Vermont Legislature SmartTranscripts:

[Speaker 0]: I'll text her.

[Matt Walker (Chair)]: No, no, no. I should see. We're live. All right. We're back again on Thursday morning. We have blown up the schedule, but their agency staff is incredibly patient and forgiving. And we're back on budget presentations and pieces and where we spend our $300,000,000 in transportation funds or something of that nature. And Chad, welcome. I don't know that I've seen you in this chair anytime recently in my time. Not. Last year was the first year. So you're back. And we're on Town Highway Structures Class II Roadway Grant program. All right. Welcome and hand off and introduce and Thank

[Phil Pouech (Ranking Member)]: you.

[Unknown Committee Member]: Take us moving forward.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: I'm Chad Greenwood. I'm a transportation maintenance engineer. Ashley Atkins, deputy director of maintenance and fleet. I'm here to talk about the town highway grant programs, structures program, class two roadway, and the nonfederal disaster program. We'll start start with the town highway structures. Fiscal year '27 around 7,390,000.00. This this grant program is for bridges, culverts, 36 inch diameter or larger, retaining walls on class one, two, and three townhires. A max award for each grand is about 200,000, which requires a local batch of 20% of the total cost of 10%, the town adopts codes and standards. The town application and selection process is coordinated through the district personnel. This program is an equitable distribution, result of the percentage of total funding over time and a percentage of eligible structures, which includes culverts 36 inches and larger as well as the eligible structures, basically the inventory from the Vermont Coal Program, which is maintained by the towns and RCPs, is what it's used to help with that. As you can see, last year we funded about 37% of what was applied from the town, about 7,300,000.0. It's been pretty consistent right around that range for the last three or four years, as you can see. Yeah. So

[Phil Pouech (Ranking Member)]: over the years, and I'm thinking of our town, you know, as a plot to these, it looks like it's roughly, you know, a third get funded roughly. What are some of the barriers or are there barriers that some folks, some towns have for even making the application? I mean, the process of the application, is that a barrier? And also is the match in your discussions with municipalities that apply, is that been a barrier or not? Just your experience on it.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: So I would say the application process is pretty simple. The district technical services is available to help the towns. I can't really speak to the budget prior to the town. I would say that it's pretty good because the towns aren't getting them every year. So they have some time, I think, to budget accordingly. But I don't I can't really speak to each town for that. Okay. Alright. Thanks. This is just a little extra information on the structured program out of the Orleans' luck. I'm not gonna go Back up for one second. Sure. This town highway bridge that you're showing right there that you've misfunded, I don't know what town that's in, but it doesn't look very big. Much is something like that? How much is that type of a ballpark? I would guess probably in the $300,000 range. The reason I'm asking, I guess, is if that's $300,000 and the town has to go up to 10%, so they have $30 and that's $300,000 So when you break down the $7,000,000 that we give out, the $300,000 is $300,000 what's the average sort of bridge? I don't know what bridge costs, etcetera, but I'm saying, so are we doing up 300,000 or are we doing three times? 21 projects of that kind of nature? Or are we doing 10 really big ones and a few small ones? So basically, last year, we funded 65 out of 87. So we did 65 grants. But they vary. You know, they're not all of them are $200,000 either. Some of them are smaller, maybe for the engineering to get the town started. I'm not sure if that answered your question. And then I'm trying to go down a line of, okay, we keep it well, we did the law we passed last year required that you went up by 2.7%. So does that that means basically maybe one more bridge. And next year, it'll go up again. And maybe the towns will get two more bridges. But it's onethree of what they're looking for. Is that $19,000,000 in application stuff that's actually in some kind of condition or ready to go that the towns have. I guess there's 20,000,000 they are ready to spend. So they've got 2,000,000 ready to go to match if we said yes, if we could say yes. I mean, if they're they should be ready to spend the money. Okay. Mean, because we don't want to lose that. You know, if they say they decide they don't want it after we've given that, then we'd have to go back and try to And that doesn't really happen? I mean, they're doing it ready to go. Don't get canceled? So most of the time, I say we have amendments around 10% of the time. Mostly are time extensions. These are thirty month grants, so they have some time to get their over multiple years to get their money together as well.

[Unknown Committee Member]: So for example, a town might start asking for a grant if they need it for the engineering study, having in mind that after that becomes a project itself, which might take two or three years. But if they don't follow through, if they do an engineering study and then they don't do the project and they receive the grant money for the engineering study. So you try to recoup them?

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Yeah, they resend that, and we get those back to the program. So it's been going on for quite a while, the demand seems to be $20,000,000 here in Utah. So next year, that $20,000,000 from this year, dollars 7,000,000 gets done, 14 rolls over and seven more million gets asked for. Any idea, we have yet either we're working on a study that says what are the needs out there in the town? Does this sort of flat lining, do you think that there's more demand the towns just don't put in for? Do you have any sense of that? You interact with these companies. I know the district project managers encourage the towns to apply. Some of them apply with multiple brands to try to get them, because it's such a leap, you're not getting them every single year. I would be maybe a little concerned if they got too much money, we'd see a lot more amendments or maybe the town would start kicking them back, which I think would affect the program to a certain extent, trying to keep up with that. Thank you. I'm not sure, Rox, I want to go with that. Thank you. Okay, we can revisit it. I appreciate it. So like I said, this is just another page with more details. I'm not gonna go over it all just for your information. The second program is a town highway class two. This will be a 27 around 8,800,000.0. This is a great pro grant program for the preservation of class two town highways, resurfaces, reconstruction. Similar with the structures, max award of $200,000 per grant. This requires a local match at 30% of the total cost of 20% of the town adopts local codes and standards. Similar process, or it is the same process through the trans district personnel. It's the result of percentage of total funding over time in relation to the percentage of the class two highway models. Do you have any sense that we're, again, less than a third, here we're less than a third, Any sense of what other states or anybody comparable of size funds their town highway rooms at versus what they're asking for? Do we have any sense of how Vermont would compare to any other state in our ability to help fund town highway work? I do not. I could certainly try to find some information out. We don't really know whether we're better or worse than our peers at helping fund town highway meet. I don't think. The towns ask for $32,000,000 and we're going give them less than 9. And we don't know that that is or is not a reasonable expectation against anything else in the industry or anything else in the state line that works in those functions. So I don't know if we're doing a good job or not in funding our town roads from that perspective. I guess we'll ask them, but as far as compared to other areas, other states and other pieces we don't

