Vermont Legislature SmartTranscripts:

[Matt Walker (Chair)]: Thursday, like the twelfth or something like that. There it is. And we're live Thursday, February 12. Oh, in the 01:00 ish time frame. And our good old friend Patrick Murphy is here. We're be talking about, well, a lecture, I know, mileage based user piece to start. It's one of those areas for sure, but it's good to see you and I hope things go well. And we have a lot to cover. So without further ado, I'll come back to the committee. I guess you'll take us from there and introduce to all our new witnesses and guests. Great.

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: Thank you, Mr. Chair. For the record, Patrick Murphy, State Policy Director for the Agency of Transportation. The last time we spoke was on Zoom, and I did promise that you'd have a rate setting proposal from UVM TRC, and that I'd be here in person. And so here I am, and at least you got one of the things that you asked about. So with the committee discussion that happened in the spring of last year in both the House and the Senate, and we thought it'd be good to make sure that you had an up to date rate setting proposal, that it would be done by an independent party, And that we'd survey all of the other states who have done it and make sure that you all had a reasonable and fair approach that could be easily explained to the public. And so, we, through a competitive solicitation, we selected the UVM Transportation Research Center, which has deep experience in this particular area. And so, we were lucky to get a good bit of work based on prior experience, particularly with Vermont data sets. So this is really informed by its deep analysis of the registration data and the odometer reading data that we do have. And I think it does come to a fair approach. It's different than what we had originally proposed back in 2024. Similar methodology, but come into it a little bit differently, and they can get into those differences during their testimony. So this time is really for UBM to kind of explain how they got to where they did, and then have you all be given the opportunity to ask questions, and if need be, seek additional kind of analysis. So with that, I'll invite you.

[Phil Pouech (Ranking Member)]: Sorry, just a quick question. This process, we had some federal grants to help us develop the mileage based user fee. Is that correct?

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: That's right. So this is a part of that grant work. We also asked because legislation last year it sort of identified this as an interim step towards a mileage based user fee for all vehicles. And so, we've asked beyond just kind of developing a rate setting methodology that you all have some sense of what the impacts are to households across Vermont, not just for battery electric vehicle owners, but if you were to move in the direction of all vehicles in the future, what that would look like by household and geography demographics.

[Phil Pouech (Ranking Member)]: But just to make sure, because I think when you mentioned, well, it could be applied to all vehicles, some people in this committee had never even heard of that. But just to make sure, we're committed to moving down with a mileage based user fee for electric vehicles.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: That's right.

[Phil Pouech (Ranking Member)]: And that this could be standing alone. But what you're saying is the process that you develop, if the legislature would like to move it further, the two could line it. Is that?

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: That's right. So the analysis that was done was to make sure that this rate setting could stand up, not just our current moment, but into the future, if changes were decided by the legislature to move in that direction. So I think we should probably just dive into that. And then if there are questions, by all means, we can follow-up through the testimony.

[Matt Walker (Chair)]: Is there any talk about the fairness of it when you drive out of state?

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: Sure. So those are all kinds of considerations that went into both the design of the program and how the rate has been designed. There's obviously challenges, and I think we spoke to this in my last testimony about there are trade offs. So those states that have piloted programs that allow for more technology heavy methods of reporting, which allow you to geofence where the miles are being reported, Those states, unfortunately, have not seen the sort of payback return that you would hope for because they have very high administrative costs. Virginia is up to 40%, Utah and Oregon are quite high, and so they're having trouble enrolling enough people, enough volume to even make it generate the revenue that you would expect, which is so the legislation last year called for setting a rate that is approximately equivalent to what a gas vehicle is paid. In those other scenarios, when you have a technology heavy solution that requires not only more upfront costs, but ongoing administrative costs, you're not actually realizing net revenue that is equivalent to what you would be raising from those other average gas vehicles. So it's not a perfect solution that we're talking about right now. But to your point, representative Pouech, we are beginning with electric vehicles to make sure that those kinds of things are worked out first before there's any kind of discussion about moving to the rest of the fleet. Because fairest thing right now for electric vehicles up until January year had not paid anything for usage tax. The fairest thing is to move them in the direction of paying something roughly equivalent. But there are certainly other things that need to be worked out over time, and that's a part of the work that we have for this grant and the proposal.

[Matt Walker (Chair)]: If I look. I'm I'm concerned about the gas end. So if I drive out of state, say we're a few years down the road and we're doing it with gas. So I'm gonna drive out of state. I'm gonna pay miles. I'm gonna I'm gonna pay for those miles I used out of state to Vermont. And then I'm also gonna pay gas tax when I pull up to the pump in in another another state. No. That's not what what's being we're proposing electric. I know you're proposing electric, but I hear everybody talking about going to gas in the future.

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: Well, that that would have to be contingent upon figuring out all of these other issues that would otherwise be barriers to the expansion towards the rest of fleet, which include not just, you know, out of state drivers, but also those that live on the border and travel the majority of their miles out of state. So we're just we're not there. And that's maybe a discussion to be had a year or two years from now, but we're just not there right now.

[Matt Walker (Chair)]: Well, was just saying, Patrick, correct me if I'm wrong, but I need to get to Representative Keys's point. I think that sort of the confusion is a little bit, it's the language that was passed in last year's bill referencing gas vehicles. That was intent language. So that doesn't really mean it. It has just like a goal, has no legal bearing.

[Representative Chittenden]: If we were to go

[Matt Walker (Chair)]: down that road, right, we would need actual law to do that. So that was just changed sort of like, this is what we'd like to do, is that correct?

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: That's right. So what we're going to be asking for this session is statutory language that implements a program for electric vehicles only. What the legislature decides beyond that is obviously up to you all and your colleagues.

[Matt Walker (Chair)]: In that conference committee, that language was discussed rather heavily. And if the vote of including it or not including it was extremely close. I think we were angers. We lost. So what we're going to do right now, and I apologize, I'm going step out for a moment. But what we have to do right now is we have to receive the presentation of what the work was done to establish a mileage based user fee for electric vehicles.

[Phil Pouech (Ranking Member)]: And the rate, Seth? Yes.

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: So what you'll receive is a rate, how they got to the rate, and then other considerations. And so the hope is that we have some sense of the committee about whether we want to move in this direction, because then we'll incorporate that language into statutory framework that we'll propose back to you all within the next week or so. And in

[Matt Walker (Chair)]: a little bit change of our normal custom, we're gonna try to hold our questions till we make sure we get through the presentation and the information. And then we'll normally, we get dug into questions while it's going on, but I wanna make sure that we get through it. So we're going go from there. We'll switch or you'll go from there, I'll be right back. Please don't wait for me, though. Thank you. Hi,

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: everybody. So for the record, my name is Claire Nelson. I'm a research analyst at the University of Vermont Transportation Research Center. I think a lot of questions that were just being brought up are well prepared to address in our presentation. So that was a good feedback.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: And yeah, I'm Doctor. Greg Grongold. I'm the director of the Transportation Research Center at UBM and also faculty and civil and environmental engineer.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: For a little bit of background context, we have done a lot of research into transportation funding and mileage fees in the past. We've written papers on this topic. We've given national webinars on this topic. We've done extensive reviews of how other states are dealing with mileage fees. So if there's questions beyond what we're presenting today, we have a variety of research that might be able to draw upon some the questions you have that include managed fee equity, managed fees in rural areas, acceptance of public acceptance and outreach about managed fees, marketing around those ideas, how the public responds and feels about increases in costs relative to where those costs would go towards in public funding.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: And I actually, Claire did a lot of the work, but I was here and presented some of that work I think last session.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And if there are clarifying questions throughout the presentation, I welcome you to interrupt so that we can all move forward through the slides together instead of leaving anyone behind. Great. So to set the stage a bit, I think everyone on this committee is probably well aware of the declining revenue problem with the current taxes. So this graph here is showing you on the y axis the current revenue from the gas tax, the diesel tax, and then those flat infrastructure fees, the BEV registration fee and the PHEV registration fee. This graph might be a little bit steeper as a decline than what you might have seen in the past. That's because we're adjusting it to $20.23 dollars. So not only is it decline in revenue, it's also the decline in the purchasing power. So you can see in 2040, for example, it's gonna be much lower purchasing power in addition to revenue. The reason why we're seeing this decline over time is for a variety of reasons that you're probably well aware of. There's more fuel efficient vehicles, so even the gas and diesel vehicles on the road are generating less revenue per mile, in addition to more electric vehicles that just aren't consuming any gasoline on the roads. And then the effect of inflation, which is that lowering of the purchasing power over time. So these are kind of two effects here. We have the decline in gasoline consumption and then the decline in purchasing power due to inflation. And just one other I

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: was gonna say, this is also just light GDP.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Oh, yes. Yeah.

[Phil Pouech (Ranking Member)]: So this is good to add in the inflation factor because we know our gas taxes don't have an inflationary piece And to it's difficult to raise, we'll just say that. Are there any states out there that tie their fuel taxes to an inflationary rate?

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Yeah. Yeah. So I know California, Florida, Delaware. We have a list of them in the report that we've provided In addition to there's a list in the policy brief. If you look on the back page at the bottom section, there's a mileage fee impact state revenue section. In there, it has a list of the other states that have indexed their gas taxes to inflation. So if you index the gas tax,

[Phil Pouech (Ranking Member)]: it will probably still be steep. It'll still come down. Oh, that's the amount. There you go. All right.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Great job segueing. You're doing the work for me. So these are revenue projections that we've done. If have any questions about how we'd projected the revenue, happy to answer them. But we see that even if we adjust the gas tax for inflation, while we see less of a decline, we still see that there's

[Matt Walker (Chair)]: this

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: effect of reduction in total amount of gallons of fuel that are being purchased. So it's a combined effect, replacing the gas tax with the gas tax index to inflation, only solves part the funding problem that we're facing. And we'll let's digest this for a second. And

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: just one other, while we're on this slide, too, one thing was thinking about is we don't to consider, we don't normally have to adjust for inflation other types of common taxes and fees like sales tax and income tax, because those essentially self adjust for inflation. Prices and wages go up, that is inflation. Those types of taxes capture that. But when you have a per unit of thing tax, like

