, okay, right. So you can't stack them. Mean, can't do them concuss. I'm just saying, as a state employee, when my husband was sick, I could not take family leave because I didn't work enough hours for the state. So, they do, they have different-

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: eligibility. Tom and then Ashley.

[Marc Mihaly (Chair)]: If they have a full

[Thomas "Tom" Charlton (Member)]: time employee with benefits and they are on a workings comp, they're on leave, I'm assuming that the employer is still paying benefits and that they have a family health plan for the rehab.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Right, I think the employer may start to

[Sophie Sedatney (Office of Legislative Counsel)]: pay that share of premium, but they'd still be covered. And again, any any bills related to the work related injury, the employer would be covering 100, and the employee would not be covering a portion of that.

[Thomas "Tom" Charlton (Member)]: Right. The benefits are what I'm in relation to the moment. So during the unpaid twelve week leave, the employer is also still paying the benefits.

[Sophie Sedatney (Office of Legislative Counsel)]: Right. And again, employee sharing paying their share of the premium.

[Thomas "Tom" Charlton (Member)]: So potentially, if this the it it just be if the there's part of my question concerns the cost. Okay? The employer employers are not bottomless buckets of money. Some of these businesses run at five to 10% margin. So if you have an employee who's unable to be there, not opposed to taking care of them, You have to still earn enough money to pay those bills in your short employee. If these are not allowed to run concurrently, then there is hypothetically not much of a limit to how long they can run, how long the business needs to come up with that revenue to pay those benefits without that employee there.

[Sophie Sedatney (Office of Legislative Counsel)]: So if someone's out on workers compensation and they're out for let's say six months and you run the PFLA concurrently with that, then that clock is run. So there's no additional benefit under the Parental Family Leave Act. Essentially what this would do is just say that your workers' compensation, you could be out again, you have reinstatement rights up to two years. You could be out for a long time on a workers' compensation plan. If you're running them concurrently, the PFLA, the clock's run. I mean, it's done. We're suggesting not

[Thomas "Tom" Charlton (Member)]: Right, doing that,

[Sophie Sedatney (Office of Legislative Counsel)]: so what this would do is then if and when that employee comes back to work, they would then still have the eligibility. Although, actually that is a one question I don't know is because you may have run out of hours, you may not have worked enough to qualify for the PFLA. Can I comment on a

[Unidentified committee member]: few of those things? So, when you're at workers' comp

[Mary E. Howard (Clerk)]: I'm so sorry. Nothing. Sorry. Excuse me. When you're at workers'

[Sophie Sedatney (Office of Legislative Counsel)]: comp.

[Mary E. Howard (Clerk)]: I

[Unidentified committee member]: am very sorry. When you are on workers' comp and you are out of work and you're only getting two thirds of your pay, There have been times where employees told their employer and said, Hey, I'm good to come back. An employer cannot reinstate you until your doctor has certified that you are okay to come back. My understanding of that situation, separately of what Sophie just brought up, if your doctor has said this person is cleared to come back, you're not going to qualify for PFLA because your doctor's not going to certify any of that, if that makes sense, because there's no longer a medical condition because your doctor has already certified that you are fine to come back to work. That being said, the way the hours are calculated, I don't believe you'd bond through your, I think after the first year probably, you wouldn't have enough hours to qualify for PFLA when you come back to add that onto your workers' comp.

[Thomas "Tom" Charlton (Member)]: Okay, but the entire duration of the workers' comp leave, the employers will pay whatever contractual benefits they have in place. Correct, But that's what it

[Sophie Sedatney (Office of Legislative Counsel)]: is already. That's

[Mary E. Howard (Clerk)]: workers' That's workers'

[Sophie Sedatney (Office of Legislative Counsel)]: I mean, this is simply just, it's just simply that confirmed issue with the, so right now employers can drive, again, assuming the employee qualifies for both types of leave, an employer currently legally is allowed to run the clock on the PFLA or FMLA at the same time that somebody's out from workers' compensation. As I understand that that's what the goal of the short form is, is to say you can't do that and that once they come back from workers compensation, again assuming they qualify and meet the eligibility requirements for hours, etc, they still would have that pool of twelve weeks of unpaid leave available to them under the PFLA.

[Thomas "Tom" Charlton (Member)]: Do we know where that threshold is when they run out of hours to qualify for PFLA? What I'm trying to figure out is

[Unidentified committee member]: twelve eighty.

[Marc Mihaly (Chair)]: Which is a little

[Unidentified committee member]: more than half. Okay, twelve fifty, between twelve fifty and twelve eighty. Hours. Hours a year.

[Sophie Sedatney (Office of Legislative Counsel)]: For that particular employer. Yep.

[Marc Mihaly (Chair)]: Which is kinda like a little more than half time. So if somebody's used up

[Mary E. Howard (Clerk)]: okay. Just go ahead.

[Thomas "Tom" Charlton (Member)]: With it the way you saw it, it's not worth money. It would potentially extending the cost of the employee getting at work. It's money the business still has to make. So if they're out for four weeks, they come back, they can still qualify for Twelve weeks. For twelve weeks. So now that's But

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: that's So

[Thomas "Tom" Charlton (Member)]: if we run concurrently, there's up to twelve weeks. So if there's twelve weeks, then yes, the employer's gonna be paying benefits if it's worker comp related or not. But potentially, what we have if we don't run concurrently is the employer paying the benefits package during workers' comp, and then again for up to a certain number of weeks. So depending on how long the leave for workers' comp is, that costs almost as much as the labor.

[Mary E. Howard (Clerk)]: So what I was trying

[Unidentified committee member]: to say is in order for you to come back to work, you have to be certified by your doctor. The

[Emilie Krasnow (Ranking Member)]: leave act could be for a range of other things other than being hurt, though. So you could be perfectly fine, and then two weeks later, you take it

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: for a

[Thomas "Tom" Charlton (Member)]: completely And different

[Unidentified committee member]: that's what this bill is trying to

[Marc Mihaly (Chair)]: In fact, that's the rash, I think. I'm sitting here trying to think, what is the rationale for this? And I think, the rationale for the change is workers compensation is for one thing, it's for a worker who gets hurt, that's paid, although not fully, it's paid, you know, and your healthcare is paid and your benefits are paid. It's as if you're at work at two thirds salary. Rental and family leave includes a whole bunch of other stuff way beyond whether you're hurt on the job. It's about the rental stuff, bereavement, etcetera. I think the theory behind the bill, I'm not sure how I feel about it, but theory is they're separate, so keep them separate. In other words, they're not the same benefits, so they shouldn't run together. I guess that's the theory behind it. In terms of cost, which is what you're getting at, the only thing I'd say is workers' comp costly to the employer because their rates go up they have to keep and Does the employer pay for the medical and all the benefits?

[Sophie Sedatney (Office of Legislative Counsel)]: Usually an employer will purchase insurance,

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: but again, if you have a

[Sophie Sedatney (Office of Legislative Counsel)]: lot of injuries in the workplace, your cost of your insurance is then you don't.

[Marc Mihaly (Chair)]: Right, so one way or another, it's either picked up by the employer I'm talking about. But on the other hand, parental and family leave, my understanding is you don't get paid, and you have to pay you get your benefits, but you have to pay for it.

[Sophie Sedatney (Office of Legislative Counsel)]: You pay

[Mary E. Howard (Clerk)]: you just pay your share of the money.

[Marc Mihaly (Chair)]: You pay oh, mean the employer continues to pay their share?

[Thomas "Tom" Charlton (Member)]: That's where as far for, like, a small shop, an employer, just having somehow you know, being able to anticipate what will this cost in the calendar year is much more open ended.

[Sophie Sedatney (Office of Legislative Counsel)]: I think the other, you know, it's unpaid leave under the parental and family leave act, it's not something that people can, you know, a lot of people can't just take twelve weeks of PMLA. But from the employer side, I mean obviously it's typically a small employer, it's disruptive. If you're losing an employee and you only have 10 employees and you lose one for a period, that's disruptive, just if you lose not the work's comp as well.

[Emilie Krasnow (Ranking Member)]: It would be helpful if we decide to have some testimony on this. We could hear from the people who were the catalyst for this request, who came to the legislators who submitted the bill and then also from some business folks if we continue to move forward?

[Marc Mihaly (Chair)]: I mean, that's the question.

[Mary E. Howard (Clerk)]: Yeah, how do

[Marc Mihaly (Chair)]: folks feel? The question is how do folks feel? Should we ask Sophie to draft this up and take testimony or not? It won't happen right away. In any case, we're pretty full for a bit, but it would happen later. Or do we do that or not? That's the decision today.

[Emilie Krasnow (Ranking Member)]: I see myself in any in each place, perhaps it or not. I think the sticking point for me, which is, great to feel good, Bill. Yeah, I get it. They're two completely separate issues, but they're also can be the exact same issue where you're on leave because you're injured, and you're on leave because you're injured. How many clocks do I have to run at the same time? Or does every clock get its own start date and then you're a huge employer and could absorb the cost, excellent. You're probably gonna be fine. If you run on the margins and one of your tactics to get good employees is that we offer really good benefit package, it's taxing on the employer to do it, but that's kinda how they recruit people. Those are the good benefit package. That's gonna hurt because I don't know if people have seen benefit package costs lately, maybe education or other things like that. $40,000 a year for a benefit package that the employee pays 5 to 10,000 of that, that adds up real fast with a small employer.

[Mary E. Howard (Clerk)]: Both of you guys. Go ahead, Gayle. So is there a possibility of in policy stating something that for businesses that make under a certain amount, this does not apply, that are not equitable? So could

[Marc Mihaly (Chair)]: it be limited by number of employees or something?

[Emilie Krasnow (Ranking Member)]: Without too much transparency, or maybe I am, the catalyst for this field is a very large employer. So maybe we need to why they can't sponsors. I just talked about that.

[Marc Mihaly (Chair)]: Which is consistent with your fear, which is that

[Thomas "Tom" Charlton (Member)]: our employers always want to.

[Mary E. Howard (Clerk)]: Part of the benefit package that you have workers' comp and family leave, and obviously you don't want to have anybody injured on your premises, but if you don't offer workers' comp, then you might run the chance to

[Unidentified committee member]: your hand off.

