Vermont Legislature SmartTranscripts:

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And here we are on ways and means, still that committee, February 12. It is 01:20. And we are continuing our work on the governor's proposed budget, which will eventually turn

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: into a

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: letter that we will send to the tax and move to the Appropriations Committee. And we're going to finish our testimony from Andrew Stein, the chief operating officer at the Department of Taxes. We're And gonna go through the beginnings of a memo that Chris Rutland has created for us. And then at 02:30, we are switching gears and doing bill introduction on H-four 18. That's the plan for the day. Also, fair warning, we are going to schedule a little bit of committee tomorrow at 01:00. By fair warning, I mean not that much fair warning. It's only twenty four hours warning. Because we just have a lot of bills piling up that need to move along with their lives so as not to not create for the appropriations committee. So with that, Andrew, would you like to sit in that lovely chair and take us through the rest of your budget presentation?

[Rep. James Masland (Member, House Ways and Means)]: Thank you all.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: We We're going to I I will let you go through the presentation and just ask clarifying questions for a while.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Sure, yeah. And if there are any particular topics you want me to?

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: We'll probably want to spend more time on your movement around the pilot funds. But it's all of interest.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Happy to. Right. Andrew Stein, Chief Operating Officer of Taxes, thanks for having me back. Is it okay to share my screen now?

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Yes, please. Thanks. Excellent. Okay,

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: so last time we lapped up here. And I sent along an overview of child care contribution revenues by quarter. Did you all get that? Great. One question, Representative Holcombe, you had asked was about health insurance and the way that that is budgeted. I can only answer some of this because a lot of this is handled by DHR and finance and management. But essentially, EHR has an actuary that projects next year's rates based on a range of information. And based on those projections and based on our employees' existing coverage And for vacant positions, there is now a new SVOD that is in the new budgeting system. The state is a new budgeting system. Bless you. And so as part of this new budgeting system, all of the insured values for our employees and insured values for vacant positions are pre populated. So that's all in there. That's aligned. So when I get the budget for salaries and benefits, that's all kind of baked in there already. So that all comes from the HR and finance. That's just high level to answer your question. And I'm not certain. I'd have to look, I'm not certain off the top of my head what the difference is between this year's premiums and the projected premiums, but that is something that And frankly, the joint fiscal office should have access to that information. So if you want to know that, So they can dig into it. They probably haven't already. All right, so we'll get back to the presentation. Actually, I think we ended on this slide, our employee engagement metrics, spotlight on success. And then have, you know, these are some key performance metrics that we rely on at the department and have been part of the department's performance management budget for like ten years now. And so, this is personal income tax administration overview of performance, three key performance indicators here. Erroneous refunds prevented. That's not all fraud. Frankly, fraud is a small slice of this. But this is really good work that department, that our tax examiners and tax analysts do. Most people are trying to follow the law and they make mistakes. And if they weren't flagged and if our team didn't work with them to help taxpayers mend their returns, it would cost the state an additional $11,800,000 last year. So that's something that we like to track. Timely filed refunds issued within forty five days of the due date, so that's typically June, that is our goal. That's what we try to hit. We've hit it the past four years. I remember years ago, when I was an analyst and our former commissioner was the V Tax director, we got pulled into a meeting with the deputy commissioner and some other directors about personal income tax refunds. And at the time, that number was in the seventeenth percentile. And so we looked at how can we improve this. We created this we have this weekly report, this weekly huddle, so we can look at things together. We have our taxpayer services division, our finance division is a cross departmental group. And every year, we work to refine things, streamline things so that we can get money back quicker than ever before. And in the past ten years, there's been a massive expansion of tax credits, earned income tax credit, child tax credit. Really, list goes on. Even just last year, there was quite a robust expansion. And so our work in this space is more important than ever. Like 75% of Vermonters who file a tax return as part of personal income taxes get a refund. So we take this very seriously. It gets money back in people's pockets quicker. And so refunds issued within thirty days of filing, that actually dropped off a little bit. Not thrilled about that, but we do generally understand why that happened last year. There were some delays related to withholding data, which delayed W-two processing. And we do all sorts of validations with W-2s. We had a vendor approval issue early in the season from one large vendor who didn't meet all the necessary criteria. When I talk about vendors, I'm talking about the Intuit's, the H and R Blocks, the Thomson Reuters, the tax preparer software companies. We do a lot of, there's a lot of back and forth to make sure that their software is accurately calculating Vermont's current information and works with our system. So I can say that all of them are approved for the personal income tax season so far, except for there might be one. There's one that typically gets approved way later, but all the big ones are approved for us this year. So that's positive. And yeah, so it was a little bit of a drop off. I'd like to see us get back to where we were last year. Property tax credit. This is a big one. Property tax adjustments granted. Frankly, we use this as part of our performance management budget, so it's here. I don't really view this. This isn't an indication of our department's performance, but it is interesting to see year over year what happens here. And last year, the threshold was down significantly in terms of who received the property tax credit and who didn't. What that really means is the intersection of who would benefit from their taxes being calculated based on the income sensitivity calculation, who would benefit was down past year. So it was more beneficial for people to pay property taxes than based on income sensitivity. So that's what that's due to. And I would defer to somebody like Jake Feldman to explain this in much greater detail.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: We actually just talked about with Julia yesterday.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Julia, exactly. You have some great analysts at JFO who can explain this much better than me at this point. In terms of erroneous credits prevented, this is similar to what we were just talking about before. Our system identifies issues, and then we have analysts and examiners go in and to resolve them. So that's helpful in terms of education funding and general fund dollars. That's significant. And then claims that require manual review, that's an indication to us as to how clear are our forms and how tuned are our systems, the less returns that require manual review, the better from our perspective, and we're at about even 17%. Rent or credit, big change in terms of credits granted. Again, I don't really view this first one as a benchmark of our department's performance. It could be if we were really behind at issuing things, but we haven't been. I do look at credits issued within sixty days of filing as a key performance metric here. Again, we have the Abramowitz credits prevented, but credits issued within sixty days of filing. Calendar year 'twenty four was big, 96%. And then 2018, that number was down around 35%. So we made steady gains to get there. So we backtracked last year, and there were a couple of reasons, but one of the main reasons why we backtracked last year was because we hit the appropriation. And so when we hit the appropriation, we needed to work with finance and management. We were able to resolve the issues within a week or so, but moving outside of that sixty day window Yeah, it wasn't that. So we dropped out there. Current use, big up in terms of applications processed by April 15, from 17% to 75%. It's huge. There's a couple of things. Calendar year 'twenty four was down particularly low. It would have been closer, I believe it would have been in the 50 percentile, but we had to delay a couple of weeks because we were in the middle of a system transition. So we couldn't have those applications processed by April 15. If we would have used May 1 as the benchmark, we would probably be looking at a difference of 50 some percent to upper 70s or lower 80% CY24 to 25. But a big change really is we have a new head of current use, Michael Ramsey. He was formerly the town manager of Killington, before that of Proctor. He's a great get for our department, wonderful guy, wonderful supervisor. And we also have a really dedicated, talented current use team that wanted to improve in this area. They all worked together to make some major gains in the past year. So I view that as major improvement year over year. We also, again, we shifted our current use application system from an older legacy system to, in December, the VTAC system. So hoping to make headway there in the next few years. The

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: average days to process applications, those are first time applications?

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I believe those are first time applications, yeah. I'd have to look. That's a very good question. I believe it is. I believe it's, I believe those are only first time applications. Can get back to you. What was

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: the year that TurboTax had a problem with Vermont returns? Was that like five or six years ago or is

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: that two years ago? No, I would say there have been a number of issues over the years, but they are very responsive and typically great to work with to resolve those issues. Nobody gets it perfect. Are you talking about the big, there was a big IN155 a few minutes ago. That was like back in 2017 or 2018. Okay, all right.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: I remember there was a big, I can't remember if it was, is that household income?

