Vermont Legislature SmartTranscripts:

[Rep. Emilie Kornheiser (Chair)]: Good morning. Morning. Good Wednesday, February 18, nine a. M. We are continuing our work on a miscellaneous tax bill. Couple flags for folks on it. We've divided the testimony on the actually, the first section we're going to take on, which is the fish and wildlife feeds, into two blocks. We're going to hear from Michael O'Grady and Rob Kidd today. But then we're going to hear from Fish and Wildlife and the Elkhart attorney.

[Speaker 1]: Tomorrow? Tomorrow.

[Rep. Emilie Kornheiser (Chair)]: So try to keep your thoughts together, even though they're one day apart from each other. Sorry. That's just the schedule. And we are moving towards having committee till having testimony until 03:00 on Friday, including a vote. So let me know sometime today if that's really

[Speaker 2]: not gonna work for you.

[Speaker 3]: Can you just tell us what that bill is about? Oh, it's

[Rep. Emilie Kornheiser (Chair)]: a bill that came from corrections that I haven't looked at yet, and I can't tell you anything about. Oh, I need to know. I even know the bill number.

[Speaker 3]: What about fees? Okay, with that

[Speaker 4]: B is for inmates who are leaving incarceration. You're charged a fee in order to get identification.

[Rep. Emilie Kornheiser (Chair)]: Yes. Okay, with that, Michael, if you want to get us started taking us through your section, and then we're going hear from Rob Kidd.

[Michael O’Grady (Legislative Counsel)]: Lost the document. Sorry.

[Rep. Emilie Kornheiser (Chair)]: You did it.

[Speaker 4]: Yep. So

[Michael O’Grady (Legislative Counsel)]: this is Michael Grady with legislative counsel. I'm going to walk you through couple of sections in the most famous tax bill related to the authority of the commissioner of Fish and Wildlife to charge for fees for the use of lands, roads, buildings, or other property within the department's authority. But before I do, I wanna give some context, which you probably all know, and how this section evolved. So as you all know, the constitution provides that all revenue bills start in the House. And you've codified that even further by saying in statute in the fee chapter in Title 32 that all that's a uniform policy on creation of executive and judicial branch fees, that the general assembly has to approve them. And you have to approve the rate and amount or any adjustment to that fee. And the fee chapter defines fee to include a license because a license is a revenue producer just as any permit fee would be. But you can delegate that authority to parties, which you have. In 1977, you delegated to the Department of Forest and Parks for charging fees for using state parks, firewood, etcetera. And that's evolved a little bit over time. In 2004, you enacted this subdivision of the statute in '10 BSA 4132, which gave the commissioner of Fish and Wildlife the authority to charge fees for the use of land, roads, buildings, etcetera. And then in 2007, you amended this section again to give the commissioner authority to charge for the tuition for the Green Mountain Conservation camps. You can take that authority away. That is your policy decision. If you believe that the department should be posing these fees in the normal fee process, that is within your authority. And that's what section, 23 of this miscellaneous tax bill would do. It amends the commissioner's general duties, to strike the commissioner's authority to adopt and publish rules in the name of the agency for reasonable fees or charges for the use of land for its buildings, etcetera, and the tuition for the Green Mountain Conservation Camps. However, there is a provision that says, and the rule that the commissioner

[Speaker 4]: has adopted would also be repealed. I do think I wanna tweak that that reference to the rule. I think I wanna, include a citation to the code of Vermont rules. I was poking around on the department's website yesterday. And

[Rep. Emilie Kornheiser (Chair)]: And I think the department is actually going to send some clarifying language to maybe leave the camps still with them and have Understood. Haven't sent it yet. I think they're gonna bring it tomorrow, and I'll ask them to look in it.

[Michael O’Grady (Legislative Counsel)]: But for for purposes of continuation, transition, however you wanna characterize it, they will report back to you on 01/15/2027 with the recommended fees to be charged for lands, roads, buildings, etcetera, and for the use and tuition for the Green Mountain Conservation Camps. That would obviously change if they still retain the tuition authority. And then in the effective dates, you'll see that this repeal doesn't go into effect until 2027. So you get a report back about what the fees should be. There are fees that are in existence now continue until after appeal. So you don't have a period where there's no fee being spent.

