Vermont Legislature SmartTranscripts:

[Matt Walker (Chair)]: Is that Sabina Michael? Yeah. Are live again here on Wednesday, March 18. Now my phone's lighting up. So we are back on the conversation related to local options tax and the pilot fund that we've had for multiple sessions. Damian has made some our legislative council is making the language change suggested, and I guess I would like to see it if we could and explain it to us.

[Damien Leonard (Legislative Counsel)]: And could you make me a cohost again, please? You wanna chat with me? K. So what I'm pulling up on the screen here, the highlighted portion would say that so our prior language provided that in any year where the option tax revenues that are deposited in the pilot special funds exceed the full amount of the pilot payments made and the grand list stabilization payments made, which are subchapters four and 4C. And subchapter four includes correctional facility payments. That was the prior language. One half of the remainder would be dedicated to town highway aid. This adds plus any amounts appropriated from the pilot special fund to the Department of Taxes for expenses related to grant list and appraisal assistance. And so this year, that is the 3,400,000.0 that was discussed in Ted's presentation yesterday. So that would add this to the amount that you now have to exceed. So based on the projections in Ted's proposal yesterday, you're looking at between 3 and 400,000 more in revenues projected next year than the total of these amounts. And so you'd be looking at one half of that next year. If grand list revenues continue to increase and these amounts stay, don't increase as quickly, then you can see additional amounts in the future or in the event that amounts are not appropriated from the pilot special fund for the grand list and appraisal assistance. So if that goes back to being a general fund or another fund appropriation, then you would see an additional amount equal to roughly half of what that was. So next year, that would be 1,700,000.0. That could be more or less in the future depending on what the amounts are. But so that that basically provides that whatever is over and above that in revenues, you would take back, or have half of it dedicated to town highway aid, which would be over and above the base appropriations for town highway aid, and not affect the inflator or put additional demands on the transportation fund in out years if this money is not coming in, for example, during a recession or something like that.

[Matt Walker (Chair)]: Other I questions specifically, I'd like to make a comment that this money, this activity, this 3.4, is in the governor's recommendation, it's been presented in other communities, it's out there, it's a battle that's already been, is being waged. I don't know where that's going to end up. Our goal, my goal in the committee has been find incremental health in four towns, and I would like to see it be significant more. And I like the direction of the committee members who say, we should have all of it. It should be 100%, as we feel about the rural caucus. Think it should be we should put a stab in for the surplus as well. But to drive this committee's discussion, drive the discussion further, to make sure that it has a legitimate shot to get through the next two committees that it's gotta get to, to get to the floor, I'm on board with the suggested language that the vice chair added. I think it's somewhat recognition of the political realities while we tend to be the ones to fight for the towns and their highway budget. I think it's an acknowledgement of the reality of where things are at and our effort to incrementally improve things. I don't like it. I don't like it as much as I would like it to be where it was, but I think it's the reality of what we face. And I'm looking for feedback, discussion, or a

[Candice White (Member)]: I feel like the language is putting in statute this practice going forward, which I love. Acknowledge the political complexity, but I guess I would personally feel better about not putting that explicit language in there with the assumption that we are drawing attention to the pilot fund and the surplus, and that this money really needs to go back to towns or town highway aid?

[Timothy R. Corcoran II (Vice Chair)]: Well, we're gonna see, like I said, I clearly hear what you're saying, but I think just where we are today, Wednesday, March 18, the appropriations committee will be basically voting their bill out or at least doing a straw poll this Friday. And there's yet to be, from our brief time during the break, there hasn't been any indication that they are not on board with this recommendation for the governor's meeting. So it sounds like that decision has been made. So whether we agree with it or not, it seems like that's been taken care of. So if we're trying to get something seriously being considered, I don't think you can go against sort of like an argument that's already been quote unquote settled,

[Matt Walker (Chair)]: if we want to get

[Timothy R. Corcoran II (Vice Chair)]: something to paint. But I don't think they'll give it that much consideration. I'm just trying to give us the best path forward.

[Candice White (Member)]: So I guess I look at it as the governor's recommend is in there and we are not disputing that. So I guess the question is, do we assume that the governor's recommend is not just for 'twenty seven, but going forward in perpetuity? Or do we assume that it's for FY27?

[Timothy R. Corcoran II (Vice Chair)]: We've been indicating it's in the future. I'm not saying I agree with or disagree with it. That's just the reality that we're in today.

[Candice White (Member)]: And you feel like if we didn't have that specific language

[Kate Lalley (Member)]: protecting pilot funds for the reappraisal, that we would have less chance of getting our 15 I'm saying that we're facing an uphill battle with or without this, each uphill battle to

[Timothy R. Corcoran II (Vice Chair)]: get this. This would be,

[Matt Walker (Chair)]: I

[Timothy R. Corcoran II (Vice Chair)]: don't say a death war, but it just, yeah.

[Matt Walker (Chair)]: You can try

[Timothy R. Corcoran II (Vice Chair)]: to massage it or maybe just let them do it.

[Matt Walker (Chair)]: The other option is to leave it out and have them force them to cut it out or cut the whole That's really the battle. Put it in and hope that they will move forward with some help for the town highway or leave it out and risk having the entire concept cut out, is what I think we are assessment of the situation. And that's where the committee's gonna have to make a recommendation or make a vote or make a change. That's what I think is, I think, everybody's clear on where we're at, that's what we think is the case.

[Candice White (Member)]: And I suppose if we didn't keep that language in there, that the money committees could put it back in. If

[Matt Walker (Chair)]: it's not an EBT bill, they're not going to add, I've never seen them add that, do anything like adding something like that to the bill. Adding additional expense to the Money amendment. Portion to a bill or a change of money without the policy committee putting it in there, I don't believe that would happen. If you don't have it in, it's not gonna get added, I guess.