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: a gasoline excise tax, then that's not built in. And so ideally, it should be, or you lose money every year since you've adjusted. You don't want to be back there adjusting it. So obviously, the state has recognized this issue. We just wanted to kind of forth leave with the idea that inflation is also part of this problem. But this is the language from the intents that you guys were talking about earlier that the state set to use a mileage fee to help cover some of this revenue loss for BEVs. So the intent language, just a refresher here, is that the state is hoping to use a mileage based user fee for B2B pleasure bars. The intent is that this mileage based user fee will be approximately equivalent to what current gas and diesel vehicles are paying, and that this will serve as kind of a pilot for an interim step towards gradually expanding this to a statewide program, pending all of the issues that need to be worked out that you were bringing up earlier. So just some interpretation here. Pledger car is kind of a funny term. We interpret that as any light duty vehicles in the state, so vehicles where the gross vehicle weight is less than 10,000 pounds. We're also going to share some analysis that we've done looking at expanding this to a statewide program. And in that case, we also interpret a statewide light duty vehicle mileage fee. We don't do any analysis related to medium or heavy duty vehicles. They are used very differently for very different purposes, they're, to put it bluntly, a whole other beast. So that is not within the scope of what we've done. But if that's of interest, we can chat about that, too. So what we've done legislation from with the agency of transportation, we've reviewed how other states are setting their mileage fees. We've looked at the recommendations that the legislature has received previously about mileage fees and then update those recommendations. So today, we're going to be sharing with you what we recommend in addition to how that differs and why that differs from suggestions you've gotten in the past. And we are gonna be focusing mostly on what our updated recommendations are, in addition to what the impact would be on both Vermont household costs and state revenue generating potential. So that's what we're going through. So the actual fee that we're recommending for BEV pleasure cars in Vermont, which are just light duty vehicles, is a 1.4¢ per mile fee. This fee was set to be approximately equivalent, this blue box up here, approximately equivalent to what current gas and diesel vehicle owners pay in motor fuel taxes. And we calculated that using the state gas tax, which is dollars per gallon divided by the average fuel economy. So dollars per gallon divided by miles per gallon gives you dollars per mile. So that's how we calculated this mileage fee here. There's a couple of key factors that go into this. I'm not gonna spend a ton of time on it, but we can dive deeper if there's additional interest. For the state gas tax, we used a five year average. Obviously, the gas tax has that percent that's based on the retail price of gasoline in it. So to avoid any short term fluctuations in market gas prices, we figured the safest route was to take a multi year average of the gas tax to smooth those trends in gasoline prices. So we use a five year average here. And then we get our average fuel economy for the state of Vermont for light duty vehicles from our Vermont registration and infection records. So we took all of the light duty vehicles that consume gas or diesel in the state of Vermont and used a distance weighted harmonic average jargony words for, basically, we want to account for the fact that not only does the vehicle have a fuel economy, but those fuel economies are differently on the roads based on how you're driving, relates to how much fuel you're consuming. So we weight the average by how far vehicles have traveled to account for those real differences in how vehicles are used. So those distances come from the same method that we would use to charge an IMG, which are the odometer readings from the vehicle inspection. So all of

[Phil Pouech (Ranking Member)]: this is state specific data, yeah. So this is something I've been waiting for to just So sort of there really isn't mean, you're looking at like the average car and not so that could be a truck and a Prius C. And what you're saying is a battery electric car is in the middle. It's not less efficient or more efficient.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: We're gonna get there. Yeah. But I think the point here that we're trying to make is just because we're going to the next slide's comparing to the prior report, but is that we're using a multi year average because the state has that little formula that lets it vary a little bit with the price. And then rather than just looking at all of the vehicles in the registration record, cross reference them with an EPA database to get their fuel economies. So as a straight up average, we account for the fact that some of those cars are barely used and some are used to a lot. So that's the weighted fuel economy. So if you have a Prius and it sits in a driveway, it's not going to influence this average fuel economy. If you have a car you drive a lot, it will be more weighted in here. We do that so that this fee we're recommending, the 1.4¢, is as close as possible to the average per mile cost that people with gas or diesel cars are paying.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: I think your question is getting to the purpose of a mileage fee generally. And here, like you said, we're just trying to make an equivalence to what a gas and diesel vehicle would pay per mile and apply that to BUVs.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: We've got tables, plots, maps coming,

[Matt Walker (Chair)]: So so you'll see all the

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: this approach differs It's similar methodology, but differs a bit from what the 2024 legislative report recommended. That's on the left here. They recommended a slightly higher rate per mile, 1.8¢ per mile. Ours is 1.4. A couple of reasons for that difference. The first one is that they use just the most recent state gas tax. As I explained, we wanna kind of smooth the trend in differences in gas tax prices, so we used a five year average. We also use more recent data. So they had originally used data from 2013 to calculate the average fuel economy of light duty vehicles in the state of Vermont. We used the most recent data because if, I mean, you can imagine in this equation here, if you, let's see, the 2013 average fuel economy for vehicles was about 19 miles per gallon. Now it's '23. So fuel efficiency has increased a lot since 2013. If you used 19 miles per gallon, this mileage fee increases. Right? So the average amount that people with gas and diesel vehicles are paying per year would be lower than what you would be charging BEVs now per mile. If you have any questions on that, I can also elaborate a bit more.

[Matt Walker (Chair)]: Yeah, any You got a story of electric cars?

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: I drove my big internal combustion engine car today, but I have an electric one also. Do you?

[Phil Pouech (Ranking Member)]: Go ahead.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Go ahead.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Go So we're using more recent data to make sure that when you implement a mileage fee for BEVs, it's not going to be much more per year than gas or diesel vehicles are paying any additional, basically, consequences for EVRs. Also, there's just a couple of methodological differences with the way that we calculate our average based on the best recommendations that are currently out there for how to calculate averages for rates that were not necessarily accounted for in the last report. And some of the bigger differences are the differences in rate adjustments that we recommend to our report. So previously, they had recommended increasing this per mile fee to cover the additional administrative costs. Obviously, a mileage fee program is going to cost something to administer both as startup and then an ongoing costs moving forward. They had recommended increasing the per mile rate. We recommend increasing per vehicle fees. We feel that the cost of administering this program is much more likely to vary with the number of vehicles registered in the program than how many miles and the individual vehicle travels within that program. So a vehicle that travels 5,000 miles a year versus 50,000 miles a year is gonna cost the same amount to administer. You just need to check and charge their mileage rate. So charging an administrative fee based on the number of miles that the car is traveling, we feel, is not necessarily reflective of how the administrative costs would actually be incurred. So we recommend an alternative of potentially increasing the vehicle registration fee for vehicles in the mileage fee program or the inspection fee where they're actually getting their odometer reading checked, or some alternative that the legislature comes up with. But biggest point being, we don't recommend adjusting the actual mileage view rate to cover administrative costs for the reasons I just mentioned.

[Unidentified Committee Member]: Can I just Yeah? Do we have an additional registration fee right now for EVs? Yes, we do.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: You 89 per vehicle.

[Unidentified Committee Member]: On top of the regular registration fee? Yes. Okay. Well, yeah, regular registration fee.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: This is a requested by

[Unidentified Committee Member]: a placement. Yes. But you will still have, so your recommendation is if I'm paying an IV gas vehicle, I'm paying $93 a year. An electric vehicle would pay more for the registration of the vehicle,

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: if that's what you're recommending. We're recommending replacing that infrastructure fee of $89 per vehicle that BEV's currently pay. We're recommending replacing that flat fee with a mileage fee of 1.4¢ per mile. And then in a small additional cost to We cover the

[Phil Pouech (Ranking Member)]: were paying $93

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: That therapy would go up. Maybe it's 94. I know. I would say our scope to figure out how much the costs are.

[Unidentified Committee Member]: Okay, but absolutely I'm

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: trying to figure out what- The concept is, yeah, the cost is every time you have to go register and automate the mileage fee, that's where the administrative costs come It doesn't come from the fact that you drive your car a lot or car. Correct, yeah.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Okay, thank you. The other major rate adjustment that we recommend is about inflation. So the prior report, the 2024 report, does not really make any strong recommendations about inflation. They don't say much about it. We highly recommend indexing the mileage fee to inflation for a couple of reasons that we'll get into in some revenue thoughts that we have later on showing our projected revenue from a mileage fee.

[Matt Walker (Chair)]: What are your thoughts on driving out of state? What would you guys talk about when you drive out of state as far as, say I live White River and I have a job over in Concord, New Hampshire?

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Yeah, there's really no other states are doing much with EV charging on a per mile or per kilowatt hour basis, we don't see any problem with the EV per I

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: think the question about if you drive out of the state, you're paying the mileage fee in this case, because it's based on an odometer, and then you're paying the gas tax also outside some states. So we haven't got into the details on your in state, you drive out of state and you're being double charged is quite If you're being double charged, it's the idea of being

[Matt Walker (Chair)]: charged for something you're not driving on.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: No, exactly.

[Matt Walker (Chair)]: This program is made to help take care of Vermont roads.

[Phil Pouech (Ranking Member)]: And

[Matt Walker (Chair)]: so it's not fair if you drive over to another state and you're paying a fee. Yeah, I guess it's good for Vermont, but it's not good for the driver. He's paying for something that's There not

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: are some different There's the technology options that Patrick talked about. There are other options that are simpler, being reimbursed for your estimated gas tax payments out of state. We're going to talk about We have at the end of this, and we can do more after if we get to this, but we have some recommendations how to at least capture revenue from out of state drivers that are in Vermont that wouldn't be paying the gas tax

[Matt Walker (Chair)]: with the amount of fuel. So I'm the guy driving the car. I don't care about what everybody else is doing driving in here. I care about I'm paying for a tax when I'm driving out of state that's meant to take care of Vermont roads. It's not fair. There's care how you say a

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: big concern of everyone in the committee, we are on retainer to do additional analysis. So if this is something that is a pressing matter to everyone, we'd be happy to and we can do that.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Can talk Patrick in terms of contract, but yeah, we can do a deeper dive into it. There are a range of options to deal with these sort of things. The focus today though has been on setting the rate in state and what the equity, rural, urban, different types of vehicles and households looks like. And so you're not going to see a bunch in New York. It's pretty

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: good question.

[Unidentified Committee Member]: It's the western part of the state, so I have New York drivers that come in to go out with gas because our gas is cheaper than New York state. Similarly, those who live on the Eastern part of the state, I'm sure, go over to Hensdale or wherever to get cheaper gas. But they're thriving in the state, so I think it'll happen. We actually, we

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: do talk, oh yeah.

[Unidentified Committee Member]: I mean in end, I mean it's like if

[Matt Walker (Chair)]: you're, I'm just doing what I'm trying to do.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: I do, yeah. I think in terms of total state revenue, but to your point, the individual drivers are We not where they're do have some thoughts on out of state drivers coming into Vermont at the end of this presentation we can get into. So just in summation of what I've just been talking about, we recommend this 1.4¢ per mile fee. This type of equation that we're using here is used in three different states' active mileage fee programs in addition to over 10 different states' proposals for mileage fees. It's a very commonly used way to calculate a mileage fee equivalence, so we feel it's defensible from that standpoint and from the ways that we've adjusted it to be specific to Vermont's. What, three states? They're in our report. Utah uses a very similar measure to this, Oregon and Anyway, so ultimately, we recommend indexing this mileage fee to inflation, as well as using a type of per vehicle fee to cover that administrative cost as opposed to a per mile fee. What this means for actual revenue in the state of Vermont, we've done some revenue projections. Just a quick overview of how we got these. We used EPA's MOVES model, which accounts for vehicle fleet turnover, fuel economy projections, mileage projections of vehicles. And these are county specific, so they're actually representative of Vermont's data that we've summed across the state. The of state Vermont last provided data for this model in 2022. So it's relatively recent state provided data. So we calculated how much revenue the state could expect to bring in using our current system of gas taxes, diesel taxes, and these flat BEV and PHEV fees. That's this blue line at the bottom here. So that's what I showed on the first slide. All

[Matt Walker (Chair)]: of

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: the dashed lines are if we indexed our fees to inflation. So I think I showed this blue line and that dashed blue line earlier to show if we adjusted our gas tax and our diesel tax to inflation. Also projected in the yellow line if we were to apply a mileage fee for just battery electric vehicles. So the yellow line here is mileage fee for battery electric vehicles. Dashed yellow line is if we index that fee to inflation. And then finally, the pink line is if we were to apply a mileage fee to all light duty vehicles in the state. Because remember, we're just focusing on light duty vehicles for this analysis. You can see some trends here. For one

[Candice White (Member)]: Oh, yeah, yeah. Just to clarify, for the line with mileage fee for BEV indexed, does that also include indexing the gas and diesel tax,

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: or is that still not adjusted for inflation? Yes, so that includes all of the fees there would be indexed. All of, okay.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Yeah. Mean, you index one, not the other, the difference in what people are paying per mile would be better.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Right, okay, thanks. That's what I was saying. Yeah, and if that's of interest, we could draft up something that just shows if you were to index it. Well, it seems much more fair the other way. I just wanted to make sure it was clear that that was the case. Thanks. So a couple of things are going on in the spot. For one, even if you indexed the gas tax to inflation and did not, gas tax being a generalized term for all of our current vehicle fees that we're talking about, even if you index that to inflation, we would still see a decline in revenue because of increasing fuel efficiency vehicles, increasing BEV costs. So some sort of fee for these additional vehicles that is not dependent on fuel purchase is necessary to retain the state's revenue. In addition to that, did you This question? Yeah.