[Rep. Emilie Kornheiser (Chair)]: Anyone have any questions? Just

[Rep. Mark Higley (Member)]: for clarification, Michael, I brought this up just a month ago. The Rules Committee paid the rules, Andrews for fees, for nutrition, venues, camps, other things. What we have in here, we'll keep those in play until next Until

[Michael O’Grady (Legislative Counsel)]: next year, Yes. And I do wanna note that looking at that rule and looking at what the commission proposed for license to use Fish and Wildlife Lands, it does give the commissioner authority to charge for a license, but it gives him or the commissioner the authority to charge between 50 and $5,000. Good range. And it doesn't say what the license would be for. It just defines what a license is, and that

[Rep. Emilie Kornheiser (Chair)]: that in the rule or in statute?

[Michael O’Grady (Legislative Counsel)]: That's in that's in the rule. Because a license means a written instrument that authorizes a certain activity on department property but does not vest the licensee with any property rights. That's really raw. Actually, it's $50 minimum and $10,000 maximum. So that's the range that the commissioner has under that rule to charge for a license, which is very broad and big.

[Speaker 3]: Representative, go ahead. That's one small clarifying question. Has the Department of Fish and Wild the recommendations will come back in January next year. Have they already set fees for this coming summer?

[Speaker 4]: Yes. Yeah.

[Michael O’Grady (Legislative Counsel)]: And that's the rule that representative take is with the residents And of

[Rep. Emilie Kornheiser (Chair)]: then the LCAR attorney is coming in tomorrow in order to answer any questions about how that process went or goes.

[Rep. Mark Higley (Member)]: If I could Yeah. Clarifying question. So when you're talking about license in there, is what the commissioner proposed earlier actually a license? Or is it something

[Michael O’Grady (Legislative Counsel)]: I think that's the terminology that you use information licensing. I would note that I'm not aware of any fish and wildlife license that have been created in rule. You generally do that in statute. There is a long section of law called the license section, where every license that you generally, every license that you authorize for Fish and Wildlife is authorized.

[Rep. Mark Higley (Member)]: So again, if license is not really the term that should be used, is there another term that Commissioner could use that would impose a fee for the usage of the boat docks?

[Michael O’Grady (Legislative Counsel)]: Yes. That technically, would say, is within the commissioner's authority because the access areas are Department of Fish and Wildlife Land. I will say that having worked on that issue in the past, it's not as easy as it sounds. Who carries the license? Where do you carry the license? If you're with a group of campers, does everyone need a license? Is it only for commercial? Even though commercial is not allowed to use an access area, have you now turned everyone into a commercial user by requiring motorized vessels to have a license. Those are all the questions, and there are more that come up. Do you need a decal? Do you need an actual license carried with you like your fish and wildlife place? Those are all the common questions that come up with that.

[Speaker 7]: Okay. Thank you. Yeah.

[Rep. Emilie Kornheiser (Chair)]: Representative Page.

[Rep. Woodman Page (Member)]: I'm curious. Has Fish and Wildlife ever abused this authority in the past?

[Michael O’Grady (Legislative Counsel)]: I wouldn't say that I know of that. I think you you gave them basically the same authority that Department of Forest and Parks has for the use of state parks and lands that Forest and Parks control. And to my knowledge, it hasn't been it's been used consistently since that, 2004. And I think I actually drafted this language that gave them. I think Representative Rutland was a reporter.

[Speaker 3]: I'll let Trump out.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: But

[Michael O’Grady (Legislative Counsel)]: I'm not aware of Rutland Page of events. And is there a

[Rep. Woodman Page (Member)]: way currently, if these are instituted, that perhaps this body doesn't care for? Is there a way? Do we have the authority to rescind

[Speaker 4]: Yeah. Okay, so And is

[Rep. Emilie Kornheiser (Chair)]: that what we're doing here?

[Michael O’Grady (Legislative Counsel)]: That's exactly what you're doing here.

[Rep. Woodman Page (Member)]: But there isn't anything else that's in statute other than what we're pointing

[Michael O’Grady (Legislative Counsel)]: That gives the commissioner that fee authority? No, there isn't anything else.

[Rep. Woodman Page (Member)]: For us to rescind it. There's no way for us to rescind it other than this proposed bill.

[Michael O’Grady (Legislative Counsel)]: I mean, this is the the commissioner sets those fees in a rule. The authority that the commissioner has for the rule is this statutory provision in forty one thirty two. If you don't want the commissioner to set those fees by rule any anymore, you have to rescind this authority so they no longer have that and repeal the rule, which you have the authority to do. Also, rules are legislative authority delegated to an administrative agency, you can repeal that.

[Rep. Emilie Kornheiser (Chair)]: Representative Holcombe and Branagan?

