Vermont Legislature SmartTranscripts:

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Here we are, we have the unions.

[Emilie Kornheiser (Chair)]: Is still January 22 at 10:20, and, we're gonna take our second piece of testimony on h five forty five, and then we're gonna do a straw poll about it. We already heard from Nolan that there is no anticipated fiscal impact. And we're gonna hear from Katie about what the bill actually is. We've done it in reverse order today because people's schedules. Katie, good office of Liberty City Council.

[Katie Green (Office of Legislative Counsel)]: It's nice to see everyone. Okay. I know. Zoom is getting the best of me. Let me pull up the document. Thanks. Okay. So this is House Human Services Committee report on the Immunization Recommendation Bill, H. Five forty five. I know that you do not want to walk through this entire bill in detail. So I will try to give you a high level overview of what the bill does. If you have specific questions, we can drill down on language. So as you have probably heard, this bill is aimed at shifting the way and who makes recommendations for immunization schedules in Vermont for children and adults. Right now, our statutory language applies immunization recommendations to the CDC. And this language decouples that and instead has our Vermont Commissioner of Health making recommendations on immunization schedules. These are not required immunizations. This is the recommended schedule. So the Commissioner's recommendations, there are sort of specific guardrails for how the commissioner is to make these recommendations. One thing the commissioner would do would consult to consult with a specific immunization group that already exists in Vermont. The Human Services Committee did make some adjustments to the makeup of that committee, but it is a group that already exists. And the commissioner would be consulting with this group of professionals to make recommendations. The other thing the commissioner is required to do is review other professional organizations' immunization schedule. That list includes the CDC, but also professional organizations like the American Academy of Pediatrics, Academy of Family Physicians, those types of groups. So there's a whole list in the statute of which sets of recommendations the commissioner shall be looking to in developing the recommendations for Vermont. You will see that this bill is quite lengthy, 24 pages. I don't think that should be too daunting because a lot of those pages reenacts law that is currently in place. The provisions that change how the recommendations are made are only in place for six years, 07/01/2031. See that repeated over and over in the bill. And so half of the bill is putting language back in place. It's in place now, with some exceptions. For example, I said that the committee makeup of the committee that's making recommendations to the commissioner has been changed, that committee makeup and those changes would be retained going forward after the six years. What you might be more interested in is health insurance. Right now, health insurance, there's no copay or deductible. There's no cost to the consumer for receiving an immunization that's recommended by the CDC. But because the statutory language is linked to the CDC, this is decoupling that and instead referring to the commissioner's recommendations. So there would still be no financial obligation on the consumer for receiving immunization that was recommended by the commissioner. So we have two sections that do that. There's also language about pharmacists and pharmacy technicians in terms of what their scope of practice is with regard to prescribing and administering immunizations. Again, now it's coupled with the CDC recommendations. So the language in the bill decouples that and instead links the authority to what the commissioner is recommending for the period of six years. Is there any changes? Just a few clarifying questions. One, are there any changes at all in this bill to mandates for vaccines in any way? No, there's nothing about requiring somebody to take one. It's developing a schedule of recommendations. And the administration was who brought this bill to the committee? Yes, this came from the Department of Health. Thank you. And then can you show us the bottom of page 16? I think that's the only reason the bill has arrived with us. And you found the bottom

[Bridget Burkhardt (Clerk)]: of page 16, too. Thank you. My questions were on page 16 and page five, but yes.

[Katie Green (Office of Legislative Counsel)]: Let me just know where I am before I bring you down there. Restoring. So this is language that's an existing law. And where you are is where it's being restored to the way it currently is, before any changes happen. But this language is about how the payments happen for the existing state's immunization program. And this language requires that there be a surcharge on health insurers that is remitted to the health department to fund the immunization program. And there is an existing group that-

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: That's all current law.

[Katie Green (Office of Legislative Counsel)]: It's current law. There's an existing group that makes determinations about what the appropriate funding for the immunization program is, and they're regularly giving that information to the health department to fund its program. That's all existing law. But I think that's maybe what you're interested in. Could that be what you're referring to? Yep, do you have more representative?

[Bridget Burkhardt (Clerk)]: So I was just a little bit above that. It says the department shall determine in which immunizations Oh, no. It says the immunization program shall purchase immunizations from the federal centers for disease control and prevention at the lowest available cost. My question was, given where the CDC is right now, sort of in flux, whether that is going to be the place to buy the immunizations at the lowest available cost or not. I was surprised that that language hadn't changed.

[Katie Green (Office of Legislative Counsel)]: It has. You're looking at the section repeated, when it's repeated, going back to existing law. So this is what it currently says in law. After six years, this is the proposal that it would go back to this. But the proposal from human services says that they could purchase from the CDC or another vendor at the That's lowest

[Bridget Burkhardt (Clerk)]: where I got confused, the

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: structure of how this is

[Bridget Burkhardt (Clerk)]: Because put I read it probably too fast. And at the beginning, I was

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: like, oh, this is

[Bridget Burkhardt (Clerk)]: not making sense. And then I got to pages sixteen and twenty. I was like, wait, this is talking about the CDP again. I got

[Katie Green (Office of Legislative Counsel)]: It is very confusing. The first half of the bill is what changes Human Services is putting in place, well, proposing to put in place for the next six years. Second half of the bill is what the program will look like after six years. For the most case, it goes back to what the current program is, again, with some grammatical changes and with some changes to the makeup of the advisory council.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Any other questions?

[Unknown Member]: So we're changing it now, and in six years' time, it'll go back to what it is now?

[Katie Green (Office of Legislative Counsel)]: Yes, for the most part, with those few little changes that would be a change. So

[Mark Higley (Member)]: currently, the health department has the authority to determine the fee charge for the immunization, correct?

[Bridget Burkhardt (Clerk)]: I believe so.

[Mark Higley (Member)]: Without any action by the legislature?

[Katie Green (Office of Legislative Counsel)]: I believe it happens with this financial advisory group that's in statute, that they are determining the per member per month payment for the immunizations, how many people in Vermont are receiving immunizations, which immunizations, and they're providing those recommended numbers to the health department so the health department knows how much to be collecting from the health insurers. We do have somebody from the health department here, so if I mangled that, I would welcome a question.

[Mark Higley (Member)]: That's already occurring anyway? Yes. Yes.

[Rebecca Holcombe (Member)]: That's already occurring now. The base of the fee, essentially, the legislature isn't involved at all?