[Chris Keyser (Member)]: I think we should proceed and state your own ground out, because you know that if you don't take care of yourself, no one's gonna take care of you except your mother, she's not here anymore. With

[Matt Walker (Chair)]: or without acknowledging that appraisal. With or without? Okay, I've

[Chris Keyser (Member)]: got two minds to that. First off, there's nothing to say that can't expand, so it takes more. Can also contract, but I never don't probably see that very often. So it's part of the budget this year. We're to have to put it in. I mean, it's got to be there. Going forward is the question is what you're asking. That also is a need and I would say that we should leave it in.

[Matt Walker (Chair)]: Anybody else wanna weigh in? Aye. Okay, no? That's where we're at. Mean,

[Timothy R. Corcoran II (Vice Chair)]: to move things forward, I'll make a motion to the bailout of both the linguists there to move the buys, language including the reappraisal,

[Matt Walker (Chair)]: read. I a

[Timothy R. Corcoran II (Vice Chair)]: make a motion to approve the language that's publicly for us.

[Damien Leonard (Legislative Counsel)]: Yeah. I drafted this on the fly, so there's not a document on the website right now.

[Matt Walker (Chair)]: Okay. For those in favor of including it in the language, give a thumbs up. Okay. If there was a not, then I guess it would be thumbs down. So we will ask you to include it in the draft that we'll be reviewing later today, move it into the T Bill. With that, we're gonna move over to mileage based user fee language with Patrick Murphy and Damian.

[Phil Pouech (Ranking Member)]: Yeah. Put the cleft tape on my email.

[Timothy R. Corcoran II (Vice Chair)]: Yeah. I'll be

[Chris Keyser (Member)]: right here. I

[Matt Walker (Chair)]: think I have a phone call. But in fairness, yes, it's certainly been a we're not all the way through it yet. I don't have an electric vehicle, and that doesn't mean that I don't want it to be the best setup possible. So yeah, we may have to move on in some of the areas that aren't fully settled. There's nine months left to get this program ready to go. It is a first of the kind in the country. There's programming and pieces that have to go. Our job is to make sure that we have a framework that they can operate, that the agency can operate with the Department of Motor Vehicles and their effort to get it to an implementation place. They're going to continue to work on it. It's going to go from here. It's going to go to the Senate. It's going to potentially come back to us at some point. We need to have a framework that they can keep operating and moving towards the implementation. I am not suggesting that we don't want the language to be perfect, but I don't know if we can do perfect on a first time program and a first time implementation. But we're looking to make sure that they have the law that they need to work the building of the program in between. And I am all for the idea of having them come back to the committee regularly and update us all the way through the very end of when we adjourned the April or somewhere near that. Somewhere near that. And they're going to continue to work on it all the way through, and we can look at it at spots. But it is going be evolving. And I suspect there will be recommended changes when we come back or those that do come back in January because it is a development program. But let's see what we can do for making progress on the current version of mileage based user fee and pick up where we left off. Last time we're working at Patrick's here Last Friday, we didn't get very far, yet we need to pick up and keep working on it. At least from now until we break for lunch.

[Timothy R. Corcoran II (Vice Chair)]: Okay. It's a 200.

[Damien Leonard (Legislative Counsel)]: Math number is 4.1. Is that available on the website?

[Patrick Murphy (AOT State Policy Director)]: Yes. Yep. Good. Okay.

[Candice White (Member)]: So it's under Friday.

[Kate Lalley (Member)]: Yeah. It's last week.

[Damien Leonard (Legislative Counsel)]: Yep. Alright. I don't remember how far we got on Friday. I know it wasn't very far, but why don't I start from the top, and I'll try to move fairly quickly. K. So starting from the top of draft 4.1, the first changes were in the definition of mileage reporting period.

[Kate Lalley (Member)]: We

[Damien Leonard (Legislative Counsel)]: took out the reference to the pay as you go program in this definition and just explain that payment later on.

[Kate Lalley (Member)]: What page are we gonna do, Jamie?

[Damien Leonard (Legislative Counsel)]: I'm sorry. That was on page two. On page four, I've made some technical corrections here. So at the conclusion of each mileage reporting period for a battery electric vehicle enrolled in the pay as you go mileage based user fee program, the commissioner would determine the actual miles traveled during the mileage reporting period, whether they were greater than or less than the miles reported during that period. And this is reflecting that in the pay as you go program, you'll make intermittent reports of your mileage, but you're actually being trued up every mileage reporting period. So when you get your car inspected, they true up that mileage and either credit you or assess you credit you for overpayments or assess you a balance due. The next change on page four, line 15, I left out the word be, so I've added that in. For newly registered vehicles, and I think this is as far as we got last time. The mileage based user fee for newly registered vehicles. If you're registering for the first time, you can either elect to opt in to the pay as you go mileage based user fee program if that's available. And then if you do not opt in to that program, you would be assessed an estimated mileage based user fee equal to the rate multiplied by the annual vehicle miles traveled for a pleasure car, which is roughly a $154 at the present time. The fee would be provided or paid as provided in subdivision a three, which means that you have the option of lump sum monthly or quarterly payments of that amount. And then at the end of your first mileage reporting period, you do a true up. And again, if you pay if you overpaid, you get a credit against your future payments. If you underpaid, you're assessed an additional amount due.

[Matt Walker (Chair)]: Representative Pouech?

[Phil Pouech (Ranking Member)]: So if I sell my car and I don't buy another vehicle or anything, I have a credit, will that credit be applied to my DMV fee going forward? Or if I've sold the car, will I get a check back for that credit?

[Damien Leonard (Legislative Counsel)]: That is a great question. I would defer to the agency on this one.