[Speaker 3]: No. And there's no way we should when that particular provision that we're repealing was put into place.

[Michael O’Grady (Legislative Counsel)]: 2004 was the first time the authority to charge fees for use of lands, etcetera. And then 2007 was when the Green Mountain Conservation Tuition was added to it. You.

[Rep. Emilie Kornheiser (Chair)]: Representative Branagan?

[Speaker 3]: And this clause that we're adding here, look at if we approve it, takes that authority away. Repeals it,

[Michael O’Grady (Legislative Counsel)]: and then the default is going to be the fee statute, which requires the general assembly to approve any fee or revenue generation. And there's a process for the fee. They're supposed to submit it as a fee report, etcetera.

[Speaker 3]: So what well, part two of my question, what do we do then about the current governor's wish not to have a fee report?

[Michael O’Grady (Legislative Counsel)]: Well, you have a report back from the commissioners specifically related to these fees, and you have a repeal of these fees. So if the commissioner doesn't report back with the proposal and you don't enact them, then there would be no fees for next not this coming summer, for the subsequent.

[Rep. Emilie Kornheiser (Chair)]: We do have we two years ago, three at some point recently, we changed the reporting requirements around fee reports to make them much more explicit and specific throughout all of state government. And there's now a process with JFO where they can work through those. We are not spending a great deal of time on them because the passage of said fee changes is challenging, despite our revenue challenges. Yes. But we do have much better information than we have had in the past. So if for whatever reason they did not bring us this report that they would be required to under statute, we could put back in place appropriate fees. Or we could even just repeal the subset if we need to, right? If that's what you're concerned about.

[Speaker 3]: Yeah, represent Nussel.

[Speaker 7]: Yeah, using basic generic language. If the choice is to create an exception versus going back to basics, I'd much be in favor of going back to basics. We add exceptions to things from time to time, and we make our lives, in Mike's slides, kind of complicate things, then we have to negotiate around what we said we'll do. And this is kind of generic language, but I think you understand where I'm thinking.

[Michael O’Grady (Legislative Counsel)]: But I think it's a good point because you do not withstand your general fee authority. Right. And in existing statute in '32 BSA six zero three, so you did create an exception. And you're taking that exception.

[Rep. Emilie Kornheiser (Chair)]: Thank you. Yep.

[Rep. Woodman Page (Member)]: Do we know why we created the exception? Pardon?

[Michael O’Grady (Legislative Counsel)]: I I Or

[Rep. Woodman Page (Member)]: shouldn't I ask that question?

[Speaker 3]: You don't wanna ask that question.

[Michael O’Grady (Legislative Counsel)]: From my recollection. It's purely from my recollection, being the person that's drafted it, is that the department was looking for the same authority as Department of Forests and Parks, and that ability to kind of be flexible with fees and not have to come to the general assembly every time that they wanted to change a fee for a use of a camp or a use of a facility at a camp. And

[Rep. Emilie Kornheiser (Chair)]: we'll hear from them tomorrow with some sort of splitting the difference on this to some degree, but leaving them the flexibility around camp entry fees.

[Speaker 3]: Yeah. I just wanna put in a fit for a TP-eighty exception because I

[Speaker 7]: think this

[Speaker 3]: increases transparency as well. And one of the things that happens when an administration doesn't advocate for appropriate revenues is that certain purposes crowd out other purposes, but we have no ability to see where that's happening. Whereas at least if we're having a consistent, coherent process, people can see what's going on.

[Rep. Woodman Page (Member)]: I guess I would take exception to that. I think we're creating a bureaucracy. I think we should allow the commissioner to set the feeds that he or she wants to. We were briefed on it by him when he made this proposal, and in some ways I think we have better things to do.

[Speaker 3]: Would you recommend that for all agencies and all partners?

[Rep. Woodman Page (Member)]: Maybe not, but in this case, it seems as though it works well.

[Rep. Emilie Kornheiser (Chair)]: And I would agree that, and we can talk about this more tomorrow and the next day, because we still have more testimony to take on this. But I think it was working well, and I think, frankly, the department sort of overstepped the legislative intent of their delegated fee authority. But we have more time and more testimony. Any more questions for Michael? Thank you, Michael.

[Michael O’Grady (Legislative Counsel)]: You're welcome.

[Speaker 1]: So that's what we do.

[Rep. Emilie Kornheiser (Chair)]: Yeah. The creation of the license.