[Thomas "Tom" Charlton (Member)]: I'm just trying to figure out how long a clock could hypothetically run while I'm in pain when it gets active.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: It didn't come to one.

[Thomas "Tom" Charlton (Member)]: The that's not where I can find any workings comp, find the benefits package. Taking something that used to overlap, essentially putting it in to end. I'm just trying to figure

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: out how long, because it's,

[Thomas "Tom" Charlton (Member)]: yeah, I mean, it runs a year, you could hire another part time employee.

[Unidentified committee member]: Yes, or do some cross training or

[Mary E. Howard (Clerk)]: Would you feel comfortable if there was an amendment offered for a very large threshold of a business?

[Thomas "Tom" Charlton (Member)]: There are business size thresholds for other HR type agents?

[Mary E. Howard (Clerk)]: Yeah, think we'll bottom in this committee.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: And I think they will I had a question here.

[Marc Mihaly (Chair)]: Go ahead.

[Leonora Dodge (Member)]: Can you tell us about the thresholds about because I thought that the unpaid Family Leave Act was 50 and under, which

[Sophie Sedatney (Office of Legislative Counsel)]: is going to cover most of Vermont. So under the Parental and Family Leave Act, an employer needs a person who, for purposes of parental leave well, all the different needs employs 10 or more individuals who are employed for an average of at least thirty hours per week during a year. Is that federal? This is our state one. State one? Yeah, federal is 50,

[Leonora Dodge (Member)]: but we've made one that's four and ours is higher.

[Sophie Sedatney (Office of Legislative Counsel)]: So ours is if you have 10 employees working at least thirty hours a week, then you're a covered employer under the parental family leave ad. If you have 15 or more, that's for the family leave, that's the paternity child leave. But yeah, so right now there is a threshold on the size of the employer. But again, I think if you were adding something in, you could have a threshold that was specific just to the current piece. How

[Marc Mihaly (Chair)]: would people feel if we just asked Sophie to draft it up, but to contain a provision that would have a size cut off and you could just leave it blank, and tell us different size cut off.

[Mary E. Howard (Clerk)]: Yeah, want to do a little research there.

[Marc Mihaly (Chair)]: Yeah, it

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: could be. Could federal. Yeah, maybe federal cap.

[Emilie Krasnow (Ranking Member)]: Yeah, let's do that.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Could I ask a question? Your

[Unidentified committee member]: job is much harder than mine and I wouldn't know how to do it. If you're drafting the language, could we ensure that it would not prohibit any other types of lead running concurrently? STD? Right. I just want to make sure that language is very clear that

[Sophie Sedatney (Office of Legislative Counsel)]: you might still be Yeah. On

[Unidentified committee member]: Please and thank you. STD is short term disability. Yeah, thank you.

[Emilie Krasnow (Ranking Member)]: Thank you. Oh my!

[Marc Mihaly (Chair)]: I'm hearing that the committee has

[Emilie Krasnow (Ranking Member)]: It's not Friday.

[Marc Mihaly (Chair)]: Kathleen, you want to turn your computer or mute your computer? It's Kathleen.

[Mary E. Howard (Clerk)]: We've got

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: the silliest today. Okay.

[Marc Mihaly (Chair)]: What I'm hearing is despite, I think, uncertainties would be the minimum way I could put it about the substance of the bill, I think you should go ahead, think that there's enough feeling about it, you should go ahead and draft it up, but wrap it up with a size threshold that we can then debate, and when you come back, perhaps with some examples of size thresholds, 10,000 employees or more, you

[Mary E. Howard (Clerk)]: know. Maybe.

[Unidentified committee member]: Let's remember that a majority of our businesses

[Mary E. Howard (Clerk)]: in Vermont have 10 employees or That's right.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: That's the truth.

[Emilie Krasnow (Ranking Member)]: I'm trying to go after the big guys.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Dope.

[Emilie Krasnow (Ranking Member)]: Alright. We're I'm done. Alright.

[Marc Mihaly (Chair)]: Thank you very much. You're welcome. So we are now going to return to H-seven 72, which is an act relating to residential rental agreements, eviction procedures, creation of a positive rental payment credit and reporting program. And our next witness, Jean, you can sit down. You know how that is computer connected?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Yeah, I'm a little nervous, and I'm a little nervous. Pathology takes me a little bit longer.

[Marc Mihaly (Chair)]: Take your time, please.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: My computer makes it nearly as old as I am, so I have to plug in, or it might just abandon.

[Mary E. Howard (Clerk)]: Did you see some

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: of tilt there? It works pretty well, except for the back of the parking.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: So

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: trying to open the email so I can get the Zoom link.

[Marc Mihaly (Chair)]: Oh, Jean is schooling the technology. She's our first witness on this bill this afternoon. She's the senior housing attorney at Vermont Legal Aid. I can tell, I know what senior is being, but I won't comment on

[Mary E. Howard (Clerk)]: that. And

[Marc Mihaly (Chair)]: Jean, going to have a break and then we're going to have testimony from three more people before the floor at 03:30.

[Mary E. Howard (Clerk)]: Right, Kathleen is Right,

[Marc Mihaly (Chair)]: I'm sorry, Kathleen Burke from the Housing Authority. Do you need help? Because we have a person here who is of an age that means that she's very technologically savvy.

[Mary E. Howard (Clerk)]: You want to help. Great movie. I

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: got to the Zoom link, but now I'll let you.

[Mary E. Howard (Clerk)]: You hit the button.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Okay?

[Mary E. Howard (Clerk)]: Okay, it's there we go.

[Marc Mihaly (Chair)]: I mean, I think the governmental affairs person has to explain why your technology is not sufficient to deal with our system. Yeah, would you like that in court, Okay.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: It's up on the screen, and give me the screens. Is that working?

[Marc Mihaly (Chair)]: That is. You might want to use the little thing there to make it big.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I want to take the side thing away. How do I make this bigger? Oh my gosh. I'm so sorry.

[Unidentified committee member]: No, don't be sorry.

[Emilie Krasnow (Ranking Member)]: Made it farther than me, so don't feel bad.

[Unidentified committee member]: You can

[Sophie Sedatney (Office of Legislative Counsel)]: just hit this right here. Oh,

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: perfect. All right. Why don't you

[Marc Mihaly (Chair)]: tell us who you are for the record?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: For the record, my name is Jean Murray, I work at Vermont Legal Aid, I've worked at Vermont Legal Aid since 1998, when Angela was first out of law school, she and I met in court, and we've done trainings together. She means a really nice person, and I was here when she was testifying. One of the things that makes me nervous is my whole career, thirty five years, I've stood up for tests. Now looking at this bill, I feel like I need to stand up for Vermont, and it kind of makes me nervous because what's going on here are housing policy choices. You guys aren't seeing them. Okay, what is the problem that we're trying to solve here with amending landlord tenant law? You've heard from other people, I saw your agendas early in January, there's a housing crisis in Vermont. There's not enough housing. The housing, especially the rental housing we have, is too expensive for the people who live in Vermont, for people who live in Vermont forever. My data, my information, comes from representing tenants. I did a thing in our database to find out how many tenants that me personally has talked to who are facing eviction in court in the last three years, and it's $3.59. And one of the things that I do when I first meet a tenant is I Google them and I find out, I look at the online docket, I look to see if they show up on Google anywhere. The place that most of my clients show up is in somebody else's obituary. So they are a relative of somebody who's lived in Vermont for a very long time and has passed away, and they're the people we're in meeting. The people who don't have enough money to pay the rent in Vermont are Vermonters. So for me, the problem that Vermont is trying to solve is housing affordability and rental housing availability, and we need to solve the barriers to people who are trying to exit homelessness.

[Leonora Dodge (Member)]: So, one of the things

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I wanted to do was what they call level set. What are we trying to change? We're trying to change the landlord tenant law. Where did the landlord tenant law come from? The landlord turnout law came from legislative discussions in 1985 and 1986, it was effective in 1985, and it was passed as a whole policy, a whole policy in Vermont to balance the rights between landlords and tenants, to protect tenants from unscrupulous and recalcitrant landlords. In 2019, I turned it into a lease, and so if you want to see the whole of Vermont landlord tenant law, I'm passing it around right now so you can see what it is. You could use the Residential Mental Abusement Act as a lease, which is maybe even the most important point. Over the years, since 1986, what has changed? In 1986, the vacancy rate was 7%. The vacancy rate now, and this I disagree with Angela on, it's only 2.5. The vacancy rates in the other states that Angela was talking about, they are much bigger vacancy rates. So right now, because Vermont doesn't have enough housing, the vacancy rate has split. The landlord, the Residential Rental Agreements Act, based balance on how people behaved in the market, but scarcity has tipped that balance in favor of landlords. It's meant to protect tenants from unscrupulous and recalcitrant landlords. In my written testimony, I gave you the Supreme Court site that says that. But the lack of tenant lawyers means that the current law is not enforced. You can pass all the laws in the world, but if there's nobody watching, they don't have to be followed. And believe me, there are landlords out there that do not follow the law. Sometimes it's because they don't know the law. But then I would say, if you don't know the law, what are you in the business of being a landlord for? You need to know the law. You need to understand how it interplays and what the duties and the rights and duties are. And sometimes they just make mistakes. Sometimes they don't understand what they have to do. Like for example, when we're talking about the time needed to adjudicate even a non payment case, a professional management company with professional software did not keep a ledger of on this date, this much was owed and this much was paid, But they kept a kind of changeable spreadsheet. And so the way I found out is they attached a ledger at the beginning of the case and then I did discover you got another ledger and I said, look, if we look at this gate on this one, these transactions happened, but on this piece of paper, these transactions happened. You mean you didn't actually keep a record of when payments were made and not. You went with your computer and went back and changed the records you kept. And this is a professional management company. So they don't mean to be unscrupulous, I suppose, but the ability to be careful is not always there. And the Landlord Tenant Act was meant to assure that rental housing is safe, clean and fit for human habitation. But in Vermont, we used to have town health officers, the town health officers were not necessarily trained as building inspectors. The health department tried to step that up and ultimately the Department of Public Safety took that over, and now they have a complaint based system and they have professional people that will come out. But if the tenant never calls, then there is no guarantee in most of Vermont that the place that they're renting is safe, clean and fit for human habitation. So is the current landlord tenant law doing what it's supposed to do? Among anything you're talking about here today, I would keep it, but if you actually wanted to sit down and talk about how I think it could be improved,