[Ernie Patno (Director of Maintenance, AOT)]: know. Representative Pouech?

[Phil Pouech (Ranking Member)]: Yeah. And this is not to be taken as any criticism at all in the program, just to sort of understand. I mean, is it a fair statement that these grants and the previous grants, there's criteria of when you get a grant and certain things you have to do. But is it fair to say probably the number one criteria is when was the last time you got a grant? And if it hasn't been three or four years that your grant application has a higher chance of getting it so that funds are equally distributed across the state?

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Right. That is part of the criteria. It's the total funding over time. But for the class two, I would say more class two miles you have, it's gonna push you up further and quicker to get a grant, same with the structures and more structures, bridges you have.

[Phil Pouech (Ranking Member)]: So that's the criteria too. Part of it. Yeah. One municipality may have just two structures, one might have 12. And so they would be expected they would get everything else equal. They might get more grants. One of more structures. Correct. But it's fair enough to say if you've got grants this year or last year, you're probably not going to get one this year because there'll be another municipality that's in line because these are, they start lining up behind that you haven't got one year, you go for it again.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: I'd say that's fair statement.

[Phil Pouech (Ranking Member)]: Yeah, okay, great. And it seems like when you have limited funds, you wanna be fair and every group municipality gets something.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Representative White.

[Candice White (Member)]: Is it fair to assume that if a town has applied for a grant and didn't get it in one year, would they just go ahead and apply again the next year?

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Sorry. Other than 2022, where I believe that I'm not 100% certain, but didn't this body make an adjustment, make an investment

[Unknown Committee Member]: That was correct.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Was the acronym to double S, right? So there hasn't been any it's been the no, there's been a couple of times. Those numbers were sometimes bumped up. In other words, the minimum required to give the statutorily required the agency to fund, sometimes we have funded above that statutory requirement. Not this year, but well, maybe $60 or something slightly. Changed the statute a couple of times. A couple of times then, order to be at the 8,000,000 plus, we would have had to have spent over what was statute required a couple of times, or at least a few, because it wasn't 8,000,000, it was lower. So we have at times put more money into this program than what is statutory minimum required. Is that fair to say? I mean the statutory was 8,600,000.0 before what you guys passed last year. I think 'twenty three, it was lower than 8,700,000.0 in 'twenty three point eight million it was more, right? We, the agency or this or the legislature, one or the other, put more money into it than the minimum required. Or we overspend it. Or we overspend it. Yeah, I imagine You just need to give them more money, is that what you're saying?

[Phil Pouech (Ranking Member)]: But there's probably some timing on that, those funds, that's, you know, inflation.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Well, it's such a long fluid thirty month grant program too.

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: If I could add on that, that's kind of the beauty of this program, by the being thirty months, that if a town, after they've completed the job and the job is less than what they had submitted for, then that's money back to the program that historically has been used to then potentially fund more grants during that fiscal year or for the next fiscal year in addition to what is the statutory requirement.

[James "Jim" Casey (Member)]: I'm looking at the funding there. Doesn't really reflect how things have gotten more expensive. But I mean, the towns just doing smaller projects to keep things at the funding level that we're at. It seems as though we should be increasing the funding, I mean, when things don't get any cheaper, I'm just amazed at how things kind of stay the same through the years. It's changed a little bit, but not lots. I mean, I don't know. I know in my district, they're complaining that they're not getting the grants and they want to know how the grants are handed out and stuff. I'd like to see some more funding on that. Else seems to go up in the transportation department, but that kind of seems to stay somewhat level.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Don't know. We need to give more

[James "Jim" Casey (Member)]: to little towns, I think. I

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: think it's the next slide. It gives you a little bit of what we've done for mileage. So you can see the last five years. Sorry, one here is the same. It's just a piece out of the orange book for more information for you guys to look at if you want. So for the class two, I just put a little thing together basically showing for what we're getting for mileage out of the money that we're spending. So as you can see, it's staying pretty consistent. I I think we did have an increase, the jump, the original jump after COVID days, but everything is kind of leveled out. Just kind of speaking to what you're saying on increased costs. Is that funding?

[James "Jim" Casey (Member)]: The the funding levels, is that because I mean, obviously, you're seeing that they need they need more money. I mean, it was like,

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: I don't

[James "Jim" Casey (Member)]: know. We we we I mean, we spent a lot of money elsewhere. It doesn't seem really all that.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: I mean, we manage our programs so that the governor has recommended as presented.