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: That was the I'm 155 was, I believe, for when there were some changes in apportionment. I'd have to look at that again. Yeah, that was back from when I was in Annapolis, but there was a big issue back then. But there are, frankly, I'll just speak from personal experience, not as the COO of tax. My partner and I rely on Intuit for our taxes. And a couple of years out of the past five or six years, there have been some issues as a result of some calculation problems in that software. Not huge issues, just we're still using it for us, but yeah. So not gonna advocate or just speaking from personal experience. So I'll keep going. So this, I'm not going go over this here, but what we did is we put together slides that provide status updates as to where we were with regard to legislative mandates. This is just from last year. Every year, we have a big, what we call the legislative build. You all pass policy, and you all pass legislation, and we have to build it. And so there's a lot, but really there's a lot every year. And so just for the budget presentation to comply with the new requests from the appropriations committees, we just took a snapshot based on one year. That's what we're planning to do moving forward. But you can go and take a look at all legislation that we're required to implement year over year. We provide that every single year for frankly, we rely on the Department's top web page regularly.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: The last years, I've really appreciated what a great partner TACS has been in suggesting legislation and really collaboratively moving those things forward so that they're meeting your administrative improvement goals and your administrative capacity limits.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Thank you. Yeah. So vacancy rate. Frankly, this is higher than I'd like to see. A five year narrative of our vacancy rate, from my perspective, would be when I came in to this role in early twenty twenty one, our vacancy rate was rising. There was a lot of attrition then, a lot of turnover, That was an interesting time for everybody. And there was a lot more turnover than I can think of at any other point in the department's recent history. And so later that year, we put together a recruitment team. At the time, our vacancy rate went up to like 25%. We were like, we really need to address this. And so we had a recruitment team and Craig was already very focused on employee engagement. The entire leadership team was very focused on employee engagement. And so we were able to get this vacancy rate down to between 56.5% pretty consistently for several years. But last fiscal year, it started to grow primarily due to our compliance division. Those positions are really difficult to recruit for all states. They're really difficult for us to recruit. Frankly, while we did just have a class action RFR to bump up the pay grades for our auditors, And those are really difficult to recruit for positions, and other states pay a lot more than we do, and the private sector pays a lot more than we do still. I have been asked about what do I think about market factor adjustments. The state auditor's office has them. DFR has them. Many departments and agencies do. I personally don't love them. I think our classification system is very, very antiquated, and it's really, really ripe for replacement. And the fact that our state classification system doesn't account for the labor market unless you have a market factor adjustment, I think, is problematic. And it creates these inequities. That said, if we continue to really struggle in this space, I feel like all options should be on the table. We'd have to figure out exactly the budget for that. But outside of our compliance division, our vacancy rate last year was between 05% consistently.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: How do you navigate the competing pressures between sort of an across the board administrative use of vacancy savings as sort of like a budgeting tool and your desire to have a complete healthy

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I would love to get our vacancy savings down to about 5% to six and a half percent. We have bumped up our vacancy savings over time because we've had them, so it's like to make our budget work. That said, if we had a zero to 3% vacancy rate, that's a problem that I'd like to have and would have to figure out how to handle that over time.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I know we've been talking about replacing the wellness system for about twenty years now. Is there any serious effort to get that?

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I would defer to DHR on this, but my understanding is yes, DHR and probably the secretary's office could respond to that better than I can. I understand that there is an effort right now underway. I would love to see that happen.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I mean, the market rate adjustments, level of inequity that they create is, I understand that it's a necessary solution in some cases, but it's really not.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Even within one department, even when I was at the state auditor's office, even between just two physicians when you'd get a promotion, and the promotion would move you into a position that had a market factor adjustment, that change was huge. So the inequity between two positions where the qualifications were just a little bit higher creates issues. Yeah, no doubt about it. But I don't fault departments and agencies for working with the tools that are available.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Yeah, absolutely.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Hire the talent that they need. So I definitely appreciate that. Our vacancy rate is trending down, but it's not as significant as I'd like to see so far this year. We are reclassifying a number of vacant positions to better meet department needs, and that does leave positions open longer. Especially when you create a new position, it takes quite a bit of time with our existing classification system. It takes months. So we might know, when a position becomes available, we want reclassify it, but the process that it needs to go through, it's quite lengthy.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Oh, sorry. No.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Other states, even other states like Massachusetts, my understanding, talking with our former commissioner, are able to take positions that they currently have and turn them into different positions pretty quickly. And I do think that if state government, if departments and agencies had that ability, they still need to manage their own budgets. They need to figure out how to make ends meet. No doubt about that. But I think if departments and agencies had that flexibility, and I have to imagine the union would be open to that flexibility. I'm getting outside of my lane here, but I think it would be very helpful for the future of state government to have a bit more flexibility in that space to take, say, a position that becomes available that was very clerical before, and you turn it into a position that works with software systems and it's steeped in accounting skills, etcetera.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Do you the pool of folks who left the IRS, have all of those folks found jobs now? Or are you still finding that?

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I don't know. I do know that we have Our new audit manager came from the IRS.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And you said that, and I just wondered if there was more

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: We've had some IRS folks apply for some of our positions in the past year. I haven't seen as many lately, but that doesn't I'm not quite as I'm not tied into every recruitment that we have going on right now.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I want to make sure that you can get through your whole presentation.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Sure. Well, will really, the rest of my presentation, for the ups and downs here, I provided a summary last time of this, so I just keep moving along. And if you all have any questions in the future, happy to answer that. Carry forward, there's not too much to discuss here. We actually chatted about it last time as part of what was rescinded. So really, the main thing that I'd jump to, and I'm going to keep going, would be what are referred to as our grant appropriations. And that gets into what you asked about before, madam chair. So I was just trying to

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: get

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Yeah, sorry. Yes,

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: and do the grant appropriations. Is that grants in, grants out? It's all out. And I really refer to them as grants because what these are, these are Well, I'll

[Rep. James Masland (Member, House Ways and Means)]: go through each one. How about that? Sample, whatever could be different.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yeah, so payment in lieu of taxes is one of those appropriations. Oh, I see. Yeah, which I really don't view as a grant, but it is budgeted for as a grant because there are disbursements out of state government, Exactly. Not for our operating So 12,200,000.0 is the budget request. The prior year amount came in less than forecasted, and so this year, the forecast came in at 12,200,000.0. Pilot for correctional facilities, this is like an enhanced pilot for those communities that have correctional facilities. It's been level funded for years, 40,000. The homeowner rebate is down $1,500,000 and this is due for the same reasons that we've reduced the homeowner rebate in the BAA. This is the disbursement to municipalities from the general fund to make them whole for those taxpayers who receive property tax credits under the circuit breaker, so under $47,000 So when they receive that assistance on the municipal end, the municipalities are made whole with these general fund disbursements. Above that, it's just forgone education fund revenue. This is the reappraisal and listening payments. And this was in the general fund, and we proposed shifting it to the pilot fund as part of fiscal year 'twenty seven. And the House Appropriations Committee seemed to like that proposal and decided to shift, is proposing to shift it. I understand it's already passed the House. It's what they're signing now.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I bet you adjustment.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yeah. So this same proposal was just moved forward a year from FY 'twenty seven to FY 'twenty six. It's still in FY 'twenty seven. And there's four main components to this. There's an $8 here, let me get out the trustee sheet on this.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: We're actually in pretty active conversations about what these numbers should be in the future as part of regional investment district. Great.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yeah, I I think that's a really important conversation to have. Let me just add

[Rep. James Masland (Member, House Ways and Means)]: all this paper. Not just having as much

[Chris Rutland (Analyst, Joint Fiscal Office)]: paper in.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Apologies. Well, I can rattle it off the top of my head. How about that? So, the $8.5 per grand list per parcel payment to municipalities is for reappraisal costs. Of course, they can use it for whatever they want, but it's the reappraisal costs. Then there's a $1 per parcel payment that is for assisting the state with the equalization study. There's $100,000 for a Lister Education Program that PBR administers, and there's $70,000 for Grambliss Litigation Assistance for utility valuations. That's used for all sorts of things. In the past, primarily been used for dams, but also methane digesters. We propose keeping this for now. At some point in the future, I could see it shifting to the commercial appraisal and litigation assistance program. But for now, we're keeping this here.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Are you imagining I guess I'm curious about the decision to use the pilot fund, how you would explain the nexus,

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: and if you're imagining that this is a permanent home or just a convenient home. Well, think it ultimately would depend on in the future, what the legislature and administration decide to do with reappraisal. So I know there's this proposal, like 66 per parcel. And with everything else currently in the pilot special fund, the pilot special fund just got spent down pretty quickly. Of course, it's growing because there's new global auction tax municipalities coming forward. And I'm not certain what the legislature is going to decide to do. Legislature and governor's going to decide to do around these 2% municipalities. And there's proposals in the Senate around using that money for other purposes. But in general, I think the nexus is that these are appropriations to support municipalities. And so coming out of the pilot fund, which is funded by local option taxes, when there's more money there, the idea was that's the nexus. These are municipal disbursements. Put them there, save the general fund money. I would frankly defer to finance and management and commissioner Gresham, who ultimately, proposal came from finance and management. We assisted and we said, yes, I think this can work for the foreseeable future. But I would defer to them on but the general nexus is these are municipal payments, and this is funded by a slice of municipally generated local option taxes. And it's in a fund to make municipalities whole that is currently doing that as payments in lieu of taxes, and there's surplus funding here.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Okay. Yep. We're not doing the funds come from this pilot. You talked about the local option tax.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Is, yeah, it's 30%. So essentially, there's an administrative fee that we assess, 5.96. And then the amount that remains, 70% goes to the municipality, 30% goes to the pilot special fund. Oh, sorry. 75% goes to municipality, 25%. This just changed on October 1. Sorry, I'm dating myself. Yes, 25% goes to the pilot special fund.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: $5.96 per return that's filed by the filer, the business.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: The way it actually works is you have it works a little bit different if you have like a remote seller, for example, who's remitting on behalf of a bunch of municipalities. It's per return for that municipality. So if there's three municipalities, that $5.96 is being used three times. And that's always been the case. Our former software system and current software system, it's really the only way to do it. If you think about it, how would you apportion that $5.96 You know what I mean?