[Katie Green (Office of Legislative Counsel)]: Right now, there's already let me bring you up to the top of the bill. There's already in section one of the bill, I think it's subsection g, let's see. There's already a I'm not sure yet. Page three and four. So there's this Immunization Funding Advisory Committee. It's an existing law. It's established to provide the commissioner with the annual per member per month cost of recommended immunizations. That term recommended immunization has a special meaning here to mean immunizations recommended by the commissioner of health for the pediatric population, and it's doing the same thing for the adult population, and a recommendation for the amount of the yearly immunization assessment. And then we have a list of who is on this committee. And so this committee is doing the work of calculating how much funding has to be collected from the health insurers to fund the immunization program that the state runs, whereby anyone in Vermont who wants to receive a recommended immunization receives one without a cost. So this bill maintains that structure. Any other questions for Katie? Okay, so Nolan says, Thank you Katie, very much. Enjoy whatever committee you're about

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: to. Okay.

[Rebecca Holcombe (Member)]: Or don't.

[Emilie Kornheiser (Chair)]: Next up we have a struggle, we don't have possession of the bill. Nolan said there was no revenue impact of any kind.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Straw pull motion or something?

[Rebecca Holcombe (Member)]: I don't think I need

[Emilie Kornheiser (Chair)]: a straw pull motion, I think I'm just going to ask you to do a straw pull.

[Bridget Burkhardt (Clerk)]: Usually for straw pulls we just say, everyone who is in favor. Oh, everyone in favor, Say aye and raise your hand so I can count. Oh, it looks unanimous, eleven-zero-zero. Great, thank you, thanks everyone. Along

[Emilie Kornheiser (Chair)]: with our theme for the day of constantly totally changing topics, we're going to talk about our miscellaneous tax bill now. So anyone who wants to come or go or leave or find a chair? Would you like to find a chair? Okay. Great. Text from whatever combination you would like to arrange yourselves in at the table, you're welcome to. Is this your first time testifying this session? Oh, hello. Welcome. So nice to see you. Spectral shout out for Abby for her return to the room. Representative And Page, do you want to give me a moment to

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Great. Well, I'm Rebecca Samaroff. I'm the Deputy Commissioner at the Vermont Department of Taxes. And I'll just say, I feel like I've been very close to you all this session because of the joys of YouTube, but it is really great to be here in person.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Good morning. My name is Jill Remick. I'm the director of property valuation and review at the tax department.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Great. Yeah. And I think under my name, on your documents, we just did a section by section of the draft of the miscellaneous tax bill that's up right now to kind of guide our discussion today. And we heard a really great summary of a lot of this from Kirby last week and thought we could approach this just by kind of going through section by section and addressing some of the questions that we had flagged from committee members and also get them in real time, obviously.

[Emilie Kornheiser (Chair)]: You want to trigger screens along with you? I don't. Don't want

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: to do that. Is that an answer that's acceptable? Yeah, sorry. I just have a tremendous amount of things open right now, and that's always scary as a tax official to go live. But I think some of my notes Yeah, yeah, I know. It takes a lot of thought. I don't multitask as well as I did before parenting. You're actually Now

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: you're going say better, I

[Emilie Kornheiser (Chair)]: should say. Yeah,

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: did think of bringing in a picture of the twins for this group, which I should do. Next time thing. Yeah, a more spacious test. Definitely. Yeah. Because we think about you guys

[Unknown Member]: a lot.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: They hear your voices. So it's great, it's great. Democracy, early age. But sec so I think I did some of the notes that I'm speaking to, I think, are on this section by section in the notes section, but I did not take take some ones on the side here too, which are not not polished. So another reason why it'd be great if I follow-up separately. But section one of the miscellaneous tax bill draft right now is that issue of credit or taxes paid to another state by an S corp owner, and how our current statute treats owners of an S corp differently than owners of other partnership structures like LLCs, or other pass through structures like LLCs or partnerships. I think the questions I heard in this committee were more about the background of how this came to be. It is a juicy tale, Kirby, that you're here for Sand now. It's borderline scandalous, I think. It happened in the '90s. So not many, if any, of us were there at this time. But basically, there was a seminal Supreme Court case, Tarrant versus the Department of Taxes, about this issue, where Tarrant was successful in all levels of appeal. Supreme Court in 1999 ruled that, yes, of course, an S corp owner is eligible for this tax credit for taxes paid to another state, as are other pass through entity owners. But in this journey of appeal and going through the court system, in the middle there, when it was still actually getting decided in Superior Court in 1996, the tax department, which, with the support of the legislature, apparently, just changed the underlying law and put in this clause, this piece that said pass throughs can take this credit, but not S corps, which seems probably related to the individual and the goose at hand. So the court case was all about the tax year that had passed, and meanwhile, tax department sponsored legislation to change the law moving forward. So I think the historical record's been like, oh, there was a big court case that said something about this. But it's kind of news to us this year that actually, in our statute, there's this little bit of inequity that says that if your pass through is designed as an S corp, you don't have the same benefits of taking this credit as other S corp owners. So now that we've seen it, we can't unsee it. We would really restore equity for all pass through entity owners by addressing this. So that's my exciting tale.

[Mark Higley (Member)]: Just to clarify, if I may, because it's always tough when you are repeating a denial the double negatives.

[Rebecca Holcombe (Member)]: Yeah, yeah, oh, yes.

[Mark Higley (Member)]: So currently, it's just more advantageous for an S corp, the treatment of an S corp. Is that correct?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: It's less advantageous currently. Like, everyone can take this credit except for S corps.

[Emilie Kornheiser (Chair)]: And it's like a vengeful little corner of statute.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah. Yes. Right. It's definitely vengeance. Yeah,

[Mark Higley (Member)]: we try that.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Not one of our core values anymore. Perfect. I I promise there's not. But yeah, so is there any other questions on that piece besides the thrilling backstory? Great, awesome. The next one on my list, section two, is the property transfer tax, the higher rate for second homes. We're proposing some, or we've put forward some language that closes an identified loophole in that language. And the questions, this is where folks could So this is the higher rate for properties that are second homes in the eyes of the property transfer tax. So that's like, it's fit for your own habitation, but it's not rented out long term. It's not used as a principal residence. And, you know, there's a legal pathway now where someone could purchase a home, know, like set up an LLC and rent it to themselves and, you know, still meet that long term rental threshold? Or do a number of other arrangements that aren't arm's length, I don't know, rent it to your kid who's not there that often, or your nephew or something. I don't A number of arrangements that could be designed just for tax avoidance, which is not great. So this language proposes having the commissioner have discretion to review the facts of these situations and deny that lower rate if the commissioner determines that it's inappropriate, if it's not a bona fide landlord tenant relationship, for example, or that an entity only exists for tax avoidance. But really, the enforcement need of a proposal like this is going be through real estate attorneys, because these transactions are handled when you're doing your closing. It's one of like a million things. PTSD is a recent dish home buyer. A bunch of stuff that happens all at once. Your real estate attorney is there guiding you every step of the way. And those professionals take their professionalism very licensure seriously, they're great stewards of tax law. So I think clarifying that this loophole does not exist anymore is going to do a lot of the lift just right there. And we will certainly be giving these a lot of expert scrutiny if this change came to pass. But really, on the professionalism and wisdom of that community to make sure that these arrangements don't happen anymore, because they'll no longer be legal as they

[Emilie Kornheiser (Chair)]: are today. Thank you. And I found some links online of advice about the loophole, really,

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: right around the

[Emilie Kornheiser (Chair)]: same time you sent the language about the loophole. So I appreciate the process.