[Unknown Committee Member]: Represent the court. So class twos are tuned by the tenant of the state. The state is responsible, technically the state is gifting, orienting money to the towns to help with their roads.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: As legislators required, that's the minimum amount, very close to the minimum amount they're required to do, does come directly, it's 100% T Fund money. I appreciate what the conversation around this, you're trying to get at. The towns need more or want more. Every dollar we were to give them takes away from a T fund project on a state project. And this is part of, I think, me, the discussion about where we're at financially and what's going on around the building about how we are or aren't gonna fund transportation funding. I'm not sure how well it's understood that the towns are getting one third of what they think need to keep their infrastructure whole. They're only getting a third of what they've asked for, or less than a third. And I'm not sure, and we've done a very good job in the last year of educating the entire building about the overall picture of the T funds. Inside of that, the ability for us to make any help for our towns is very minimal. Because every dollar that we would want to put into town work on the structure we just heard about or on here comes out of the T fund and out of what state project needs to get done. And they have an obligation through the federal highway very clearly that they really only measure our performance by the federal roads. But we might, as representatives of each of those towns, want to help those town highways and the town structures more. We would be taking out of a T fund project, a T that we know is on a crash, on a flat trajectory. But we have little to no flexibility to help our towns even if we want to, without taking it away from there, because the pot's not getting any bigger. It's basically flat and the expenses are much higher. But if we even had consensus, it wouldn't be hard for me to get everybody to say, Let's help our town some more, but at the expense of what state project? I guess that's the next level of discussion. What we aren't able to do because of the funding situation. We've got everybody's attention about how bad it is in terms of how much we have, how flat we are. But I don't know if the building understands how little of what towns ask for we're able to give them. And that's a comment.

[Unknown Committee Member]: Take it all this year.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: President Pouech.

[Phil Pouech (Ranking Member)]: It's okay if I just add to that. So along with all that, the only way towns have to raise the money to make up the difference is property tax, where the state was able to raise money from different user fees, property tax. However, there are other opportunities. I don't know of any other town. I guess they're 1%. Some towns have that other funding, but primarily it's property tax. So it's in our experience in Harrisburg, it's hard to come up with an extra $60,000 to do the project when it just comes right from property tax. It

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: would be

[Unknown Committee Member]: interesting to know how many towns actually have bridge replacement funds, or a maintenance fund that they put Like a capital fund? Know the town of Oatly did. We had like 10 different funds.

[Phil Pouech (Ranking Member)]: Vinesburg has done. Even if

[Unknown Committee Member]: we put 5,000 a year in, or 10,000 a year into Of course, we have six or seven bridges within a square mile going up back and forth over the Pulte River. I mean, that's a chunk of change to try to, but I don't know. I wonder how many, I wonder if BLCT has that information about how many towns actually do budget. Have capital funds.

[Phil Pouech (Ranking Member)]: That'd be an interesting one. It's a hard thing to get going. I think in Heinzburg, we had capital funds that never really was done very well. And I'd say over the last five or seven years, there's been more discipline because the town manager brought that disappointment. So now there is some money in the capital fund for things. So the property tax doesn't have to absorb it completely.

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: Thank you. This is just a little map of trying to show you the distribution in the last couple of years of the three programs, Just to give you an idea of your district, I guess.

[Phil Pouech (Ranking Member)]: Hard to see, though. Well, I can find my tab.

[James "Jim" Casey (Member)]: All my titles, I've

[Chad Greenwood (Transportation Maintenance Engineer, AOT)]: been going on. The last program I'm gonna discuss is the town highway nonfederal disasters. 1,150,000 for fiscal '27. It's an annual appropriation for emergency aid in repairing, building, or reconstruction class one, two, or three town highways or for repair and replacement drainage structures, including bridges on class one, two, three, four.

[Candice White (Member)]: I'm sorry to interrupt, I was just going back to the Class two miles page, which I think was the previous one. $113,000 per mile to pay. Weren't we understanding that it costs a million dollars a mile to pay when we're using federal highway funds?

[Matt Walker (Chair)]: I have been very relaxed this week and I'm going to regret it. But I appreciate that. And if we want to have clarification on that, Jeremy and Reed is in and out of the committee on a regular basis. Suspect he'd be the man to answer that question for us for why there's such a disparity. Does likely have to do with the level of treatment, how deep you mill and how much you have to fill back in and how much you do leveling piece and then the actual surface on top of that, if it was a travel surface and whatnot. It's got a lot to do with that. I also want to mention that the 160 down there was the double up here because there was none and there was a double up here with the COVID. So it's not it's really, like, you can just basically say eighty and seventy as far as if it was a two year trend. That's a big difference in profile. But

[James "Jim" Casey (Member)]: I would think it'd have something to do with the state doing highway projects with very minimal bidders that can put their prices up pretty good. And the towns probably have paving businesses that can come in and bid. So they get probably a more competitive bid, I think.

[Matt Walker (Chair)]: I mean, it is state funds. In terms of federal funds.

[Phil Pouech (Ranking Member)]: I think

[Candice White (Member)]: this would be helpful

[Matt Walker (Chair)]: to oversight. Would probably be some of that as well.

[Candice White (Member)]: That's a clarification from the agency.

[Matt Walker (Chair)]: We're certainly going to have the papers in at some point to testify as an industry. And we certainly could have chief engineers in here on the regular. So we can dig into that more. I'm not sure that Chad is the person for that question. But I want to make sure that the question gets answered and also understanding at what level we are doing the work. Representative Pouech, your question.

[Phil Pouech (Ranking Member)]: Yeah, and sort of add on that, I'm going to guess, maybe you've termed that the number of miles also is tied very closely to what the cost is for the payment, which does vary based on the price of oil and things like that. So I know in our town, we've seen fluctuations and when we go out to bid and find out how much it is per ton or however it's purchased, that's gonna really be the piece that says how far you're gonna go with that amount of money. And it fluctuates over years, it has fluctuated good amount, I believe. I agree.