[Mary E. Howard (Clerk)]: I could give you some ideas. So

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: who are the stakeholders in this landlord tenant situation? In my written testimony, I identify landlords and a subset of landlords as managers, property managers, and then there are tenants, and then there are the human service. Heard from CDOEO this morning, all of the CAP agencies and the elder service agencies and everybody who tries to help people stay housed. And those are funded, by the way, by Vermont. They're funded through Agency of Human Services, not entirely funded, don't want severe your person, but they're funded through Agency of Human Services from the Office of Economic Opportunity who gets a grant from the legislature and turns around and says, Here, here's money for staff, here's money for back rent, So see how many people you can keep housed with this. And the reason I wanna point that out is because when you take things away from tenants, and on this hand you're paying to have people help tenants, that money that you're spending becomes far less effective. But okay, I was landlords, property managers, tenants, human services providers, and the judiciary. So those are the stakeholders, and I'm going to start with landlords. You may have heard when people, especially Laura Collins from Vermont Housing Finance Agency, tells you how many units are needed, how many affordable units are needed, how many subsidies we have, how many subsidies we need. Kathleen's going to tell you that they're in a desperate spot about subsidies, that we're standing to lose some of the vouchers that we have because of financial things, and hopefully she'll explain that better than I can. But if you take away everybody who might be living in subsidies, then what you have is 65,000 households who are housed by private landlords, and some of them are mom and pop landlords and some of them are corporations. Yes. I had this question earlier, and I

[Unidentified committee member]: hadn't asked, but if you're like, you might be better equipped to answer it. Do you have a percentage breakdown on how many landlords are corporate versus smaller mom and pop?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Okay, so here's my plug. The first time I'll probably do it three more times for a rental registry. No, we don't know that. There are marketing reports and there are newspaper reports about the increase in investor owners in Vermont, that's part of the housing needs assessment too, that an investor owner is defined as somebody who owns, I think, three or more properties, and those are grown in Vermont. But we don't know exactly who is the owners of places and how many units they have, and whether those units are available or vacant, or how much rent is being charged, or how many times did you ask the people there to leave, and when's the last time you renovated? We don't know any of that. And so as Chair Mihaly pointed out earlier this morning, when you're trying to make a decision on this, I would say that mostly you're not making a decision based on data of the landlord side, you're making a decision based on some landlord stories. And I was on the landlord tenant study committee. There are some landlord stories. But let's get back to just discussing landlords a little bit. There's 65,000 private landlords. I looked up the marketing data. There are as many buildings bought this year as there was five years ago. There was a spike in 'twenty one and 'twenty two where double the amount of buildings were bought. So people are buying multifamily buildings, must want them for something. I imagine they want them because they want to be landlords. And I also am very familiar with foreclosure numbers because the lady who helps with foreclosures do sometimes. Foreclosure numbers are very low, non residential foreclosures are non existent. I went and checked bankruptcy statistics. For Vermont, only two sixty two bankruptcies were filed at all, and it did not appear that very many landlords were declaring bankruptcy, and yet they've raised the rent. Now when I say they've raised 40% in the last five years, that is the average raise of rent. Some people's rent went up more than that. My rent went up 40% in the last five years. The sales prices of multi family buildings have gotten 71% higher, so the value of the investment has gone up.

[Emilie Krasnow (Ranking Member)]: Sorry to interrupt, hello. Do you think there's a correlation between the costs going up on buildings and other tax related things to the rents going up?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I would suppose and

[Emilie Krasnow (Ranking Member)]: It would seem like it's

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: So when you're trying to figure out a policy question, I mean, I watch a lot of TV, they follow the money. Who is making the money?

[Emilie Krasnow (Ranking Member)]: Right, no, I know. I'm just

[Mary E. Howard (Clerk)]: saying my point is it

[Emilie Krasnow (Ranking Member)]: has to be a correlation of costs going up due to costs going up to the landlords.

[Marc Mihaly (Chair)]: I guess to piggyback on that, I think the question she's asking is what about net profit? In other words, if rents go up 40% and costs went up 40%, landlord wouldn't be making it anymore, so she's asking, do you have any opinion on the rate of increasing costs?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I guess I have an opinion on it, which is that Vermont allowed itself by not building enough housing to allow people with a bunch of cash money to come in and buy pieces of Vermont and make it more expensive for Vermonters. That would be my opinion. Do I think that the rents across the board going up that much are directly related to all of these people who are deciding that property is cheap and they want to invest in it. That's actually not what to think, but I don't know. I mean, I'm not an economist, and so I don't know, all I can do

[Marc Mihaly (Chair)]: is I don't think you should be afraid to express an opinion, since we hear plenty of opinions, and I'm not sure how much else there is.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: And one of the other things we know about landlords is landlords, a couple of years ago, it was actually a fairly dramatic statistic, 70% of housing choice vouchers went unable to lease up because landlords simply wouldn't take them. I think that's improved since then, it was pretty bad for a while there. When was that? Three years ago? During the pandemic.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: You said seventy percent nationally.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: No, didn't say nationally. I thought it was us. I thought it was something for me.

[Mary E. Howard (Clerk)]: Gayle, you have a question? I'm sorry, thank you. So my question is, don't we think that if we don't level off the playing field and really take a look at landlord and tenant, it's going make it that much more difficult for landlords to want to provide

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: rentals. No, I don't think so. I think somebody who doesn't want to be a landlord and figure out how to, because landlords make money in two ways. One, they invest in property and the investment value of the property appreciates, and they also have tenants to pay the expenses, including the mortgage, but pay the expenses and the maintenance while that property appreciates. And so should landlords be making a profit on rent? Well, they're going to make a profit on the appreciation of their investment in the property. So do I think that refusing to give landlords more rights is going to discourage people. Well, it would discourage some people, but people who are business people and they want to figure out how to make this investment and manage the investment, they're going to do that. So at this point, when I look at this legislation, I think landlords want more. They want to have legislation reduce their expenses and their risk of expense. They want to blame all tenants. There's 80,000 tenant households in the state of Vermont, which is actually 30% of all Vermont households. They wanna say, let's change the rights of all of those people so we can reduce our expenses. And they want to blame the court for delays, even though the courts, and I don't know if you guys know this, the courts process evictions faster than any other kind of civil case. Their aspirational goal is to make sure that the case is disposed of in less than one hundred and eighty days, and they make that goal 78% of the time. That's from the judiciary's decision.

[Mary E. Howard (Clerk)]: Sorry, can I interrupt real quick? I want

[Unidentified committee member]: to go back to this bullet point of have refused to take tenants with subsidies. Am I misunderstanding? I thought that's against the law.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Right, but if you don't have any lawyers to sue them, and if the Human Rights Commission is not funded enough so that they can investigate those cases, then people can get away with it.

[Unidentified committee member]: But I guess my comment is if we're talking about blaming all tenants, isn't it kind of blaming all landlords? There's a lot of great landlords out there. And I guess my concern was saying, have refused to take tenants with subsidies. Like that's already against the law.

[Mary E. Howard (Clerk)]: True.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: The reason I put these things on my bullet points is because this has been my experience as a lawyer for tenants, and trying to be here in the state house saying, what is it that we need to have a balanced policy about housing? Yes, go ahead. It's

[Leonora Dodge (Member)]: unsettling to know that even with a law on the books,

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: those rates can be achieved. For example, I'll name names, because they've come here and talked to this committee before. There's a management company called Stone and Browning, and if you go on their website and you try to apply, their criteria is that your income has to be three times larger than rent. And will they let you say, Hey, I have a voucher that's worth this much money or would be worth this much money. Can I count that as income? And their application says no. So that is how they don't take tenants with subsidies because they say the only way you're eligible for a unit is if your income is three times the amount of rents on this unit.

[Mary E. Howard (Clerk)]: So, what you had said before about it being against the law, is that across the board? Like if somebody owns a duplex or a quad and they rent, is it against the law for them to refuse a subsidy or a voucher?

[Unidentified committee member]: We have an attorney here who could answer that, but that was my understatement.

[Marc Mihaly (Chair)]: Think what we should do is, Kathleen, would you note this issue so when you testify you can address it? This is a whole issue of the legality of refusing to take Section eight vouchers. She knows that issue, she'll be addressed. Okay.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: So, of the stakeholders, tenants right now are not doing fine and they are trapped. I try to use the thesaurus as much as I can, but they're stuck, there's no place to go. Wherever they are, they are struggling as hard as they can to stay there because there's so much scarcity in the market, there's no place to go. I call that trapped. Rental housing scarcity means there have been huge rent increases. There's no availability, there's no bargaining power against junk fees. Have you guys heard about junk fees? Where, oh, you're going to get a concierge service along, so your rent is this, but you need pay $35 for that and $23 for that and on and on, and you don't get anything for it, they're just surcharging your rent. Parents are chilled from complaining about bad conditions or bad let go of behavior because if they do, now you talked about retaliation earlier today, sure, if the landlord turns around and tries to no cause you out within ninety days of you complaining, you can defend yourself with retaliation, but if they wait until ninety two days, you don't have that protection anymore. So, people don't want to complain. New workers can't move to Vermont. Think we've talked about problems in healthcare and problems in getting teachers and things like that, they can't find a place, they can't move to Vermont. This is my opinion, based on the cases that I've seen, there have been more evictions because new landlords have come in and they want to renovate, so they just evict the tenants.

[Marc Mihaly (Chair)]: I gotta tell you, I'd say max five minutes.

[Mary E. Howard (Clerk)]: Okay. We

[Marc Mihaly (Chair)]: have one more witness before 02:20.