[Patrick Murphy (AOT State Policy Director)]: Thank you for the record. Patrick Murphy, state policy director of the agency transportation. In those limited circumstances where credit couldn't be applied to next balance and a refund just the issue.

[Phil Pouech (Ranking Member)]: They'll get a refund. I wouldn't have a balance sitting there in DMV for other DMV things.

[Patrick Murphy (AOT State Policy Director)]: So the point of having a credit system is that every time DMV has to issue a refund, no matter what the actual amount, there's a significant problem to it,

[Kate Lalley (Member)]: and so we want to

[Patrick Murphy (AOT State Policy Director)]: limit those circumstances in which we do that. There are going to be things that, you know, what mid year sale is one of those, where you're settling at the point you get an odometer reading for the bill of sale, and then you're reconciling at that point and issuing a baseline.

[Phil Pouech (Ranking Member)]: Okay, thank you.

[Damien Leonard (Legislative Counsel)]: And I will if you decide to add this to the t bill today, I'll add language that just provides in the event of a terminating event, the commissioner, if a if there's a a credit to the individual commissioner shall issue a refund, something like that just to address that. Let's make a quick note.

[Kate Lalley (Member)]: Sorry. I just need to Okay.

[Damien Leonard (Legislative Counsel)]: The other changes in here are just cross references that we're missing, And I you'll see I broke things out into new subdivisions there as I renumbered. Calculation of the mileage based user fee, instead of sailing saying mileage reporting period, it now says the applicable applicable period just to reflect that there are interim periods for the pay as you go program and overall mileage reporting periods. And then it explains how that's calculated for a mileage reporting period and then for a report filed by an owner as part of a pay as you go mileage based user fee program, providing that in that case gets the difference between the current reported mileage and the most recent prior reported mileage. The reports for terminating event here, it was identified last week during one of our testimonies that we'd forgotten to mention how quickly after terminating event you need to report your odometer reading. And so this says in the time and manner required by the commissioner, allowing the commissioner to kind of set that and adjust it as necessary. For the failure to pay fee when due and interest, this title changed because the penalty assessment that was in here was taken out. And so subsection b was renumbered because we eliminated the old subsection that was in the middle that assessed a 5% penalty for every thirty days you were past due and added in a cross reference to subsection a. In the failure to file a report so if a commissioner is unable to determine the annual vehicle miles traveled because a person failed to file a report, so, for example, an odometer reading or failed to have their vehicle inspected as required, and that I realized was left out of the earlier draft. So this allows the ninety eighth percentile mileage assessment if you don't go and get your annual inspection to have your odometer reading done. The next changes in here from the prior draft all the way down on page 14. This is the transition language. So mileage based user fee in the transition. So for current electric vehicles that are registered in Vermont, they would transition to the mileage based user fee as follows. So for a vehicle that will not complete its first mileage reporting period prior to the next renewal of its registration after January 1. The owner or lessee may, at the time of the registration renewal, elect to pay an estimated mileage based user fee, and it should say shall, at the time of the registration renewal, either elect to pay an estimated mileage based user fee, or if available, opt in to the pay as you go. Because this would indicate that you don't have to do anything. So that the may would change to a shall, and that's what that comment is noting there. And then if you will complete your first mileage reporting period prior to the next renewal of registration, you would receive a credit of $89 from the current EV infrastructure fee that that owner has paid towards the amount of the mileage based user fee due for that initial mileage reporting period. So in other words, you do a two year registration sometime this year. You've paid your two EV infrastructure fees. Your next inspection in in 2027 would start your mileage reporting period. And then in 2028, presumably before your registration renewal is due, you get your assessment of your first mileage based user fee, and that will include a a credit for that $89 for the second year of the EV infrastructure fee that you already paid and allow for that transition at that point. And there there with the way this is set up, there are going to be folks who come out a couple months ahead as this transition goes, but it will save the administrative requirement of figuring out a month by month prorated credit for each person because you will have folks who might have part of that $89 that they paid overlapping with a reporting period, if their registration renewal, occurs before the reporting period is over. But the current proposal here did simply say we're not prorating unless you have a full year of credit. And then so you'll you'll have winners and losers under this transition proposal, but administratively, it's the simplest. So that's the proposal that's in. It's up to you whether you move forward with that. That's AOT's proposal here is to do the simple administration

[Kate Lalley (Member)]: with this to avoid

[Damien Leonard (Legislative Counsel)]: problems trying to assess the exact amount. Yeah.

[Phil Pouech (Ranking Member)]: I get trying to simplify it. Can you describe what the worst case would be in this situation where you pay the registration, the infrastructure for such?

[Damien Leonard (Legislative Counsel)]: The the worst case would be where my first mileage reporting period ends one month after my registration renews. And so I've I've you know, 11 twelfths of the $89, I'm missing out on that. So that could be be about $80.

[Phil Pouech (Ranking Member)]: Yeah. That seems fair.

[Damien Leonard (Legislative Counsel)]: So there there are other potential approaches, but it it becomes a policy question for you as to how you would wanna prorate it if you decide that that's the direction you wanna go in. And I'd encourage hearing from the agency too on that because I can't comment on the administration that would be required to implement.

[Phil Pouech (Ranking Member)]: Again, it does add complexity, but it seems like a simple calculation, you know, $89 divided by 12 at that much per month, full month. Because if I just paid the $89 and then a month later I start having to pay mileage based user fee, it just doesn't seem fair.

[Patrick Murphy (AOT State Policy Director)]: I think it's really fair.

[Matt Walker (Chair)]: Patrick, did you have a comment on this at all? I'm not sure that I followed it entirely.

[Patrick Murphy (AOT State Policy Director)]: Yeah. Not sure of it.