[Matt Walker (Chair)]: So basically, excuse me, to include on this, this town's eligible so this is the for a disaster that doesn't qualify for a FEMA or FHWR FHWA ER program. Basically, the town is eligible for 90% of the repair or the eligible repair replacement cost minus amount equal to 10% of the overall total highway budget minus the town's wooden maintenance budget. This has been around 1,150,000 for the last few years. Do you know what we spent that what the agency spent that 1,150,000.00 on last year? What projects, towns, fees specifically? So for fiscal year twenty six, we have not had given any grants yet. Fiscal year twenty five was similar, and we ended up getting a few late in the spring, a year from now ago, and that reached around 840,000. The year before, was around 1,900,000.0, and the year before that was 603. It averages around 1,100,000.0 for the last four years. Three years, sorry. In the budget, but not in spending budget? No, that's in what we've spent.

[Phil Pouech (Ranking Member)]: So these aren't grants. I'm assuming the towns apply for them. And they say, hey, we lost a couple culverts in this storm. It doesn't qualify for FEMA. And then do they so what's the process? Do they then apply and say, hey, here's one here. That's my question is, again, how many applied and how many were granted because the funds are you know, have a limit. And then I'm assuming that if culverts get replaced, what's done to ensure that the sizing and all that is gonna give some resilience. So there are two questions there.

[Matt Walker (Chair)]: Yeah, so the first one, I mean, basically the criteria, I mean, obviously it would have to be a disaster or emergency road close, not just from regular wear and tear, but porter that should have been maintained five years ago or something. So there's some criteria, basically, roads closed, slope or something filtered, that would definitely meet the grant program. What was the second part of your

[Phil Pouech (Ranking Member)]: question? The first question was how many applicants, what's the amount that's applied for and how much do we satisfy? And maybe that will end up here.

[Matt Walker (Chair)]: So we have there is no cap in this program. So if they wanted $300,000 we would tell them that we get to the end of the budget and then we would obviously have to ask the CFO to see if we could move forward with some more.

[Phil Pouech (Ranking Member)]: So my question is last year how much money, how much demand was there and this is how much we were able to apply from point one.

[Matt Walker (Chair)]: So I don't, I'll have to give you the actual amount of experience. Last year, I'm pretty sure it was three. I just want to double check on that.

[Phil Pouech (Ranking Member)]: Okay. And then my second question was assuming that there's engineering done if it's a storm sort of related thing to ensure that there's some built in resiliency and it doesn't happen again.

[Matt Walker (Chair)]: Right, they would go through the hydraulic analysis. That's part of the codes and standards, which we help the talent Okay,

[Phil Pouech (Ranking Member)]: so it'd be interesting to see just like we looked at the others, how much demand there is and how much we're able to satisfy.

[Matt Walker (Chair)]: I don't have that, but I'll get that for you. Thank you.

[Unknown Committee Member]: Representative McCoy, I'm sorry. So I'm assuming this is a Rolling Brand thing, unlike the one we just heard previously. There was a deadline to apply this, obviously, because it is a disaster, even though it's non federal. People can apply, like, July '1 through or now, and if they have to wait until the next fiscal year.

[Matt Walker (Chair)]: Yes, so if they apply now, would be fiscal year '26. Right, okay. Thank you.

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: This is more of a program than grant. And so it's not like an occupation date or a death meeting. It's more when the need arises, we have this program to help support the talents when it's not a perfect event.

[Matt Walker (Chair)]: Okay. At the secretary's discretion. It's money there to spend if needed for a particular emergency that's not funded any other way.

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: As long as it meets the requirements of the program. Okay. Thank you.

[Matt Walker (Chair)]: But I do think we'd like to see how it's been spent. Too. Can see why it's budgeted for. I'm curious how we actually who do we help that needed help? Who do we help? Like the last couple of years? I'm sorry.

[Phil Pouech (Ranking Member)]: Yeah. Yeah. Much after you know, I assume the talents apply. You guys probably guide them, hey, know, this I would apply for things because so they apply. It'd be nice to know what the demand is and maybe, you know, some examples of where in the last two years that went.

[Matt Walker (Chair)]: I know disaster will happen, but is there

[Unknown Committee Member]: a particular time, a month that these applications come in?

[Matt Walker (Chair)]: For this? No. Not for this program. The class two instruction. Yeah, understand there's a deadline,

[Unknown Committee Member]: but you just referenced that there's been no words or money's delved out of the $1,100,000 and here we are in February. The previous year, 4 and 25,000 got reverted because it wasn't expended.

[Matt Walker (Chair)]: There like, do we get

[Unknown Committee Member]: to March and we're like, alright, we might have some little bit of extra money

[Matt Walker (Chair)]: to play with. Not for you, that's for our company, but is there a particular timeframe that these awards are granted? Basically, something happens in June, it's going to go to the fiscal year '26 money. Yeah, yeah, yeah.

[Unknown Committee Member]: So if it's funded at 1.15 yearly, if you don't use all of the 1.15, is the balance rolled over and then you add to that to get it to 1.15 for the FY 2070.