[Mary E. Howard (Clerk)]: So, there

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: is the problem though of the really bad tenants, and you're going to hear more about that. But this is what I would say about that. Creating homelessness does not solve security problems. All tenants don't create the security problems. You don't need a law to change the law for all tenants. What are the alternatives to eviction without due process, which is really what the show cause part of seven seventy two does. It really eliminates due process, think probably unconstitutionally. Alternatives could be security. Yes, it increases the costs of some places, but the cost is the cost. Roofs cost money too. I don't think you say there's no way to solve security problems until you've tried to make sure that there are security buildings. Law enforcement has a role in this, and people should be talking to law enforcement about what it is that they're doing to keep the proliferation of, I guess, drug dealers and criminality out of housing. And then of course, I think there should be more housing retention or lead intervention services. Shortening notice times for tenants will not make courts move faster. It won't. The courts are going to move as fast as they can. In my written testimony, the judiciary is my branch. They are the place where people can go and be heard and the judges take it very seriously and they try to give each case the time that it needs and they are under resourced like everything else. I'm sure if you had somebody from the judiciary in here, they would say, if you gave us more money, maybe we'd have more judges, maybe we'd go faster. The court, taking rights away from tenants is not going to make the courts go faster. As CBOEO said this morning, shortened notice times is just going to mean that you're not going be able to get help. One of the really things that I think has gone not good in 1772 is taking away the time to pay and stay. The policy in Vermont has been, yes, you get behind, but if you catch up, you could preserve your tenancy. And right now, there's a certain amount of time to do that, and this takes away time to do that, which seems backwards to me. I think the thing that is being proposed here, the most telling thing to me about this is adding grounds for eviction under the violation breach part, nonpayment violation breach, in July, there's a paragraph that says, if the tenant doesn't agree with the landlord's changes, that is now under seven seventy two, a violation of the statute. So what that means is this is legislation directed at taking away tenants' bargaining power. And for me, that frames the whole intent of this legislation is to make things better for landlords and make things worse for tenants, which is going to set up a situation where it's ever increasingly more okay to take advantage of tenants. I don't think that's good for Vermont. I think people will not come to Vermont if they can't find a place to live. Yeah, and then there's other embedded things in July. Right now, a complaint is allegations and an answer is cross allegations or their version. Complaints do not have to be verified under oath. They're actually not even supposed to be. This is not the evidence. A complaint is not evidence. The answer is not evidence. It's just stating your positions. Seven seventy two says tenants have to answer under oath, but landlords can come to court and say, this is what I think is happening, which is fine if you have time to adjudicate it and say, okay, prove what you think is happening, that's fine. But seven seventy two takes away tenant rights to be able to present their case. It says, If your affidavit doesn't meet snuff, you're out of here. That's more profound in the show cause piece, but it's also part of an eviction for every tenant. One of the things that seven seventy two does, right now there's actual notice, and the words of actual notice are: actual notice is the receipt of notice. And then it suggests in a sense two ways, you can put it in first class mail or certified mail, or you can put it in the tenant's contract. And in seven seventy two, the word receipt is taken out. That means that it's valid notice and you can go to court, but you do not have to prove that the tenant received it. And I'm just, to me, my fault. So other states may have the shorter notice times, but other states notice times fit with the housing policy choices that those other states have made and paid for and approved. Other states have housing courts. Other states have trained housing mediators. Other states have building departments that regularly inspect places. A lot of places there, you need to have a certificate of occupancy to rent. Certificates of occupancy, wow, that would mean that there's someplace to look to see what is the rental housing here, who owns it, how much they're charging for it. In other words, a rental registry. Other states ensure tenants the right to adequate housing and even though the law does, we can't enforce it because we don't have enforcement mechanisms and tenants don't have lawyers. So other states protect elderly from no cause eviction. Other states have court eviction of eviction. But what works in this? I'll go down to the side that I think March, April, and July to the extent that they picked up Bantam March, And there's one in six eighty eight. June would change a rule about mediation. It would allow mediation in landlord tenant cases. But what works, limit eviction for no cause That is not serving Vermont, somebody said, how many evictions is this for what? So we were able to, with pandemic money, do outreach to all the tenants facing eviction. And so that was 5,000 tenants over three years and 2,500 came back to VLA and LSV. We don't have that money anymore, but for the time we did it. So we were able to basically track what was the reason for evictions. And so 70% of them are not payment rent, 72% were for no cause, which was greater than the last time we did an account, which was from 2016, where only 17 or 18% were for no cause. And seven to 9% were for cause, but most of those causes were not violent problems. They were you didn't get your paperwork done.

[Marc Mihaly (Chair)]: I'd have to ask, because we're really cutting into the time of our subsequent witness. I see these lists and they're very valuable. Maybe you just want to make one or two of the most important things there. We see the list, and I think it's safe to say, at this point, know what they mean, but feel free to comment on one or two, and then I'm having to ask you to wind up.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Well, it had not been for this bill, I'd be back in this room asking for more programs, back back rent programs work. Kathleen's going

[Mary E. Howard (Clerk)]: to tell you about them.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I'd have a tenant right to counsel, I would keep eviction records confidential, there would be a rental registry, there'd be more than this, I'm going read my list, there it is. These things are important for what the problem Vermont is facing now. And so if we wanted to sit down and have a rational discussion about what are housing providers going to do about the tenants or the guests of the tenants who are destroying some buildings, we should do that. We should have that discussion. I don't think that's contained in seven seventy two. I really appreciate all your time.

[Marc Mihaly (Chair)]: Thank you, and I'm sorry there isn't enough of it.

[Emilie Krasnow (Ranking Member)]: Questions? Just one question would be, it's very obvious that we have the people being evicted and the landlord side of this whole lot. My question for you would be, how much work does your group do with the people that live on either side of the person being evicted? We talk about tenants' rights all the time, but some of those tenants are perfectly fine in buildings they're in and being having their lives flipped upside down because of the person next door. How much work does your organization do with people on either side of the person being evicted?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Well, right now I have a case where my client is a single mother and she's living in housing built with public money, and her upstairs neighbor is going through some substance abuse problems and is very loud and is just so she's not rational and she does stuff like jump on the floor, which means that my client can't sleep at night and she is trying to have a business that requires her to have a lot of energy and she lost, it's a house cleaning business, lost clients because she wasn't able to get there because she couldn't sleep. She's asked management to do something about it, management won't do anything about it. And this is not a foot traffic person, this is just a person whose behavior is not good and it's disrupting the other company. And the reason she's my client is because management is evicting her. So do I see that management plan evicting her because she's complaining management and evicting her because she's behind on her rent? She's behind on her rent because the other tenant disturbed her and she lost business. So, do I see both sides of it? I do see both sides of it. But there are ways to deal with both of those sides, and letting deputizing landlords to be the arbiters of whether or not somebody

[Mary E. Howard (Clerk)]: has broken the law is not really to leave people. Other questions? We're really running behind, so Drew,

[Saudia LaMont (Member)]: Really quickly, just can I piggyback off of that? And if you can just decide if this is for Jean or Kathleen to answer. Similarly to to that, when folks are in a residential situation where there's disruption so I'll give a a specific example. Similar situation, apartment unit, the upstairs neighbor literally terrorizing the downstairs neighbor, cutting their cables, flooding the bathroom so it leaks into their apartment, stomping on the floor, very similar situation. But both apartment units are on vouchers for people, with disabilities. So the and and so, of course, the the, agency that is the housing infrastructure, who I won't name, you know, has not evicted either tenant. Are there legal recourse for damages or anything? Or like, how does that work with the tenants just being like because, you know, part of it on your first slide, you know, it said to to provide safe, housing where there's not disruption, and I think that's what we're talking about.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: So here's a story from way long time ago. I worked in the elder law unit and the elder kept smoking cigarettes in the apartment and was worried that they're going set a fire. Everybody met and said, okay, person is losing cognitive ability to take care of themselves, how are we going to preserve this tendency? They took the stove out, they provided sand buckets. The idea is you solve the problem with human services providers, with management, with people who are in the group of how do we approach this. You don't say we don't have the resources to figure out how to, if somebody's making noise, maybe noise muffling can be provided. There are ways to solve the problems. Is there a universal way to solve the problems? No, these are human people, human problems. They all need individual solutions and

[Mary E. Howard (Clerk)]: services to solve our own. Thank you, Jean. Thank you so much. Thank you very much.

[Marc Mihaly (Chair)]: Kathleen, you're up next.

[Mary E. Howard (Clerk)]: You may have to make some adjustments on our schedule. They just don't secure.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Make a similar chuckle as I think

[Thomas "Tom" Charlton (Member)]: instead of starting at thirty.

[Emilie Krasnow (Ranking Member)]: I think he drove all the way here to test five.

[Marc Mihaly (Chair)]: Okay. And that we have house for Well, we'll just have to see, I don't think we're going to have time.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Yeah, because he doesn't have bug hopefully, so.

[Marc Mihaly (Chair)]: Kathleen, you should feel free to make your full presentation, and we'll just have to adjust it.

[Mary E. Howard (Clerk)]: I know. But it's yeah. Still from where we're gonna come up.

[Emilie Krasnow (Ranking Member)]: I'm saying use this.

[Mary E. Howard (Clerk)]: You can do the, what, this one here, look, use this.

[Emilie Krasnow (Ranking Member)]: Oh, I'm saying if these do get them.

[Marc Mihaly (Chair)]: Yeah, right, to here?

[Unidentified committee member]: Yeah, sure. And these are virtual.

[Marc Mihaly (Chair)]: Yeah, and these could be or not. Okay.

[Unidentified committee member]: You wanted to share chips with us too?

[Mary E. Howard (Clerk)]: Let's see

[Marc Mihaly (Chair)]: how it goes, but one possibility is to you

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Alright. Well, I'm set. Are you able to

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: get the Zoom link? Just a question. Do I need to pull the presentation up before I open

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: the Zoom link or? Okay.