[Matt Walker (Chair)]: I'm gonna go through the scenario and make sure I understand it.

[Timothy R. Corcoran II (Vice Chair)]: While you're thinking about that, one concern I had is about the failure to pay with interest. Know, people move, people die. There probably should be an end date when that stops accumulating interest. You know, somebody moves away for thirty years and comes back and gets a bill for amount. So I think my comfort level should stop accumulating after a year, something like that, because they're going to not be able to register par anyways until it's paid up, but I think that interest rates should have a stop so it doesn't continue to just go on through somebody really not realizing that.

[Damien Leonard (Legislative Counsel)]: Yeah, so the 1.5% per month comes out to 18% per year. So you could say the total amount of interests the total amount of interest on the unpaid amount due pursuant to this section shall not exceed 18%? Yeah.

[Timothy R. Corcoran II (Vice Chair)]: Whatever it is. I think it should be a stop point because, you know, things are gonna get lost in the weeds. People move and reregister in their cars somewhere else and not realize they have an outstanding balance.

[Matt Walker (Chair)]: Don't know if you would In the collection, you're saying that it should yeah. Collection for the crew did not exceed twelve months or eighteen months. Do you think that the next section about the commissioner's, that he has the ability to waive or not waive or negotiate, I guess? I assume that means some or all, so he can negotiate, he or she could negotiate settlement of that, but you'd like to be once.

[Timothy R. Corcoran II (Vice Chair)]: True, it depends on what mood he is.

[Matt Walker (Chair)]: I don't want to be based on a mood either, but I mean you have to have some discretion as if you're saying that with a further guardrail that it does not go on accumulating. I guess it would be quite the situation right to come back after being gone to

[Phil Pouech (Ranking Member)]: an emergency. Like a library. I

[Matt Walker (Chair)]: don't know, I would think that somewhere in the regulation it could cover that or it got covered by the waiver. If it's approved for eighteen months, would

[Chris Keyser (Member)]: it sit there?

[Timothy R. Corcoran II (Vice Chair)]: Wait until it's paid because they can't register the car because we have another can't register it. Ledge counsel for a

[Matt Walker (Chair)]: comment and then to the agency and then back to the committee.

[Damien Leonard (Legislative Counsel)]: Yeah, mean, you can you can put in a gap on the the total amount. There, another option is to just impose a flat percentage. But then that that doesn't deal well with someone who's thirty days past due or sixty days past due versus someone who's a year past I just want to,

[Timothy R. Corcoran II (Vice Chair)]: whatever it is, just stops at a certain point.

[Matt Walker (Chair)]: If the agency wants to comment on that or while they're looking at the other piece or do you want another minute? The agency has a comment on whether or not there should be a limited time frame that the interest should accrue.

[Patrick Murphy (AOT State Policy Director)]: I think we're finding some correctness around this. Wanted to go back to, Amy, if you could run through again what you're saying is the worst case scenario. I thought in our discussion the other day.

[Damien Leonard (Legislative Counsel)]: Yeah. Was trying to remember where we ended up in that discussion the other day, and I know there there is also the scenario where someone could come out up to eleven months ahead on on not having mileage based user fee assessed. But let me pull this back up. Because we we were discussing when we had a chance Logan, Patrick, and I had a chance to meet on Monday afternoon how the transition would look for the other folks who so the the possibilities here are if you're completely synced up on registration and inspection and your registration or inspection is due in January, then it's a wash. You you go straight from your EV infrastructure fee to your mileage based user fee if you're not completely synced up. So take, for example, a car where your registration is November or December, your inspection is, let's say, June, then you would have you know? So if your next registration, you register, renew your registration this November. You get your car inspected in June 2027. That starts your mileage base report mileage base user fee period. And then you go to the next June. You'll complete a reporting period there, and you'll get the $89 credit towards that reporting period. And then you'll have the six months there where, depending on how much mileage you were driving, there's just there's no calculation of mileage. Instead, you're you've covered that with your EV infrastructure fee, and then you're into your next mileage reporting period. Although, this doesn't address to what happens in the second mileage reporting period as far as the EV infrastructure fee goes now that I think about it. Because you would have paid, your EV infrastructure, you could sell $89 a year for the two years from November 26 to November 28. Your first mileage reporting period would be June 27 to June 28, and you'd get an $89 credit against your balance due for the mileage you travel. The language in here doesn't speak to June 28 to June 29 because you've paid $89 for that period of November 26 to November 28 or that EV infrastructure period for November 26 to November 28. So language doesn't address January 27 through May 27 and June '28 through November '28. What are you doing with the EV infrastructure fee for those periods? That could be changed depending on how you want to address it or you can leave it silent.

[Matt Walker (Chair)]: I know. Representative McCoy and then Representative White. So do we

[Patricia McCoy (Member)]: have a sense of how many people would pay per year? Minimum damage?

[Matt Walker (Chair)]: Is it a lot of people Do pay per

[Patricia McCoy (Member)]: we have a sense?

[Patrick Murphy (AOT State Policy Director)]: We do have a sense, I don't have the number right off.

[Patricia McCoy (Member)]: Is it a lot or is it based on how 8,000 BBs, is it 6,000, is it 20?

[Patrick Murphy (AOT State Policy Director)]: Yeah, it's 13,000 BBs.

[Patricia McCoy (Member)]: It's good

[Patrick Murphy (AOT State Policy Director)]: to know. I'll have to get to

[Matt Walker (Chair)]: a point where you

[Michelle Bullock (Vermont Agency of Transportation)]: actually I

[Patricia McCoy (Member)]: mean, don't know what we're talking about, probably. Because on the flip side, are there people that are not paying for a while before it hits in? So they balance one another out.