[Speaker 0]: That's why I'm here. Candice, Chief Financial Officer, Agency of Transportation. We did take a reversion to this program for fiscal twenty five closeout and we also executed the DRR against the pilot fund in this fiscal year because we recognized that we really shouldn't have taken that reversion and closeout. We then backfilled the pilot fund and the governor's recommended '26 budget adjustment act from the Transportation Department. But I noticed that

[Unknown Committee Member]: the House did not backfill the pilot funds from the transportation fund. It doesn't seem like they asked. Do we have a choice? I remember that. But

[Speaker 0]: that's all to say that we typically take reversions act flows out for the past twenty plus years. It's a decision that you do with that money that's reverted, like if you're not using it? If it needs to be reverted, it assists in the bottom line. In the case of 25 closeout, there was underperformance of the transportation fund against sepsis. If we didn't need it to assist in the bottom line, then it could be applied to the next year's excuse. Okay, thank you.

[Matt Walker (Chair)]: We appreciate House appropriations, even if it's a symbolic measure, not to have to pay cash back. All set? Thank you very much, John. We appreciate it. And we're gonna transition to you. Back to the maintenance that we started to dig into a lot of this. Yeah. And

[Phil Pouech (Ranking Member)]: Yeah, your new license plate there, from

[Speaker 0]: my opinion. Yeah, Kenneth's still down there,

[Unknown Committee Member]: in case you open your table. Any of the soccer players there?

[Speaker 0]: I think just one.

[Ernie Patno (Director of Maintenance, AOT)]: Good morning. Ernie Patno, director of maintenance. Thanks for having me back. Always a pleasure. Just gonna speak a little bit about salt. It's kind of an interesting topic. A lot of people think that you call one eight hundred Ernie Salt Company, and the salt just shows up at your shed, and a dump truck dumps it in the truck in the shed, and that's the end.

[Matt Walker (Chair)]: Like, you remember.

[Ernie Patno (Director of Maintenance, AOT)]: Yeah. Yeah. Yeah. So there's a huge reality for this. It'll take us almost all the way around the world. So I put together just a few talking points about salt. So it starts off by every spring, we put our salt needs out to bid. There is six vendors that traditionally bid on bringing salt into the state of Vermont. A lot of people again, with my opening statement, although it was a chuckle, a lot of people think there's only one person that brings salt to the state. It's actually six massive companies that will bring salt into the state of Vermont. Geographically, Vermont is very challenged. We don't have a seaport, and a lot of this salt, a majority of salt, comes on a barge. 60,000 tons at a time from across the ocean from places like Egypt, Chile are some of the big ones that we deal with. And then those barges come across the ocean. They sit out to sea until they can come into a port to be off offloaded. Places like the Port Of Albany and then ports all in up and down the East Coast. There's a water port in, somewhere in Pennsylvania and then Montreal. And maybe Saint Catherine. I don't know if there's a port there or not, but regardless, north of the border. And then we have a couple of mines near us. They're in New York. One is near Rochester, and the other one's in Lansing, New York. So this salt and and I guess I'd like to go back. Like to talk about Vermont's usage of salt. It seems like we're a huge user of salt. But around us, not only are we geographically challenged, on average, a rock number, Vermont uses 110,000 tons of salt. This is an AASHTO publication where I've gotten these numbers.

[Matt Walker (Chair)]: The whole state? Like the whole states or just the agency?

[Ernie Patno (Director of Maintenance, AOT)]: No, the agency of transportation.

[Matt Walker (Chair)]: 110,000. Yeah.

[Ernie Patno (Director of Maintenance, AOT)]: 110, 120, if you want. We've been 120 the last two years. Tons. 120,000 tons. Now I'm going to start skipping states here. New York, 681,000 tons of salt. Pennsylvania, 459,000 tons of salt. Connecticut, 169,000 tons of salt. Rhode Island, 83,000 tons of salt. Massachusetts, 232,000 tons of salt. New Hampshire, 172,000 tons of salt. In Maine, a 100,000 tons of salt. So we're geographically challenged, and we're not one of their largest customers. So that adds up to some of the salt. And I just kinda wanted to break it down. District 1 down in Southern Vermont, it's Morton Salt that currently has the bib. It comes on a ship, and then it gets trucked into Vermont. District 2, it comes out of the Port Of Albany. It comes on the ship, and then it goes on to a truck and is delivered to customers. District 3, it's Appalachia Salt, which is coming on an ocean, an ocean liner, and then it goes on to a truck. American rock salt is d four. They're out of here in Rochester, New York. That goes on to a train and comes into Vermont, gets offloaded at a storage warehouse, and then it goes by truck to where it's being distributed. District 56, and 7 are our most challenges places. So that's right here in Central Vermont. It's we get salt from all over. We get a train, truck, ship, mines. And, traditionally, if it comes in on a train, it comes in out of New York. If it comes into a harbor, it's Portsmouth, Boston, or Providence, Rhode Island. Districts 8 And 9, so Northern Vermont, the the salt this year came from comes from Canada. As I mentioned, it either comes out of Montreal or Saint Catherine, and that salt is a mixture of it comes in on ships, and they have a very large mine in Canada, And that salt is all trucked into Vermont.

[Matt Walker (Chair)]: President Casey, I have a

[James "Jim" Casey (Member)]: question for you. Where is the where is the storage salt storage facility that you offload on when you come into, like, you know, the middle of the state. The middle of the state?

[Ernie Patno (Director of Maintenance, AOT)]: Well, Rutland area. So Rutland area, I had to give you an address. So besides it going directly to all of our sheds, ours all gets stored in our sheds. I don't know where the contractor stores. Okay.

[Matt Walker (Chair)]: It wasn't a state thing.

[Ernie Patno (Director of Maintenance, AOT)]: It wasn't a state store, big state store. No. Anything that where it was. Anything that would come in on railcar, those are privately held facilities that are you know, the salt stores. And then it would come to our facility via truck. Okay.