[Sophie Sedatney (Office of Legislative Counsel)]: Good afternoon. Thank you

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: for inviting me in today. Again, my name is Kathleen Burke. For the record, I am the executive director of Oops. I'm really having a

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: hard time here. Maybe

[Sophie Sedatney (Office of Legislative Counsel)]: I'll

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: just read from my file.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Could

[Marc Mihaly (Chair)]: you help her one more time?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: So my presentation today is really an overview of the impact on federally assisted tenants. Age 72 introduces significant supports for renters, including eviction protections, increased confidentiality, credit building pathways, and VSHA managed funding. At the same time, several provisions may create challenges for households receiving federal funding assistance. Understanding these impacts requires examining the bill through the lens of federal program requirements that often govern federally assisted tenancies. It's important to understand that federal regulations always preempt state law and HUD funded housing programs. Alignment is essential to protect program integrity and ensure continued receipt of federal funds, prevent conflicting obligations for landlords and safeguard thousands of Vermont households that rely on federal housing assistance. Challenges and risks in H-seven 72. If not aligned with federal requirements, certain provisions in H-seven 72 could unintentionally accelerate court timelines beyond what federal due process allows, create strict cure requirements that conflict with health standards, permit owner use. Permit owner use or renovation terminations that violate federal good cause rules. Allow rent increase processes that destabilize vulnerable tenants in tight or high poverty markets. The following slides detail where state and federal requirements currently align and where conflicts arise. ABE seven seventy two supports several objectives that are consistent with federal policy. Reflects federal good cause expectations for base enforcement, reinforces health and safety requirements similar to federal habitability standards, establishes security deposit limits that can improve access for voucher holders, supports confidentiality practices consistent with federal screening requirements. Potential conflicts with federal regulations. Specific provisions risk conflict with federal housing law. No cause terminations contradict federal good cause rules versus the tenancies. The three day criminal activity notices may not meet federal due process timelines. Non payment standards do not distinguish between tenant paid rent and PHA paid rent. Federal law prohibits evictions for non payment of the PHA portions of rent, that's the housing assistance portion of the rent. Trespass and removal rules may interfere with tenants' ability to meet program obligations or receive required accommodations. Key recommended exemptions. To prevent compliance problems for both landlords and tenants, BSHA recommends creating exclusive statutory exemptions for all federally assisted tenancies regarding no cause termination provisions. Clarifying that federal requirements govern eviction, notice and due process procedures for these households. These exemptions provide a simple and effective way to prevent conflict between state and federal rules. To maintain program integrity, H-seven 72 should specify that landlords may not evict a tenant for non payment of a PHA paid portion of the rent. Ensure court timelines allow federally mandated due process protections, including time for contesting termination actions. In this context, termination actions relate to the termination

[Sophie Sedatney (Office of Legislative Counsel)]: of a subsidy.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: These clarifications support fair process for tenants and legal clarity for landlords. Disability related accommodations. To remain consistent with HUD civil rights requirements, H. Seven seventy two should include explicit language requiring reasonable accommodations for tenants with disabilities. Apply these accommodations to property removal, trespass orders, and other provisions that may impact a tenant's ability to comply with program requirements. Summary of recommendations. To ensure alignment between state and federal law, PSHA recommends adopting clear exemptions for federally assisted tenancies. Distinguishing PHA paid rent from tenant paid rent and non payment actions. Preserving federally required due process timelines. Incorporating explicit disability accommodation language. Together, these changes support both tenant stability and landlord compliance. Rental arrears assistance funds. This is an appropriation that is outlined in this bill. And I just wanna raise for the committee's attention in fiscal year twenty twenty five, received $2,500,000 to create the Rental Arriers Assistance Fund to prevent evictions for sustainable tenancies. This fund authorized under H829 provides targeted assistance to stabilize households and reduce court based evictions. This is a snapshot of funds spent to date. This illustrates that we've cured 188 evictions spending about $1,500,000 And then you can see the county breakdown. H-seven 72 proposes $1,000,000 to continue the program past May 2026. Without continued funding, the arrears assistance fund will sunset when current appropriations expire in May 2026. Continued investment will sustain eviction prevention capacity statewide. Thank you for your commitment to housing stability in Vermont. VSHA looks forward to working with the legislature to ensure that H-seven 72 strengthens tenants protection while fully aligning with federal requirements, supporting families and landlords across the state. And attached to this presentation are two appendices where I've outlined where H-seven 72 aligns with federal law, and then the areas which there are potential conflicts along with recommendations.

[Marc Mihaly (Chair)]: I just want to say, I took the liberty of forwarding her testimony to our counsel. And these acknowledge her seat, Kathleen knows that that's heard. Kathleen, just one thing and then I'll go to your question. We just heard testimony that at least several years ago, was a problem with landlords refusing to accept Section eight vouchers. Is that still a problem?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: I do not necessarily agree that landlords are refusing to accept Section VIII vouchers. We have gone through a period of time, certainly the pandemic era, where landlords had more choice, and it was more difficult for tenants to find housing. But we have a very strong landlord base that we work with, and we have landlords that call us, that work with us, to let us know that they have apartments available or becoming available. So I cannot agree that landlords are refusing vouchers.

[Marc Mihaly (Chair)]: At this time.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: At this time. In

[Marc Mihaly (Chair)]: fact, the problem is, isn't it not enough vouchers?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Certainly, there's not enough vouchers. To your point, I'm not sure who raised the question earlier during Gene's testimony, there is a Vermont protection, it's illegal to discriminate against recipients of public assistance. So, in the work that we do, working with landlords and tenants, if we identify that situation to be preferring, then we make the appropriate referrals.

[Marc Mihaly (Chair)]: By the way, just as an aside, and then we'll get to questions. Do you remember we sent a letter to appropriations advocating $5,000,000 in the BAA for assistance? It was in the BAA and passed out of the House. We'll see what happens in the Senate. Yes, no, and

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Ben Ashley. Tom, Gayle, Ashley.

[Thomas "Tom" Charlton (Member)]: Okay. Federal regulations, programs, state law, and all HUD founded HUD funded housing programs. So when a subsequent slide, we're talking about federal regulations. These are all regulations that apply to HUD funded housing or federal regulations that apply to housing?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: My testimony is through the lens of HUD federally assisted housing.

[Thomas "Tom" Charlton (Member)]: Follow-up, then, a section eight voucher, the person has three units and then our one somebody comes who has a voucher. It's illegal for them to refuse the voucher, so they, you know, it probably because they're also just nice, but it's just they have now one tenant with HUD voucher. Does that bring them also? Does that then make them a HUD funded housing?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: Yes. Okay. Yes. For all the tenants?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Not for all the tenants.

[Thomas "Tom" Charlton (Member)]: Okay. So, so governing their relationship with the one tenant, it probably

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: It's the subsidy that dictates. So the voucher in your example dictates that that landlord can buy. But if it's an entire building and there are several properties where the entire building has Section eight assistance, then the entire building, all the tenants would be protected in that way. And so the biggest differences from my review of seven seventy two are the notice requirements and then due process protections that participants in federally funded rental assistance programs have. And so a reason that a family might lose their Section eight voucher is if they are evicted from their housing. So there was a question I think raised yesterday with regard to are owners required to notify the public housing authority by sending copies of termination notices to the PHA? And yes, they are required. The requirement is there so that upon, as we're notified that that action is occurring, we can intervene and begin working with the family ultimately to prevent the evictions. But if a family is not paying their rent and they're moving toward a non payment of rent situation and they're at risk of eviction, if we put that family on notice that they're violating their program obligations by not paying their rent, we have to give them an opportunity for a fair hearing. So we can't just take a family subsidy away without giving them an opportunity for a fair hearing, for an appeal, and that takes time.

[Mary E. Howard (Clerk)]: My question before is if I own duplex or boxplex and I want to rent as the owner and someone comes to me and they have a voucher and I refuse to take that person to rent that space, that's illegal?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: You have to have a legitimate business reason for not accepting that tenant, you can't simply say, I'm not gonna rent you because I don't take Section eight. That's

[Mary E. Howard (Clerk)]: you would exactly say something what else.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Well, hopefully as a landlord, you're doing background checks and suitability checks and there's a reason Dedicated income ratio. There's reasons that you've decided that you don't wanna rent to this tenant. Cannot be because they have a subsidy, that's a violation of the bill.

[Unidentified committee member]: Thank you. Ashley? I just wanted to give a shout out to CBOEO, because they're still in the room, but I learned all I know about Section eight subsidies in the Fair Housing training, and it was fantastic, and I think it is a great program for both tenants and landlords.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: So, thanks for all you do.

[Mary E. Howard (Clerk)]: Yes Debbie? When you talk about the federal, like the Section eight in the federal note, would that be like, I think in the federal law you have to give a thirty day notice, right now we have a fourteen day notice in the law for a termination for whatever reason, so if you had the Section eight person, you'd have to

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: give a thirty day notice. That's exactly the case. And I'm not suggesting as you're crafting revisions to tenant landlord law, July or whatever it might become, you just need to be cognizant that there are federal requirements that are going to prevail, depending on the unique situation.

[Marc Mihaly (Chair)]: This is something that I would say is a drafting problem that's pretty easily dealt with. And also, just from my own experience, like I said, I was heavily involved in the East Callis store project, which had three units of housing above it. And

[Mary E. Howard (Clerk)]: that project

[Marc Mihaly (Chair)]: was entirely subject to federal law because we received it wasn't because of it was because of federal tax credits that made the whole renovation possible. So, we just knew we had to look to federal law. For example, we knew we were gonna be responsible for relocation of a tenant who was there when the renovation began. So, we knew we had to follow federal law. And I think what Kathleen is saying is it would be really helpful in whatever we do, July or whatever emerges, if we make it really clear so that it won't be confusing to landlords. That's okay. I will say that we as a landlord, and a lot of landlords, really want Section eight because it's guaranteed income. In other words, if you're going to rent to a tenant and you know you've got a Section eight voucher that covers three quarters of the rent, you know you're in better shape, perhaps, than in other situations. Yes?

[Leonora Dodge (Member)]: Am I okay to be next? Did you hear that?

[Mary E. Howard (Clerk)]: I

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: lost track,

[Leonora Dodge (Member)]: sorry. The question I have, and I don't know if it's a question for the SHA, these requirements that seem very strict are a higher threshold than what we currently have than the operating general non section eight, non federally funded housing, right? Right. And I guess, sorry, just to follow-up, sorry. So my question is, like you just pointed out, pros, the pro of engaging with that, it's optional for you as a landlord, I guess, to rent it all. But then when you have this person, a tenant who comes with a voucher, there's going to be a financial incentive of, you you're know, going to get paid, it's going to And be, then there's this con of maybe you have to live up to certain other standards as the landlord is getting federal funding. And so I guess I'm just sort of stating the obvious, like if it's working for a huge proportion of our housing, of our landlord tenant relationships in the whole country, will it be as destabilizing and tough as we hear? I'm trying to get you know, these stories of this is going to ruin, you know, any kind of standard is going to ruin our rental market to, Well, if we already operate a large proportion of our housing based on these standards and it has not entirely ruined our market, then

[Marc Mihaly (Chair)]: Is this a question?