[Matt Walker (Chair)]: I may have missed this in the beginning on the assumption on that dark blue line, current gas tax is a significant decline in five years, and then that decline slows down, I guess, in terms of what is it that's going to happen in those five years? Is that based on the idea that we're going to adopt 126,000 electric vehicles as the climate goal? Do you think that inflation is going

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: be

[Matt Walker (Chair)]: that? What is it that means so dramatically in five years? That's a significant drop.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So there are plots in our report that show the specific assumptions that went behind this model. They are the base assumptions that moves uses for the state of Vermont based on they account for federal policies that impact, you know, new vehicle sales and things like that. It's mostly EV adoption is that big decline. And if you want to see the exact trends, they are in the report.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: And yeah, just a few additional points on that. So it's right. You got a couple of factors. One is changes in the average field miles traveled per year, which generally going up, not down. The change in the number of vehicles, the fuel economy of the remaining internal combustion engine vehicles, and adoption of electric vehicles. There's plots, there's curves for each of those things separated in the report. And then you see the result of that here. We used a version of this EPA model that was put in place that represents the state of federal policy before what's known as the multi within rule, which is a Biden rule that was designed to reduce the snow pipe emissions and encourage more electric vehicle adoption, which is currently being undone. So this is a more conservative EV adoption scenario than would Well, we would have thought of this being conservative a year or two ago. Now this is maybe more likely to reflect reality. So it's not a super aggressive EV.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: To answer your question, that steep drop is a combined effect of more EV adoption in addition to vehicles just getting more efficient on average.

[Matt Walker (Chair)]: There's conventional hybrid. So I guess my issue is we're working on a '27 budget right now, and when I move over, we went from 50, we're already at 40, one year, 28, now we're working in this building to solve a $10,000,000 and $20,000,000 problem, and you're suggesting it's a $35,000,000 to $45,000,000 problem annually.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So Yeah. We're suggesting that this is an incredibly big issue. Keep in mind, too, that this access is adjusted to $20.23 dollars So it's not just revenue, it's also purchasing power.

[Will Baker (General Counsel, Vermont Department of Taxes)]: That's the excess. It's less about purchases. This

[Matt Walker (Chair)]: would make a significant Okay.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Another assumption here that's not written on slide, but it's in reports, this is assuming a 4% annual inflation rate, which is based off of the National Highway Construction Price Index. Insulation could always be more or less.

[Phil Pouech (Ranking Member)]: I think I mentioned this before, but what's causing that steep decline is three things. Adoption of EVs, more efficiency, mileage is about the same or even higher, So I'm those two things, but the biggest drop is the inflation factor. Even if everyone's gas mileage went the same and we charge EVs a fee, it's gonna continue to go down because as you said, the gas tax is a per unit. It doesn't have an inflationary piece built in like a sales tax or an income tax.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And that was our next slide.

[Matt Walker (Chair)]: Which is why we really gotta have through the presentation. We'll do what we find out the same before we ask them. I assume, like, we're just gonna be pushing more and more like the next few years, or we gonna

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: assumptions of are the report. So it assumes, I mean, we could dive into

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: the Yeah, mean, we can.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: This is one way of projecting future revenue. Are projecting less cars or more? Basically, more cars.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: More cars,

[Matt Walker (Chair)]: What more percent of cars do you think later on we're going to be what percentage of all our vehicles are going to be electric?

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So again, I want to clarify that these were not assumptions that we arbitrarily chose. This is guidance from Biden No, the pre Biden era. So I think this actually latest version of moves was released during the last Trump administration. This

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: was a version of this model that was used to be the baseline to compare against the Biden's proposed regulation. So we're using that to reflect the current state.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And if you're curious about the assumptions, do have graphs of all of that in the report that we wrote. But I do want to point out, it's a great point, EV adoption might vary. So if you look at the difference between gas tax with no BEV fees and the mileage fee for BEVs. This is the uncertainty realm for EV adoption, because this is the additional revenue we get from charging EVs. So if you want to alter in your brain the assumptions about electric vehicles that we're making, If this feels really optimistic to you, this is closer to the revenue that you could expect if you want to adjust our assumptions about electric vehicles.

[Matt Walker (Chair)]: So Representative McCoy has got the last question, so we

[Phil Pouech (Ranking Member)]: I think we find a report. Yeah, emailed yesterday.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: There's a two page policy brief also in addition to the 40 page report and a few slides.

[Unidentified Committee Member]: So do we have the 40 page report? You should. We

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: made a two page, easier to digest summary of it. We recognize your time might be fleeting. But if you have questions that are not addressed in the policy brief, the specifics of everything we've done are in the report. In the report. Yeah. Great. Thank you. So it's there for your reference. So, yeah. So points here are that some sort of additional fee, mileage fees, in this case with the state of Vermont, are essential to preserve revenue due to decreasing fuel consumption from vehicles. And that, in addition to that, adjusting for inflation is the essential element for preserving the purchasing power of those fees over time. We wanted to then hop into what this means for actual household costs and their difference in costs, too. So we're going to segue away from overall state revenue conversation, but we can get back into that if there's more questions later. So on the left here, we have a list of some of the most common types of vehicles that are owned in the state of Vermont. The top three are the most common, BEVs, PHEVs, and then the HEVs that have regenerative braking or something. And then the bottom three are the most common types of gas or diesel internal combustion engine vehicles. So we can see that currently, vehicles like the Nissan Leaf are paying closer to 0.8¢ per mile that they travel. That's the second column here. You can see how much. Normalizing, assuming that every vehicle travels 10,000 miles. So we can just compare across their fuel quantities. And then gas and diesel vehicles are paying much more per mile right now at about 1.8¢ for the most common gas car in Vermont, the Chevy Silverado. Does anyone in the

[Phil Pouech (Ranking Member)]: room own a lot of things?

[Unidentified attendee]: What was the question?

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Chevy Silverado's? Yeah.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Pickup answer is number one. Yeah.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So if we were to go from our current taxes, this Bell Colander, which are the gas tax, diesel tax, and then if you're an EV or PHEV owner, it would be that flat fee you're paying at registration, so $89 for EVs. If you were to go from that to a mileage fee, we just show it for adjusting for all vehicles. But for this case, you can just look at the BEV if you're in that, we see that on average, BEV owners would see a $60 bump in costs by switching over into this mileage fee. We see that gas and diesel vehicles, if you were to switch over to a mileage fee, would on average see cost savings every year, because they tend to be less fuel efficient vehicles right now and are paying more than that 1.4¢ per mile fee that we're recommending. So they would see savings. Do have a pen?

[Matt Walker (Chair)]: I do, but I don't know if he wants me to ask any questions. We can come back to it.

[Phil Pouech (Ranking Member)]: We're not going

[Matt Walker (Chair)]: to get through it if we don't.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: You can look at individual vehicles, and that's helpful. But really, people use their cars in household contexts. And to point out, of this information that we're showing is based on the Vermont vehicle registration and inspection records. These are real data from real Vermonters in this state. So here, we're showing, in a household context, vehicles travel a little bit differently, used a little bit differently. On average, if you're just a one car household with an EV switching over to a mileage fee program, with this 1.4¢ per mile fee, you would see about a $70 increase in costs annually. Some EV owners might see less. So you can see this bar. I'm not sure if there's too much glare on the screen. Some EV owners might see up to $60 savings in costs every year. Some might see up to a $200 increase in costs. Again, switching to a per mile fee, people travel differently in their vehicles. So it is going to vary when you're switching from a flat fee to a user based fee. But on average, it's about a $70 increase in costs. Obviously, this scales with the number of vehicles, because in a household, vehicles tend to be used if you have them. So for two car households that have two BBs, which is a very small percentage of households in Vermont, not many households have two BBs, they would see about double that. So it's about $70 a vehicle increasing cost per year. We also want to point out that because we do have this data from the Vermont inspection and registration records, we can look at how this varies spatially across the state of Vermont. So right now, people in rural areas, the lighter colors on the map, tend to spend more per mile that they're traveling. Again, this is partly because they own less fuel efficient vehicles overall in rural areas. So they're paying less per mile than our recommended mileage fee. Obviously, with a mileage fee for everyone, everyone would pay the

[Matt Walker (Chair)]: same amount. It's kind of a

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: boring map. It's all the same color. But the important part here is the annual cost difference that they would see from switching from their current fee system into a mileage fee system. We see that people in rural areas, again, because they own less fuel efficient vehicles on average, would actually see cost savings. They would pay less per year than they currently are with a mileage fee program. Generally, people in urban areas would see slightly higher costs per year with a mileage fee program because they tend to run more fuel efficient vehicles. So last slide. Do you want to wrap it up?

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Yeah, so here's the last thing. The main takeaways here, there's a lot, but mileage fees by themselves aren't going be enough. Inflation, it's a huge factor here. And so if we adopt a revenue neutral mileage fee today and just on battery electric vehicles, then immediately there's going be a divergence between what EV owners are paying and what people with gas and diesel vehicles are paying per mile, because those gas and diesel vehicles are becoming more fuel efficient each year. And so this gap will widen and then we have inflation. And then maintaining out of state revenue, only gets to part of your questions and concerns, but if we were to transition to all light duty vehicles, we need to think about how to capture revenue from the 30% or so of vehicle miles traveled that come from out of state drivers in Vermont. So an option is to keep the gas tax and everyone pays the gas tax when you get assessed your mileage fee. You either owe the state a little more or you get reimbursed if you overpaid it, if you paid more of the gas tax than you would have with a mileage fee is one way to think about it. So you could, using and how this might work or could work and is being thought about in other states, is using the same odometer data that we would use to calculate your mileage fee every year. We could use that same odometer reading along with the VIN number of your vehicle to look up the fuel economy of it, just as we've done for all the figures in this presentation. We estimate what you would have paid or what you did pay in the gas tax, and we could subtract the two and see if

[Matt Walker (Chair)]: you owe or earn enough money.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: So this way, you're paying the mileage fee a little bit throughout the year like you know how to do, and then you get adjustment out there. That's a way. And then out of state drivers are just paying the gas tax and that's way to to you guys. So that's an option.

[Matt Walker (Chair)]: Are we That's it. Okay. Well, Representative Casey, you're up first. And then, Perth, please come to Tomlinson. I'm right there at work. One, two, three. So we keep brushing with the M Buff for all, but the say we did have mileage based user fee for gas also. Why wouldn't I wanna drive a gas guzzler afterwards? Why wouldn't I just go get a V eight at that point if I'm only paying per mile? Now it's almost like we're incentivizing the gas go

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So there's a couple of points there. Would still be purchasing gas, and the federal gas tax is still in place. So this is just replacing the state gas tax portion. So this federal gas tax is still a disincentive in that way. The other part of that is that you're still buying a ton of gas, which is incredibly expensive. So that in itself is another disincentive. This doesn't mean it can't exist with additional incentives for electric vehicles, but the purpose of this mileage fee was to right size how people traveling on the roads are contributing to the system that pays those roads. We weren't trying to create a type of fee that catches every incentive. Yeah,

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: on that point, I think the purpose, and at least what we've been asked to look at is one, just what would a revenue neutral mileage fee look like and how it should be written so that it continues with its purpose over time. And two, the focus of my understanding of the legislation, at least what I would recommend if it were up to me, is this is not to combine a bunch of different policy objectives together, but is a fee that was originally put in place back in the 20s, 30s

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Yeah, 'eighteen.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: As a road user charge to pay for construction and maintenance. And so the purpose isn't to incentivize anyone to buy one type of vehicle over another. It's to everyone pays their fair share for using units.