[Rebecca Holcombe (Member)]: Thank you.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Could you

[Rebecca Holcombe (Member)]: tell me those two rates, the property structure?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Oh, that is a really good question that would have been great to have prepared for you.

[Rebecca Holcombe (Member)]: I can find it.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: It's very findable on our website, so I'm gonna venture to multitask.

[Mark Higley (Member)]: Property transfer tax rate? Yeah. 3.4%. For a second home, 3.45%.

[Rebecca Holcombe (Member)]: 345%

[Mark Higley (Member)]: or 3.47 What's the point on two? I don't want to search our heads on two two.

[Rebecca Holcombe (Member)]: Holcombe, I'd love to take a slight segue. That's fine.

[Emilie Kornheiser (Chair)]: Let's not.

[Rebecca Holcombe (Member)]: Yes, just asking. Okay,

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: well, did pull this up in the non principal residence tax rate is 3.4%. And that becomes 3.62% when you include the clean water surcharge, which is also applied to those properties.

[Bridget Burkhardt (Clerk)]: Impressive that you had a

[Emilie Kornheiser (Chair)]: close number and check

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: this. Yeah.

[Rebecca Holcombe (Member)]: 3.62, you said, with the No,

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: no apologies at all. Oh, yeah, 3.6 2 with the clean water surcharge.

[Emilie Kornheiser (Chair)]: Okay, thank you. And there's a great fiscal note from Ted when that passed that we can find. I think that was two or three years ago. Questions on that section for people?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: All right. Well, sections three and four are in current use world. So I can ask the mic a bit on this one. Oh, this is a land use change tax, changing that.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Yeah, thank you. So I'll try to provide a quick overview of land use change tax to sort of set the table a little bit. So in 2015, the legislature made some pretty significant changes to the current use program, one of which is the land use change tax. So this is basically the, for lack of a better word, penalty or expense of removing the lien from the land. And that can either be voluntary or if there has been development on the land. But either way, basically when the land is no longer eligible for enrollment, either by choice or by development, then the Lister or assessor at the local level must establish the value of the withdrawn portion coming out. So if I have an entire parcel in the program, I'm taking the lien off the whole parcel, That's fine. That's the fair market value of the entire parcel. The listener doesn't need to do anything extra. But what the process is, if it's a portion of the parcel, then we receive either a request from the landowner or we make a director's determination. We send that valuation request to the lister and assessor. They're required to establish a value of that item as a standalone parcel. And then the tax is 10% of that valuation. So, and just again, some municipalities may not see a land use change tax request very often. It's not as high of a turn even remotely as current use applications or homestead declarations, right? This is only in the instance when a portion of the parcel is coming up the program. So they may not see some of these for years at a time. And so the vast majority of time that works out fine, but there have been a couple instances where we have not been successful in getting that valuation. And so then that sort of creates a delay in the landowner getting the lane moved and that can impact real estate transactions. It can impact enrollment. So what we do as a practice now in PVR is when there is a withdrawal that requires the evaluation, that valuation request is sent to the municipality. We also send a thirty day reminder and a sixty day reminder. And there are just a few instances every year where, and I don't think it's in any means negligence or with refusal to do so. There's just people who work part time, there's some turnover, they may not be anybody on the other end seeing that email, that a landowner is sort of asking us, asking us, asking us for what their liability is. And so this is just a way we, just to be clear, we don't really want to use this or do this having the tax department set the value, but it's a way to kind of release that logjam. If after sixty days, we still haven't been able to give that landowner an answer. We obviously will continue to do our level best to work with the municipality to get that value in. That's still the goal. The goal is definitely not for PPR to take on valuation on a regular basis, but this seems like one way we could address that when those instances come up. And another piece of this that we thought was really important while we were having this conversation, right now, the appeal window is only fourteen days. And so if you're a landowner, again, you may only do this once in your entire time of owning a parcel, you're submitting an appeal to the valuation. You're getting the land use change tax bill from the tax department. Then you say, Oh, I'm gonna submit my appeal to the tax department. So if they come in to us, the valuation appeals still need to go through the municipality. So now they've lost their window. They have an appeal to the right place. So we wanna make sure there's a little more time for us to be able to say, actually this appeal needs to go to the municipality first and then through us, Because what's, again, these are sort of intent versus impact, right? These things, if everything goes according to plan, it makes total sense. But the impact is that we then have to appeal. We have to docket that appeal and then basically say, sorry, it's too late. And I would say about 25% of the land use change tax related appeals that our current use section chief gets are in it. They're not meant to come here. They're land use change tax valuation items that should have gone to the municipality by the time, especially honestly, and like the mail fourteen days is a very short window even in normal times. So we modeled that we made a thirty day request because that's much more consistent with other parts of property values. So just again, hoping we don't have to do this very often, but the idea is basically if in the instance where we have been unsuccessful in getting that valuation for that land exchange checks from the municipality, again, despite we will definitely continue to try to work as much as we can. So we don't want to have to do this, but this was one sort of fail safe we wanted to ask for those situations where a landowner has not gotten their information. The last component of that is right now, whatever 50% of the land use change tax collected on a given parcel up to $2,000 is remitted to the municipality. So again, I wasn't here in 2015, but my understanding is that was sort of meant to be like, hey, we understand this is more work for you municipality. So you get some of this land exchange tax revenue back. So in the instance where, again, this is sort of a carrot and stick situation, we're hoping to not have to do this. But in the instance where we were unsuccessful in getting that valuation, then all of the land exchange tax collected would go to the Ed Fund and the general fund, which is where the balance of that goes now. Whatever we collect currently, the municipality gets 50% of the 2,000 and the rest goes to the general fund and the Ed Fund. So we would just put all of that into that same pot of money. Think those are the main components I wanted to make sure we covered.

[Bridget Burkhardt (Clerk)]: Representative Burkhardt? So I had a question about this the other day when it was presented. You might have already seen the question. The question was the situation where the municipality misses its thirty day window to do the initial evaluation. So it kind of lost out on sharing the land use change tax, its portion of it. But then if it's appealed and then PBR goes back and asks the municipality to actually go back and do some work because they have to go then do some work to respond to the appeal, but they've already kind of missed out on any revenue that they're basically keeping out of that land use change tax. And I just didn't know if there was going be incentive for them to do the work on the appeal if they had already lost out on the caret parts of the

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Well, I don't see us on day 31 saying, Too bad, so sound. Right now, we would continue to do We would do our phone calls. We would send thirty day and sixty day reminders. Like we don't really want to be in that position to do that. We wanna give the town ample time to do that work. And then if they don't, right now there's other places in statute where PVR sets the value, like for utility properties, there's subsidized housing exemptions. There's all these other places where the municipality is the first place of appeal, but they really haven't been, they don't really have any option to change that valuation. They could certainly, the BCA could certainly say, well, we don't agree with PVR at that point and change it if they want to, just like they could with other appeals. But the hope is always to do whatever we can to help the municipality get that valuation in. And then, yeah, at that point, if they get that appeal, they'll say, hey, this is just what PVR told us and up the chain it will go.