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: If I had a store in Williston, one in Burlington, one in Killington, they all have options taxes, then you have to buy them all off.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yeah. So, and right now in terms of what's in there, and I know Chris has an updated version of a spreadsheet that he and I worked on earlier in session, but you have your general pilot, your correctional facilities pilot payment, You have, in fiscal year 'twenty six, a Newport and Springfield correctional facilities payment, which is an additional $152,000 coming out of this. You have the municipal grand less stabilization program, which is to make municipalities whole, who have buyouts associated with flood prone properties. In fiscal year 'twenty, that's a $1,000,000 appropriation that carries forward automatically. In fiscal year 'twenty six, it's about $82,000 that appropriation. And the max that we think it will be in FY27, of course, we don't know what we don't know, is $200,000 My guess is it's going to be less than that. We've got the telecoms valuation project that we talked about as part of the BAA. That's coming out of that $150,000 in fiscal year 'twenty six. Well, we're asking for all of it now, but I think $150,000 is what will actually be charged in fiscal year 'twenty six. And then there's the AOT town highway non Fed disasters money, which is like $1,500,000 now, and then reappraisal listing payments. So that's all there, and we anticipate that revenues are going to grow. The balance will start to be spent down with all of this, but with this current portfolio

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: When you say the balance will be spent down, do you mean that you don't anticipate that the fund could manage this as an ongoing?

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I think it's something that we'll have to look at. I think it likely will be able to. I'd like to look at the updated figures from or it might make sense for Chris to come up here with the updated figures. And I'm happy to chime in from the sidelines because I think it's likely that with this current mix, it probably can. But again, we don't know what we don't know. But we're looking at seven additional municipalities voting on lot. It doesn't

[Rep. James Masland (Member, House Ways and Means)]: mean it's going to pass.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: It doesn't mean the voters are going to go for it. But if you have four to seven new municipalities coming online year after year, of course, it's a of-

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: The national vote.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: The run out of municipalities and really the big ones, you know, like, but there are some in there that I think will bring in some more money, both for them and for these funds. So I think it's more than conceivable that the fund balance will go down year over year for the next five years or so. And then I think it's conceivable that things could level off and it could be a sustainable source of funding. Because essentially, it's getting spent down right now. Expenditures are greater than revenues coming in for the next several years, but we're anticipating that revenues will grow. We just don't know by how much, because we don't know if it's gonna pass. Will say, I did take a look at that 60

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: seems like we have a lot of special funds that are, their revenues are not meeting their expenditures, and it seems dangerous to

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: hire someone help

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: a new one. Yes. I

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: share your concern. Do you want me to touch on anything else here, or do you want to shift it over to Chris on?

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: No, sorry, anything.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: Oh, okay. So there were two. There was $40,000 for the correctional facilities, but there's our pilot 152.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yes, yeah, yeah. So Newport and Springfield correctional facilities, that doesn't come out of our budget. That's what what I did was I got I got all of the expense I wanted to make sure that it it would work for us to administer the pilot special fund, so I worked with others to pull together those other appropriations. Yeah.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Any other questions?

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: No, thank you.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Okay. Anyone else? Thanks so much, Andrew. Thank I appreciate it.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: You like me to stick around a little longer for cruelty? But

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: you don't have to. If you have something, you don't have But it might it would save us having to chase you

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: down if we ever I'll I'll stick I'll stick around. Okay.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I'm not gonna make you explain these. So

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Oh, thank you. I appreciate that. I wouldn't know what I'm talking about.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: Cool. Thank you today.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Hello, everyone. Chris here at Joint Fiscal. Madam chair, would

[Chris Rutland (Analyst, Joint Fiscal Office)]: you like me to start with just walking through that pilot sheet that Andrew mentioned? Okay.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I can go to the other sheet.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Alright. Share this. And I'll send this to Sorsha to post later. It's been public in other committees, but I

[Rep. James Masland (Member, House Ways and Means)]: don't think you've seen it yet.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: All right, so

[Chris Rutland (Analyst, Joint Fiscal Office)]: with the great help of my colleague from the tax department who you just heard from, we updated a outlook for FY '26 and '27 for the pilot fund to give you all a sense of the recent appropriations out of it as well as the anticipated expenditure level. Those appropriations, as Andrew mentioned, are one time appropriations that are expected to be spent down over a period of years. So just to orient everybody online on row one here, The pilot fund ended FY '25 with a surplus of $15,000,000 and in FY '26, those those three those first three rows, rows two, three and four are sort of your annual recurring obligations that come out of the pilot fund to make pilot payments to towns. There is also, you all remember, the one time $1,000,000 for the Municipal Grant List Stabilization Program. The telecom, $05,000,000 you see there from the BAA. I highlighted these cells in yellow because they've changed as a result of the BAA. You might remember that last year, the transportation budget shifted. There's a line for town highway non federal disasters that's carried in the budget every year of 1,150,000.00. Typically, that's funded by T funds. In FY '26, on a one year basis, that was switched to the pilot fund to free up that T fund for other things. Subsequently, AOT was able to pay two additional towns. I think it was Norwich and Pomfret for two additional projects. And finance and management had allowed them to spend an additional $360,050 through excess receipts out of the pilot fund with the understanding that B TRANS would identify ways to pay the pilot fund back that $360. Given the status of the different funds and their relative strengths right now, The house did not agree with that approach to make the agency pay back the pilot fund. So the pilot fund absorbed that $360,000.50 increase just in FY '26. And then that money that would have otherwise gone to pay the pilot fund, about 70,000 went in for other things in the BAA and about 292,000 remained in the T fund, which is currently projected to end the fiscal year in the rent. So that helps them a little bit on that. And then you'd see that 3,410,000.00 on line eight that Andrew mentioned appropriated in B-one hundred thirty nine for all of those town related, municipal related grants. The House BAA had advanced that construct to begin in FY twenty six, and that freed up some space in the general fund to deal with some other things. Senate appropriations voted out the BAA earlier this week. It's all starting to blur together now, but that concurred with that construct that the House proposed. So when you factor all this in and you factor in what tax projects some of the expenditure activity to be, and I think they project pretty conservatively on this front, The fund would end FY '27 with a surplus of about $11,600,000 So something to keep in mind is that there's still a pretty healthy surplus that would be higher than the $10,300,000 that the fund ended FY '24 with. I also want to point out that the number on line 11 about pilot revenue, Andrew mentioned that's likely to tick up in the future, and it's hard for us to get a really good handle on that until after town meeting. But that number is likely to grow. So in the immediate term, the expenditures are dipping a little bit into the surplus, but we expect the cash flow to start balancing out in the future. I did just want to point out that the construct that's in the BAA and the gov rec around reappraisal and listing payments, the legislature, if things got tight in the future, could always change its mind on how to fund these costs. Every year, the Appropriations Committee figures out how to make things balanced by shifting money from fund to fund. That's a solvable problem. And it would be less disruptive than altering the balance of payments that go out to towns or changing the revenue allocation or anything like that. So, that's just the high level context of where we are on the pilot fund right now. Even with these additional costs going in, the fund still is in decent shape for the near future. I, unless you have any questions on that, I'm going to switch to another document. Sorsha was kind enough to post a big summary chart that prints on legal size. Every year, just to remind everybody, the Appropriations Committee puts a memo together, sends it out to all the policy committees, and asks you all to look at different sections that are within the committee's jurisdictions. And then they ask you all to respond to the House Appropriations Committee by and this year, it's the deadline is next Friday, with your thoughts. So to begin that conversation, what I've done here, just like I've done in the past, is I went through the governor's recommended budget language and just combined all the sections and the annotations into one cheat sheet for you all to work off of. And based on your reactions to this, that can then inform a memo that the committee can then send to house appropriations. So this is really just a starting point of the conversation, so I can walk you through the sections of language that are being proposed and how it all sort of ties together in the big picture. So the numbers at the top here, all these B numbers, those are the base appropriations. Andrew already walked you through most of those. These are the appropriations to the tax department as well as the things involving pilot. The one thing with the corrections payments that I think you pointed out, Representative Kimbell, is there is another pilot appropriation for correctional facilities that doesn't show up on this list because it gets routed through the Department of Corrections budget. So there's going be a note in here that is a breadcrumb that leads you to that appropriation and explains that. So D100 every year. Oh, the other thing I just wanted to point out here, other than the numbers are the numbers that Andrew walked you through, the most significant thing that's notable is on B139, that 3.41 shifting from the general fund to the pilot fund. Change It's in funding source. And there's gonna be a whole lot of accompanying language sections that I'll get to that relate to that. D 100 is the annual property transfer tax allocation language. The consensus revenue forecast estimates property transfer tax to be $82,000,000 this year. It has held up pretty well so far. This can be a tax that can exhibit a lot of volatility in the economy other than the estate tax. PTT is probably one of the most volatile tax types. We have not seen a whole lot of volatility in this yet. The consensus revenue forecast has not made any sort of downward revision that's notable, and we expect it to keep ticking up by about 3,000,000 a year. But, you know, it's something to keep an eye on if conditions change. I don't if anybody has any questions on the PTT allocations, but the minor, notwithstanding here, really have to do with the fact that tax doesn't need as much money as the statute would give them. And ACCD had requested some different allocations on how some of the money in sub bullet three is allocated to meet up with actual demand. So D101, A1C and A3A are transfers from the Sorry, guess.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Yeah, for somebody. What's the nexus between the tax department, ACCD?