[Matt Walker (Chair)]: The other question I had is this is, again, assuming that we go to a mileage based user fee for everything. The the want the border town gas stations, they'd be happier than be happy, won't they? Because they'll be, for once, we'll get New Hampshire people wanting to come over here to buy gas, and New York will be wanting to come over here and buy gas.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Just actually back to our last point on the slide here, that last thing that Greg was saying, we actually part of our obviously this is a conversation for one or two years from now if the state decides to expand to a statewide program. But it's absolutely an option to keep the gas tax in Vermont so that everyone's paying the gas tax and move to a reimbursement style system. Where if you're a local resident, you either get charged an additional amount based on what you would have paid with a mileage fee, or you get refunded an amount.

[Matt Walker (Chair)]: I wonder what the bureaucracy would look like for that.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: There's a couple of states who are actually interested in this right now in addition to what we've been researching. So there might be one or two years down the road. You

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: would have all the information you would need to charge the mileage fee using odometer readings at the inspections, which is the current scheme that seems to be moving forward or that's been talked about. The data you collect in that process is all the information you would need to figure out this rate adjustment. Because you know how far everyone you have the odometer reading. So you have the mileage and you have the VIN number. And with the VIN number, you can cross our friends at federal database that gives you the fuel funding. And then with those two numbers, you can estimate what you paid in the gas tax.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And this is just one option that would need to be much more fleshed out when that I mean, it's a great point. How do we make sure that we're retaining the revenue from out of state drivers traveling on our roads?

[Matt Walker (Chair)]: Well, you only got to drive a lot of mile into the state in general, so we're going to worry about charging them one mile of distance on our roads.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And I think to better answer that question, you would need better data on how many people are actually doing that and how much of our revenue constitutes out of state. Think the rough percentage that I've heard from around is 20% of state gas tax revenues from out of state drivers. But I think that's a question that we need to dive into with a bit more time.

[Matt Walker (Chair)]: It just wasn't the focus of what we're doing here.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: And another point, I don't know if we mentioned in the report or not too, is you can take this as an opportunity. The gas tax being generated from out of state drivers will also decline in its purchasing power and its overall revenue because out of state drivers are also using more fuel efficient vehicles. You could increase the gas tax under this scheme and collect more revenue from out of state drivers, but Vermonters aren't going to pay that if they're being reimbursed with this mileage fee that already comes with that. So you could use it as a scheme to capture more revenue from out of state drivers, you could be like New Hampshire, it's like putting the coal on the border. There's all sorts of things if you want. But the point is there are ways to capture this revenue for a number of reasons that Patrick was mentioning and you're mentioning. There's things that have to be thought through more, I think.

[Matt Walker (Chair)]: I'll be driving a car that gets less gas mileage. I'll tell you that when we go through, for sure.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: You drive out of Ford F-one 150 right now, you're helping, you're doing more than out of person paper runs is the current situation.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Yeah. Representative Tomlinson? Thanks for this presentation. It's so helpful and informative. And I just wanted to appreciate the concept about the reimbursement, because that would also address this concern that I've heard from folks around just having to pay that fee in bulk once a year as opposed to paying as you go. So for folks where that could be a challenge, I could see this help address that. Although I certainly would also have questions about the administrative burden, but I guess that's kind of down the road.

[Candice White (Member)]: Implicit in these recommendations, there kind of a recommendation for indexing the GAPS tax as well? I mean, that was kind of included in your projections. It seems like that

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: would be necessary to achieve fairness. It wasn't exactly the scope of what we were asked to do, but the recommendations that we have for indexing the mileage fee to inflation could easily be used for the gas tax, although we don't explicitly state it in that way in our In the full report, there is a table that outlines different measures of inflation and recommendations for what we think is the most appropriate method for applying an inflation rate in the state of Vermont. Just a quick summary of what that is. We recommend basically looking at your biggest budget items from transportation, whether that's construction and materials, whether that's wages or administrative costs, and choosing a measure of inflation that best measures that change in costs. So if it's materials, we recommend using something like the National Highway Construction Cost Index, which actually measures the change in cost of transportation specific materials. There's also the PPI. There's a list of things. The most common measure of inflation is the consumer price index, and

[Phil Pouech (Ranking Member)]: that would probably be a

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: more appropriate measure if the biggest budget item for transportation is something like wages, because that reflects consumer costs. So it would be things that you're using your salary, things you're using your salary. But that's all outlined in our report, and you could take some of that and have discussions about what that would mean for the past. Thanks. Yeah,

[Unidentified attendee]: because nothing is easy. But as we're having discussions in this building about getting rid of inspections, or going to regular inspections, that's another, how would that drive with needing to, the simple way to turn a mile should be through granular inspection.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Well, I mean, so we're not tasked with looking at that. And I read about that in the news this morning, and we were joking about it on the way. It's like, Hey, we're coming to talk about this. And they're getting rid of the

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: The way we're looking

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: at it. I think it comes down to what the concerns about the inspections are. So in principle, you could still require people to come in and get their odometer looked at real quick by someone that's not yourself. So there's some auditing system or ability there. Some states have talked about self reporting it. Would still need some way, obviously, to do some sort of audit system to keep people honest.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Especially with AI generated automations and things right We see a lot of additional administrative complexities with getting the right amount of revenue from a

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: system I like think, yeah, the fact that we have inspections is really convenient because there's already a whole database system set up that collects various information, including the odometer, and it's in a database that can be combined with the VINs. And we've developed at UVM, we do a lot of work for the state where we've been collecting and correlating that data to evaluate different policies that affect

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: It's how we were able to do the small analysis with annual inspection data.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: So I think If there is a desire to get rid of the inspections for one reason or another, I think there are still opportunities to collect odometer data one way or another.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And there are additional, just to add on to that quickly, there are additional ways to collect mileage information. There's plug in devices for vehicles, and there's RFID tags that can scan. So there's other options, but as Patrick was saying earlier, they are more expensive to administer, more expensive for an individual, and these additional, sometimes privacy concerns in trying to get people to either enroll or accept this as

[Phil Pouech (Ranking Member)]: a partner for them. So

[Unidentified attendee]: just other considerations. Just one more question, and I may have missed you in the beginning. When you say battery electric vehicles, are you including plug in hybrids in that category? No.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: No. Plug in hybrids were not considered a part

[Matt Walker (Chair)]: of the battery electric vehicle.

[Phil Pouech (Ranking Member)]: Representative Howard? Yeah. I have a couple of questions. Just one is, you know, I I I think we're muddying the water when we're looking at doing all vehicles when really we're talking about battery electric, bringing them into the system to pay their share. And I was all for matter of base user fees for battery electric. Think looking at that other piece is fine, but we don't wanna muddy the water of taking that first step. I have a bit of concern of how you came up with the weight because treating every vehicle based on a mile at a time rather than your fuel efficiency, lower fuel efficiency vehicles cause other problems too. And that's not part of your calculations here, they're all coming up with the rate. And then the other piece was, we know the gas tax costs 3% overhead to collect. We have you calculating what the overhead is for the mileage based user fee? What the efficiency would be?

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: So I think that's

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Short answer, no.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Yeah, but the prior, I think that prior study for legislature estimated at like, let's say 3.5

[Matt Walker (Chair)]: to five.

[Phil Pouech (Ranking Member)]: That's not so bad. That's assuming you have the inspection piece that helps.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: That's not

[Phil Pouech (Ranking Member)]: too bad. And in my mind, I've always thought we move forward with my lease use of fee, let electric vehicle owners like myself pay their fair share. But I also thought we would put on an inflationary figure on that and also the same inflationary figure on fuel tax so that we don't drive ourselves down into a hole. So just adding the battery electric doesn't really solve anything without inflationary pieces to it.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: You can see if we stuck with mileage cheaper BAVs and dealt with inflation piece, we're doing a lot better, even if we are leaving that chunk there, that maybe another $10,000,000

[Phil Pouech (Ranking Member)]: We've added a couple of inflationary pieces in some of the funding formulas for municipalities. And there's a formula that is around that does that. So that could be the one considered. Yeah, we have

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: in the report too, we've written a formula and you can look at it. It's pretty standard, it's price index.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And there are a couple of I mean, there's many states that have indexed their gas tax to inflation. There's two states that have used that NHCCI, the National Highway Construction Cost Index. I believe it's Alabama and Mississippi. So there's precedent from other states for actual statutory language. For the CPI, there's, I think, seven states that have indexed their state gas tax to the CPI. And then if you're interested in this more construction materials cost, there's also two states that have done that. So there's ample examples of states that have

[Matt Walker (Chair)]: done this.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: And I think your first point though is about we didn't consider the other external costs of gasoline and these vehicles. So that is intentional here for our scope, is simply the replacing, think about this as a highway user fee for roadway maintenance costs. To the extent that you want to consider the environmental externalities of using gasoline or diesel, you could always consider things like retaining a portion of the gas tax to account for the something like that if you wanted to. There's California, for example, part of their gas tax, a percentage of that is for environmental fees. Those are always options, but that's what we were tasked to look at.

[Phil Pouech (Ranking Member)]: Thank you. Representative Boyd?

[Representative Boyd]: Yes, so my questions are on the heels of several other colleagues. So number one, on the heels of what Representative Pouech was suggesting, To me, it feels like mileage based user fee for battery electric vehicles that is indexed for inflation makes sense, coupled with indexing our gas tax, which we haven't done. But I'm really happy to hear that there are examples in other states where they have done that. Is that included in the 40 page report? Okay. Great. And then my other concern, which again, representative Pouech was suggesting, I think it's important that we don't, in the end, net out to penalizing battery electric vehicles, because there are a lot of reasons why we have said that these are good for our state in terms of emissions and getting off of fossil fuels. If we were to look at that scenario where we are putting a dollar, excuse me, 1¢ on 1.4¢ per mile on battery electric vehicles, plus an index gas tax on combustion engines. We just want to make sure, and again, this may be outside of your purview, but we don't want to net out so battery electric vehicles are paying more. Think we're looking for equity, want everybody to be paying into the roads.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: You're still going to save money with the EV on your Well, okay, there's the fact that the vehicles cost different amounts of money to buy, but you're still buying gasoline for the internal combustion engine vehicle, which is thousands of dollars per year. And these fees are $100 or $200 a year at most. So going from the $89 flat fee to per mileage fee, which is basically going to roughly double the cost of that fee on a battery electric car, you're still saving thousands in capital.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: But you've also got the cost of electricity for the battery

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: electric And that is currently pretty inexpensive, but we know there's

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: anything. And

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: the other thing to point out too is there's still the federal gas tax. So with the DEV, you're still not paying that. If you were to do this today and could, in additional work, we could put the total costs of owning and operating these vehicles into these type of figures and probably show that you're still doing well with an electric vehicle. Although it depends on the varying and now disappeared EV tax credits, all that sort of thing.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: One of the additional things I want to point out, is that EVs in Vermont, on average, are driven more miles per year than gas or diesel vehicles. So if you look at the average mileage fees in the one car household, gas, which is a vehicle, would be paying about $152

[Unidentified Committee Member]: a year. EVs would

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: be paying about $158 That slight just $6 bump is because on average, EVs are just driven more, so with a per mile fee. And that's in the report too. We have mileage broken out by the fuel types. Obviously, depends on how many vehicles you own, how old they are, your household makeup, it's relative, it's just another kind of, I guess, marketing branding nuance. And can you pull that from inspection data? Yes, yeah, actual Vermont vehicles. And we have range estimates too, because you can talk in averages all day.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: In the report- more versus the table that have every combination of car and household size. And this data-

[Phil Pouech (Ranking Member)]: And from

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: this data, we've done this calculation for every car in every household in the state using the actual inspection records, using just the same data methods you would use for the fee. And so what you're seeing in these ranges are, if you did this today, this is what people would have actually think. The report's long because we've tried to break it down in a bunch of different ways.