[Leonora Dodge (Member)]: Yeah, no, I want to. I

[Marc Mihaly (Chair)]: think you're

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: making the

[Marc Mihaly (Chair)]: point that the regs set a higher bar, maybe we should think about that, right?

[Leonora Dodge (Member)]: Yeah. I guess do we know what the proportion is of how many of our housing is?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: We certainly have Estabosed to federal aggregated for the state.

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: I don't have that metric.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: The Vermont State Housing Authority is about 8,000 households. Do you have that statistic?

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: It's about 15,000 households. Can you just state your name back again? Jean Murray from the VA. It's about 15,000 households. The housing that's funded with LITEC, Low Income Tax Credit Housing, which I think is one of the things. Those regulations are from the Internal Revenue Service as opposed to from HUD, but there are regulations, they're different ones. So I'm not sure how many biotech houses there are.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: I can certainly report that back to you. The number's available, I just don't know it offhand. But I will clarify, it's the housing provider and the landlord's responsibility to comply with the more stringent standard, the federal requirement, by participating in a federally funded program. Where I am a bit concerned, just from a public housing authority perspective, is the shortened notice requirements and making sure that as a public housing authority, we're receiving those notices promptly and that we're able to take the necessary steps that we're required to take and that participants receive the right to process that they are entitled to.

[Thomas "Tom" Charlton (Member)]: Tom, An open question to those of you that are here, don't need an answer right now, but just partly to address what the North American Heart is to here, which

[Marc Mihaly (Chair)]: is a little louder, Tom.

[Thomas "Tom" Charlton (Member)]: We're responding in part to the number of small landholders who have an apartment building, a garage, or one or two places who are afraid to rent long term. And even if, I think it is, even if the situation is not as dire, these are people who may need to rent that apartment in order to keep their home, but they are afraid that if they get that one bad tenant out of 40, they lose everything. And even if it's just a matter of perception, these conclorsening out of the market. And if I recall from the HFA's report, we're talking about a five digit number of rental units. And one of the problems we are having is we don't have enough units. So how do we win the confidence of some of it, even if we bring 500 up and back online? We do have to think about the relationship and the communications to kind of reestablish with, I'm not so worried about the 100 unit building as I am about the little places, especially in rural areas where there are not five raises, public apartments. We have a challenge in trying to reestablish their willingness to not put things in short term rent, let's just keep them out the market.

[Marc Mihaly (Chair)]: So there may be a bit

[Thomas "Tom" Charlton (Member)]: of an open suggestion as to how do we, even as agencies, rebuild that bridge so people are like, yeah, can do this. Because right now we're trying to address the things that are keeping units off the market.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Yeah, I mean, that's a very good question and I'm sure we all have our own unique response to that. I will tell you that within the Vermont State Housing Authorities Program, about 50% of our participating landlords are private non involved landlords. The other 50% are nonprofit landlords. I think from my observation, nonprofit landlords do a pretty good job at tenant selection. They're making good choices to the best of their ability. It's really the smaller mom and pop landlords that may not know the law. So it's not necessarily intentional that they're not following it, but there are issues with that. They may not give the right notice. They may not provide the public housing authority with a copy of that termination notice, and so they go to evict the family and that eviction gets thrown out because they didn't file the proper notice required. It's really, I think, more education, more training, and this is really why I'm recommending to just make it clear in whatever language you adopt that federal law will preempt Boston law And these

[Mary E. Howard (Clerk)]: so it's absolutely clear. Well, thank you, and I appreciate very much

[Marc Mihaly (Chair)]: your testimony. Our next witness is here.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Okay, could I just make one clarifying statement before I leave? And so Jean in her testimony had referenced 70% of the vouchers at one point in time were not being used. That statistic was that our success rate at that time was seventy percent of our voucher families were successful. What that means is if you have 10 vouchers on the street at any one time, seven families were successful. Vouchers still weren't used, just was an added burden to the public housing authority because they just would put a ton of vouchers on the street and have a lot of searching families to ensure that that assistance was being used, but

[Sophie Sedatney (Office of Legislative Counsel)]: it was a success rate. I just have

[Mary E. Howard (Clerk)]: a quick question. Isn't it true that vouchers were returned because people couldn't find apartments to rent?

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: So that is all tied into the success rate conversation, and I'm happy to talk with you more about that. I'm sensing I need to get out of the hot seat.

[Mary E. Howard (Clerk)]: Kathleen, thank you so much. Thanks for receiving your award.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Good afternoon folks. I was actually in the cafeteria trying to respect your process. Hopefully it wasn't you that's being tardy because I won't respect it.

[Marc Mihaly (Chair)]: No, don't worry about that. But please, when you have them here after everybody gets out of your way, sit down and tell us your name for the record and tell us what you have to say. Excellent. And welcome, but you know what, you haven't been here, starting with you Debbie, why don't we introduce ourselves to you, thank you.

[Deborah "Debbie" Dolgin (Member)]: Yes, I'm Debbie Dolgin, I represent St. Johnsbury Concord and Derby. Thank you Debbie, pleasure to

[Thomas "Tom" Charlton (Member)]: be here. Tom Charlton, Athens, Chester, Crafton, Linden.

[Joseph Parsons (Member)]: Excellent. Joseph Parsons, Newberry Chops, and Groton.

[Leonora Dodge (Member)]: We've moved by Essex Town, City Of Essex Tunction.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Where everybody's the best.

[Leonora Dodge (Member)]: Oh, best place ever.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Big town on 10 speeds.

[Leonora Dodge (Member)]: I saw some skis marks on them. Here people stitch that. They just keep walking.

[Marc Mihaly (Chair)]: They're double Wilmax,

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: liberty spikes, so they may not recognize me if we cross paths. Costumes change, but the thoughts are

[Leonora Dodge (Member)]: the same. Ashley Bartley, Fairfax, Georgia.

[Marc Mihaly (Chair)]: Welcome, I'm Marc Mihaly. I represent Plainfield, Caledonia, Marshfield.

[Emilie Krasnow (Ranking Member)]: Hello, Emily Krasnow, Chittenden 9, South Burlington.

[Mary E. Howard (Clerk)]: Hello, thank you, Mary E. Howard and I represent Rutland City District 6. Welcome, Gayle Pezzo, Chittenden 20, Colchester. Saudia?

[Saudia LaMont (Member)]: Hi, Saudia LaMont and I represent Lamoille Washington District.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Excellent, thank you. First, thank you guys very much for having me here today. My name is Brian Armstrong, I'm a born and raised Vermonter. I swore when I was growing up when my hair was in Mohawks and Liberty's flakes, I was gonna leave this small state and never come back. I've never left and I'm hard pressed to leave. I absolutely love the cold and I love our community. I've raised two amazing families in the state. I'm the principal broker of Keller Williams Vermont, is one of the large real estate companies in the state. I'm also one of the operating principles and co founders of Strong World Property Management, which in the Burlington area manages give or take about two sixty rental properties. I'm also an operating principal and co founder of Lake Champlain Closets. I've been in business with both my amazing wives. Hopefully I'll never have a third business with a third wife. Also a co founder of Match Man Cannabis, which is a very clean and straighted cannabis company in Essex Junction. And one of the things that I'm most proud of, besides the fact that I've worked two jobs most of my life for a job and a half, is not so much the companies I've helped create, but the impact that we've had in creating sustainable jobs, most of which have benefits. And the impact that we've had in housing through increasing home ownership through Kettlewings, Vermont, or providing safe and reasonable housing to our rented residents. I prefer renting residents over tenants because it makes a little bit more human of a statement. I can be occasionally precocious and blow the eight, but the reason why I asked Emilie to bring this beach ball when I brought her up is this comes from one of the most impactful books and courses that have ever taken. I actually got certified to teach this course. The course is called Fierce Conversations, and it argues that most people see that truth is black and white, when in fact it's more like a beach ball, because you're sitting on one side, so you're seeing a green stripe, that's your truth, You're seeing on partially colored blood, I think that's orange, you're seeing the orange stripe. The other reason why I blotted today, and I hope we think about it is to go through it, is because the beautiful thing about that beach ball is we have a problem here and a challenge here that we're all stakeholders in, And like that beach ball, I think we all have a role to help fix it. With candor and forgive me if this sounds a little bit conceited, I have worked extremely hard in my life. I'm not here worried about Brian. Don't get me wrong. There was three times I thought about getting out of the housing business as a renter. Once when I went into an apartment that I owned with three Pawinowski police officers and saw more needles than I ever thought I'd see ever, let alone outside of a medical facility. The second time when I had a tenant who was so challenging and verbally abusive to the fellow residents that it took me a year and a half to get them out of the building. Side note, the other residents were so kind through that entire process, I cooked them rib eyes, I'll get that person out. The third time I thought about getting out of the business was when I read about three ninety nine, April, and July, in some parts of July, and here's why. The hopes that I today leave you with is, I'm concerned about some of the impacts on homeownership, the inverse and unanticipated consequences of some of the programs being discussed, ultimately furthering the wealth divide. Home ownership had the primary I think in the nineteen eighties, the average age, don't quote me specifically on the number, it should be pretty close, nineteen eighties was 28, it's now 38. Home ownership is a dream that's starting to disappear for our youth. So I'm here today for the next generation of Vermonters, my two amazing grandsons and the three amazing stepchildren that my two different wives brought me. So I thought it might be helpful to promote equality, not massively pro tenant, not massively, which I do think it's very pro tenant right now, pro renting resident. I'm not looking for or promoting extreme landlord protection, for example, I hear and I don't know this to be fact, that New Hampshire takes about thirty days to evict somebody, in Florida it takes about thirty days to evict somebody. I think that's too fast, but right now I am seeing a six month process on average and I think if we're not careful to correct that, we are gonna see one of the most valuable partners in this beach ball we call housing get out of the game. So I thought it might be helpful, I'm gonna respect your time to tell four brief stories. First, name was Laura. If I get a little flemics, I'll explain why in a second. She was a daughter of an alcoholic construction worker that happened to be raped. Laura lost her mother unexpectedly at the age of 13. She, her first marriage, and that was her second for the record, I just told you who she was. She left an abusive first marriage with a firstborn of less than two years. Despite being a single mom, she found time to be a guardian at Lightham. She worked a job and a half, both at the Stowe reporter as well as she waitressed in Stowe so that she could provide a life to her son Jackson, who became my stepson. Well we're worked extremely hard to save 3%, so that she could buy a house through the Federal Housing Administration. And one of the great things about the FHA program, I used to be a loan officer as well, is you can use 75% of rental income to qualify. Laura could have never bought a house, she could have never bought a condominium as a single mother. It was the opportunity to buy a multi family property that helped this person build a future for her son, a retirement for herself. Laura was headstrong and stubborn, but at the same time as much as she was a risk taker, I cannot tell you in good faith that she would have bought a duplex in today's market. Not because of the affordability, but because if a single mom barely had 3% to close, and then she had one non paying tenant for six months, she would have destroyed her credit, which is one something that was extremely important to She would have been able to make, and I can tell you this, no repairs during that time. So no cause eviction, I think is an extremely important tool. I'll talk a little bit more about that if you give me time down the line. But it's also a reason why I think the current state of affairs simply does not work for housing providers. And my greatest concern again, is we will see the small housing providers get out of the game. If that happens, I think you will be left with big corporations that can afford to carry units empty, that will operate like a machine, you either meet the qualifications or you don't, versus Laura and at times myself, who would like to take chances, but we took chances knowing it was on average three months to get somebody out. So the second story and for the record, Laura passed just under ten years ago, Winnie the Pooh, how lucky am I to have something that makes saying goodbye so