[Chris Rutland (Analyst, Joint Fiscal Office)]: There's no nexus between other than the fact that they collect the tax. They get a piece of the property transfer tax. And a piece also goes to the municipal planning. And there's a whole allocation here of where the money goes. Some of it goes to VHCb. But since So tax

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: if there's extra for the tax department, all goes to No.

[Chris Rutland (Analyst, Joint Fiscal Office)]: This is a very, very complicated issue. But I would suggest you read the the annotations. But the statute says a certain amount of money has to go to the current use administration special fund that PVR uses. They don't need as much money as the statutory allocation would send to them. So, that's why that section is not withstood. Then pieces go to the general fund, some of it goes to VHCb, And then some of it goes out to regional planning activities, municipal planning, and also to ADS for the Center for Geographic Information. So, year there's a process where they look at what the actual needs are versus what does the statute say the money should go to. And there's often, notwithstanding language, to more neatly align the appropriation authority to where the need actually is.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: The RPC money goes through ACCD. Yeah. Is that okay. Yeah. Yep. I just wanna Okay. Yep. Decision one, the settlement being made. Oh, there's actually a rule of thumb. In

[Chris Rutland (Analyst, Joint Fiscal Office)]: a perfect world, all taxes would go into a major fund and be subject to appropriation, but that's neither here nor

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: I

[Chris Rutland (Analyst, Joint Fiscal Office)]: wanted to point out a few other things that are I don't think are very spicy, but just wanna draw your attention to. Every year in the d 01/00 ones, which are the fund transfers, you'll see transfers from the general fund to end of the ed fund to the tax computer system modernization fund. That's because the computers at tax are Okay. Collect the revenues that go to these funds. Fairly straightforward, but I wanna make sure that when you see that, you understood what it was. D101 a 1 D. This appears very straightforward in the bill, but there's a little bit going on here. That $114,900,000 proposed transfer from the general fund of the education fund, there's two components of that. 10,000,000 of that reflects the governor's proposal to move general fund to the ed fund to essentially pay for the cost of reducing purchase and use tax to the Ed Fund by $10,000,000. The remaining $104,900,000 is in would be intended for buying down property taxes. But these don't show up as two separate discrete lines here. It shows up as one rolled up total. So I just wanted to make sure you knew what was going on behind that number.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And as we figure out what we're doing with both of those funds, we would engage with those two topics separately, and we would with the Appropriations Committee about those as two separate topics. And in both cases, it is fine with the chair of the Appropriations Committee if we say, We are still figuring out really big picture important questions with those funds. Please just leave that money alone for now. Because that is due, you know, the letter is due long before our yield bill is due. Right. So, Chris, I understand the loan yields are 4.9 and the 10,000,000. There's also an ominous 22,000,000 that appeared. Ominous? No, only because I don't know where it came from. Oh, okay.

[Chris Rutland (Analyst, Joint Fiscal Office)]: 22,000,000?

[Unidentified committee member]: Yeah, It's a surplus from last year.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Oh, sad. Oh, okay. Yeah. 22,000,000 is lower than what was last year. Last year was 42 That

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: sounds right.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And I held for cash on hand, but

[Chris Rutland (Analyst, Joint Fiscal Office)]: Yeah, there was a fair amount of money that was intentionally fenced off at the '6 to roll over into 'twenty seven.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Ended 'twenty two?

[Chris Rutland (Analyst, Joint Fiscal Office)]: I think that's part of that. Yeah. And there was what set there was some of it was due to the revenue forecast upgrade that happened as well.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Can we get a Julia will run through it all again on Tuesday? Yeah. I should ask that.

[Chris Rutland (Analyst, Joint Fiscal Office)]: But our budget folks have looked at the numbers and they add up. How you choose to use the money is up to you. Thank you. I'll move over to the language sections now. So, some of this stuff will dovetail with the other items I just mentioned. Some of it's new. And there's a couple of sections here that all relate to each other. So, I'm going to try to point that out. E-one39, grand list litigation assistance. This is really standard annual language. What's different this year is that this highlighted piece notwithstanding 32 VSA 3,709 A, that is to facilitate paying this cost out of the pilot fund. And 32 VSA 3,709 A, that's the pilot fund statute. So, anytime you deviate from that, that statute is typically not withstood. That is the first of several items related to this shift of that $3,410,000 cost over to the pilot fund. E142, this language is standard annual language. Nothing to see there. It shows up every year. E142.1 changes statute around the payments that the tax department makes for lister and assessor education. This is also included in that $3,141,000 appropriation. You know, statute said this had been paid out of the Ed Fund. In reality, it had been paid out of the general fund. So this proposed change aligns statute to the proposed construct moving forward. E 142.2 amends that pilot fund statute I mentioned earlier, '32 VSA 3709, to add a few more allowable uses that Andrew had mentioned when he was here. And those allowable uses are subsection thirty four thirty six refers to that Lister and Assessment Education, that $100,000 appropriation we just talked about ninety seconds ago. 4041A refers to the $8.5 per parcel payments to towns to reappraisal and listing assistance. And 5405F refers to that dollar per parcel payment for the equalization study. So this is technical cleanup to align everything in this construct.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And any changes that we make to regional assessment districts likely would not be for this next fiscal year anyway, so as people are thinking about this piece.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Yeah. And I'll also just point out that I'm not entirely sure if the appropriations committee is going to want to be this specific as recommended in statutory revisions or just make these expenditures subject to the funds that they're being appropriated of. So it's it's an ongoing conversation. E142.3, same cleanup that we'd mentioned. This is the section about the $8.5 per part of payments. 142.4, again, type of cleanup to specify that equalization study, that $1 per parcel payment comes out of the pilot fund. E-one 144 is standard annual language, no changes from last year. E-three 106.2 and E-three 106.3, if you look at the language as it appears in the budget and this giant word salad of session law references. It's really confusing to see what this is, but it's an issue that this committee has looked at previously. This relates to extending the sunset on the health IT fund. So, I believe it was just last year, the sunset was extended by a year. The administration is proposing an additional one year extension.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Folks, I'll just jump in and say this shouldn't be in the budget. It should be in our miscellaneous tax bill as it usually is, and so we can save that conversation for that bill.