[Patrick Murphy (AOT State Policy Director)]: Yeah, mean the thought behind all of this was that you'd have the $89 infrastructure fee, you don't have that initial mileage reporting period when you first begin when you go to registration, then the $89 registration fee you could apply to that, and because it was set at a rate that was much lower than what the average vehicle actually traveled at $154 per year, the differences in the number of instances where there'd be like a substantial difference is probably pretty small. And even in the example that Damien shared of eleven months, it said $80 or less, it's

[Matt Walker (Chair)]: still

[Patrick Murphy (AOT State Policy Director)]: about half what people pay on average for a gas vehicle going 11,000 miles. And then on the flip side, that there also, with that decision, are sort of giving away some months, but that in the initial transition it wouldn't be too big of a task or burden in either direction. I think we're open to language if you want to sort of narrow this down and have some probation schedule or whether it's on a monthly basis or what have you, so that that gets applied in a more exact manner with that. What we're trying to do with all this language and the design of the program to start is to keep it simple, so that we are able to work through things in the next iteration for the rest of the vehicles. So I think the agency is open, the department is probably going to be able to prorate in some way,

[Kate Lalley (Member)]: as long as we don't

[Patrick Murphy (AOT State Policy Director)]: get into a situation like representative Pouech highlighted, of actually issuing refunds, all kinds of refunds, that would be a costly administrative task. Thank you.

[Candice White (Member)]: There was a suggestion last week by a committee member to change EV registrations to just one year, just during your transition period so that because if Damian's scenario were a one year registration, not a two year, it would just be that much simpler. There'd be a little You paid your registration fee, you'd get to your inspection, that would start, so you're gonna pay a little bit, you'll pay an amount at your second inspection, but you will have paid your $89 so there's some truing up, it's not, it just might simplify things for the agency.

[Patrick Murphy (AOT State Policy Director)]: I think what we wanted to do was provide all the options that are available to a gas vehicle owner, to an engine owner, So some people do find that paying the three year registration is preferable and there is some financial benefit to that. So that's why we didn't entertain the idea of just going to one year registration just for this group of people. Which we did hear from the Committee on Fairness of applying EDB roads to different behavioral types.

[Phil Pouech (Ranking Member)]: Yeah, I hear that, it's taken a little while to get to the two year, to get people used to it, to get it all programmed. And then just to sort of, oh, trim out a little piece just for a year or two, and it just muddies the water. This is gonna be a hard enough thing to explain. What I'm sort of saying is it isn't fair if somebody gets charged the infrastructure fee and they're not able to sort of apply that going forward. And we heard the worst case, what would happen. It just doesn't seem fair. So I think coming up with a way for the end, you could round up or down just to make it really simple. Nobody's gonna argue about one month, but I might argue about eleven months of payment that, you know, the tourist says, okay, we're gonna apply the credit, not a check credit for what's left over in the infrastructure fee as you pick into the mileage based user fee. Seems like we should put some language in that so that even if it's only two fifty people, they don't care how many people get caught up in it. They just care about what they've had to pay. It seems unfair. If it is unfair, it's hard to argue. There's only a few of you that have to do it. So I would suggest we try to find some language, or Damien find some language in there. Continuing to make it simple, but make sure you've credit for what people have already prepaid. And it is a

[Timothy R. Corcoran II (Vice Chair)]: prepayment. Yeah,

[Kate Lalley (Member)]: I think if it's only two fifty people, this should be something that we should do. We want to make this as frictionless as possible, this transition. So that makes sense to me.

[Damien Leonard (Legislative Counsel)]: So the question is how you would want to provide that credit. For example, it's fairly easy to draft the language to provide that electric vehicle shall transition to the mileage based user fee as follows. At the, you know, annual inspection for the vehicle, the vehicle will commence its first mileage reporting period. And then for annual inspections or for mileage reporting periods that commence prior to 01/01/2029, you know, those cars would receive a prorated credit. You know? And then how would you prorate it? Would it be by month, quarter, six month period? Yeah.

[Phil Pouech (Ranking Member)]: It seems like five months would be a good way to do it. Know, I have to cut a month in half by a month.

[Damien Leonard (Legislative Counsel)]: Okay. Yeah. Alright. I'll I can redraft. Yeah.

[Michelle Bullock (Vermont Agency of Transportation)]: We're fine.

[Patrick Murphy (AOT State Policy Director)]: Okay.

[Matt Walker (Chair)]: Alright. That puts us back to the capping the interest piece at some spot and I'm sure that I did hear what the agencies are thinking about that was.

[Timothy R. Corcoran II (Vice Chair)]: They just said they're fine with it.

[Damien Leonard (Legislative Counsel)]: Where would you like to cap it at?

[Matt Walker (Chair)]: We're suggesting twelve or an eighteen month.

[Timothy R. Corcoran II (Vice Chair)]: Doesn't matter to me, it be an endpoint, something. Month. Pick a number.

[Kate Lalley (Member)]: Twelve, twelve.

[Matt Walker (Chair)]: What we're getting at is the difference between somebody avoiding pain versus somebody that's unknown that drug.

[Chris Keyser (Member)]: Well, would get at

[Timothy R. Corcoran II (Vice Chair)]: them because when they go reregister in the car they couldn't get the last pay. These are just people that have pooped or died or just fall into the cracks.

[Matt Walker (Chair)]: Twelve months is a reasonable amount of time that the agency would be able to identify the situation?

[Kate Lalley (Member)]: Yes.

[Matt Walker (Chair)]: Anybody else have an opinion on that?

[Chris Keyser (Member)]: The only thing I'd say is it would be good to do that. We're talking about $186 18% on $153 gives us a That is almost insignificant. You wanna put any resources to try to collect that money? I don't think so. So anyway.