[Bridget Burkhardt (Clerk)]: Okay, so it'll basically get picked back to you if they appealed the decision that PBR had made in terms of budget.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Yeah, definitely would not want them to have to do additional work at

[Bridget Burkhardt (Clerk)]: the appeal level. It would have

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: been like, Well, this is

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: the value that has been now imposed on us by PBR, so that's what we had to go with.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, so it sounds awkward, but there is some precedent for this type of thing. Also, PVR's work in valuing these things would be using the town's land schedule, which land schedules are unique town by town, which is part of the reason why it was hard to come up with a statewide way to value these partial parcels that get withdrawn, which is something we were trying to tackle in the prior year. So hopefully, using the town's land schedule will also feel like it's kind of true there. I've come

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: in a few times to this building to see if we could change how land use change tax works, because it does require a lot of steps and a lot of sort of unique evaluations, and we just haven't been able to thread that needle. So moving on from that, this is like a simple thing that I think there's like a handful of taxpayers a year who would at least get that bill sooner from us for their land use change tax. But the goal would always be to work with the municipality to get the valuation. And there's thirty days, sixty days, like we would do our level best before we get to the point saying, well, I guess there's really nobody there, which is sometimes that happens. It's hard to find folks to do this more difficult. Hoping not to have to do this, but if we do once or twice a year, if it becomes a, I think another question you might have is, well, then why would the town maybe they just want to sort of not bother. I'm sorry, I'm not sure if that was attributed to you or not. If that starts to happen, then we would be coming in here to have a bigger conversation. This is step, PBR has like no capacity to do multiple individual things, but once in a while we can go to the town, get their land schedule. We can look at the valuation and we can come up with a percentage like, well, we can figure that out. We'd rather not have to do that.

[Mark Higley (Member)]: That's a timing question. So if client owner contacts you saying, I'm taking this part, this 10 acres out of the hundreds out of, current use, you then contact the municipality, say, hey, Joe's taken the land out of current use, and then they don't do anything for thirty days. Joe contacts you again and said, hey, the town hasn't done anything. So is that when your clock starts going as to when you need to do the evaluation?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Well, I'd like to continue our current practice, which is from the point of which the director asks the municipality for his evaluation, like they'll get an email and notification that says, hey, this land, this amount of acreage, this is coming out. The thirty day, they'd get another reminder from us, hey, this is still sitting in your queue. And then after the sixty days, or unless something to say, hey, look, I'm gonna have to change my real estate transactions because of us, then we'll do what we do now, which is we'll try to contact them and just help me. But they have the full thirty days from the point at which the director asks them to do the valuation, which is also not a lot of time, but considering like is something is happening to the end of the program or someone's on certain major lane, there is definitely like a sense of urgency there that we'd like to do. But yeah, don't want to, at thirty days, I think there's still a lot that still haven't been done, but within sixty days, a lot more can come in, especially because we're sending reminders and calling.

[Mark Higley (Member)]: So I think the typical time for an appraiser right now is about six weeks. Is that still the same?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Yeah, but for a parcel coming out of the current use program, this is not like a full valuation. This is like looking at your land schedule. Oh, it's 10.5 acres out of the 50. I mean, I'm not making light of the work, but it's not. It doesn't require them to have an assessor come in and there might be some instances where it's a complex property and that might be the case. But theoretically, they've already done that because when you enroll in the program, the local assessing official has already established the value of the enrolled piece and the excluded piece. So they have something there to go by. So hopefully it's not a big, I haven't heard that that component is the problem with the thirty days. It's more just honestly, it's hard to reach folks sometimes and they don't have to do this very often. So this is not like, oh, it's Monday. I better check and see if I have land, just change tax valuations to do this. It's very sporadic.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Sporadic?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Sporadic.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Sporadic. Thank you.

[Emilie Kornheiser (Chair)]: So the next section about the sheep was something that we had

[Rebecca Holcombe (Member)]: a remarkable number of hypothetical questions about.

[Emilie Kornheiser (Chair)]: We went kind of far

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: in traffic. Yes,

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: I was sitting at my desk going, oh, can't wait to get in there and try to clear something. So you want me to move on to? So current use. Okay. Let's keep going. Really, really narrow. I'll kick it off with my favorite story

[Emilie Kornheiser (Chair)]: about the vengeful of

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: the next food. This is just how I sat with this proposal. Was like, oh, this makes intuitive sense to me. That right now, this is about the qualifying income from grazing, sheep, cows, whatever. But today, haying is a big part of Vermont's agricultural landscape and current use program. So if you pay your property, sell it to your neighbor and drop it over their fence, you're set. But if you open your gates and say, Here's, let's sign this lease where you can come graze my property, that doesn't count. And that feels Direct

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: to consumer.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, sure. And the latter feels even more Vermont y if we're throwing our house around like that. But it feels like that's an inequity that's challenging. I just want to, from a fiscal perspective, we're not sitting on a pile of folks who are trying to become eligible for the program because they want to open their gates to their neighbors to come graze their land or something like that. But we're aware that that's a big part of agricultural activity that's happening on enrolled land right now that's probably meeting multiple eligibility thresholds. It isn't just about the neighbor's cows coming to graze. But it's just like it's a known practice and it feels weird that one way, like haying and selling works, but the other way of making your lands available for grazing doesn't.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: And I think it's really important to remember this. I've only known of one instance in my time that this has come up. That it's not common. Typically because, right, so there's lots of other ways that pasture that is being grazed on or hayed or cultivated can be enrolled in the program. Or there's lots of sort of agreements, right? Like maybe you're leasing to a qualified farmer and they are a qualified farmer and using that property, and you can be qualified under that. This is literally only in the instance where it's my five acres, I'm not a qualified farmer. I don't qualify that way, but I'm selling $2,000 or more. I'm literally getting $2,000 or more from whatever the use of my property is that is considered a farm crop. So this shouldn't prevent anybody from existing practices that are already happening. Like I said, I only know of one in which this came up. I've spent a lot of time worrying about this because anytime we talk about current use and like, you know, unintended consequences. So like this does kind of keep me up at night, but it is a very narrow example of where the parcel might not otherwise qualify. Most people who have a sort of like few parcels for grazing, it's like a tit for tat kind of thing. It's like, I'll let you do this and then I'll, I think I've told you guys, my mom would have her field hay that she'd the manure and that was for her garden. It was kind of like a helpful thing. But this is specifically for the income requirement for less than 25 acres only, being that $2,000 revenue threshold of grease rates on a per foot basis. And so I do think we've heard from our colleagues at Agency of Agriculture that this would be helpful. There's like sort of this narrow band that for all intents and purposes is doing remote program to do, but doesn't currently qualify under 25 acres and currently not earning $2,000 from grazing.