[Chris Rutland (Analyst, Joint Fiscal Office)]: And I think my colleague Nolan has come in and explained how all this works. This is where the health care claims, piece of the health care claims assessment goes. I have a quick question. Can I

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: ask a question? You bet. So early on, just so you know, the administration have a practice in terms basic insulating the answer to the question, but there were questions at the beginning of this piece. We noticed some years it's one and some years it's the other. Just assuming you have preference for

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: We prefer any tax related policy, which is what this is, or really any tax rate policy to be in the miscellaneous tax bill. Last year, we actually didn't have a miscellaneous tax bill, so we farmed out everything that would have been in it to another bill, and that's part of the

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Gotcha. Yep, it's just full transparency at the point when this settled and I understand around the health IT shop and how far are people pending the governors this one year, think this committee had

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: two years.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: I think

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: it was five.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Five years, okay. That's helpful for us to keep in mind in the future. We went back and forth, but we think this makes more sense to budget, but that decision makes.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Alright, chugging along. E-three 38 references that standard annual language about Newport and Springfield's extra pilot payments that comes out of the corrections budget, not out of the tax department's budget. No change there from prior years. So now we're getting away from the pilot fund and going to the next sort of knotted up issue. And this is related to the proposal to fund school construction using windfalls, for lack of a better word, from the estate tax. You'll all remember that windfalls from the estate tax, if they're in excess of 125% of the July forecast and the stabilization reserves are fully funded. That money goes to the Higher Ed Trust Fund under current law, and the proposal before you is to shift that from there to the school construction aid special fund. There's also just a technical correction in here to reflect that. We don't appropriate money from one fund to another fund. We transfer money from one fund to another. You're also going to see companion language to E 501.3 show up a little bit later in this document, but it's sort of a package deal. E516 and Oh,

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: yeah, the procedural question. Because this is in the budget, though, this is a one time deal.

[Chris Rutland (Analyst, Joint Fiscal Office)]: This is an amendment to statute, so this would be ongoing.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: So

[Chris Rutland (Analyst, Joint Fiscal Office)]: on another proposed amendment to statute that was in the budget

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Another thing that we know that most of you don't like.

[Chris Rutland (Analyst, Joint Fiscal Office)]: E516 and 516.1 are related, and this goes back to the phase down of the purchase and use tax to the Ed Fund. So, this language would propose to step down by $10,000,000 a year the amount of money from this revenue source that goes to the Ed Fund, therefore going to the T Fund by default. And by fiscal two thousand and thirty one, no money from the purchase and use tax would be going to the Ed fund. So, it's a phase down over a period of years. So, E606, this goes back to that thing I was just mentioning about windfalls with the estate tax. This language would amend the statute on the Higher Education Trust Fund to remove those estate tax windfalls as a funding source for the Higher Ed Trust Fund, since the prior language would put that money in the school construction aid special fund instead. There's one other item that was in the language that's revenue related that I wanted to draw your attention to. The administration had proposed some language to stipulate that interest earned in the T Fund should remain in the T Fund. Current practice had been that interest goes to the general fund. It is not a huge revenue source due to the cash flows of the T fund. The folks we've spoken to in the administration estimate that given where rates are today, which are higher than they've been in the past, this was about $1,060,000 I think you'll likely see some discussion around not making this type of change go live in FY '27, but perhaps delay the effective date by a year so as not to blow a hole in the budget and require people to general fund. Because if this were to go live, things would not be fully balanced. So, I just want to make you aware of what that is. You might be used to seeing in the consensus revenue forecast and the way we've talked about interest, it being this big revenue source. A lot of it is due to the average balances in the cash flow of the different funds. So, the T fund is a sizable fund, but it doesn't have a really big average balance just given its cash flows. It currently gets interest from its stabilization reserve and from impact fees and on the tip. This is not tens of millions of dollars. By contrast, can you just say how

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: much interest is earned off the general fund?

[Chris Rutland (Analyst, Joint Fiscal Office)]: It's well into the tens of millions. Without looking at the forecast right now, I want to think it was around 50,000,000 recently. It went from being nothing to being the fifth or sixth largest revenue source to the general fund. And it's been steadily declining as the state's cash balance has been spent down. And that's what was expected.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Do have another question to make sure I got this right? So the new B606, going forward, new transfers were made by the general assembly would go to that Higher Ed Endowment Trust Fund.

[Chris Rutland (Analyst, Joint Fiscal Office)]: There is one additional revenue source that goes to the Higher Ed Trust Fund that's not in this section here, and that is a piece of unclaimed property. You'll actually hear more about this when you take up H567, which is currently on your wall. But the trust fund does get a small amount of money. I think it was $147,000 last year from unclaimed property that's under $100 in value and more than ten years old. So, this is a really, really minor revenue source to the Higher Ed Trust Fund. But you're going

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: to hear more about this issue when we tick up H567. So, what's already in that education, damage that fund will stay, it's just the new monies that used to go into it under a formula wouldn't be going into it?

[Chris Rutland (Analyst, Joint Fiscal Office)]: This is only about the revenues going into the fund. New revenues.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: There are other conversations that are not in this

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Not in

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: our committee. Not in our committee about the money that's in the fund right now. Yes. There are lots of reasons to have lots of opinions about, but are just not in the committee or in the cycle. Wanna be sure that I get that going forward, they're not gonna close out the fund with the

[Unidentified committee member]: funds that exist in it now and use that They're

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: not proposing to do that. No. And the they is?

[Chris Rutland (Analyst, Joint Fiscal Office)]: The administration.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: My mind, Brad, it's okay. So when secretary Saunders came in this afternoon, this was why she came in, was to pitch this proposal. I heard it. Yes. Sentenced. That was like a throwaway sentence, so she kept going on the next thing. Well, that was why she was here. And then we took testimony a couple weeks ago about how profoundly unstable a revenue source, maybe the most unstable of all revenue sources. I heard all of those things. Well, yeah, I'd love

[Unidentified committee member]: to see David's chair from the treasurer's office presented in House Ed two weeks ago now, I think it was, around the time that we went to the joint session that Ed and Commerce had about it. So, it's been two years over the last ten, I think, that there actually hasn't any revenue that's So, gone in from excess estate yes, there was a windfall.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Yeah, it took twenty years to get the first $26,000,000 contributed and then the balance doubled in one year. But

[Unidentified committee member]: the chances are that it could be years and years before any more money goes. If

[Chris Rutland (Analyst, Joint Fiscal Office)]: we're systematically that far off in a state tax, we need to seriously revise our revenue forecast.

[Unidentified committee member]: Well, that's the point. It's an excerpt of the forecast. So people have talked about, well, if the population is aging, we may end up with more estate tax coming in. And that's true. But then the forecast is also going up. So it really is just the windfalls beyond our estimates.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Yeah, it's really hard to predict when people are going to pass away and when their estates are going be settled. There's one other item I wanted to mention. You all last year had asked for $148,000 of one time appropriations support, the Volunteer Income Tax Assistance Program. The legislature did put that request into the budget in FY twenty six under the one time appropriations. It is not included in the FY '27 gov rec.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: And, you know, everything that we heard from Andrew about all of the really incredible work we've done on tax credits over the last few years, all the changes that we're planning to make and all the stress around property taxes, like, these are the folks that help people navigate that. I'm happy to take more testimony from VITA, from the folks who actually implement VITA, if anyone wants to hear that. But I know the request is for us to round this up to 150 going forward.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: The program was that. This is my view of the program, because I think it'll readily be people like this.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: It might be significant too, but it's a very

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: high priority of my intervention.

[Unidentified committee member]: It might just be helpful to remind us who the testimony was from so we can go back and watch testimony or see the presentations from last year

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: because there were a couple of It's a community action agency. It's a search. Can pull it up. Rather than having to drag it back in. I think they'd probably find it a pleasure, but yes, we could do it twice. Mrs. Brady. But we're paying for volunteers? No, but volunteer I don't know if you've ever organized a volunteer, Representative Branagan, but organizing volunteers costs money, too. And training volunteers costs money. And so that really small amount of money is divided amongst every single district in the every county in the state in order to implement the volunteer training program. So it really does cost that. Yeah. It's a pretty robust program. We can take more testimony from them. Who's asking about interest income? Was that you, Kimbell? Perhaps?

[Chris Rutland (Analyst, Joint Fiscal Office)]: In FY '25, interest was $58,300,000 to the general fund. It's expected to be $40900000.0.27.5 and it goes down to 26.5 and sort of hovers around there.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Yeah. It's

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: going down as the ARPA monies are expended in that kind

[Chris Rutland (Analyst, Joint Fiscal Office)]: of stuff. Exactly. The state's cash balance is going down, and interest rates are have been creeping downward as well. The the treasurer's office has done a really good job of locking in pretty decent rates whenever they can.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: Transportation fund by comparison is

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: not much.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Not much. And the transportation fund doesn't get a slug of hundreds of millions of dollars of federal money front to then spend out over many years. It operates more conventionally. Revenues come in every month, revenues go out pretty predictably, and the Feds reimburse us on a pretty regular basis as costs are incurred.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Any

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: other questions for Chris? Thank you, Chris. Thank you. Any further testimony anyone would like to have a where I will ask for testimony separately? For But people who to learn more about VITA and not necessarily take testimony on that, and everything else feels

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: okay. Great.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Let's take a two minute break while our next group of witnesses arrive. Okay, we are in the Ways and Means Committee room still. It is still February 1430. And we are going to hear about H418. And first up, we have our colleague, Rep Arsenault, sponsor of the bill. If you'd like to join us. I think so.