[Matt Walker (Chair)]: But that would be thirty years? No, no, no. I'm not Oh, yeah. No, I agree with it.

[Chris Keyser (Member)]: The point is that it gets de minimis and you're just gonna add up this money that you're just gonna write off.

[Matt Walker (Chair)]: So the system will be marked in a way that then they wouldn't be able to re register another vehicle, Michelle

[Michelle Bullock (Vermont Agency of Transportation)]: Bullock, Vermont Agency of Transportation. So you know I think the chair is correct that they're going to be marked in the system so when they come next to register a vehicle this will be an outstanding debt. We're not going to go out and try and collect these debts at all, but it does kind of put a marker in the system that could catch up with that person at that point in time. And then they would owe with an amount that won't be astronomical, but it recognizes the fact that they avoided earlier systems charges.

[Matt Walker (Chair)]: Okay. So does that help guide you?

[Kate Lalley (Member)]: Yeah, just want to say this. I'm really grateful that this is before I got to the legislature, but that our state invested in modernizing the DMV system. This stuff is possible because of that. Presumably, there'll be future patches and things that continue that. Changing just needs, changing times, and we're able to adapt. And I just want to give a shout out to those who are

[Michelle Bullock (Vermont Agency of Transportation)]: here and part of that.

[Damien Leonard (Legislative Counsel)]: So what I'm hearing is the maximum amount of interest that could accrue on an unpaid mileage based user fee would be 18%, the one year total interest amount. So I will update that. There are I'm just looking at the list that I have. There are three other outstanding issues in the draft that I forgot to touch on in my walkthrough. So first is there was discussion about the inflator on the annual tax rate. That is on page seven, line seven.

[Timothy R. Corcoran II (Vice Chair)]: I heard enough. I make a motion just to remove that section. The inflator.

[Matt Walker (Chair)]: Representative Keyser? Thanks.

[Chris Keyser (Member)]: Anyway, this is a point of view. All right, so I wanted to add some flavor to this thing about fairness. And you know that I'm very concerned about fairness, everybody should be. And about the inflator. Now, the UVM study, I'm just background, envisions an inflator, and it's so that we don't get into the same thing, whatever. EVs have been on the road since the late 2000s, so they've been driving on the roads without any contribution since that time. There's been a, pardon So the pun, but there's been a free ride there. No other class of vehicles has received federal and state tax dollars to be able to buy them. So there's an advantage there. The other thing is that there's been tax dollars provided for the infrastructure for charging and things like that. So there's been an advantage to EVs there. And currently we know, and the law written was for only if they recouped the gas tax, the state gas tax. We did get testimony that for every federal dollar from the federal government, or that we give in to federal government for fuel taxes, we get a buck 5 back. So we have been promoting this by not charging the full bill for a long period of time. So just to cause a little bit of problem here, I would have a proposal that we have a new flavor. Now, I think that 27% is ridiculous. You'd have to come up with something like that. But that inflator only be applied until it reaches a cap of the 0.0218. How'd I come to that? That is including the federal taxes. So we cap it at what the tax, total gas tax would be, or until such times that an inflator would be applied to motor fuels. I know there's a lot there, but that fairness thing is we've been very fair to EVs, there might be an opportunity there. I'll just throw that out to the group. I don't expect much support. That's a nice

[Timothy R. Corcoran II (Vice Chair)]: suggestion. Perhaps that'd work?

[Kate Lalley (Member)]: Well, I'd have to consider more detail, speaking to the other side, Bruce felt there was turning stone that said that IV trends said they did not wanna start taxing EVs until they represented 15% of the fleet. And not even quite that bad, it's close. So that's why we started with the infrastructure here, and I think EVM was very happy to contribute. But I think it's also, this is something we can't be able to quantify, but the air quality benefits of EVs are very strong, and you can't you can't I mean, somebody may be able to quantify what that is, but we know that asthma, people are really affected by the way, what you get, and terms of financial measures and salaries. Maybe savings and health care costs.

[Timothy R. Corcoran II (Vice Chair)]: Both sides, both sides. Yeah.

[Matt Walker (Chair)]: Representative Pouech and Representative White?

[Phil Pouech (Ranking Member)]: Yeah, I can appreciate the argument there. Let's be clear, EV owners, and I've been one probably since when they first came out, Haven't had to pay because the legislature didn't do anything to make them pay. So there was no way I could pay anyways. EV owners have paid what they've been asked to pay. It was a policy of the state to wait for 15% for a number of other reasons. I would argue the 1.4, the 0.014 rate, which is the equivalent of a vehicle getting 26 miles per gallon is already a pretty good compromise because I would argue my EV and all EV vehicles are getting a higher, a more efficient rate than that. So I think that that's been a big give and I've gone with it because it is, I agree that these vehicles need to pay it at the time now we need to start doing it, But we haven't not done it because the state hasn't asked us for it. And the federal government hasn't either. But at some point you would hope they would, I hope they do. And the amount that of federal gas tax that EVs aren't paying is not changing the amount of money we get from the federal government. So I would say I'd still I'd go along with the proposal to remove the inflator.

[Matt Walker (Chair)]: Representative White?

[Candice White (Member)]: Yeah, thank you. So representative Keyser, I appreciate your proposal. I was unclear about your reference to the Vermont gas tax and getting $1.05 back from the federal government for the gas tax. I'm not quite sure what

[Chris Keyser (Member)]: We had testimony a couple weeks ago, I think it was, that made the same point. And it was described that for every dollar of collected federal gas tax, we pay above five bags. But regardless, I mean, that's

[Matt Walker (Chair)]: I'm sorry, I should have interrupted. My bad. We get back more money than we send in.