[Emilie Kornheiser (Chair)]: We want to better understand how many more properties might qualify or sort of the fiscal impact of this. Not today, but before we finish. Should we have ags come in? Do you want to come back and talk about that? Should we send JFO on that?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Our internal evaluation is that we're not expecting a fiscal impact. If we had been denying enrollment applications on this, we would know if there was some Wellspring we were tapping. It's come up more in a compliance space, questions that flag areas. Great, thanks.

[Emilie Kornheiser (Chair)]: I'm not sure if we were running behind or if this is taking I don't really know what happens to people wise. Does it make more sense for us to reschedule time with Rebecca and Adam and finish this now? It seems like we probably have another forty five minutes left of this memo. No?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, I mean, don't think we're gonna wrap up in five if we wanna go through this stuff. I'll be in a round. Yeah.

[Bridget Burkhardt (Clerk)]: I'm open to either of the next two being rescheduled.

[Emilie Kornheiser (Chair)]: Adam, do you mind if I reschedule you you don't have to wait on that really cozy bench for a while? Okay. Cool. Thanks.

[Rebecca Holcombe (Member)]: See you. Nice

[Emilie Kornheiser (Chair)]: you. To Happy New Year.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Great. Do folks have more questions for Jill or I on the grazing?

[Emilie Kornheiser (Chair)]: Everyone's okay? Was it just sort of a day where we got a little silly about the types of animals and that's why we spent so much time on Yes. The

[Rebecca Holcombe (Member)]: Chickens. I think she messaged her there, but I don't

[Emilie Kornheiser (Chair)]: think they're relevant to this stuff. Okay. Great. Okay.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: The next section, section six, was the municipal grant list stabilization program. This was a request and I'm actually not sure if I tracked questions on this one, but this was technical request to change the statutory calculation. So we're using the prior year's municipal rate rather than the current year's municipal rate. A couple of reasons for this is that that's the methodology for pilot payments to municipalities. So it allows that work to be done in the same way at the tax department, same human, same process. That'd be great. Also using the current year rates, and Jill, actually, you might be better prepared to speak to this than I am, so feel free to step in. But it requires a lot of extra vetting because the process for doing these stabilization payments happens kind of before municipal rates would need to be vetted for later in the year department processes. And this year it was like 30 individual town rates that our team member had to go through and have some back and forth with the municipalities. There's often, and this is where my depth gets a little light, there's just some inaccuracies of how those municipal rates get transferred to the department, there's always some back and forth with them. It's like their local agreement rates, municipal rates are our own complicated world that luckily I don't need to know much about. But anyways, so I think the biggest rationale for this ask is that it's just like how pilot payments work and it's very similar calculation.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: It feels like it was an inadvertent. It wasn't meant to be different.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, should have thought about that last year. That's why we

[Emilie Kornheiser (Chair)]: have this annual bill, since we didn't think about last year. Or in 1983, a good Any questions? Okay. All

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: right, so section seven. So you all might remember two years ago, legislature passed the creation of a new brand list category for communications property. So that requires a pretty big change to

[Emilie Kornheiser (Chair)]: We actually took testimony about this very recently because there is that little bit

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: in budget adjustment about it. Right. We're like so you're

[Emilie Kornheiser (Chair)]: caught up. Than you might expect. Yeah.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: So we did ask for an extension last year and got it. Thank you. Because it's not simply naming something that's called one thing and

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: naming

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: another. It's changing treatment of telecommunications property, basically creating a new category and the definition of that. And then it does have impacts on moving some things that might've been personal property at the municipal level onto the grant list. So we are in the process of implementing that as we speak. That is in effect for this coming tax year. This language is simply taken from another part of statute at a $100. I looked at it was first done in 1965. So I realized that that seems sort of trivial, but the idea is simply that we would have the same sort of leverage for us and municipalities to get the information that we need in time to do the valuations. This was also suggested by our contractor because they have a similar construct in Massachusetts, but this was language that was taken and cleaned up from what used to be, hey, this was the penalty if you didn't provide this inventory to municipalities. Now it's, hey, this is the penalty if you don't provide it to PVR. I don't know that it's actually ever been put into place, but we do wanna make sure that we are able to collect the inventory. And there is a component in here that if there's sort of willful uncooperation of providing those inventories, that the appeal rights are denied for that valuation. If you did not send an inventory, you hopefully did not participate providing inventory, therefore PVR kind of had no choice but to come up with something based on the information you could glean, then you've lost your appeal right. So it's very much meant to be like, hey, let's get this to us so that we can do our best to provide you a fair valuation.

[Emilie Kornheiser (Chair)]: I know that you all go out of your way to have positive relationships with anyone that you're trying to collect information from. You just described sending multiples in the opposite multiple in another scenario. And am wondering if a 100 fine is a meaningful enough fine to make it any difference in any of us behavior whatsoever. Especially, I imagine at the municipal level, it's smaller entities. And if you're collecting all of the information for the whole state from one entity, that might be a larger scale situation. I don't know. I don't have a suggestion of a higher fine. I just and maybe in a couple you could even just say, in a couple years, this fine clearly isn't doing what it needs to do. Maybe we should raise it. I don't know. I just I can't imagine $100 is No, agree. Okay.

[Rebecca Holcombe (Member)]: That's great.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: It is taken from another section. I think it's a token. It's just sort of meant to sort of hold that place. Think the much larger sort of, you know- The appeal rights. Influences the appeal rights.

[Unknown Member]: That's what she

[Rebecca Holcombe (Member)]: was saying.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Go ahead.

[Rebecca Holcombe (Member)]: Yeah. I'm sure, thank you. What's that inventory deadline?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: What's the deadline? '31, they need to get them back to PPR. We haven't sent them the form yet. We need to do that by February 1. So that's what our crunch is right now. So we get them the form by February 1. They provide them back to us March 31, and then we have to give the values to the towns of May 1. So this will be the first year that we're implementing this. Oh, next is the reappraisal ceiling. Did anyone have any other?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Are you so excited about that? This

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: one doesn't give me edge to the way that current use and communications property So this was actually has been come up several times over the last few years with really smart people in the department like Jake Feldman and Chloe Wexler. Right now, the statute requires us to do a different calculation for the municipality in the year in which a reappraisal is completed. That is a different way of calculating the CLA in other years, which makes sense. But what it does, what the calculation does right now is creates what we call a snapback. So in the year of the reappraisal, we create, we generate this reappraisal CLA following that sort of statutory guideline. And it looks really good. It's like 01/2010 or 01/2020 or so on. But then the next year you're going back to how the CLA is calculated normally. And it might be '95 or it might be '99 or it might be '91. And so it's sort of a strange one time calculation that creates a false sense of what the CLA is doing for that one year. And then it creates quite the snapback following year because then you're going back to the normal. There are also lots of ways the CLA is used that may not necessarily be obvious to everyone. It's not just for the tax rate, right? So we use it for current use valuation and the year in which a reappraisal is happening, the current use values we use as one, we use the reappraisal CLA. For utility valuation, we apply the CLA to those values directly. There's lots of other things we use the CLA for. And so right now we sort of make this sort of falsely inflated value for one year, plug that in all the different places, including on the tax rate, which looks really great, the year of the reappraisal, but then the very next year, you're back into the normal treatment. So it would give the municipalities very clear understanding what their CLA is, beginning of the year in which the reappraisal is finalized theoretically. Right now, we can't get them that until August usually.