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: So welcoming. Oh, and your short film. See how you roll. Please lower our chair.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: Hi, everyone.

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: For the record, Angela R. Snow, representative from Williston. And I just have a few notes on H418. So happy that you'll be having a discussion about this bill today. So here I am very proud to sponsor four eighteen, H four eighteen, and to present the bill to your committee today, alongside advocates for survivors of domestic and sexual violence. As you may know, H four eighteen would create an 11% excise tax on firearms and ammunition to increase revenue for Vermont's existing domestic and sexual violence special fund. The question before us today is not whether domestic and sexual violence services or state funding to support them are necessary. Thankfully, Vermont answered that question in 2008, when the legislature established the special fund to support these essential services. The question that has so far remained unanswered, however, is how we fund them in a way that is sustainable rather than continuing to rely on one time appropriations to fill the perennial deficit. Every year for the past ten years, there's been a deficit in the special fund, and the legislature has made a one time appropriation to ensure that community based domestic and sexual violence organizations don't have to cut services for survivors. Despite these efforts, the special fund is once again in deficit this year. There is a clear structural revenue problem that we need to address. But as is true in most cases, we don't necessarily have to invent a solution all by ourselves. We can look to other states and the federal government for examples of firearms excise taxes and how they function. Under this model, the tax is applied to the retail sale of firearms, firearms parts, and ammunition, and is paid by the firearms dealer or ammunition vendor at the point of sale or background check, not by the purchaser. We also know that firearms impose significant costs on our society and that the majority of domestic violence homicides are committed with a firearm. At the same time, the firearms industry has seen record breaking profits since 2020, the very years when the revenue to the domestic and sexual violence special fund has declined most sharply. So I ask that this committee consider H418 as a potential solution to this fund instability and work with JFO to explore what a measure like this would mean for our state.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Thank Any questions for Rep. Arsenault?

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: Thank you very much. Appreciate it. And I

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: will say, we often have folks come and say, here is a problem, here is a deficit, fix it. And I appreciate you actually finding a revenue source for said deficit. So thank you for that. I enjoy finding solutions.

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: And I love it even more when many people agree with those proposed solutions.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Sarah STEPHEN Robinson from The Brunt Network, would you like to join us next? Thank you.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Another vertically challenged person. Share my screen. Thanks.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Makes me feel any better. My feet don't really touch the ground when my chair is up. Yeah.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Come on.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: That is what I do with the whole yep. Mhmm. You can do it.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: All right. Well, while just getting my slides ready for you all, for the record, Sarah Robinson. I'm the co executive director of the Vermont Network Against Domestic and Sexual Violence. And I am very pleased to be with you here today to talk about age four eighteen. I'm going to let a few of the things that Representative Arsenault just discussed with you all, but hopefully provide you with a little bit more context and detail about that. Let me open this up now and try one more time. Thank you for your patience, Sorcha.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: There we go. Okay. Hopefully, this lets me present. There we go. Thank you for your patience.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: All right, because I haven't been to the community at this biennium, I think, I wanted to provide just the briefest of orientations to the Vermont Network and the coalition of providers across Vermont who serve victims and survivors of domestic violence, sexual violence, and trafficking. We are a statewide nonprofit organization, and we have 15 member organizations who are also independent nonprofit organizations. The Vermont Network serves as the leading voice on issues of domestic and sexual violence statewide. We're very proud to represent these 15 member organizations that offer both lifesaving services to victims of domestic and sexual violence and prevention programming in their communities. They offer services like a 20 hotline, emergency housing, legal advocacy, children's services, and much more. And as I'm sure you can appreciate, there are very few service providers these days in our state or elsewhere who truly offer twenty four hour services. And so the workforce of advocates who work in these programs are truly nothing short of extraordinary, and you'll get to hear from a few of them in a few minutes. Last year, in 2025, these organizations answered 23,000 hotline calls from Vermonters seeking support for issues related to domestic and sexual violence and provided in person support to about 8,000 Vermonters. As Representative Arsenault shared with you, the Domestic and Sexual Violence Fund was established by the General Assembly in 2008 and is set forth in '13 VSA 05/1960. The fund is established by or is administered by the Vermont Center for Crime Victim Services, which is a quasi state agency. The Fund really serves as a primary revenue source for critically important services for victims, as well as systems which improve the public response to violence statewide. And the Fund has been this, I would say, foundational resource for many of these organizations since its inception. The fund expenses have been relatively flat for the past fifteen years, with some small exceptions. In FY 'twenty six, the fund supported just over $1,000,000 in expenses. And those expenses that come out of the fund include $627,000 which was distributed to the 15 member organizations of the Vermont Network. Those funds are distributed in accordance with a funding formula. So there's a formula that's used that distributes the funds based on the service area of the organization, the number of square miles, the population that is in the service area of those organizations, as well as the kinds of services that they provide. So for example, an organization that operates their own shelter receives more funds than an organization that does not. Dollars 90,000 of the fund also go out and are direct supports for survivors. So we're talking first last month's rent, transportation expenses, truly the expenses that somebody needs to remove themselves from an unsafe situation and find themselves just a brief period of safety. And around 317,000 of the expenses support statewide responses to violence, including the Vermont Council on Domestic Violence and the Deaf Vermonters Advocacy Services, which is a statewide program serving victims who are deaf or hard of hearing. But as you heard, despite the important purpose of the Fund, there is a structural revenue problem with the fund. The revenues for the funds are comprised of two revenue sources. The first is a surcharge on criminal and civil judgments and a portion of the marriage license fee. So there's a $47 surcharge on criminal and civil judgments that the court can levy, and 13.5 of that $47 currently goes to the Domestic and Sexual Violence Fund. In addition, it's $80 for a marriage license in Vermont. I always like to say, you know somebody who might be considering getting married? Please have Because a $50 of their marriage license fee will go to the Domestic and Sexual Violence Fund. The revenues in the fund have been in decline since 2015. And the reason for this decline, I know this committee has discussed this in years past, it's multifaceted, but much of it also has to do with policy decisions that the General Assembly has made around criminal justice reform, many of which we have supported, and also has to do with changes in policing. So if you look at data on, for example, traffic tickets, the number of individuals being pulled over and given traffic tickets has declined significantly over the past ten years. And it has to do with changes in police practice. Courts will often also waive fees for people who are unable to pay. Again, something we support, but what it means is that there's fewer revenues going into the fund. And this has resulted in year over year deficits in the Fund. There have been many efforts to address the health of the Fund. First, there have been multiple reports and study committees. I know, Representative Masland, I think you maybe were on one of the first ones many, many years ago. In 2017, the marriage license fee was added as a revenue source for the fund in addition to court fines. In 2021, the legislature asked JFO to author a report on special funds supporting victims of crime. And the 2022 JFO report, which I'll submit to the committee so that it's on your web page again, provided really a detailed analysis of the health of the fund and provided some recommendations for possible revenue replacement. One of the recommendations of the report was to reallocate a portion of the court fines and fees that had previously been going to the general fund to the domestic and sexual violence fund. And so before 2022, 07/25 of that $47 court fee was going to the general fund. And after 2022, the general fund allocation was split between the domestic and sexual violence fund that we're discussing today and the Victims Compensation Fund, which is another special fund. So now of that $47 surcharge, dollars 13.5 goes In to the DVSB addition, this body has increased the marriage license fee from $60 to $80 two years ago to support the fund. That was an initial two year increase, and I'm sure many of you remember making that permanent not so long ago. So now of the $80 marriage fee, 50 goes to the fund. But despite these changes, we have not realized any increased revenue. In fact, there continue to be year over year deficits in the fund. I get monthly updates on the deposits that are coming into the fund because I want to know during the course of the year, is anything improving? Are these policy changes that we're making making a difference? And I can unfortunately report that they are not. So this year, we are again looking at a couple $100,000 deficit in the fund. And we have needed to go to the appropriations committee to ask for one time general fund dollars every year. But we really need a new permanent revenue source that eliminates this annual instability and reliance on one time funds. You'll hear in testimony later, but I'm sure that you can appreciate that our member organizations face a very uncertain fiscal environment right now. Certainly, there's a shifting landscape on a federal level. Many of our member organizations are majority federally funded. Some of them, often the smallest, are up to 80% or 90% federally funded. And the instability on the federal level, when that's compounded by instability on the state level, creates kind of an untenable situation for many of these organizations to be able to really responsibly staff upright the services that are needed in their communities and know that they're going to have resources come in every July 1. So that brings us to H418, which proposes a firearms and ammunition excise tax to support the Divestity and Sexual Violence Fund. Bless you. And this was one of the revenue options that was outlined by the Joint Fiscal Office in the 2022 report. And we can look to other states and to the federal government who actually has an excise tax on firearms and has for a long time for examples of how these taxes can work. But the point is it's not a new or novel idea. Both California and Colorado have, in the past five years, passed excise taxes on firearms in order to fund anti violence efforts and in order to fund organizations like ours. You'll be able to hear from one of my colleagues in Colorado shortly about how that has gone for them. The difficult reality is that there is an evidence based connection between firearms and domestic violence. Here in Vermont, nearly half of all homicides in Vermont are domestic violence related, and the majority of those are committed with firearms. Every year, more than seven hundred American women are shot to death by intimate partners, and that's roughly one every twelve hours. And research indicates that when an abusive partner has access to guns, their partner is five times more likely to be killed than if they lived in a household where their partner did not have access to firearms. So at the same time that victims of violence are paying the price for firearms violence, the firearms industry is realizing record profits. The industry generates an estimated $91,000,000,000 in economic activity according to the National Shooting Sports Foundation. There is public support for these investments. We know that here in Vermont, and we know that from how this is looked in other states. In a moment, you're going to hear more about the Colorado excise tax, but in Colorado, changes go to the ballot. And so there was a ballot measure that was supported by the majority of Coloradans. Here in Vermont, we know that there's very widespread support for investments in services for victims of domestic and sexual violence. In the 2025 Vermonter poll conducted by the Center for Rural Studies at UVM, over 90% of Vermonters said that it's important for Vermont to invest more resources and services for victims of domestic and sexual violence. So that really wraps it up for me. I just want to say thank you and really appreciate your attention to the bill and your consideration. I'm happy to take any questions you might have for me now, or if there are questions after other witnesses, I'm so happy to take those then.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Yeah, Representative Masland.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Thank you.