[Timothy R. Corcoran II (Vice Chair)]: I think that's the case. That's the

[Matt Walker (Chair)]: As a state on a bigger picture of gas tax board, Federal Highway, we get more back than we send in.

[Candice White (Member)]: Yes. Okay, that, yes. Thank you for clarifying that. I would be in support of putting language in this that said that we would add an inflator to the MBUF at the same time we add an inflator to the gas tax. Otherwise, I would not support an inflator.

[Kate Lalley (Member)]: Representative. This one other thing, is that the federal gas tax, which is ridiculous, has not been raised since, like, whose fault is that? And all the money that we could have been getting for the Iowa Trust Fund vaccines.

[Chris Keyser (Member)]: Thanks for listening.

[Matt Walker (Chair)]: Other comments? I think that in the testimony it was pretty clear that an escalator related to inflation, whether it be CPI or some other piece, it was pretty clear from the UBM testimony that it's good public policy to have an escalator. I think that that would lend the conversation to go in all kinds of different directions in terms of fees and user fees that this is a user fee that we are implementing. There's a lot of just clear testimony that having it set would be good, but I think we're also recognizing that we inherited the situation, that getting to fairness is an incredible challenge. Is there anybody else that wants to speak on it? There is a motion. I think what we normally do here is a thumbs up or a thumbs down. The motion is to remove the escalator from the language. All those in favor of removing it, put the thumbs up. One, two, three, four, five, six, seven, eight. Those that would want to leave it, leave three the other way. We would instruct the council to take it out. We have that was one. You got two more. Yeah.

[Damien Leonard (Legislative Counsel)]: Lynn, can you please make me a cohost again? So It's not a recorded phone.

[Matt Walker (Chair)]: Unless you look really close if you need to.

[Damien Leonard (Legislative Counsel)]: The the next piece in here is also related to the actual m buff rate. It's not actual text in the draft. It occurred to me as I was editing the draft that there is currently no provision in here that allows a person to appeal the amount of their assessment. So if they think the commissioner made a mistake or the agency department made a mistake in the assessment, there's no provisioning here that allows them to go back to the agency to say, I think you made a mistake. My mileage was this, and you have it as that or something like that without going to court. So the only appeal process is is to superior court, so there's no administrative process. So I wanted to highlight that it was something that I didn't catch in the draft until the last revision round. Typically, we offer an administrative process so folks don't have to go to court and deal with court violence and back and forth if it's a simple math error or something like that.

[Phil Pouech (Ranking Member)]: Was there So this process exists if you think you were overcharged for purchasing new sales or any of that. You have an administrative process where you can say, at least get to say your piece. And what you're saying is that doesn't exist across the board. It has to be in the statute. Since there you follow this process if you have a problem.

[Damien Leonard (Legislative Counsel)]: Right. We typically establish a process to do that. So, for example, with motor vehicle purchase and use tax, the we provide that let's see. Sorry, I can't find the language. But we typically provide a process for an individual to contest or appeal the amount of tax assessed and for the commissioner to set up a simplified review of that rather than a full court hearing or something like that.

[Phil Pouech (Ranking Member)]: This language in this bill that's proposed, it's on page nine that says, notice an opportunity for

[Patrick Murphy (AOT State Policy Director)]: a human.

[Phil Pouech (Ranking Member)]: So that's the kind of language I assume you would have.

[Damien Leonard (Legislative Counsel)]: Yeah, that's a suspension you're taking away. So under the due process, constitutional due process requirements, when you're going to take away someone's a right that someone has or has been granted, you need to offer

[Patrick Murphy (AOT State Policy Director)]: So

[Damien Leonard (Legislative Counsel)]: this is a little bit different. The yeah. Hold on. There we go. So under under the gas tax, a distributor may, within fifteen days after an assessment, basically, notify the commissioner that they're contesting the amount of the assessment and then have a hearing. And then it it goes on beyond that. But there there are different provisions like this where you provide a, basically, a fifteen day period or something like that, a reasonable amount of time for an individual to contest the amount of the assessment and then have it reviewed by the commissioner at that point. And then after the commissioner's decision, if they still are in disagreement, they could choose to file a court action. But that

[Matt Walker (Chair)]: we're gonna go over there. Are you gonna to color?

[Michelle Bullock (Vermont Agency of Transportation)]: I think that going from a commissioner's decision on the action, it would go then to the hearing unit, not to the court. Think you want to keep this as simple as possible. So I don't know if there are any other, can assume there's an example somewhere in DMV law that gets you to the hearing officer. And then after the hearing officer, then you get to go to court if you want to. So I just would suggest maybe we could cut and paste with some other part of statute that addresses this issue.

[Damien Leonard (Legislative Counsel)]: Sure there is. And I just forgot to make a note of which section.

[Timothy R. Corcoran II (Vice Chair)]: Just a little comment, Bill? I I

[Kate Lalley (Member)]: was wondering if we were ready for a motion to direct our alleged counsel to

[Matt Walker (Chair)]: We got one more.

[Kate Lalley (Member)]: Provide. Oh, we're wrapping them all in. Okay. I think we have I'm sorry. I didn't put the

[Matt Walker (Chair)]: whole in, we're going to ask him to make he's got one more area that he said we need to revisit.

[Kate Lalley (Member)]: Well, was just specifically to this issue. I was just wondering if we were ready to wrap this one up in about this particular issue of the hearing process.

[Matt Walker (Chair)]: I think if we're gonna ask how we would be instructed into, if we all agree and identify, we want to instruct them to have this piece, I guess. I guess. I understand what you're saying. I guess we are looking for that. Because can say yes. Representative Lalley is suggesting that we agree that we want to put a hearing process in place. And I would say that probably generally speaking, we were at the spot where we would instruct our alleged counsel to bring us back additional. We're gonna have to look at the whole thing again. When we come back at 01:15, we have to go through the whole-

[Michelle Bullock (Vermont Agency of Transportation)]: 01:15?