[Michael O’Grady (Legislative Counsel)]: So I do I do recommend a tweak to the citation to the rule. Should I just thought this better be about? Yeah. Thank you.

[Rep. Emilie Kornheiser (Chair)]: Rob, Kidd, would you like to join us?

[Speaker 4]: Yes.

[Rep. Emilie Kornheiser (Chair)]: Thank you.

[Robb Kidd (State Director, Sierra Club Vermont)]: Thank you very much for accommodating my schedule. Sometimes on mornings, I can't get here early enough, and I am here. So thanks. First off, my name is Rob Chittenden. I'm the state director for the Vermont chapter of the Sierra Club. For those of you who don't familiar with Sierra Club, we were actually formed in 1892 as an outings club. And so all this political stuff that I used to be involved with, we were actually our bread and butter is connecting people with the outdoors. So this is why, when when the officials department announced this possible fee, we got contacted by a bunch of our members saying, what? This is outrageous. And we look at it as an access and accessibility. We encourage people to just get outside and enjoy nature no matter where they are, not looking for signs, not looking for any particular place where they have to play expensive. Now, Sierra Club, we lead outings ourselves in Vermont. We have a team of four people. I'm one of the certified outing leaders, just as a convenience factor, but I have three volunteers who do that. We have other groups around the state who do lead people into different areas. And these those type of programs are not really impacted about that. We like actually even even when we do outings and a lot of times conserve lands, I'll make a donation to the location that we're doing. So it doesn't affect our outings programs. As well, we have a national outings program that actually, raises money for the Sierra Clubs that brings people to different parts of the country. And, like, there we will have outings leaders from around the country bring them to Vermont. So we do bring them out to different areas and resources as well. So but I wanted to kinda kinda flesh on, first off, is our broader campaign, Outdoors For All campaign, wants to see people to be able to access all lands. We worked with the military outdoors program where we even did a training in Lincoln, Vermont back in right? Pre the pandemic where we trained dozens of outdoor outing leaders who had military experience. And because then we figured out it was a really good tool for them to do post their military services, connecting people into the outdoors. So we look at that as air. We also have, what we call nearby nature, just getting people out to their local community and exploring different trails that they don't even know about. One of the things is I've been I partnered a couple times recently with the Millstone Trails in Barry Websterville, where we just went a couple of snowshoes, and people are like, I didn't know this place was here. There's other smaller places that I've done some outings with that are just kind of like just they're in your backyard. I've even led couple of people from my board on unofficial outings up into Hubbard Park here. There's lots of resources. So we see programs like this infringing on that people's ability to get into those lands. And now I wanna be cognizant, yes, the the funding revenues are short, and they're tight staffed, so we're not blanketly opposing any type of fee. We would like, you know, a full process. We we encourage the the department to look at this and vet every particular funding process. When I first, was messaged from my national campaign, now guards for all, they said, oh, there's a great program in Kentucky called the Kentucky WIL, where basically they partner with a lot of private entities, raise money for that to supplement the fish and wildlife access fees. So those who like wild land, they can actually support and contribute to the different manufacturers of sporting equipments. They can all contribute to that and help elevate the needs for that. So what we would like to see is the department and even the legislature to do a much more open investigation on this to see what works for Vermont Scale, not just adding a fee that prevents people from accessing the land. So basically with that, that's what we would like to see is something more of process, not just you know, saying, hey. We gotta tax this and add this extra burden onto people. Now yeah. You know? And some people will say, well, you know, a $50 fee. Oh, that's nothing to access this beautiful land. Well, people already own this land. This is the public's land. And with the nature of how much public land is being attacked around the country, we don't wanna see it turn into a con commodity where you can't people who own it can't use it. So that's why we're requesting this particular land. And then I I've always heard people argue with us and say, well, the fish and hunters and anglers are the one paying for the department's budget. And, yeah, I agree with that because they're extracting. They're extracting a resource. A lot of hikers and people who recreate practice what's known as the no trace principle, where we do not take things out of there, so it's kind of a difference. When you're extracting something, yes, there should be a fee. When they're not extracting anything and you're following rules, you should not be penalized for that. So that's the short story, and I'd be happy to answer any questions if you'd need it, but I don't want to take up much more of your time. I don't have a legal analysis. That's Michael's job. Any questions?

[Speaker 3]: Yep. Representative Ode. Thank you. You said if you're piping and not extracting, then you said following rules.