[Rep. James Masland (Member, House Ways and Means)]: Thank you. Yeah. I'm remembering, and you can correct me, from way back when the other times that we've looked at this, that one of the connections has been if we increase the add on to traffic tickets sometimes, but some people aren't able to pay them anyway. That's right. And so on paper, we think we're doing it, we think, but we don't succeed.

[Andrew Stein (Chief Operating Officer, Vermont Department of Taxes)]: Thank you.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Yes, I think that is a very fair statement. And I think that for, again, a lot of good reasons, courts have become more practiced in waiving those fees. And the reality is, and you'll probably hear this from other witnesses, people who are involved in the justice system are, on average, can include low income folks. And we know that I mean, we fundamentally just don't believe that victim services should be paid for on the backs of people that are involved in the criminal justice system. So we do think, yeah, an alternate revenue source is needed.

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: Thank you very much.

[Rep. James Masland (Member, House Ways and Means)]: The question basically gets an answer from the table so that we all can

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Appreciate it. So you were imagining that Elizabeth knew when we'd go next and then Okay, great then. Welcome. Thanks for joining us from Colorado.

[Elizabeth Newman (Director of Public Policy, Colorado Coalition Against Sexual Assault)]: Thank you. Can you hear me okay? We can, yeah. Great. Well, good afternoon, members of the committee and thank you for allowing me to speak today. My name is Elizabeth Newman. I am the Director of Public Policy for the Colorado Coalition Against Sexual Assault. We are the statewide membership organization in Colorado that represents survivor voices and the programs and agencies that serve them. And CCASA was one of four organizations that work on the legislation and ballot measure to enact a firearm and ammunition excise tax in order to help address the funding crisis for victim service providers in our state. CCASA and our members, along with our sibling coalitions representing domestic violence programs, all crime victims and child advocacy centers began this effort in 2023 as we continue to face reductions in federal Victims of Crime Act funds and no longer had American Rescue Plan Act or COVID relief dollars to fill that gap. In Colorado, we also have a unique fiscal requirement referred to as the Taxpayers Bill of Rights or TABER, which requires the state to limit budget growth and give back revenue that exceeds the annual cap. It also requires voters to approve any new taxes. And this puts a significant strain on our state budget, even in good years. And so we have had no ongoing state funding for these services and rely heavily on federal funding. We started looking into generating a state revenue source to address the decreasing federal funding that we've been seeing since 2018, and we worked closely with our legislative champions to consider a range of options. We found that Coloradans were pretty much taxed out on many items such as alcohol and cannabis. We looked at fees and sales taxes as well. Ultimately, the most common sense approach for us was firearms and ammunition because of the nexus between the item being taxed and the purpose of the revenue and the fact that there was not a state tax on those items. We looked into the constitutional issues of taxing something that is protected as a right and found that the federal excise tax on firearms had been in place for more than one hundred years without issue. And lawyers agreed and we moved forward with a proposal through the legislature to then refer to the ballot and excise tax on manufacturing, dealing, and selling of firearms, gun parts, and ammunition. As I mentioned TABER earlier, this did also have to be approved by voters. After passing through the House and Senate, we did begin a voter campaign. And based on polling, we knew that the majority of households in Colorado are gun owners themselves, and so we would need at least some voters to agree to run a statewide ballot measure campaign, and so we relied heavily on voter education through the media. We highlighted the need for these services and the importance of shifting the cost of violence in our communities from victims to the companies who are making a profit from it. And the measure passed at 54% in November 2024 and went into effect in April 2025. There has been a lawsuit filed immediately upon the tax taking effect. However, is no stay. There has not been any movement on the case. The tax remains in effect and the funds are coming in at this critical time when resources continue to drop and the need from victims and survivors has increased. We anticipate the funds will start being fully released in 2027. For Colorado, this is a huge benefit as this new source of funding has greater stability for our nonprofit budgets, as well as greater flexibility to provide programming and services not typically funded, such as mortgage assistance or prevention programming. I would be happy to answer any questions if the committee has them, but I do also thank you for your time today and wish you best of luck. Thank you very much. Any quick questions?

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Thank you very much for Zooming in and joining us, and I hope you wish you well. Thanks. Up, have Donna Macklemore, if you want to join us.

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: I definitely want to join you, and

[Donna Macumber (Legal Advocate, Women’s Freedom Center)]: in keeping with the commentary on the seat, I was always

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: wearing a

[Donna Macumber (Legal Advocate, Women’s Freedom Center)]: divot in my kindergarten photo.

[Unidentified committee member]: And I am not the divot today.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Thank you for your

[Donna Macumber (Legal Advocate, Women’s Freedom Center)]: time and your work and your attention. So for the record, my name is Donna Macumber, and I am the legal advocate at the Women's Freedom Center. The Women's Freedom Center serves victims of domestic and sexual violence throughout Windham County and in Southern Windsor County. We are opening a brand new shelter for domestic and sexual violence survivors just this past month in Springfield. So we're very excited about that. Our organization provides a twenty four hour hotline, emergency shelter, safety planning, legal advocacy, support during sexual assault exams and many, many forms of community outreach. The Women's Freedom Centre has been serving our community for five decades. Despite our strength as an organization, each year we contend with deficits in the state fund that supports our work, the Domestic and Sexual Violence Special Fund. This special fund is a crucial foundation for our work in Windham and Southern Windsor Counties and the work of organizations like ours all across Vermont. As you have heard today, the revenues in the Domestic and Sexual Special Fund have been declining for years. This has led to year over year instability in this fund. At the same time, our field is facing unprecedented uncertainty on the federal level, and you can understand that. Serious and structural changes to the revenue sources for the fund are overdue, and they're needed now. For these reasons, we strongly support h four eighteen, which would create an excise tax on firearms and ammunition to fund the domestic and sexual violence fund. I'm gonna go off script for just one moment and say, I so appreciate the brilliance that brings this bill to the fore today. And sometimes the solution to a problem is embedded in the very geography of the challenges we face. So it is with this issue, much in the way that jewelweed, for the gardeners in the room, grows near poison ivy and can eliminate the unpleasant consequences, this bill offers us a similar opportunity. So I thank you for envisioning such possibility. The instability in this fund is, of course, difficult for our organization to manage each year. But there is another, more direct cost of this instability, which has an impact on everyday Vermonters. The Domestic and Sexual Violence Special Fund distributes nearly $100,000 statewide in direct support to survivors of domestic and sexual violence. And how do we do that? We use this funding to meet essential emergency needs, such as food, utilities. We keep the lights on. We give track phones, which cannot be tracked. Transportation costs. We have an amazing mechanic who fixes every survivor's car and only charges us for parts. He is just incredible, has never charged for labor. And so these funds also help us cultivate essential relationships with our community members. There are very few flexible resources for survivors of violence in our state, and the Domestic and Sexual Fund is one of them. Advocacy organizations such as the Women's Freedom Center believe that adequate funding is crucial to the safety and the well-being of our families, our neighbors, our friends, and the community at large. Our legislature created and has supported the Domestic and Sexual Violence Special Fund in recognition of the critical role that we play across the state in supporting survivors and breaking the cycle of violence. It is time that we fix the fund to ensure that these services remain strong in our communities. And I thank you so much for the work that you do and for your kind attention at the time of day that it's really hard to pay kind attention. Thank

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: you very much, Donna. Really appreciate your time. Yes. Abeloy Lanning. Thank you. You.