[Matt Walker (Chair)]: Representative Chittenden.

[Representative Chittenden]: Hi there. So thanks for all this, of course. Is it the reason you looked at just the state gas tax is because you were directed to do that? Do you have any idea how many dollars come back from every dollar that we send the

[Phil Pouech (Ranking Member)]: federal government for gas tax? Believe general price is one for three.

[Representative Chittenden]: One for three. Okay, so-

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: It's not our

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: overall Yeah, transportation now for the gas tax, I think we're one of these net

[Phil Pouech (Ranking Member)]: federal funds that comes back to

[Matt Walker (Chair)]: the state.

[Representative Chittenden]: In other words, you could break that down, in other words, you get about No, 80

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: it's higher. Yeah, we're one of the, I forget what you call it, get 4%, our fair share.

[Representative Chittenden]: Excuse me, if we send the federal government a dollar, you get back 80¢?

[Will Baker (General Counsel, Vermont Department of Taxes)]: We get like 1.3.

[Representative Chittenden]: Get 1.3 more, Okay, whatever, okay, so there's my argument. So effectively, by not gathering federal gas tax, we are shorting ourselves that revenue that usually comes back to us.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: No, because we're keeping federal gas tax still.

[Representative Chittenden]: Woah, woah, no, no, excuse me. You have an EV that does not buy gas. You have a fee that is supposed to replace the gas taxes. That's what my phrase is, gas taxes. So if you don't get back the federal gas tax, you are shorting yourself what we would have gotten back if it was gasoline. So my argument So is

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: the counting doesn't work that way. The money comes back based on BMT estimates for each state. There's a big formula.

[Phil Pouech (Ranking Member)]: What's speed? Vehicle loss assets.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: There's this thing called the Highway Performance Management System that estimates the amount of vehicle travel in every single state. Those estimates along with population and other things, are used to apportion federal funds from PLUS fund for the various formula funding programs. And so the fact that we may have more EVs than some other state isn't going to, at least to the best of my knowledge, unless something has

[Will Baker (General Counsel, Vermont Department of Taxes)]: changed, affect what we get.

[Representative Chittenden]: I guess I'm not getting through. Currently now, if you have a gas vehicle, you're paying some 50 odd cents a gallon. 38 of it is Vermont, and the balance of it goes to the federal government. Federal government receives those dollars from us, and then they turn around and use that same pot of money.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So that's what he said.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: It goes into the highway trust fund.

[Representative Chittenden]: I know, we get that federal money back, don't you?

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: There's lot of like wandering that goes on before it comes back.

[Representative Chittenden]: I think we're splitting ears here because the fact is that we get federal highway dollars based on, or not based on, but because we get federal highway money because of a gas tax and a federal diesel tax. So my argument is that if we're receiving a rebate from that tax, I don't even call it many things, but if you get money back from the federal government based on highway projects, we should then, for a fairness issue, get also a portion of the federal gas tax in the fee that we are posting. Anyway, that's my argument.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: Agree, yeah. I think that's another conversation. We'll await our returns.

[Matt Walker (Chair)]: It's back over to you when you had your hand up, if you're all set, representing Thank you. And then it's representative Tomlinson. We haven't discussed them here. And I'm just looking at Jed stepping ahead. I really don't want to go to a mileage based user tree on gasoline. Why would we bother? There's these headaches in trying to go over that in a few years. Why bother? Why not just deal with the electric vehicle issue of them not paying their fair share on the roads. Why would you want to go ahead and bother with the gasoline when it's already got its system? If you've got a problem, the governor doesn't want to raise gas taxes. I understand, but sometime probably going to have to. Why don't we just raise the tax instead of sitting here going to this whole new bureaucracy for I think

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: you're right. Another option is to have a modest fee for EVs and raise the gas tax for internal combustion engine vehicles. And you could raise it, but you'd have to keep raising it because the fuel economy is going to keep changing. And so that means coming back here every year or so and discussing what the new rate should be and having to pass legislation. But that's not On

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: top of that, I do want point out, and we've studied this in some of our prior journal articles that I'd be happy to send you to, there's also just some additional equity concerns with the gas tax. As it stands, it is a regressive fee. Lower income, rural households tend to pay a lot more in gas taxes because they own less fuel efficient vehicles. So they're paying the brunt of gas tax revenue in the state of Vermont. People with higher fuel efficiency vehicles aren't paying into that system as equally. So there's just some additional concerns with the gas tax as a concept. It was originally thought of in the 1920s when basically every vehicle was the same. And then with the diversification of vehicle types that we have today, it's gotten, the range of what you could pay in gas taxes has grown a lot broader, with the brunt of the responsibility falling on low income rural households with less fuel efficient vehicles. So I think there's some conceptual reasons why, in addition to revenue reasons,

[Phil Pouech (Ranking Member)]: why the

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: aspects might be a direction the state would want to move away from.

[Matt Walker (Chair)]: Representative Tomlinson?

[Candice White (Member)]: Thanks. I have a question about the administrative costs because you mentioned like a base administrative fee, and it sounds like the MBUF is estimated like 3.5 to 5%. Might be a question for the administration. What is the administrative cost rate for the gas tax or fuel taxes?

[Patrick Murphy (State Policy Director, Vermont Agency of Transportation)]: About 1%

[Will Baker (General Counsel, Vermont Department of Taxes)]: or probably.

[Candice White (Member)]: One percent or less. Okay. Just kind of curious, trying to

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: get a sense of the comparative rates of the admin fees. That doesn't sound like it's not massively more to do the MBUF. So it might be a consideration. Is it appropriate to charge an admin fee for one type of taxation versus another, depending on how different costs end up coming out to. The biggest difference between the structural taxes is that state gas taxes apply to distributors, whereas mileage fees scales to So individual there are some pretty genuine scaling issues there that you probably I mean, it obviously depends on what the actual costs are. But other states propose an administrative cost for this reason.

[Matt Walker (Chair)]: Representative White, had to, I believe, next if you were still in that spot.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: I was just wondering if, I see Logan in the corner there, and I was just wondering if he wanted to speak to the conversation about money from the gas tax and federal money versus state, just to clarify.

[Will Baker (General Counsel, Vermont Department of Taxes)]: We're not going to solve that today.

[Matt Walker (Chair)]: We've got a couple of minutes left. Representative Pouech and anybody else that had their hand up.

[Phil Pouech (Ranking Member)]: Just say thank you for all this work and all your data. One of the pieces, so if we wanted to move forward, we could do it fairly quick for a battery life. We set the rate, we turn on the buttons at inspection. But one of the questions was how are we paying? So, you know, you could just pay at your inspection or registration based on the miles or there's then discussed, I'm not saying one way or another, to allow you to pay on a quarterly basis and all that. Did your reports look at any of that? Okay. That's okay. Thanks.

[Matt Walker (Chair)]: And those are a good point. Are all policy decisions like, representative McCoy, you're up next.

[Will Baker (General Counsel, Vermont Department of Taxes)]: I just That'll probably be

[Phil Pouech (Ranking Member)]: I can

[Unidentified Committee Member]: get clarification on what representative Keyser was saying. So currently, when we collect the federal gas tax, would you get that from the gas stations that are giving that information to the state monthly? Or I'm looking to

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Well, it's at the distributor level. So it's a wholesaler. This is why it has low administrative cost.

[Unidentified Committee Member]: Okay, so we know how much gas is actually being sold to the market. Then we have a federal gas tax attached to that. So that's what you're saying. So it isn't based on miles traveled by vehicles in the state. Based on what we actually bring into the state and our tax debt distribution level. That's the money that

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: goes to the federal government.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: The point is that it's, yeah, fuel sales in a state is what's taxed. It doesn't matter if you drove here from New York and bought the fuel or here, it's just based on fuel sales.

[Unidentified Committee Member]: So it's based on fuel sales. So right now, currently, representative Keyser is saying, we're not capturing the miles traveled by electric vehicles for federal gas tax. All the federal gas tax that we send, which we get, people really don't know what we're getting. Is it $5 for every $1? We're really not sure what we're getting, but we are

[Phil Pouech (Ranking Member)]: not

[Unidentified Committee Member]: capturing any zero dollars for federal gas tax. And I think what he's trying to get at is, is there a way we can, I mean, it's gas that the federal government is taxing, but we're losing out a federal money big time because we don't get, we're not sending gas tax? You know what I'm saying? Do hear

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: what you're saying.

[Phil Pouech (Ranking Member)]: I think

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: there's just a space confusion about there's money that goes up and money that comes back down, and they're different.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: But there's the other thing, and we can, Logan, I guess, in the corner can fill in more of the details and we have to do that as well. So one thing is federal gas tax, the fact that there is no battery electric vehicle fee or modestly being discussed at the federal level is a federal problem. And this is why the highway trust funds hasn't funded itself completely for well So over a decade at this they have general fund transfers. And that's basically what's gonna happen to our highway funds with our state highway funds. If we don't address these issues, you're gonna have to start transferring funds and it's being proposed to transfer funds from other places have enough money to build bridges and fill bottles and take care of stuff. So that's the federal gas tax and the money the federal government's losing by not having a mileage paid is, I think, something that's not really in our control here.

[Unidentified Committee Member]: So I think what you're trying to tell me is that it doesn't matter what we send out. We X amount And that money X amount of dollars and we send it

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Yeah, to the goes into a federal bank account. But

[Unidentified Committee Member]: they have to calculate what the state of Vermont is getting. So they're either calculating based on the number of roads, that

[Matt Walker (Chair)]: we have in

[Unidentified Committee Member]: the state or some other vehicle. And I think that's what maybe we can get from.

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: Yeah, exactly. There's a whole series of formula funds and they are- So it's

[Unidentified Committee Member]: not based on what we get.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: So, no point it would be that the amount of money that's being sent from all states up to the federal government is less because of the national. Correct. So, from a national perspective, that funding They

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: tag our money and know which funds came from Vermont to give back.

[Unidentified Committee Member]: Okay, now I think that's where we were.

[Matt Walker (Chair)]: The last part you made or the part you made about the point of where you get your money from because the gas tax is not funding the roads is absolutely where we are at. And you were asked to set a rate or suggest a rate that we would charge for mileage based user fees for electric vehicles. And you're suggesting it's 1.4. And there's a 40 page plus report as to why it's 1.4.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: And a two

[Phil Pouech (Ranking Member)]: page policy group.