[Matt Walker (Chair)]: President Pouech, if you don't have any

[Phil Pouech (Ranking Member)]: Before your presentation, I would have assumed the state of Vermont would have like one, two contracts and here's where it needs to go. But it sounds like it's pricing, it can be so variable that the districts find their own or how how are those decisions made? It just seems like you probably had five or six different contractors. So it

[Ernie Patno (Director of Maintenance, AOT)]: goes out to bid competitive bid. It goes to all of these folks. They all have the opportunity to build to bid on each district. And then at the end of the bid, we tabulate who was the cheapest. Right?

[Phil Pouech (Ranking Member)]: So the bid, just to follow-up, the bid is we need X amount of salt here, delivered here to this. That is correct. Okay, yeah.

[Ernie Patno (Director of Maintenance, AOT)]: And it's traditionally in the past, it's just, will you supply the state of Vermont salt in Rutland? Here's a list of the five garages in that area. How much per ton dumped at our door? And so the reason that it needs to be six vendors is, let's just use Canada for an example, they have no interest in bidding in Bennington or Battlefield, right? They only have trucks, they're not gonna truck it all the way for Vermont, they could, the cost would double. And then, so these vendors that I mentioned are in Southern Vermont, they're either training or they're trucking to the port excuse me, shipping across the ocean to the Port Of Albany, and then it comes by truck. So in order to secure our best price, we need to have one unified contract, but BGS puts that out for us. And and then we secure through these six companies who's gonna deliver the cheapest to our door. Now to further complicate that matter, the vendor has an option to extend their pricing to towns. They can say whether yes or no. Right? We can't pigeonhole them into saying you will. What they do, this year, 59 towns in the state were offered a price. It is up to the town if they would like to enter into a pricing deal. However, it is not a contract at all. It is we'll sell you ourselves for $100 a ton. We'll offer it to you for 100. I don't know how many towns take that up on the offer. I think most towns bargain for their own salt deal. Yeah. A lot of people do. So it's crazy.

[Unknown Committee Member]: So take District 3, you said there's Appalachia Salt coming out of the where does that go? Through Boston, and then it's trucked here? Nope. Or goes to Albany? Or to Albany?

[Ernie Patno (Director of Maintenance, AOT)]: Nope. District 3, it's coming out of the Port Albany. About But

[Phil Pouech (Ranking Member)]: it's Appalachia Salt. It is salt, Appalachia Salt.

[Matt Walker (Chair)]: The

[Ernie Patno (Director of Maintenance, AOT)]: Comes across the ocean.

[Unknown Committee Member]: Okay. So if the vendor, when they bid, in the bid, say, will you sell or extend your price to town? Yes. Okay. And how does the town become aware of that? Are all towns aware of that? Or how do they know that they can, okay, the state is bidding and they've got the bid salt to statewide, District 3, if you're in District 3, we can extend that option to your town for x amount of tons, whatever the town wants.

[Ernie Patno (Director of Maintenance, AOT)]: I actually do not know the answer to that question. Can't even pretend to know. I

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: can try to. So before, when we were going out for an RFP, which is on an as needed basis, right now our contracts are good for five years that we have. But when we do go out to bid, the Mount insisted towns does send a letter to the town saying, Hey, they're going out to bid, no commitment, but would you be interested in the pricing of state contract? Then once the contracts are executed, they are on the BGS website under commodities, so then a town can go on to look to see if that vendor was going to supply salt to those towns within that district and at that price. So that's all public once the contracts are executed.

[Unknown Committee Member]: Okay, so you have a contract for five years. When did that contract begin? July, around July this past year. Oh, this past year, so 2020 I have it through 2030. Is there an opportunity for a town to get in on that now or not?

[Ashley Atkins (Deputy Director of Maintenance & Fleet, AOT)]: So the contracts are just with the vendors, and then the vendors check the box if they're willing to supply the town with that price. The town would have to do their own separate contract. They would just know that this vendor A would supply my town with salt at this price based on this contract that that vendor has for state. The

[Unknown Committee Member]: So they could, if this particular vendor, Appalachia Salt, checked the box and said, the option is to extend to town, and they checked it yes, my town could actually call them up next year and say, Hey, can we get our salt through you? For this price. Correct. For this price. Yep. Okay, great. And how So we were just dealing Bernie on that? Who would deal with the salt price? I mean, How do we do that?

[Ernie Patno (Director of Maintenance, AOT)]: The best thing is for the town to reach out to their district partners And the they can get them turned on to BGS website and the commodity, how to get ahold of them.

[Unknown Committee Member]: And just so everyone's aware, I mean, our town, that big storm, a week or so, the rogue foreman came to me and said, we're not gonna have enough salt. I'll call share Walker to say, I don't have any salt. So he called Ernie, and Ernie called District three so that we were able to get salt. So I appreciate it. Thank you. It's a Friday at like 05:30. Anyway,

[Phil Pouech (Ranking Member)]: thank you. How much does the price vary in the different districts? I mean, just an example, is it like 5¢ a pound or, you know, significantly? It does.

[Ernie Patno (Director of Maintenance, AOT)]: From eighties, in the eighties to close to 120.

[Phil Pouech (Ranking Member)]: So $80 a ton to 120 a ton. Yep. And is that true just because of where they are? Trucking? It

[Ernie Patno (Director of Maintenance, AOT)]: is all trucking.

[Phil Pouech (Ranking Member)]: Yeah.