[Emilie Kornheiser (Chair)]: That's one of my favorite parts of this, because I know that the reappraisal process in a municipality is such an incredibly stressful thing to navigate with a community. And this adds at least one piece of stability for the municipality as they're navigating that.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: So that's huge because right now, yeah, there's this grievances are happening, tax bills are going out and somewhere in there or right after that, you get this interim reappraisal CLA for the next six months for that year. And then we do the equalization study and we're back to doing a CLA the normal way. So it would provide that information a lot sooner, provide a little more stability for that year. Think, sorry, there's anything else that I might've missed, but So if it comes from Jake Feldman and Chloe Wexar, I get excited about it because I have complete faith in their judgment. And this is something we've talked about for years that we really wanted to see if

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: this is something we could do. Yeah, and I guess just like a nuance I'll add is that like it has been an active conversation at the department, but we didn't actually put forward proactively to do this year. And I think the part reason was because we were thinking about pitching it in the reappraisal report, this but actually came out a little bit ahead of our report deadline. We're like, okay, they're exploring this already. But part of the discussion is how this transition becomes a little easier once we're kind of in flow with our six year cycle, because there'll be a little more stability in general. There will be folks impacted in various ways from keeping to 100% CLA in year in some instances where someone's property value, let's say the town hasn't reappraised in twenty years and someone's property value increases like 300% or something, that's way different than the town's average. The current system could give them a little cushion. Not that that's a reason to keep it, but there are going to be impacts and those impacts are lessened the closer we get to a steady cycle of reappraisal. So I think that was part of the reason why we were like, we should definitely do this sometime soon.

[Emilie Kornheiser (Chair)]: And I'd had at least a dozen passing conversations about it, and I

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: was like, why are we

[Rebecca Holcombe (Member)]: not just putting this out? I was like, enough.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, so yeah, I'm interested if you guys hear your other reactions to this idea, but certainly it seems rational and logical.

[Unknown Member]: It just getting the calendar straight? Is that a tax year thing, a fiscal year thing?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Are you referring to the effective date? So maybe this is more of a Jill question, but my understanding is that something that we will recalculate the CLAs for all these towns in January like we do the other towns, but then we'll say, Oh, don't use some free reappraisal town. And we actually do that work in July, August. We Right. Have

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: to have their new reappraised brand list in order to calculate the reappraisal CLA. I'm not

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: sure if this might be a question for the ways, too, if an effective date on passage, how that would impact that process, like that's coming up this July, August. If that's the effective date, that means that those towns immediately get it on 100% CLA.

[Emilie Kornheiser (Chair)]: I think that was the goal.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: And Barry's in the middle of a participant now, so I imagine our clerk might have a of questions. Yeah. So your fifth grade is crazy.

[Rebecca Holcombe (Member)]: Yeah, because we've already, we just reappraised five students, we've already got them in CLA,

[Mark Higley (Member)]: which is 103%.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Okay. So,

[Rebecca Holcombe (Member)]: what you're saying is it would take effect this year to just go to 100% in the coming tax year.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Right. For towns that are reappraising, I guess, 2026. The 2026 reappraisal, I mean, that would be the absolute soonest you could do it. It would be right now.

[Emilie Kornheiser (Chair)]: We're not moving this bill until crossover, so you can think You're both making lots of thinking faces. Yeah, thinking lives.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: But the intent is to have a account that's reappraising right now having 100% CLA in FY27. Check Yeah, the effective date for that. I think you do the effective percent sign.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Could a school board, like we just passed our arts and health care last night, us awards to send out there. Congrats. If we were a town that was reappraising, we wouldn't know what to put in there

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: to different owners for So an active

[Rebecca Holcombe (Member)]: what you would tell any town that is either currently reappraising or just completed, are you telling them to view it's 100?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: No,

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: no, they kind of have to have a placeholder. See them our official one in the summer. We do calculate, we still calculate to your point that we do that. We just finished the equalization study. We did it for everybody across the board. So there is like a CLA that that town has, but for their tax bills that go out in July, they should have a different reappraisal CLA to use.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Any other questions about this? Okay. The next sections were the Health IT Fund Sunset. If Adam is still here, Commissioner Gresham is still here, he might point out that this is in the gov's recommended budget as well as a one year extension. Think We

[Emilie Kornheiser (Chair)]: were talking about five because we're higher about it every second year.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: I'm not aware that there would be big resistance to that from the administration, but

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: I will certainly follow-up and apologize that I didn't do that ahead of this testimony.

[Rebecca Holcombe (Member)]: Five was

[Emilie Kornheiser (Chair)]: fairly arbitrary. It was just more than two. Okay. Less than 10.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: So is the committee bill drafted at five right now?

[Emilie Kornheiser (Chair)]: No, no. Committee bill drafted at two

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: right now. Two, okay. Great. Awesome. And then the bill gets into some new to me things. I admittedly just started learning about the five twenty nine plan proposal. And this is

[Emilie Kornheiser (Chair)]: This was a suggestion that I got from another member who had it flagged by a constituent that essentially they had a loved one with a five twenty nine plan that was 30 and had their entire education paid for by their employer or something like that. And so had no need for the five twenty nine spending, though they had gotten as much education as they could possibly want. And they were like, What are we supposed to Can we roll this in?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: I know you can roll it over to another scholar. And

[Emilie Kornheiser (Chair)]: then it's available at the federal level now, and so wanted to match up. So if you all want to, that was the thinking. So if you want to, you're welcome to speak to it now or wait.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, well, think I would love to dig in further, but my understanding is that this would be another instance where we're not tracking federal treatment exactly, and that, does that set your grade too? Just the last thing you said, was like, oh, is it tied up

[Emilie Kornheiser (Chair)]: to the federal federal change? There is a federal change, but it's not definitionally tied to the Is it definitionally tied to the federal change?