[Matt Walker (Chair)]: Thank you very much. And the agency still has to answer and come up with how we're going to collect it, how we're going to reconcile it, how often we're going to index it, how the payments are going to be made, and all of the other pieces that go with it that were brought up. But for your part, what you were asked to do is that you're recommending that a $0.14 per mile would be the rate for electric vehicles at this time. And there was some discussion in some pieces that we might suggest it could or could not work for other vehicles. But right now, that would be the rate discussion. That's where we're ending it for today. And we can dig into other parts of it. Thank you very much for all of your work. And thanks for coming out. And we're going to stay live. We have another fairly hefty policies and file up and piece to dig into next. So thank you very much. And we're going to stay live, but we're going to transition. So it'll take a minute. And we're going back into this subject in electric vehicle supply, Electric vehicle EVSE stands for. And we're going to pick up where we were was it as soon as yesterday? Wednesday. Was it yesterday? Wednesday. There was a million and one questions back and forth. And we've got forty plus, forty five minutes to dig back into that subject. And there was, Scott, we appreciate you coming back. And Mark, oh, we have Will this time too. Oh, a new committee. So we're going to make sure that we get to that. Your name came up in the last testimony several times. Thank you very much for being here. And we haven't heard from Mark yet, but Scott was in the hot seat for quite a while yesterday. We'll pick up in that part. And if there's a part I'm missing about setting the stage, you can probably do that for us. But we're trying to pick up from where we were. And Do you want

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: to share them powerfully so we can get back to where you want me to?

[Will Baker (General Counsel, Vermont Department of Taxes)]: I don't have the Do

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: you have the number for for the meeting?

[Matt Walker (Chair)]: That's why the committee next door spends all their time on tax policy. Taxing and studying up the facts and dealing with the tax is incredibly difficult. It has a wide range of questions and people that make an entire living just trying to figure that out. Anybody like that?

[Unidentified Committee Member]: Hey, we charge an hour.

[Matt Walker (Chair)]: No background.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: So this is, I guess, I think this is where we left off yesterday. Were there any lingering questions people had at the

[Phil Pouech (Ranking Member)]: top of their mind right now before I? No, but I think the summary was it's the Wild West out there. All this charging infrastructure came at us, whether it's public, private, or maybe sort of in between. And at some point, rates and measures needs to come in and say, hey, you're selling to the public. We need to make sure this equipment is accurate and meeting the state state laws around selling the product to the company.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yeah, I mean, we use the terms accurate and correct, right? So not only just accurate, but also correct, like receipts, receipts being accurate, all of the other things that are important. Again, we talked about it yesterday, the price being advertised in advance so consumers know what they're getting to gain rates. So yeah, these are the apps. This is where we left off. Now we're getting into more of the numbers of what we did this past year. On the DC fast, we get two columns here. We expect with 84 devices, 96 meters. Some devices have two meters. DC ones, most of them just have a single one, but there are a couple. The caveat to that 96 meters that were tested is there are 78 Tesla devices in the state of Vermont that are having a communication issue with our testing equipment. Both Tesco and Tesla are working on that. There was an extra 78 devices that we were trying to test, but we couldn't do two technical issues with the equipment. On those DC fasts, we officially approved 26. Those actually got gold waste measure stickers on them. We rejected seven. We had three meters that were actually out of the two percent tolerance. And then the range of errors was to the buyer to the right. Most of

[Dr. Gregory Rowangould (Director, UVM Transportation Research Center)]: the ones that are

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: out of tolerance were actually giving energy away instead of keeping. Obviously, consumers don't tend to complain about that. So that's a less concern to us than if it was the other way around.

[Phil Pouech (Ranking Member)]: I realize that we're at the beginning of this, you guys are at the beginning of it, but you're dealing with nationwide, you're in communication with other states that are trying to do this. Are these failure rates what we expected? Currently, Vermont is the

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: only one sharing data in national. Wow, interesting. And again, just to give you some background. So I went and presented at the National Conference of Weights and Measures interim meeting in January in Mobile, Alabama. We have some revisions submitted for the handbook based on what we have found. I have then been appointed the chair of the National Council of Weights and Measures EV task group. It has been in existence for two years, hasn't had a meeting yet. We have scheduled our first meeting for March of this coming month. So we will start addressing the issues nationally. One of the things that has been bandaged around is having a national data share. So we actually have some because even Vermont, these numbers, it's all small data. It's just small numbers. Until we get bigger numbers, it's hard to say, again, whether this is representative of the country, This is just, as said, what I can say is this is what we found last year. That's kind of as much as me.

[Matt Walker (Chair)]: And Theresa, remind me where we're at. So we have three seventy devices that have registered with you. Are the From our different locations, you have three seventy?

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: That's the number of devices we inspected last year. How many are? Licensed, we'll get to that's another slide. This is just like inspection stuff. So AC, you can see the same thing. We get to 189 devices, two seventy four meters. A lot of more of those have two meters per device. Approved, rejected, and you can see the rates of error there. Most of the rejected ones, a fair number of them actually were devices the manufacturer didn't mean to be in commercial service, were never designed to be. So somebody either sold or bought devices that they thought they could put in public purview, but even the manufacturer said, No, these devices shouldn't be in use for that. The car dealership can use this to charge its own vehicles in the background. It's not a device that was ever meant to be available to the public.

[Matt Walker (Chair)]: That's why it's fine. Yes. Again,

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: just anecdotal findings, labeling capacities and the pricing issues that we've kind of touched on here. So, those have been kind of two touchstone issues of what we saw anecdotally, not as far as the numbers go. Different to most of our weighing measuring devices, most of the time, one business will own devices and they'll be in all in one spot. In this case, we have numerous businesses that own devices in even different towns, if not even different counties. So, there'll be devices spread around the state. Licensing data. So, officially, as of weeks ago, when the last I pulled this, we had two fifty nine plugs licensed at $25 a piece. So we are starting to bring in some money on this. Those devices were licensed at 54 different locations and by 40 different businesses. And the pie chart here is

[Phil Pouech (Ranking Member)]: just me taking I

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: roughly qualify these as what types of businesses these were. So again, you can see Tesla has the largest share of them, them being the outlier because they own all the big DC fast chargers. They don't actually sell those, or at least they did in the past.

[Matt Walker (Chair)]: I think they're beginning to. We've got a

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: lot of car dealerships that have them, quite a few gas stations have put them in. Hospitality, that's a broad category of inns and other things and just places that are weird. Sometimes they're open to the public. Municipalities, usually town offices, town parks, lots, parks and rides, quite a few of those. Recreation facilities, again, usually owned by towns as well, sometimes by the town rec departments. Tourism, other, we had some property management groups, like people that own different tenant buildings or even commercial rental facilities. They put a charger outside of their thing so that the customers of their tenants can use it while they're, say, in having their hair done or something. We've also looked at the commercially available devices in the state, give or take about a third are owned by the public utilities. We're powered by electric, etcetera, etcetera. The way the current language sits in statutes, those devices, it's questionable whether we should be licensing those devices or not. And again, that would be a great thing to get cleared up just so we know exactly what is where. It would be probably advantageous if it was all underneath the same enforcement umbrella, there's no question about US jurisdiction when there's issues with the superst complaint. But those are things that need to be cleared up statutorily. Does that answer all the questions you had about licensing?

[Matt Walker (Chair)]: These are commercially licensed? Yep. Better selling? Selling, yep. Better paying some level of tax on those?

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Not all of them paying tax. Again, we've tried to address that. And again, I've been in communication with Will. It's nice to meet you in person.

[Matt Walker (Chair)]: We appreciate you all coming because that was a lot of questions.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yeah. So yeah, they are selling. Like I said, there are some brands that are collection tax. There are some that, again, as of the end

[Phil Pouech (Ranking Member)]: of last year that we don't believe were. So, we've raised that with them. So, just to clarify, when we're talking tax, this is a 6% sales tax that without any changes to our legislation is a requirement in this type of business, selling this. Now, when I buy gas at the gas farm, I don't pay 6% sales tax. Just correct. So there's a disconnect or it's different. And buying gas tax, I'm paying gas tax, but I'm not paying sales tax. And the expectation, correct me if I'm wrong, is anybody who is has a electric charger and they're charging money for it, but sometimes it could be at a business or at a store or at a car dealer. If you're charging money for it, then you should be paying sales tax. I would prefer to go on that. Okay. I'm just not saying one way or the other how I believe, I'm just sort of saying, trying to understand where we are today. Do

[Matt Walker (Chair)]: you mind identifying yourself and answering? Sure. Will Baker,

[Will Baker (General Counsel, Vermont Department of Taxes)]: general counsel of the tax department. That's right. For highway fuels, highway fuels are exempt from six. Okay. It's a separate tax that's collected by

[Matt Walker (Chair)]: HCF Transportation. And sales tax on electricity, solar electricity is? Sales tax eligible at 6%? Yes.

[Phil Pouech (Ranking Member)]: We must get into it because we've been thinking about this, or I have anyways. So at my house, I have a charger and I have a meter, and that meter goes in, takes care of my house. But then my charger goes to my car and I pay the electric company specifically for that charge at a certain rate. Should that electric company be charging sales tax?

[Will Baker (General Counsel, Vermont Department of Taxes)]: No. So just to give a little bit of background here. So we have a sales tax in Vermont since the 1960s, that's 6%, like about $635,000,000 a year for the education front. There's been no, to my knowledge, there's been no deliberation or legislation or anything like that regarding the application of the sales tax to electricity for electric vehicles. All of this is just old and existing law. We have a very old and typical sales tax in Vermont, similar to many, many other states. Electricity is specifically defined in the state sales tax statute, and specifically identified and specifically subject to sales tax. Now there are a lot of exemptions from the sales tax as well, and energy and fuel and electricity is prominent in those exemptions in a variety of places. Residential use is one of them. So all fuels, electricity, court, any fuel for domestic use in the home is exempt from sales tax. So your electric utilities know that, so when they put the meter on their residence, they the code it so that they're not going to be collecting sales tax there. A similar exemption applies to farms, farming activity, manufacturing activity. So there's a lot of exemptions for electricity in sales tax. Typically, the kind of typical scenarios would be your residents, of course, no sales tax. If there's a residence, say someone has a residence with a small auto mechanic shop sort of connected to it in the garage, the utility might have two meters, one for the residence and one for the shop, and there's no exemption for automotive shops. And so all that electricity is subject to SEDS tax used in the shop. So that could be two meters or in some cases, there is some sort of study or consideration of the amount of use of the two uses. And the utility takes that into consideration and applies sales tax on their percentage of the electricity. That's very typical in large manufacturing plants, because electricity is exempt from sales tax on the manufacturing floor, but not for all of the purposes. So you'll have a large manufacturing floor, and then you'll have administrative offices, the finance office, sales, CEO, all the offices, that's all subject to sales tax. The manufacturing floor is not. And so these companies actually do studies to determine how much electricity is used in the manufacturing process, and the utility takes that into consideration. So that's kind of it works that way across many different industries, the electric utilities know all this, and that's been in place for years and years and years.

[Matt Walker (Chair)]: So

[Will Baker (General Counsel, Vermont Department of Taxes)]: then V's came along. Again, there's been no specific consideration of this to my knowledge, the retail sale of electricity is subject to sales tax unless an exemption applies. So if a customer is purchasing electricity, then that would be subject to sense tax. That's just the kind of standard interpretation from the existing law. Has nothing to do with EVs specifically. It's simply the sale of electricity.

[Phil Pouech (Ranking Member)]: So just to clarify, if I own the gas station and it's all part of my business and I buy electricity through the meter, I pay a 6% sales tax on that. But then again, if I have a charger too open to the public, I'm paying the 6% that comes through to the charger, but I'm supposed to charge the user of that public charger 6% to or or I end up paying for it.