[Ernie Patno (Director of Maintenance, AOT)]: So right here in Mount Pleiard, I mean, there's currently no great way to get salt here other than trucking at a rather large distance.

[Phil Pouech (Ranking Member)]: So those areas with the rail depot, which you mentioned in the center of the state

[Matt Walker (Chair)]: or Yep.

[Phil Pouech (Ranking Member)]: Yeah. And then I know in Shellburn, the rail depot. It's the only two in the state? I actually. That's all. Okay.

[Ernie Patno (Director of Maintenance, AOT)]: I don't know that. So I I I think there's rail into Rutland and there's rail into Shelburne. I don't know where else. Oh, Saint Johnsbury. Sorry. Those are the three that I'm aware of. And there's just another added cost. Right? Because the closer you are to a salt pile, the better off you are. So Canada comes down out of Montreal, crosses the border, boom, here in District 8.

[Phil Pouech (Ranking Member)]: Yeah.

[James "Jim" Casey (Member)]: So while the towns are out, is it coming? I actually I mean, we're going to get salt? I mean, is it coming into the state at all? Is it coming into you guys? I mean, is

[Ernie Patno (Director of Maintenance, AOT)]: it up to the towns to figure it out or So currently, there's a lot of salt kicking around the East Coast. It's getting that here seems to be the problem. And by getting it here, the towns that have enjoyed a very cheap price on salt, that is not gonna be how much you pay for the salt that is coming. So I actually don't know each vendor. There's six vendors. I have no idea what their piles look like. No idea. But I will say a few things. I don't know if any of you folks heard. We diverted 2,500 tons, 5,000,000 pounds of our salt, made it available to towns. That will be gone tomorrow or Monday. We didn't dare to quite divert any more than that because we have very good historical records, and it's an awful balancing act. If we let too much go, then what? So we we made 5,000,000 pounds available. That has been trucked to all over. I have no idea if that was a deal between vendor and towns. Right? We're we can't say, thou shalt, thou shalt, thou shalt. The other thing we're doing, as representative McCoy mentioned, is we can loan a load. If you are in dire need, we can load lend a load of salt. But what we can't have is a run on the bank. Yeah. Because if we had the classic run on the bank, we're not gonna have and so what we started to see is and we had to start being a little more careful. We would loan a load of salt because the the plea was we're out.

[Matt Walker (Chair)]: What's a load of salt in

[Ernie Patno (Director of Maintenance, AOT)]: About 30 tons. 30 tons is a load of triaxial load of salt or a tractor trailer load of salt, about 30 tons. So we would load, the town would skip over to the nearest shed, and they said, we're out, and we'd loan and load. What started happening is the town starts saying, I need six loads, I need eight loads, I need 10 loads. We cannot sustain that. We can help through a storm, and you can pay us back when you can, a load at a time. But the the classic 200 year old run on the bank, we we cannot do it. So being proactive, you're gonna see a press release today or tomorrow that we have asked all of our vendors, all six of them, not to deliver to us next week. Take a break. We'll take a break. We got some salt in the sheds. We dare to take a gamble to have a seven day period of no salt deliveries. And if they have product, they can deliver to where they see fit. And we're trying to be a good partner, and we're trying to help out everyone. So next week, we're gonna take a hiatus on salt deliveries. And to put that into perspective, we had districts last week that received 3,000 tons in one week. So I have no idea what this will equate to, but what I can tell you is next week, unless the vendor chooses to come to our building, we have we are notifying them all today. They can go ahead and and fulfill other orders for a week instead of, you know, say, it's not really making us priority, but it's us being willing to take the back seat for a few days.

[Phil Pouech (Ranking Member)]: So I was gonna ask the question, do you get all your salt in the fall? I know our salt jet in town, it's like full in the fall and I think it's good enough for the year, but it doesn't sound like that's how you guys operate. You get a load in the fall and then you get deliveries as needed during the year.

[Ernie Patno (Director of Maintenance, AOT)]: So what happens is in the springtime, we fill all the sheds that we own right to the door, because we want that salt here. We use it all year, we want it back, we want it in the sheds. We do not have enough capacity to make it the year, and then so say December comes and we start using that. As soon as that shed gets down, say 200 ton, we're gonna place the order and try to get 200 ton brought back to the shed. And then that cycle repeats. We do that for about twenty six weeks.

[Phil Pouech (Ranking Member)]: So you tend to try to keep your load full. We do. Yeah. Okay. And then what you're saying, I think, is, hey, we'll back off for a week and to allow vendors potentially to give to other tenants rather than try to satisfy your contract immediately.

[Ernie Patno (Director of Maintenance, AOT)]: That is correct. And we also are patient in the winter. Sometimes we have to we might have 10,000 ton on order, but it might be just one shed somewhere, and we have to prioritize, hey, today, can you go to shed? And this problem that is happening right now, to be very, very frank, this happens almost every year, but it happens in March, not January. So we are accustomed to all these tactics. This one is a little new, and then the press release, and then diverting salt is a little new. But we have always been a good partner at moving salt if we need to. But like I said, it's normally in March, say the shed's three quarters full, it's like, yeah. We're we're gonna make it. But never happened. I've been kicking around for a few years, '29, and I've never seen this in January. February now, but it started midway through January.

[Phil Pouech (Ranking Member)]: And is it fair to say some of the weather down south has, like, sucked available salt and causing the price to change? Or, is that having it is that part of it or is it just the weather here has been so bad?