[Marc Mihaly (Chair)]: very hard.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: I will tell you and I know this is not a part of July, Peter saw me. One of the things when Laura was first diagnosed with cancer, which bear with me if I get weepy eyes, days, I've been blessed two days of wives, I was driving to a doctor's appointment and my mom was taking me to my stepfather. You're gonna be alright, you know, cancer, you guys need in mind. I said, mom, I've worked a job and I have two jobs all my life at home. I'm good. So as a side note, when I read thoughts about rights and first refusal, I could not have imagined recognizing my spouse, likely going to die with cancer. We needed money and I had an investor who was going buy it like that, and to go to market and wait for a first right of refusal. I mean, makes me cry. Second story I'd love to share with you. First gentleman's name, we did that, Muhammad. Laura and I worked a lot with the refugee resettlement program. It was a great program. I love the fact that we were welcoming new Americans in that had a real flavor for the dream of, excuse my language, bust your ass wide open, provide for your family. I'll try not to swear, it's one my new spots here. Kicked out of Rice High School in two days because my haircut, so I I'm sure you were shocked. So we used to love working with the refugee resettlement program. We knew we were taking a gamble, we knew again at the time it was about three months to get somebody out. We also knew that we had no cause of eviction if it wasn't working. Now, Muhammad and I, think he left our buildings twelve, thirteen years ago. Today he's a manager for JetBlue. I see him when I fly through Burlington Airport. He found out Laura passed, you could tell he was like taken back, because he knew we gave him a chance that nobody else would have given or not many people would have given. And I think he's a great example of why landlords need to be empowered to take chances, but to take chances, you have to have reasonably quick exit strategies. For two reasons, we know this. One, I take my credit very seriously. Two, if somebody's not paying us, we can't make repairs. Now as a sign up, of the two sixty units that Strong will Property manages, my stepson Jackson from Laura and I are business partners in this building, we probably operate 27 of our own person. But think about that person who owns a duplex, one person's not paying them, 50% of the cash flows come. Fourplex, one person's not paying them 25% of the cash and I can assure you this is not a 50% margin business, this is not a 25% margin. If I had to guess our margins have gone down over the last few years, which is part of the reason why I took a volume approach. Now, again, I think it's essential that we retain no cause evictions, timely processes so landlords take chances as opposed to just operating like machines. Third story I'd love to share, John. The Dalai Lama would say that we're all masterpieces in the making. John, I have no doubt, was a fan to have a little bit more opportunity for making than others. John lived in our 40 unit apartment building, and while he was respectful to me, he was often dismissive, rude, and chauvinistic to my first wife. Would have a threatening posture. Now for the record, as a daughter of Maureen, I worry more about John and altercation than Laura, but Laura was a unique person, I cannot say that for a lot

[Thomas "Tom" Charlton (Member)]: of the people I've worked with through the real estate brokerage that could happen.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: We even brought the fire marshal in on our own building, we said please help us, we're concerned that he is becoming a hoarder, he's a fire hazard, a pest hazard, and I hope you probably would agree with me, not every landlord invites the fire marshal and throw

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: them to them. I hope

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: you see somebody today that you sense, yeah, I'm a little bit of a risk taker, I'm an entrepreneur, I love the state, but I wanna do the right thing by people. I'm at, you know, I'm the one that's gonna die when it's time for me to die, so I wanna do that with clear conscience. We even reached out to the housing authority to get John help. He refused to participate. No cause eviction was essential because what started to happen was his belongings were spreading across the yard. Other tenants were starting to complain, other tenants were starting to have combative discussions with them, and as much as I believe we all have a right to a day in court, I could have seen that if I had to go through a full eviction, you could clean it up one day, gets nasty the next month, but then when I go to rent the building, people look at all the stuff and say I want to live next to this person. And so it would have put me in a position where, hey, I can't rent to tenants who want to be part of a positive community. I don't know if I should sell the building at a loss because it'd be hard to sell it if they didn't have good people in there. And again, was not I have a sense that sometimes in this conversation, my friends on the other side of the island, they are my friends, possibly as with the mild legal aid, are so focused on their strike of the beach ball, they're only worried about the renting residents. Whereas I'm trying to look at the entire beach ball, because we've got to have great tenants rights, we've to have equal aid to defend people against the nasty landlords that happen. We've got to have equitable opportunities, not only for the landlord, not only for the tenant, but for the other residences who aren't gonna speak up in these hearings. So eviction or no cause eviction was an essential tool not only to protect the community in that building from the risks that was a significant hoarder, but also for us, Laura and I, to continue being small housing providers. Expenses. I live a modest life.

[Emilie Krasnow (Ranking Member)]: I worked two, job and I

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: have two jobs all my life. I drive a used car. My life drives a used car. I recognize I'm not going have a pension, was an IBM brat and IBM taught me that that no longer exists in most places in our world, can go or can get attention. So I chose to work extra jobs to prepare for my future. Side note, Warren Buffett once said, if I offend anybody, please let me know so I can let me know so I can grow. If you're born a white male in this America in this country, you won the you won the ovarian lot. Some people may not like that statement, I think Warren Buffett's a pretty smart guy. I recognize I won the ovarian lottery right or wrong. So again, I'm less worried about me, I'm more worried about other people wanna get into homeownership and provide housing. So we own a six unit property in Winooski, and I love Wooski. I love the community. I love diversity. I love the town. They're they work with us. Great place to buy property and a great place to participate in housing. In that building, I have a tenant, last names remain nameless, name of Donna. They have been with us twenty years. I even tried to help them buy a house because no disrespect, you're paying down my mortgage, I think you should pay down yours. They just love the convenience of renting. I have long kept Donna's rent well below market because she is, excuse my language, a damn good tenant, she's a damn good human being. You know, checks in with me still and she stops by KW to pay her rent. She asks if I'm available and it's just great to talk. Windham's key raised our property taxes 13% in one year. I had no other choice but to raise every unit $100 a month just to break even. One of the reasons why I started a property management company is because you're looking for someone to hang a door, change a toilet, good luck. Now do you want to renovate a building? Oh yeah, you'll get plenty of this. Our property management company provides benefits. We provide a four zero one ks, we are struggling to find the talent necessary to fix our clients buildings, let alone ours. So when I have to raise a unit, $100 a month just to break even on property taxes, that does nothing for our guests, nothing for the sprinters that we have our workshops at, nothing for the payrolls, nothing for the increased cost of Vermont gas. So the question I ask open endedly, is if I'm capped at, is it 8 percent plus three, five plus one of the various proposals that I see? And that doesn't allow me to keep up with the expenses. How many years do you expect a housing provider to stay in the business before their margins are gone? With polite Pope to amazing legislators in this building, if the state can't keep their revenue on to 8%, why are we asking the very housing providers who are penalizing them to do that? Again,

[Marc Mihaly (Chair)]: couldn't enter that current,

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: I think I'll stay in the business, that was a side note, should tell you this, after my first wife died, bought a motorcycle, every now and then I may hit three digits, I've stepped out of helicopters with a snowboard on my feet, I'm a risk taker, I don't think people have as high risk tolerance as I do. So I'll play the long game because I love providing housing, and I do believe in the value of real estate. Do you have

[Marc Mihaly (Chair)]: a question here, Ashley?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: I'll let you think. Almost on thoughts, and then I've got various thoughts on these. I'll admit, I am challenged by the mayor of Berwick. Why? Because with everything that's going on, as a cat lover, I heard she might unleash my cat. I said to her at a meeting one day, I I told her about the story of the Sunniewski Building, and her reply was something to the effect, I don't think landlords should be able to evict people just because they can't pay increased rent. With humor, if I don't pay my taxes, what happens to me? I'm evicted from the ownership of the building and all the equity that goes along with it. Well, I have other thoughts I sense, I wanna respect your time to answer questions. To me, rent caps said imposed by this legislator will also equate to guaranteed rent creases change over here. And I will tell you right now, I will do that because I'm concerned that if I can only raise rent x and then there's a couple of good years, property taxes don't go up, everybody's getting along in Washington. I don't raise rent that year under a rent cap, but then the next year there's double digits expense increase, I'll have to do it. I'd rather deal with the market. Now I think it's Alan Brooks, which does a study on the Chittenden County real estate market. Chittenden County is at a record high of 4.6%. Rents are starting to come down. I have never seen Burlington's rental market have more than a 2% vacancy. So I think the market is starting to stabilize. Side note, part of the reason being, I also think we have a lot of these new big buildings coming up. I'll also mention on that note, being able to look at a credit bureau for a tenant, a renting resident allows me to take an educated guess. If I haven't been cut off, I will tell you another quick story. I one time looked at a credit bureau, wasn't great. People were super nice. They were following up. They're quick. They're responsive. My fees are good people. I rented to them because I knew the whole picture. Whereas if I can't look at their credit bureau, I feel like I'm making a decision like this. Now I said to those people, if I have to chase you every month, I said, one, I'm only gonna do six month lease, you seem like good people, but based upon your references, I should not rent to you. But I'm gonna take a chance, but if I have to chase you every month for rent, I'm not gonna renew this, because I can't be banging on your door instead of spending time with my son. Sure enough, I chased him every single month. 170 North Onusky Avenue, I think it was April or March, we had a conversation at the end of the lease, I said folks, you just didn't hold up your end of your bargain, I'm not renewing it. You know what's right? They honored their word. They said you're right, we'll move out. Take these tools away from us. And I think the road to hell is paved with good intentions. And I drive a mean paver. You are gonna eliminate I think what is essential in our community, the small housing providers that will operate with heart. Now I can go on for hours, but I understand my name is not Corey Booker, and this is not an opportunity. I've got other thoughts, but I want to respect your time.