[Matt Walker (Chair)]: The way that we

[Will Baker (General Counsel, Vermont Department of Taxes)]: sort of discuss this with utilities is that that's right, the gas station has no exemption. So all that electricity that they use on their account, all that meter at the gas station, that would be subject to the sales tax already right there. And so we've discussed a few different options for the gas station. If they're already paying sales tax on that and they're simply selling the electricity at a cost, It's a wash. In other words, they could purchase they could separately meter the meter, the the the EV charger, and purchase that electricity from the electric utility purchased for resale, which is a retailer buying something to sell if I buy 1,000 televisions for my retail establishment. When I buy a lot of sales guys, I collect sales guys. So there's no peer emitting sales guys. So the same way to apply here, just like any other retailer, if they wanted to purchase some of that electricity from the electric utility wholesale, and they can retail it at the meter at 0.6%. It's kind of a paperwork exercise if they're simply selling the electricity for what they paid for. The issue is if there's a markup. So if they're marking up that electricity, then we've got a problem because the final customer is paying more for that electricity, and so the sales tax has to be collected on the markup. And there are other industries that operate the very same way. For example, if you buy, it's a different tax, it's the room stacks, but it's very similar. If you reserve a hotel room on an online booking platform, you're going to pay the price for that hotel room to the online platform. They've purchased that from the hotel. They have contracts with the hotels, they pay them a certain amount, they take a markup themselves, and then they sell you the hotel room. And that markup is their profit for their service. And so however they want to do it, the point is that room stacks has to be collected on the entire mouth that the customer pays for the room. Same rules for sales tax. However they want to do it, the customer price has to be accounted for if it's being sold over and over again, and again, applies to a variety of industries all the same.

[Phil Pouech (Ranking Member)]: Thank you, Cliff. Just

[Representative Chittenden]: to clarify, so if I have a level one in my house and it's connected to my residential meter and I charge my EMV with it, I am not charged sales tax?

[Matt Walker (Chair)]: That's right.

[Representative Chittenden]: Thank you.

[Will Baker (General Counsel, Vermont Department of Taxes)]: All uses at your residential property have been, the tradition, the practical application of this throughout, since the beginning of the sales tax in 1969, it's been all uses in that home bar except from sales tax, even though it's possible that, say you're having work done on your house by a contractor, they come in and they plug in all their batteries for their equipment, because the next day they're going somewhere else and they're going to work and they need to charge it up. We all know that that little amount of electricity that they have used, it's not for the domestic use of that home, but we couldn't possibly parse out all those uses. And so just generally speaking, whether it's your fuel oil, heating oil delivery, or your electricity delivery, if it's going to that house, there's a presumption that it's optimized for use. And we've applied the same construct to EV charging at your home

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: electric car.

[Matt Walker (Chair)]: And so all these apps that we saw, listed the 40 plus whatever apps, and you're going in and buying electricity at a whole myriad of different places. They're collecting the money from you. They're from the buyer. They're remitting the sales tax to the state of Vermont, to you, I guess, to

[Will Baker (General Counsel, Vermont Department of Taxes)]: the tax. One of them is paying that 6% forward to you. It should be. And we've done outreach to the industry and the agency that has been helpful in sharing with us their lists of players, the market in Vermont, the companies that are active in Vermont. What I will say is there could be an EV charging station, built gas station, But it's operated by one of the many. So it's not necessarily going to be Will's gas station that is collecting SandStats. It could be the operator of those things. We've worked with various businesses in the industry about this issue of marking whether the electricity is marked up or not. And this is like you've described with sort of the other aspects of this, this is a new, emerging, the older cast of characters. And we've been working with them about all the different iterations of their business and whether they are marking up or not. Some of them charge a fee for if you stay too long, there's a fee associated with that. Some of them charge a fee just in addition to the metering electricity. Some of them charge a parking fee. And so we've worked through that with them. Not all these charges are necessarily subject to sales tax, but if it's a charge necessary to complete the sale of electricity, it's subject to sales tax. Representative White?

[Candice White (Member)]: And if we wanted to supplant the sales tax with a tax that mirrored the gas tax, but it was for energy on these level two and level three chargers that are being inspected by the state on the weights and measures method. Could we do that?

[Will Baker (General Counsel, Vermont Department of Taxes)]: The legislature can do anything, I suppose.

[Claire Nelson (Research Analyst, UVM Transportation Research Center)]: From your perspective, the entire department.

[Will Baker (General Counsel, Vermont Department of Taxes)]: Electricity sold at EP chargers for the sales, And then you could subject them to a different kind of tax or no tax at all. That's the way it works right now with the motor fuels. So motor fuels are specifically exempt from sales tax, even though they are a sale of tangible property in Vermont, would other clients be subject to sales tax? But because they're subject to the highway taxes, they're exempt from sales tax. So all that is mutually exclusive, same with automobiles and registered trailers and things like that. If it's subject to the purchase of these stacks in Vermont, it's exempt from sales stacks and vice versa. So it's not moved. Should this

[Matt Walker (Chair)]: electric vehicles are going out on the road and that's the purpose of this electricity, so they're going to use the roads, should that money be helping pay for the roads?

[Will Baker (General Counsel, Vermont Department of Taxes)]: I'm here as a legal technician, not advocacy or policies. I don't have that need.

[Matt Walker (Chair)]: Have items been changed from sales tax, purchase and use, or from purchase and use, over the sales tax? In the past? Has that been

[Will Baker (General Counsel, Vermont Department of Taxes)]: I don't recall. As far as I know, it's been downright for many years. There's been some changes with ATVs and snowmobile. I don't recall. I think it's always been No, I think registered if for highway use, it's motor fuels and the neurons and if it's not it would

[Phil Pouech (Ranking Member)]: persist. Thanks

[Matt Walker (Chair)]: Scott. Scott thanks for sharing your witness time.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: No, I've been doing corresponding with Will and I have coming back. It's good to have him give that depth of information because it's good for me to hear as well. Trying to check. Because I get the questions in the field, so it's good for me to be able to give a concise and then he has limited answer, and then once I hit my limit to know who to refer me to. So we've licensed the devices, we've been out doing ZIF. We also licensed, just to round out the program, we also, in Vermont, we call them DO repair persons. Nationally, they're called registered service agents, RSAs. These are people that are licensed with us to go out and install and place these devices into service. And the same thing we have with small scales, the truck scales, the oil trucks. Basically, with us, it's just a fee, you get on list, you get yourself a number, so you've got a seal, you actually can put a physical seal on the meters of these devices to make sure they're not tampered with. And then as you either install them or repair them, you send us paperwork saying, This has been installed here for a new device, or This old device that's here was repaired that had what a load cell in a scale went bad, we had to replace one, something like that. Right now, license those by the individual person. So, we've got 17 people licensed for seven businesses. And as far as we're aware, there's only three or four businesses that doing the bulk of the work for installing and maintaining EBSCs in the state. Right, now to get into more of the technical stuff. This is actual error data from this year, just to kind of give you an idea of the accuracy of these devices. The important thing in this is the orange bars are your tolerance, both orange bars. Anything inside is good. Anything outside is not so good. Scout curve. Got it. And again, it does center around zero, so that is also good. So again, they are being calibrated most of that. And you can see this does slightly skew plus, so they do skew giving away as a whole. This is AC and DC. And the different colors of the different types of tests, the full load mid range light load tests. And then just to kind of split, this data is now split up into the DC side and the AC side. Again, AC side very much mirrors the national or the together. The DC side is more blocked, not as smooth of a curve, but also much less data than the other one, so that might be an issue with that. But again, they both do skew plus versus skew minus, which is better for the consumer.

[Matt Walker (Chair)]: So

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: now getting into the other issues we found. So probably the biggest issue we found that is the most concern. So basically, pretty close to 40% of the devices we've seen have a different number of whether it's energy delivered displayed in the screen of the device versus the screen of the app that is used to pay and finish the transaction. We haven't seen a difference big enough to make more than a difference of 1p in the calculation, but they should be the same. They should be to the same decimals. Again, they should just be the same. And so this is over eleven fifty one tests. Basically, 40% of those have had a difference. It's become more symmetrical, but it is skewed slightly in the business' favor. We're not sure if that is a small data issue, if that is just a coincidence of the numbers we're using, the targets we're using for testing, or if it's actually something beyond that. So again, I can't say that, but it is skewed slightly that way. You can see the amount of difference we've seen. We've seen a maximum difference of 80% difference in the positive direction and a minus a third in the negative direction. The average is not that big, only like 0.3%, but that is more than 10% of the tolerance.

[Phil Pouech (Ranking Member)]: So at my gas pump, I swipe my card and I see the amount, it's digital, I think a couple digits in the two decimal places. The charge is based on that number that I see. It's not hidden somewhere else. But here, there's sort of a hidden, there's one you don't see and they don't quite match. That's what you're saying.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: So there are occasions around. So what this, the way the industry has explained to me on these systems, there's a front end number and a back end number. And again, I forget which one is the official one, but they all should be pulling from one of those. I don't know why there's two, it's just the way the programming is on the protocols. And so, as you've explained to me, when that happens, it means that the software is pulling from the wrong one. And again, as I said, they haven't made more than a penny difference yet, but this is something we do need to have corrected just for consumer confidence issues. Why am I getting these two different numbers, I think? So, that's a problem. And as you can see, the tolerance here is 2% versus a gas pump, which is one half of 1%. So, four times the tolerance And we've seen 20 of those that have a difference bigger than 2%. So, again, is that device intolerance? Is that device out tolerance? Harder to say. Again, so here are some of our miscellaneous findings. Networks experiencing network loss. And we've had this happen on one occasion. So if you look at this, I'll use the pointer just in case anybody's online. This here is a charge curve. Some of you that have electric vehicles would be probably a little bit more familiar with it. So this was us testing the device here in mid afternoon, and you can see that little spike because we only test for a very short amount of time. In the middle of that test, this device had a lost network error. So basically the device basically turned off, the screen said network lost, and we weren't able to do anything with it. The inspector left thinking, and there's no way to actually physically turn these off. It's not like a gas pump where there's a switch when you hang up the handle that it turns it off. So, as you can see, a few hours went by, and then give or take, what, 06:00 at night, five, 06:30 at night, somebody else plugged in onto this charge that was still And so, we got billed for the $2 and it was still on us. This was an issue, we did get refunded, but this is an issue. If a gas pump had done this, this would be a very, very serious issue. We did talk to the manufacturer, they said they tried to figure out what was going on. They're pretty sure it won't happen again, but it is something that we need to be concerned about. This one thing is the example nationally for one change to the handbook, just to make sure it's very clear in the specifications that this can't happen. This is very bad. So a lot of things again, talking about labeling. They do not have all the fees listed. Sometimes they'll have the cost per kilowatt hour, but maybe not that session fee is upfront. And as you saw yesterday, ranging from 50¢ to $10.5 That's gotta be on the device. It doesn't have to

[Unidentified Committee Member]: be on the digital screen. It can

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: be up on a paper sign or just like anything else. Long as it's posted and people can read it, that's fine. So, having that. We're also having issues with, again, capacity of the device. So, these three pictures down here in the corner, these are all this one, that one, and this one. So, the one on top of each other here, these are the same app for the same device. Took screenshots about five minutes apart. One of them says this device has a maximum capacity of 75 kilowatts. One down here says it has a capacity of 25 kilowatts. This is another one by one of this brand's partners, not the same It's not technically the brand, but they have an agreement to run each other's stuff. This one claims 100 kW. I'm pretty sure none of those three are accurate, but I can't say that for sure. Still, again, we're working with the developers of our testing equipment to better display some of the back end information so we can verify this better.