[Unknown Member]: This is something that's allowed at the federal level currently. Vermont does not allow it because the way our five twenty nine credit is constructed is not a perfect problem. So this language does tie it to what's allowable. Essentially, it's language that says,

[Unknown Member]: if you

[Unknown Member]: did this rollover properly at the federal level, firm law will allow these use of the funds without emptying.

[Emilie Kornheiser (Chair)]: And I want to be clear, I'm not wedded to this either. It was an idea that I were putting into the mix. And we need to take more testimony on, too.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah. Well,

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: ask to go forth and think and

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: come back on that testimony day on this one. Yeah, I am interested to learn more. Thanks. Thanks. Sorry for not being ready on that one. The next sections were the, there's some cleanup that I think JFO and tax stock have been working on, on statewide adjustment property tax credit, technical items, no concerns there. It's definitely deeper in the weeds than my brain likes to venture and really trust the thinking there. I also saw new sections on updating inflators, outdated New England Economic Project Index with NEPA. No concerns there. Understanding is that's current practice.

[Rebecca Holcombe (Member)]: You can talk to me about that one in committee, because I'd be curious to know why you make that.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Oh, that wasn't actually a tax department recommendation. That is something I found in this bill.

[Emilie Kornheiser (Chair)]: Julia can talk more about it, but essentially, NEEP doesn't exist anymore, they've been using NEPA for a while, and just the statute didn't bring much practice. Once we're waiting on that inflator bill, wet inflator report, and if we decide on a different inflator in that report, we'll have time to change it in miscellaneous tax. But in the meantime, NEET doesn't exist. Oh, okay. Cool. I'm

[Rebecca Holcombe (Member)]: asking is this when we're making the decision about NEEPO, which many people think is too broad. All that question specific. Gotcha. This

[Emilie Kornheiser (Chair)]: is represent in this exact moment in committee? He answered my question. Okay, great. And if you all wind up with an opinion about insider choices, feel free to

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, I'm part of that report as well. That sounds really interesting. Section 17, effective dates. I actually did capture a question on that, which I'm not sure if we hit during the grazing rights section, but I think there was a question of why September 2 was recommended as an effective date. Did you hit that?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: I didn't. No, okay. So September 1 is the deadline for new enrollments each So obviously we're already in the window of which people are applying for the following current use year. So it wouldn't really be fair to implement this mid application window. Therefore, if we make it effective September 2 onward, we're starting a new application window with this new opportunity. And

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: if there's any other effective date questions, I can hit those now, too. And I tracked the 100% CLA effective date, just clarifying that that would do what we offended to. I just thought if it's so if you're

[Unknown Member]: to read back about it, going on the change it to the Municipal Brandless Stabilization Program to the prior year tax rate, is that basically statute of just catching up with what you're doing now, or is there going be a retroactive effective date for that, do we just need

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: to put any more thought to that? I'm not sure of the perspective.

[Rebecca Holcombe (Member)]: I think we've set it

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: on passage. And impact is going to be that for towns that are already getting these payments, like two payments consecutively will be based on the same municipal tax rate. Because this year we did do it using the current year. Proof of concept wasn't a great process

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: and it

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: was awesome, took a little extra lift, but next year we'll be using the same municipal rates. Yeah, right, because that will be the priority. The minimus physical impact. Favorite word to share.

[Emilie Kornheiser (Chair)]: Yeah. More? Oh. Oh, okay. There's a three that are not in the bill yet that

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: I Oh, sorry. I'm so sorry. I got to the end of my page. This is why I should be driving with everyone watching. Catch me. Yeah, so I also just wanted to talk about a few provisions that we're interested in pursuing this year that may hopefully make it into this bill when the timing is right, and happy to come back and talk more on any of these after a little preview now. One of them is the state tax filing threshold. This, I believe, was an oversight when we made a change to a state tax law in prior years. But right now, threshold to pay a state tax is $5,000,000 your status would be that big, but anyone, according to statute, with more than $2,700,000,000 in a state that has to file a return, even though there's no liability, no payment. So there's this group of folks who, following the letter of the law, have to file with us. I've never done an estate tax return, I bet it's cumbersome, But for no reason, we're not gathering the data. We're not doing anything cool with it. We'd love for folks just to file if they need to pay.

[Emilie Kornheiser (Chair)]: And this was not included yet because we're planning to take a lot more testimony on the estate tax, because it's kind of a hot topic this year, both in the governor's recommended budget. Reporters have been asking lots of questions about it, because there was such a big spike this last year. And members, everyone. It's interesting, because there's extra money in it. So that's why it's not in there yet.

[Rebecca Holcombe (Member)]: Has anyone ever looked at if your total estate is worth more than $5,000,000 but you've been receiving a property tax exemption for low income, being able to recapture some of that from the value of your estate? I'm not sure

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: about that. That's an interesting question.

[Emilie Kornheiser (Chair)]: I feel like we started a conversation near there with Jake two years ago, but I don't remember where it went. I think maybe yeah, it would be interesting to dig back into that. Representative Russell?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, wonder if representative Holcombe could give us an example or be more specific on what you were referring to, which I almost understood, but not quite.

[Rebecca Holcombe (Member)]: I would say that ten years ago, anonymized the person who discussed it, there was a case where somebody who was quite wealthy, had a very large estate and piece of land, but a very low income, was receiving the income sensitivity credit for their When they passed away, the value of that estate was taken to the children who happened to live in another state. But we had there was no clawback mechanism for the fact that

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Right. They can We captured it. We didn't recapture it. Thank you. That's a good question. Thanks.

[Rebecca Holcombe (Member)]: And maybe it's a route, and you would have to date it as well.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, haven't looked into

[Emilie Kornheiser (Chair)]: that in my time.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: There's another technical provision that we would love to put forward the risk of talking more about Chip, which is kind of out of wheelhouse mostly. But the statute right now is missing language that clarifies that CHIP projects are treated the same way as other TIF projects for the purposes of our equalization study. And this becomes meaningful for a few instances for a few towns whose CLA gets a little impacted by having a, the before times having a TIP district, now potentially having these TIP projects as well. My understanding is like a mini TIP, project by project, TIP.

[Emilie Kornheiser (Chair)]: How is it treated under, how are TIP districts treated under current law?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: That's a really good question. One of my colleagues know that And

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: I'm feeling I didn't prepare this particular question. But basically, the concept of the TIP is there's an original taxable value. And so we actually sort of pull them out during the equalization study and do slightly different calculations so that it's genuinely providing an accurate like, we use their taxable value for the purposes of this study. The original taxable value.

[Emilie Kornheiser (Chair)]: And you don't bring it to what market value would look like?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: No, I think that's what we do. We have to separate the tip OTB. We have to set that aside, and then we have to pull the tip in to treat it under its current value, maybe applying the CLA. Should

[Emilie Kornheiser (Chair)]: Its current hypothetical value if it wasn't a TIF?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Yeah, because we do still have to track that.