[Marc Mihaly (Chair)]: I appreciate it, we are going to turn it over to the committee for questions. We have floor at 03:30, I'm just reminding people, So, I'd say

[Mary E. Howard (Clerk)]: we have about seven minutes worth of questions. Yes and yes. I can be really quick. It's obvious that you've looked through some of these

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: bills that we have in front

[Unidentified committee member]: of us. I guess my question for you, as we as a committee sit together and are trying to solve an issue that has, I think, as you said, with your beach ball, more than two sides,

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: is

[Unidentified committee member]: the status quo potentially better than the unintended consequences of these bills? Is there one bill that you would move forward? Do you have any thoughts on that?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: So absolutely quick, the status quo is not one. I heard, and I would encourage you to check this with Bar Association, less and less attorneys are doing evictions. I was looking at help, I was gonna buy a building two, three years ago, older gentleman could not afford to make the repairs that need to be remade. I was gonna let him stay x number of months, it was gonna be a very equitable situation. He could not find a lease that he had with the upstairs tenant. My go to eviction attorney said, Brian, I'm not taking it on. It's gonna be too much of a court case. And so in that situation, a senior was ended up he probably ended up I don't

[Thomas "Tom" Charlton (Member)]: know what happened, but I

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: guess he ended up getting foreclosed upon. Lost any and all equity versus the probably 25 to $50,000 he would have walked away to help him in his next place. Burlington lost the opportunity for a good landlord to bring property to reasonable condition. So I absolutely think it's not working. I will tell you if some of the bills that are in here and with candor and my goals to learn more AI, AI did a summary impact of all these bills, I didn't know if it was right. Oh, With ShaggyDB. I will tell you if some of the one-sided pro renting residents that don't consider the size that small housing provider go through, I can guarantee it. There's gonna be a glut of multi families in the market. Last month, I think there was like twelve months of inventory across the state. Side note, single families, probably I think four or five months. There's already there's two issues there. There's a lot less people getting into the game and I hear this from the broker side because I never wanted to get a tenant. I hate to take six months to get somebody and I can't afford that risk. Then the other issue you have, which is not this committee's, is there's a lot of landlords that bought properties with three and a half percent interest rate and 6% capitalization rates, and they're understanding why nobody's gonna buy their house at a 6% capitalization rate, they have to finance it at a six and a half percent rate. So some of that. So no, I don't I don't think it's I think if you don't do something, you're gonna lose a valuable part of it. But don't forget again about homeownership. Now this is gonna sound harsh for a second. National Association of Realtors Research said the average net worth of the renter is $11,000 you hear my own? Average net worth of the homeowner is like 400,000. Now on one hand somebody might hear that and say, you're just saying screw the renters. No. I'm a conscientious capitalist. The capitalists we have in Washington right now are unsustainable. It's all about profit. It's all about efficiency, as opposed to doing this great book, Do Less With More, that talked about the best capitalism focuses on the community and resiliency of the market. I will tell you if all the one-sided to my friendly renting residents and my friends on the other aisle, legal aid, go through, I'll consider getting out, Or I'll consider, despite help housing, condoizing buildings, but that's still gonna take renting out of it. With candor, yes, if you own real estate a long time can be a very good investment, but it is not let me buy this and tomorrow I'll order my guy. If anything it's, you're gonna take $400,000 with gamble, you might make a few $100 a month And by the way, get calls in the middle of the night, you'd have to deal with complaints, I just closed on a building, owner financing, it's gonna take me a year to get the thing profitable. I know I have to look at replacing heating systems because it's one heating system and a tenant's complainer, her unit's too high. That takes

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: time. Yes, I'm gonna

[Leonora Dodge (Member)]: ask you to dig deep into that jumping out of the helicopter spirit and say, I've heard you loud and clear about those measures. Those are various measures that are in July, right? Capping, rents, increases, etcetera, etcetera. Is there anything but I've also heard you say we can't stay the way we are. And so what would be the risk that you would want us to take? What would be the risk that is worth taking?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Here's what I would say. I don't know if Emilie asked me to put some thoughts and homework about what

[Emilie Krasnow (Ranking Member)]: I gave him homework.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Yeah, I still need to, I was never great

[Thomas "Tom" Charlton (Member)]: at homework. Was at least

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: It's due now.

[Kathleen Burke (Executive Director, Vermont State Housing Authority)]: Okay. So then I talk with Here's

[Marc Mihaly (Chair)]: what I can.

[Leonora Dodge (Member)]: One Whatever you got.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: Leave no cause of action in place. Do not honor any of the requests to ban it. Because again, it looks great on the surface, but it it I've never met a good tenant who I would have no cause evictions. No cause eviction helps me get drug dealers out of the building, helps me get violent abusers that are disruptive to the rest of

[Marc Mihaly (Chair)]: the thing, or that person who's a whore. I have to interrupt and ask you a question. Excuse me. What the reason I'm asking the question is because these terms just cause and no cause are simply summaries. Mhmm. So let me ask you. When you say no cause Same. You mean the ability not to renew the lease?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: The ability not to renew the lease.

[Marc Mihaly (Chair)]: Okay. Do you mean, for example, the ability to convert it if the landlord wants to put their family in it?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: I do believe that is also something that should be protected.

[Marc Mihaly (Chair)]: Do you think that if a landlord wants to repurpose the building for something else, say condos or whatever, they should be able to? Is that part of no cause?

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: To me that is, although you can tell it's not my leading reason why. Right, okay. I do believe people buy real estate, it's part of the bundle's rights, and yes, I won the O'Varay lottery, but candidly, got in trouble with marijuana when was 19, I'm an ex con, I had a lot of corporations tell me they wouldn't hire me, side note, now I have license to do the very thing I got in trouble for.

[Sophie Sedatney (Office of Legislative Counsel)]: I paid

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: 23 full time jobs with benefits.

[Marc Mihaly (Chair)]: Okay, thank you. So, I'll go answer

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: the question. So one, keep no cause evictions in place. Do not mess with a rights to pull credit bureaus. Because again, don't look at

[Marc Mihaly (Chair)]: it for perfect credit. I look

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: at it as like, what's the whole picture?

[Mary E. Howard (Clerk)]: Yeah, we're not actually If you're

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: gonna have a rental registry that has a rental registry of landlords, make that equal. Have a renter's registry, consider a course that is like a homeownership course, FHA has homeownership courses that says you're ready for homeownership. Maybe have a certification that hey, Tenet went through a course, they understand budgeting, they understand this, I would work with that group all day long. Probably, would recommend this group due to a couple of things I noticed. I think seven days for non payment of rent makes 3¢, three is too quick, 10 is comfortable, pause there. I've met only a few tenants who I sense didn't care about paying. Most tenants want to, they're gonna tell you, I'm gonna catch up, they have to look at do they have the ability to catch up. And I'd rather work with them to help them in next place. Take a look at keeping evictions to ninety days or less for the entire process. Personally, I prefer sixty, I think 60 is the equitable spot. Thirty is too fast. I think because there are bad landlords out there who don't care about being responsible citizens. 60 is really where I think it should be in total process, 90 is stomach. Other things I would be saying be careful about the tit for tats that happen when evictions start and the tennis is when this isn't working. I'm not as involved with the day to day management anymore, thanks to a great team of people. But generally when we think we have a tough eviction about the curve, we bring in the city inspectors, we get going on it so that it's taking that argument away. Inside ovals approves we're good citizens. If I had other thoughts

[Leonora Dodge (Member)]: Doug, one thing, when you ask for a security deposit of a few months, right, of like the first and last of it, and then you get non payment happening, is that not meant to, like, there be a balance between instead of just no cause because that's my only short way to get somebody out, could there be That's another tool that I don't think a lot of people have mentioned about, that is in the bill.

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: So I'll be a devil's advocate to myself. Most of our units are in Burlington, so we're not allowed to take more, so we generally collect first month security deposit, and before we give you the keys, we need the full rent. I think that is equity. I'm hard pressed, I don't know this for a fact because you've a great general manager who made part of the company. I don't know too many landlords who collect three, four months. I've heard of it, but we don't do it. So personally, if you put a clause in that says you can't collect more than two, I think that would be accurate. But again, right now, we generally collect, I don't know if it's all for all of our two six hundred and sixty units because we have some bill landlords that say this is what I want you to do. But I think two months is very equitable. I don't think four months is, so that's hopefully pro renting residents. Because my argument with the problem with, well, if I collect four months, then I can just use it if you don't pay your rent. I think most Americans are troubled with a thousand dollar emergency.

[Emilie Krasnow (Ranking Member)]: Said that just today.

[Marc Mihaly (Chair)]: Unfortunately, we are out of time. I hope that is partly answered, if not a better I answer the

[Mary E. Howard (Clerk)]: gave him Paul Marc, and so hopefully he'll get that to our committee.

[Marc Mihaly (Chair)]: Also, what we're doing is that Michael Monney and Chris Donnelly graciously agreed to testify tomorrow at 10:30. Terrific. I

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: appreciate what you guys are doing here today. I would like to earn the right to collaborate on more of this information because I care about this community and hopefully you sense I consider myself a fair and flexible person. But thank you very much for

[Mary E. Howard (Clerk)]: the

[Jean Murray (Senior Housing Attorney, Vermont Legal Aid)]: opportunity

[Brian Armstrong (Principal Broker, Keller Williams Vermont; Co-founder, Strong Will Property Management)]: to collaborate.