[Matt Walker (Chair)]: We have a permission to you would have to be on the floor. But we have permission to meet this afternoon, not on the floor. I think we're going to have to have a situation where we monitor because there are perhaps some bills that people need But to be we need to continue to push through. The speaker has given us permission to work on the bill at one hundred fifteen. You would have to individually make a decision about which part you need to be at. We still have mileage based user fee and at least two other items that we look to move on.

[Timothy R. Corcoran II (Vice Chair)]: But so far I'm in agreement with $10. So, Okay. Bert.

[Kate Lalley (Member)]: Are we

[Matt Walker (Chair)]: We got one more MBUF.

[Damien Leonard (Legislative Counsel)]: Then the

[Kate Lalley (Member)]: He's bringing up another issue.

[Damien Leonard (Legislative Counsel)]: Yeah. Final provision in the MBUF that we began to touch on, I think, a couple weeks ago but never came back to is what I'll pull up now, the proceedings to recover unpaid amounts. And so there is this section forty three zero nine, which provides that the commissioner can so currently, it provides that if you haven't paid your amounts due, the commissioner can refuse to renew your license or your registration on that vehicle. The proceedings to recover unpaid amounts here would also allow for civil enforcement action. So going to superior court to recover the unpaid amounts, filing a tax lien under subsection b, and also utilizing private collection agencies under subsection c. These are, again, were all taken from the gas and diesel fuel tax, where you're talking about different amounts. But I it's a point for discussion and we wanna hear from the agency, but you started discussion and never finished.

[Michelle Bullock (Vermont Agency of Transportation)]: So from our perspective, all right, so the person first of all is not going to be able to become registered. And after that, I don't know that the interests of the state are served by pursuing that person any further beyond the fact that they can't get their car registered. They're gonna have other legal implications or being an unregistered vehicle. The amount of money that might be left on the table would be nominal compared to the processes described here. So I don't think that we would want to include any additional steps unless there was a legal reason we had to.

[Phil Pouech (Ranking Member)]: Yeah, I have a view. I mean, feels like this was after distributors who are, it'd be like anybody who has to pay their sales tax or any that from a store. These are individuals. I'm not sure if there's anything like this in any other DMV fee sort of approach. So applying this language to a DMV fee seems out of Fee cost tax. And I would say we strike that. We already have a stick. This thing here is, it's a hammer that nobody will use because it costs too much to swing it.

[Timothy R. Corcoran II (Vice Chair)]: Make a motion to remove Section A, B, and C. You

[Matt Walker (Chair)]: are agreeing with all three of those sections. Yeah, I I want to make sure you're

[Michelle Bullock (Vermont Agency of Transportation)]: We don't renew the registration and then after that

[Matt Walker (Chair)]: Everybody approve of that? Judge Okay. Counsel's instructed accordingly. Are there other issues with that with all three of them?

[Damien Leonard (Legislative Counsel)]: That's it for the the remaining things I had on my list. Okay. So we need to break for lunch. We're gonna

[Matt Walker (Chair)]: come back at 01:15, one to one well, 01:00, but I don't if I can sustain anybody enough time to work on the piece. He's working through lunch on the updates. We will still be under markup to opportunity. Represent Burke, suspect that perhaps drive electric would come up. That's the first topic on 01/2015. So, those of you be aware that we'll let the other two members know at one hundred fifteen, we're going to take up potentially drive electric about moving an activity bill, and I know that Representative Wells may or may not be looking to move something else. I'm not aware of anything else, anybody's bringing it to the table.

[Kate Lalley (Member)]: I'm gonna vote right after we came back from break, sort of, I wish I had just said, I'm not really sure what we're voting on, or not, it wasn't really clear, and I wish we could have heard from the league again, and so I probably don't know whether that was on the, I voted in favor, that means that I couldn't

[Timothy R. Corcoran II (Vice Chair)]: It was a straw poll, tells people that you voted against it. Anyway,

[Kate Lalley (Member)]: I just need some more time to figure that out, and maybe I don't know how other people feel about it.

[Phil Pouech (Ranking Member)]: This was on the local option test? Yeah.

[Matt Walker (Chair)]: Well we are gonna be back at 01:15, we can reopen up.

[Kate Lalley (Member)]: I just wanted to bring that up, it doesn't have to happen exactly this afternoon, but I just didn't want anything to go beyond that.

[Timothy R. Corcoran II (Vice Chair)]: I don't know if there's going to be discussion about Thrive Electric not being able

[Matt Walker (Chair)]: to bring that up, but

[Timothy R. Corcoran II (Vice Chair)]: Matt, I have no clue. I don't want to bring money over to

[Matt Walker (Chair)]: the same things to discuss.

[Kate Lalley (Member)]: I'm I at

[Matt Walker (Chair)]: one when we come I'm you know what? That's up to you. I'm saying at 01:15, we're gonna be back at markup, will certainly include mileage based user fee. I have been I have been mentioned that there may be another one item from somebody else. There you may or may not have something you wish to bring up. I wanted to say we're not at a spot that we'd be closed out because then we'll still have to go through the entire bill.

[Kate Lalley (Member)]: Maybe a motion to reconsider.

[Matt Walker (Chair)]: Oh, I'm not sure. I guess you could let me know what you're thinking there and

[Kate Lalley (Member)]: we'll go from there. It just happened very fast and you all had this of huddle over there and then all of a sudden, I wasn't really sure it wouldn't have been.

[Matt Walker (Chair)]: Okay.

[Kate Lalley (Member)]: I thought they had stopped it at the time, but they didn't.

[Matt Walker (Chair)]: We