[Eva Boy Lanning (Executive Director, New Story Center, Rutland)]: Hi, good afternoon. The record, my name is Eva Boy Lanning. Sorry, Emilie? You are not the first. No, that's for sure. I am the Executive Director of New Story Center in Rutland, and I'm very pleased to be with you this afternoon to talk about H4HA18. New Story Center is the trusted community partner serving victims and survivors of domestic violence, sexual violence, human trafficking and stalking in Rutland County. Our team of eight amazing, incredible women advocates to provide emergency shelter. We have 15 shelter beds and crisis response, legal advocacy, housing support, and prevention education. We are available 20 fourseven through our crisis hotline. In FY25, we served seven fifty eight survivors and their children. To sustain this level of service to our community, our small but incredibly mighty team depends on stable and predictable funding. In FY twenty six, New Story Center received just over $45,000 from the DVSV Special Fund. And while modest, these funds are critical. And knowing that we have stable and sustainable funding helps keep us going day after day and helps me to support the advocates in our organization that are doing such amazing work. Domestic and sexual violence issues are often heard in the judiciary or in human services committees, but your committee has a critical role to play in ensuring that survivors in Rutland County and in every county in the state of Vermont has access to the services they need. This is because we rely on the Domestic and Sexual Violence Special Fund to do our work. I'm here today to share with you why I think that age four eighteen deserves your thorough and detailed consideration. The fines and fees currently supporting our work are both unjust and insufficient. And I say unjust because a system that relies on individuals just while I think in theory and originally sounds like a great idea, right? But what we know is that many people, if not most involved in the criminal know that many of them are victims themselves. Also, those revenues have been on decline, as you've heard. And so we would like to ask for you to make sure that we have the sustainable funding that we need. I also want to share with you that growing up in Texas, I'm a seventh generation Texan, Vermont is my home now, firearms were a normal and respected part of my everyday life. My grandfather, my granddaddy, taught me how to shoot when I was very young. I learned to shoot with a point two two rifle, a little lever action Winchester that's been in my family since the late 1890s. And it lives with me in Vermont now, that little 22 that I learned to shoot with. I hunted with my family. I competed on my 4H rifle team. And those experiences shaped my belief, as well as my grandfather, always grounding every lesson I ever had in safety, responsibility, and a deep respect for gun ownership. Those experiences continue to shape my belief that H418 is not punishing gun owners. It's about honoring a tradition of responsibility, while ensuring survivors of violence have a stable lifeline to safety and support. We all want that. I can't believe that there is a gun owner in Vermont, a responsible gun owner in Vermont, that would feel differently. I believe that they would want all of the victims and survivors that we work with to have safe and stable services that help them build a life free from violence. Our team at New Story remains deeply committed to our community, to our mission, and to the survivors we serve. We're grateful for the policy support we've received from the Vermont legislature year after year. You've enacted so many laws that help keep survivors, victims and survivors safe and help them move on to a life where they can write their news story free from violence. Now we need to ask you to look at new ways for us to fund the DV and SB Special Fund, so that we can continue our work directly with survivors, so that I can continue to support my brilliant and empathetic staff. Receiving one time funds for small amounts across 14 programs around the state is just not tenable. And we look to you at this table to help us fix this broken fiscal policy and create more reliable and sustainable funding. I thank you all very much for allowing me the time to speak with you today and for your careful consideration of this bill.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Thank you much. Anyone have any questions they'd like to ask of any of the witnesses that came while they have a moment? Okay. Yeah, purposes. Just curious about the 10%, how that was the number that was identified, and is that, does that line up with the people? Sorry, do you want to come back and speak to that?

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: As I'm sure you are very familiar with,

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: one of the

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: things we love doing is looking at what other states have done. So when California passed their excise tax, they passed an 11% excise tax. That is where Colorado also started with theirs. I don't know if Elizabeth is still on, but I believe that they ultimately landed on six and a half. And we have done a bunch of internal analysis at our organization about the expenses of the fund. We really believe that it ought to be supporting at least $5,000,000 in expenses. We also know that it's not possible for that, certainly not in the current fiscal moment, to be absorbed by the general fund. And so that had us looking for alternate revenue sources. So where the percentage comes from. We know we've now been able to see that play out in California. We're starting to see it play out in year one in Colorado and see the revenues that are coming in there. So it gave us kind of a sense of scale.

[Rep. Charles Kimbell (Ranking Member, House Ways and Means)]: Before you go. So thank you for coming in. And I'm not sure that I trust us to maintain a fund with our previous conversations earlier today. Just wondering about your other sources of funding. A lot of it is federal, and you showed about $1,000,000 in expenses. Does that match up to your revenues? How far are you short?

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Great questions. So both the Vermont Network, my organization, and the 15 member organizations that we represent, the vast majority of their funding is state or federal. For most of them, they are majority federally funded. And those are funds that come primarily from the US Department of Justice through the Violence Against Women Act and the Department for Health and Human Services. And there's been a lot of instability with those funds currently. We've been on many, many rounds of freezes and delays of those funds. But there are also some state dollars that our member organizations access. For example, organizations who operate shelters receive some funding through the Department for Children and Family Office on Economic Opportunity to help support their shelter operations. So it's really a blend of different resources. So that was one of your questions. In terms of how short we are, it varies by year. But I mentioned earlier that I try to get monthly updates from the Center for Crime Victim Services in terms of what the deposits are looking like month to month that come into the fund. So we're looking at each month, how far off are we from where we know the fund balance needs to be on July 1 for the fund to be able to pay out. So right now, we are at, of that $1,000,000 we have about a 3 and 50,000 to $400,000 projected deficit. So we're at maybe, if we're lucky, two thirds of those funds are coming in through the existing revenues. And so it's the same reason why at this moment, we have some folks downstairs in appropriations asking for one time dollars to help fill those holes. And we've been doing that every year for the past many years. As I'm sure you can very much appreciate, it's hard for providers who are offering twenty four hour services and a bit demoralizing to have to come back every single year and ask to be level funded, because that's really what it's meant. We're not asking for more. We haven't asked for more in a very long time. We're asking to not be cut. And so that's where the conversation has been, and that's why we really feel like it's time to change that conversation.

[Chris Rutland (Analyst, Joint Fiscal Office)]: Alright. Thanks.

[Unidentified committee member]: Do you have any statistics on gun and ammunition sales over time in Vermont? And because I'm my thought is, like, how stable is this funding source if you

[Rep. Angela Arsenault (Sponsor of H.418, Williston)]: were to go this direction?

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Yeah. We have looked into that a bit. I don't have it with me, and so I'd be happy to follow-up with the committee on that. But we do know that over the past ten years and the past, especially 2018 to now, there have been considerable accelerations in purchases of guns and ammunition. And we do know we have a lot of national data about that as well. But there is some Vermont specific data that I can follow-up with you about.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Thank you very much, Sarah.

[Sarah Robinson (Co-Executive Director, Vermont Network Against Domestic and Sexual Violence)]: Yeah, thank you all. Appreciate your time.

[Rep. Emilie Kornheiser (Chair, House Ways and Means)]: Appreciate yours. So folks, we are headed to the floor, and then we're back here tomorrow morning at nine As I said, we're likely gonna have testimony after lunch tomorrow as well. Page The five seventy seven. I don't know why I could not find that amongst just the only four bills over there. Emilie, Byrne, and Jen Carby are just working on a few commas, and we weren't able to have them back in just because of other people's schedules. And so I'm going to try to squeeze that in tomorrow if possible and might not be able to. But if anyone has any concerns about voting tomorrow, please let me know before tomorrow. And with that, we are done.