[Rebecca Holcombe (Member)]: Yeah, no, I'm glad

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: you track it. I'm just trying to understand what you do. The increment value. Sorry, I did not prepare for that one.

[Emilie Kornheiser (Chair)]: That's okay. We're gonna probably have to talk about that.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: It is very technical. It is really just meant to treat them the same as a TIFF. I don't think we anticipated it until this equivocation study, and we're like, oh, we have more of these.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, I hoping that my wisdom of the fall when I wrote memos on these policies would be more specific, but it says, the equalization study statute is specific about TIF districts, but says nothing about TIF projects. Doesn't say what the specifics are. It says nothing about CHIP projects with a TIF plan. So it leaves us to an interpretation of how to treat them, which is not ideal.

[Emilie Kornheiser (Chair)]: And if we wanted to add the CHIPs to the TIF report that

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: we receive at the emergency board twice a

[Emilie Kornheiser (Chair)]: year, would you need a statutory change for that? I think

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: that would be good to clarify with the statutory change.

[Rebecca Holcombe (Member)]: Will Jake be mad at us? I don't think Jake will be mad. Will Jake be mad? No. I don't think Jake will be mad.

[Emilie Kornheiser (Chair)]: So let's loop back to that one when we're all better prepared for it. So the follow-up there is, the heck do you do with therapy? I'll just flag, there are a lot of different folks from very different perspectives throughout the legislature that want to do different things to change the CHIP statute. And I want us to be mindful of Pandora's box by touching said CHIP statute.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: If it helps, it wouldn't actually be changing the CHIP statute. It'd be changing our equalization study instructions. Will the

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: word shift be there? We should

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: probably acknowledge the existence. If

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: it exists, I think that will have to be part of the solution. Spell it out. Yeah.

[Mark Higley (Member)]: The

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: last one is something that I assume we could also talk about when we're back on reappraisal.

[Emilie Kornheiser (Chair)]: That's why I didn't include it. It was just because of that. Yeah, because I figured we would be spending much time. Do you want

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: to forego a preview or? Whatever you want. It's fine. Do you want to do it?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: So there's a lot of statutory, a good chunk of statutory language that predated Act 16, Act 68 about the PBR director being responsible for delinquent tax collectors. So in practice that hasn't happened. There's not really, we don't oversee municipal officials to that degree. Puts some burden on them to send us all their delinquent tax sale information, which we don't have anything we can do with that. And we don't intervene with municipal property tax revenue collection. So it's sort of obnoxious, it's sitting there, it's sort of obsolete, but it seemed like it would be good to just clear that up. Nothing else, they don't feel like they have to keep sending things that they know and I know are informational only. It

[Mark Higley (Member)]: is kind of interesting that because the education property tax is also collected at the municipal level, there is not a consistent policy of how towns deal with delinquent property taxes. Right? It's an individual policy of each municipality as to what to do with property taxes that are in arrears?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: I don't know. There's penalties. There is a Board of Abatement that they can abate if the municipality wants to take that on. Added a lot more about what

[Emilie Kornheiser (Chair)]: We added a lot more guidance two years ago? In last year. In last year? But one thing that I'm curious about is in order to do that statutory change, we were working with a survey that an intern at Legal Aid did because we had very little data on what different communities were doing about property. And it sounds like you have the beginnings of a database inside your email, Jill. No paper. Paper. Actual pieces of paper that people mail to you?

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: They're required, right now, they're required to formally send any delinquent tax sale information. They have to announce when the hearing is going to be the individual And it's all on paper.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: And you don't have authority to do anything in this process. Right. Which

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: is fine, but it also feels like one less step for those individuals. And also, the way I read it, I wouldn't have any

[Emilie Kornheiser (Chair)]: Like save them in a file? That's so sorry.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Save them for a little while and then they go into our shred bin because they may have the public information, but I just don't know they're

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: on the side of caution.

[Mark Higley (Member)]: Okay, cool. But if I remember correctly, last year we passed the minimum amount being $1,500 under which, if it was less than that, it couldn't be brought to tax sale. But it was nothing about it has to be brought to tax sale, and that's a municipality decision.

[Emilie Kornheiser (Chair)]: Yes.

[Mark Higley (Member)]: Even though the funds may be, well the town still has to remit it to the state even though it may not be collecting it, never mind.

[Emilie Kornheiser (Chair)]: Yeah, that's the piece that harmonizes it all. Yes. Right.

[Rebecca Holcombe (Member)]: Anyone have any questions? Are these folks coming back to us closer to the time that we approved this bill? My question is regarding section 12. I didn't really understand that they were talking about property tax credit cleanup. So either if we have time, if we could just briefly go over that section again. Yeah, let's get up. I can wait if we'd rather. Nope.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Let's do it now.

[Emilie Kornheiser (Chair)]: Great. Well, bye. And so before you answer that, so what I was imagining for process for this is we're going keep on adding sections probably throughout the, It's the miscellaneous tax bill, so we'll maybe add different sections, different paragraphs as we move into crossover. But if anyone has a section that's already in here that you want more testimony on, please say so, Because we will, at some point, go through and really get to a review and then a straw poll. So I'm not assuming that sections need more testimony unless someone tells me or I say it aloud. So this is a great time to get those questions answered.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah. So it's the second greatest time to if Jake Feldman was sitting here, or your own Julia, Victor, I think this wasn't language in Section 12 that we put forward, but it is language that we've been It is a project we've been working on, I think, jointly with the joint

[Emilie Kornheiser (Chair)]: fiscal office. The math didn't quite map the way they had been mapping it. Yes, I'll get Julia to explain it again.

[Rebecca Holcombe (Member)]: That's why it was vague.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: You're right, you're right. Thank you. So

[Emilie Kornheiser (Chair)]: I will flag that to Julia. Explain it again. Anyone else have any questions?

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: I'm actually at the end of the document.

[Emilie Kornheiser (Chair)]: I think you're at the end of the document now. You're going to come back with answers to a few questions,

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: and we'll

[Emilie Kornheiser (Chair)]: see you soon.

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: I can pre file these in writing with the committee if that's That would be a great step, and then you can decide if you wanna have more conversations about them. Thank you. That's one for you again.

[Emilie Kornheiser (Chair)]: Oh yeah,

[Unknown Member]: just another thing to note, not like a full,

[Rebecca Holcombe (Member)]: I'm not asking you to do

[Unknown Member]: a ton of work for a report on the Municipal Grandland Stabilization Program, but just an update on how many people are using it. Yeah,

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: come back.

[Jill Remick (Director of Property Valuation & Review, Vermont Department of Taxes)]: Yeah, we didn't put that in. I Okay. Sure. Great. Thanks a lot.

[Emilie Kornheiser (Chair)]: Thank you. We're back here at 01:15, everyone.

[Rebecca Holcombe (Member)]: Thank you. Thank you. And are

[Rebecca Samaroff (Deputy Commissioner, Vermont Department of Taxes)]: you