[Phil Pouech (Ranking Member)]: And so I've experienced you go up and it's a, I don't know, certain size charger, but if there's a couple of ports, somebody books up in the middle of your charge, you're now getting at, let's say.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yes, and those are supposed to be labeled as such. So typically it's been called either shared or variable delivery. And so it's supposed to say, the most common ones, 125 kW shared, which basically means if you want your powertrain by yourself, the maximum you could get if your car wants it should be 125 kilowatts. Typically, those, when two people plug in, the maximum you can get is, give or take, sixty, sixty two. It's basically divided in half. Sometimes it can be a little more, a little bit less, depending on how much the charge is coming out. So, doesn't have to deal with This labeling isn't the actual amount that's coming out at any point because the car and the battery can't necessarily take the full charge all the time. It's not like it's a gas tank where you can just get the tank, it'll take as much fuel as you

[Matt Walker (Chair)]: can put into it through the nozzle. This, you've got

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: to tell, if the battery is very much drained, it can take a big charge very quickly, and then it will tail it down. Typically, these curves look nice and flat like that, and then they'll taper off towards the end if they're plugged in longer. So, that's one thing where again, these are the things that were different. We've started to talk to manufacturers about that. The two different land books have a different set of labeling requirements. So that's, again, one of the things that we need to standardize nationally. So we have a very good set of rules that, yeah, you need to comply with these labeling requirements.

[Phil Pouech (Ranking Member)]: And so you're saying based on the rules now, the label has to tell you what it can produce.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yeah, the way our interpretation of labels when it says maximum, like the maximum output should be what its maximum capability is. Just install it so many volts and so many amps, you do the math, you get so many kilowatts. And that's not what the car can take, that is what the device can put out. '24, 2026, just our inspection priorities. This last year was a nice friendly year. Again, we're doing a lot of talking, a lot of asking. I've got a lot of people's phone numbers. Most people have my phone number. Hopefully, lot of that stuff has been corrected. This year, it's gonna Again, we're gonna take one instead of the latter. Right now, more of those gray devices that we had last year, if they weren't passed or failed, will either get the ones that were corrected will get approved, the ones that were not getting rejected. They'll have an extended timeline to fix, either three to six months or something like that. But it's gonna be, we're now heading into the more normal, yeah, slowly, slowly tightening things in to try to get things as by the book as we can. There are still gonna be some legacy devices that maybe will be exempt from some of the requirements just because they were put in before the requirements were out, or it's like, is it really worth posting a device that somebody invested time and money into for other things? Not the important stuff, but for minor things. And I

[Phil Pouech (Ranking Member)]: think legally, there's a question whether you can, somebody puts in a device and then you have new regulations or something to it.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yeah, and that's why all of our regulations have, there are some that are retroactive and some that are non retroactive. So some of the requirements are just requirements. Having the same numbers of decimal places on your receipt as you have on the screen and having them match, that is not a non retroactive. If you don't have that, you're not going to operate. But there's other things like marketing requirements. Did you have In our case, Vermont was one of the very last states to become an NTAP state. Basically, that's the standard we use to say a device is legal for trade or not. So, the devices that were put in before that, there's no problem because we didn't have the requirements. The devices afterwards are going to have to comply with that. Sometimes that's a manufacturer going back to get certified. Sometimes that's changing out a device. There are, in fact, I think one company that put a few in this year, they're planning on just changing all their devices out to their newer device that will be N10s here at Sumo, probably sometime in 2026. Again, we're going work towards getting 100% licensed of what we're available to public, also not owned by public utility right now. Once we get clarification around that, we'll make sure we get that sorted. Because right now, public utilities won't have to license with us, but all of the private owners will. Owns operators and commercial devices. So that's some legislative, but we will get out and we'll talk to more people. We'll follow-up on the people that didn't license this year that we did talk to, but that's just the process. It's the same with all devices. How do we know how much

[Matt Walker (Chair)]: electricity is being sold? How do we know how much is being collected? How do we know if it's how much funds are being raised in this new market of selling electricity for electric vehicles? As a whole or for each charger? I guess that's interesting. How are we going to measure the amount? Well, again, I'm thinking from transportation fund money that we're not getting to help fix the roads. But how do we know that this industry that's growing of selling electricity, how does it, in any way, gets spliced off from all the electricity that goes on in the state?

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: On a device by device case, yeah, they have totalizers that keep track of how much those devices dispense over time. So again, if you were tracking that, I think the tax department did share some sample data.

[Matt Walker (Chair)]: They're required to report this in some form. Must be in order to For tax. That's by dollars, I guess.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Do they report to you guys on any of that?

[Will Baker (General Counsel, Vermont Department of Taxes)]: Any sales tax vendor reports to the tax department on total sales and the tax collectors. So not the amount of electricity or the number of pencils sold or the number of television, but just

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: the sure know the number

[Matt Walker (Chair)]: of gallons of gallons, but we don't know the kilowatts of electricity in a comparison world, I guess is what you're saying.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: I'm just saying like that,

[Will Baker (General Counsel, Vermont Department of Taxes)]: I'm just saying. For agency transportation, I don't know exactly what they collect from the water fields. So that's plenty by then through

[Phil Pouech (Ranking Member)]: the tax department.

[Matt Walker (Chair)]: I do know that they know every gallon that comes in to the state, but I'm just looking at that piece of saying, how do we, we just saw some testimony this week of an incredibly new, beautiful station that had a huge new section of electric charging and there's a significant amount of activity going on, and we won't have any idea what we're missing out on for the roads potentially, or not, I guess is the question. Or maybe I'm not looking at it the right way, but if that is your

[Phil Pouech (Ranking Member)]: And sales tax is not going to

[Matt Walker (Chair)]: Right, and we don't know if it's growing. We don't know if it's a growing business, or how the business is measured in that way, like for things that are impacting the roads on the gas and diesel tax. I'm not sure that we would have any idea what this growing market is. How do we know? On top of that, it is your goal to have every non public utility owned, you will know and be registered in every piece. And that fee is going to go to pay for your administering of the program, not to help them, which is why I'm on the line of Casey's Street. Go ahead and say, not opening up.

[Phil Pouech (Ranking Member)]: A couple of questions. I'll do one just while we have tax expert here. So we have a category of public charger selling to the public. Clearly, somebody's paying money for the electricity, should be paying 6% sales tax, which goes to normal sales tax. And then you have mine at home, not subject to sales tax, not subject to any of your requirements. You don't care whether it's labeled or whatever. Now I have a condo association. They put in four chargers, and that if they might do one of two things, they could not charge for electricity. So I'm assuming if they don't charge for electricity, then the tax department's not involved and you're not involved. But if they do, we're gonna put in four chargers charge point level twos, and you're gonna swipe your card or your charge point thing to charge your car. Then sales tax should be applied because you're paying the condo association for the electricity, the gas, and and your your regulations might also apply.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Method of sale would apply. Those will be a lower, as of right now, they're a low enforcement priority, right? Because the intent is not for the general public. The intent is

[Phil Pouech (Ranking Member)]: That's right. Those type of club, right? You belong to

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: the public. Small little club. Show me, as long as, like you said, you can say, if I can ask you, show me the list of people that are supposed to be using this, and you

[Phil Pouech (Ranking Member)]: can say here, or it's the tenants of even like these townhouses. So I think what we haven't done as a legislature or a state is sort of clearly define, you know, we kind of know if it's sold to the public, we have the rules. And if it's to private, we have the rules. But we might need to define sort of this in between space of apartment owned or business companies that own it, whether they charge or not, and what the requirements are. Would we say that's a kind of a gray area?

[Mark Falkgett (VAAFM, Weights & Measures)]: Could I just add to that, to your comments please, Mark Falkgett with the agency by culture rights measures and currently when we, it is a discussion with Scott and I and Steve, our legal staff and so on and so forth. Our current licensing does tie us into the Public Service Board's definition of what electric vehicle supply equipment is and commercial and all of that. And that is 38 BSA two zero one. You folks are welcome to look at that. There is some language there. It's fairly definitive and on our wish list very respectfully for us to deal with the Public Service Board, it might be four weights and measures to decouple from that language as weights and measures has clearly defined definitions for what commercial lightning measure devices are. And some of the items you bring up are in this definition for the Public Service Board, and if it does appear to me to limit some activity that could be taking place, in places in common, or so on and so forth. Okay.

[Phil Pouech (Ranking Member)]: Got it. Thank you.

[Will Baker (General Counsel, Vermont Department of Taxes)]: Just one thing I would add is also missing from the council is other exempt entities. So we've been talking about residential property, but there are other exemptions from the citizens as well. There are three kinds. There's a product based exemption. Those are like pharmaceutical drugs. You had to combine them for another purpose, they exempt home. There's use based exemptions like electricity for house, and then there's entity based exemptions. So in addition to home use, other exempt users. So exempt from sales tax will be government entities, instrumentalities of the state, etcetera. So, you know, if if Vermont College puts in a charger, whether or they're charging for the electricity or just for their own fleet, we're not gonna That wouldn't be captured in anything that the tax department does.

[Phil Pouech (Ranking Member)]: And I guess my takeaway from your presentation, which I totally appreciate, is that weights and measures is moving forward. You bought the equipment. Now you're moving forward. And generally, as you speak to all these different vendors, you're helping them understand, hey, here are the requirements. And pretty much, correct me if I'm wrong, the majority of the people, the vendors, the people who are selling this, sort of are getting in line, because they must be for other states too, I would guess.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Yeah, you kind of asked yesterday at the beginning, Vermont is, it's basically us in California that are ahead of everybody. Think I California has been done by counties. Yes, for the most part, I'd say most everybody is slowly combining, some people are more reluctant. I have had one company that's basically told me to go pound sand, so we'll be able to get them this year. But other than that, it's been pretty good.

[Mark Falkgett (VAAFM, Weights & Measures)]: Can I just add to Scott's comments? First of I want to commend Scott and my staff for the work they've done. I know I came in here two years, three years, four years ago, and like you said, this is the wild wild west and it truly was. And we had lots of regulations that we adopted reference in the Standbook 44. And it's been a lot of work to get this program off the ground. Now we have the equipment and we have some results. I think I said a couple of years ago, get boots on the ground and get out there and see what we find for equipment and we're doing that and we're finding that. And also that for my agency of agriculture, if you look at it nationally, we're very transparent and we're sharing our results around the country. And we're getting a lot of feedback and buy in, and we're actually giving a lot of guidance to jurisdictions who are just getting going. And a shout out to Scott, I speak with people all over the country and I'm aware of some states that they spend a lot of money on the testing equipment that's come into their laboratories and has sat there for two years and we got our DC testing equipment on it. It was a year ago in July on Monday morning, it was Monday morning and Wednesday afternoon, it was on Scott's pickup truck and we were doing DC testing. It was less than seventy two hours and we have the results and we're doing soft compliance enforcement work. We will continue the educational component of this and move forward and we're happy to keep you folks, anyone informed on an ongoing basis at any time. Again, wish list at some point in time, very respectfully to the Public Service Board, our wish list would be to decouple from their definition in 30CSA two zero one. That would streamline things and make our work more easier because we already have a clear definition of what commercial weighing and measuring devices are.

[Scott (Weights & Measures Program, Vermont Agency of Agriculture, Food & Markets)]: Thank you for coming back. Thank you.

[Matt Walker (Chair)]: It was a second day and an extra piece. Thank you very much for joining us and clarifying a lot of pieces. And we will certainly be