[Ernie Patno (Director of Maintenance, AOT)]: Well, it's both. But remember when I mentioned the cargo ships sit at sea and then as soon as they can get into a port, they unload? Well, they're out to sea. I don't know how many miles. I have no idea. It's not very hard to head somewhere else and say they needed to go somewhere in The Carolinas. They're just gonna turn the wheel, and they're gonna unload somewhere down there. So it's safe to say that all around us, I mean, it's in the news, people, states that normally don't use salt are they have they are using a lot of salt. That storm that went from Texas to Boston, I mean, left snow and ice, whatever it was, 100 miles wide, and how often does that happen? I mean, the news footage of the graders scraping ice off the interstate in the Carolinas, I mean, and the ice was whatever, three inches thick. It's like, wow. Wow. I know that wasn't short, but I really wanted to get that salt presentation out there that it is not as easy as calling +1 800 is very detailed, very methodical, very thought out, and it is a year round process. It doesn't just start in November.

[James "Jim" Casey (Member)]: So so this week so this week, the towns should be able to try to get some loads in, or are those are those vendors gonna tell them to pound soft because we're not coming up for this week? No pun intended.

[Ernie Patno (Director of Maintenance, AOT)]: I have literally no idea what the vendors are gonna do. I as VTrans, wanted to make some time available, some breathing room,

[James "Jim" Casey (Member)]: like a bladder For that to happen. For that to happen. So the vendors prioritize the state's needs first then. Is that what I'm assuming or

[Ernie Patno (Director of Maintenance, AOT)]: just I don't know, but we we have a heavy usage. What I am learning this year is if you add the towns and private contractors together, we're another small user of salt. And so, there's a third component to this salt situation. When your sidewalk is clear, where did that sidewalk come from? And I believe that number could be staggering or the contractor private side of salt. So I don't know who they're gonna prioritize, and I I am in no position to tell them who to prioritize. What I would like to say is I hope all towns are good partners with each other. If your town has 2,000 tons and your town has zero, I'm hoping these towns are willing to thank you for being honest. Okay.

[Unknown Committee Member]: So I'll

[James "Jim" Casey (Member)]: bring you to shovel for us.

[Ernie Patno (Director of Maintenance, AOT)]: And although I feel a little bit out on a branch here, I will say that, you know, I I was saying that I hope the towns are good partners. If one is out and one has a half a shed, I'm hoping that they do not demand their deliveries next week, or maybe they could be a good neighbor. So, and that's exactly how we internally handle it. If Derby is out and St. Johnsbury is good, but St. Johnsbury is still, you know, due for deliveries, we just ask, Hey, can we divert those trucks? Right? So sorry for the lengthy presentation, but that was literally just scratching the surface on salt. Representative White.

[Candice White (Member)]: Yeah, thank you, Bernie. I know we're running out of time, but can you just remind me of your use of salt brine?

[Ernie Patno (Director of Maintenance, AOT)]: Yes. So this year, we've used about well, I just looked this morning. I mean, it's over a million gallons of liquid salt. And we continue to our main product is just rock salt mixed with water at a 23.3% solution. And that what that continues to do is we spray that at the sprinter, that spinner, and that makes that salt moist. And salt needs one thing to work, that's moisture. So it starts working very fast, and it also makes it a consistency where when it hits the road, it doesn't bounce and scatter. And the industry standard is just by wetting that salt so it doesn't roll like a marble is about 30%. So if our trucks are moving and the system is working, we are using liquids.

[Candice White (Member)]: And are you using that initially and then coming in with just normal rock salt or

[Ernie Patno (Director of Maintenance, AOT)]: We're spraying it right. So if you can envision driving by the truck and the salt is coming out on the spinner where there's a nozzle and it's soaking that salt and making it wet right at the spinner.

[Candice White (Member)]: Okay. So that is kind of a normal application of salt by IoT is this salt water combo going on in the road.

[Matt Walker (Chair)]: Yep.

[Ernie Patno (Director of Maintenance, AOT)]: There are additives that we can add. If it is 10 below zero, we try everything we can not to use these additives. It's an aggressive type of chloride, makes your car very white. Very corrosive. It's bad for concrete. But it will melt ice below zero, but we try very hard not to use that product.

[Candice White (Member)]: And do you pretreat whether it's before a storm with salt brine, or are you using it when the storm is hitting?

[Ernie Patno (Director of Maintenance, AOT)]: So I lived through about ten years ago when we tried the that's a little more than that. About fifteen years ago, we went into pretreat, and we would spray the lines down the roads. Couple of things, we learned that if you didn't hit the timing just right, and I mean just right, it was just a waste of time. If we hit it right on the money, it had mixed results. The other thing, we had public outcry, and I mean public outcry. They're driving down the interstate. The sun is out. They wanna get home for supper, and here we are going down the road to 20 miles an hour with a tractor trailer. For real, we got pulled over in a small town happened to be, I was a supervisor of the garage. They pulled us on blue lights and we're going to give us a ticket for beating traffic. So here's the best that I could say about that. When you drive home tonight, take a look at the road, and I bet you're gonna notice some white residue on the road. And let's just say that a storm is coming tomorrow. There would be no financial advantage or advantage to put liquid salt on that road because it's already there. So if if it rained, say, for a week, it might be a benefit to pretreat, but right now, mean, everywhere you drive today, you're gonna see it. The road has some sort of white on it.

[Matt Walker (Chair)]: Okay. So we'll revisit the second half of your presentation at a possible at another time. Okay. A bunch of people have new meetings on Thursday.

[Ernie Patno (Director of Maintenance, AOT)]: We'll be happy to come back.

[Matt Walker (Chair)]: We will call +1 800 Okay. We'll adjourn until 01:00 this afternoon, one