[Robb Kidd (State Director, Sierra Club Vermont)]: I mean, if you're not, like, you know, all of a sudden cutting down trees and not digging up dirt, like, you know, my my son goes in my backwoods and builds mountain biking trails, you know, that's for our private woods. But if you all sudden start going into a public landscape, that'd be a little questionable. We don't want that to happen. That's why I said, like, you're falling here. If you're doing things that are not appropriate for the resource area, or you're doing things that are impacting the landscape, yet we want that to be regulated.

[Rep. Emilie Kornheiser (Chair)]: You. Rob,

[Rep. Mark Higley (Member)]: you had mentioned public lands being okay. Can you give me some examples?

[Robb Kidd (State Director, Sierra Club Vermont)]: Yeah, so around the nation, a lot of the public lands are being sold off for access to more minerals, access to more logging, even making more commodities. See some of the national parks are being trying to make them more service orientated, more hotels and more industry instead of just leaving it forever nature, natural. And that's what basically I'm seeing is more of the tax happening nationally.

[Rep. Mark Higley (Member)]: And I guess as a follow-up, I mean, would you consider some of the things that Lamoille has done as far as Act 20 tier three and Act 59 and the Wildlands Bill all being also the public lands being attacked?

[Robb Kidd (State Director, Sierra Club Vermont)]: I don't see the plans being attacked in those particular areas in Vermont. See we're trying to balance out the difficult needs. Like, you know, there's hey, we have housing prices. We do. It's not something that we have to ignore. And then there's the Vermont Wildlands, where, yeah, I think there's a good conversation that we need to have. At Sierra Club, we actually submit a letter supporting of that bill, but we should realize that there needs to be a more process of what's designated as wildlife, what's making things open and have a more vibrant public discussion, instead of just letting a few of these decisions made within the agency bureaucracy or even the legislative process. I don't know. We'd like to see more vibrant public discussion on this. Thank you, Will.

[Speaker 3]: Thanks, Robin. Just

[Speaker 4]: a quick follow-up on Representative Higley? No. Higley's comment. If you're looking at a scale of access to public lands in Vermont over, say, the past twenty years, would you say we have more access, less access, or about the same?

[Michael O’Grady (Legislative Counsel)]: Put that on the continuum.

[Robb Kidd (State Director, Sierra Club Vermont)]: What is created from twenty years ago to now? It's what's available.

[Speaker 4]: What's available. If you think about just total access to land. Yeah.

[Robb Kidd (State Director, Sierra Club Vermont)]: I I think I think we're getting at a point that there's more access to land, and we're getting it because, like, there's a lot more private lands that are being conserved, and there but there's a lot of pushback onto, like, what's posted and what's not. So we have to make sure we're keeping this where it's accessible on all locations, all communities. I forgot to mention there's one program I'm working on nationally, which is not gonna come here because it's gonna cost a lot of money to do, called transit to trails of how to get people from the like, you know, say, somebody who lives in Winooski to take a bus to then access the the hiking trails. We wanna see more diversified landscape conserve, not just in these pockets of the Alumni Green Mountains fine. Let's find more places and make it accessible to more people. So I see, yes, we have growing availability, but it's slipping because some lands are being posted and restricted from usage. Pressures. Thank you.

[Speaker 4]: Thank you very much.

[Rep. Emilie Kornheiser (Chair)]: Folks, we are going to move from this section of the miscellaneous tax bill to a completely different section of miscellaneous tax bill, which is related to 05/29 plans. And so if folks want to pull up the bill for a minute and find the sections, we can refresh our memories as we totally switch tact. Omlittle joins us in the chair. If But you wanna just sort of move up there slowly so we can pull up the draft. I just want you to remind me what section we're talking about, so that would be super cool. 12. 12. Thank you, Kirby.

[Speaker 1]: Page 11.

[Speaker 3]: I think everyone's done scrolling.

[Rep. Emilie Kornheiser (Chair)]: The floor is yours. Thank you.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Good morning. For the record, Tom Little from Vermont Student Assistance Preparation. But could take some direction from the committee. I could do a brief summary of the history of this program, or I could jump right to the Roth rollover proposal.

[Rep. Emilie Kornheiser (Chair)]: A brief history, I think, would be helpful for folks to have some context. I don't think we've taken much of the 2529 before.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Internal congress had amended the internal some people call it the infernal revenue code in the 1990s to create Section five twenty nine. And you often hear these college savings plans referred to as five twenty nine plans. Vermont, through a house bill in 1999, enacted the Vermont version of it. Under the Internal Revenue Code, there has to be a state sponsor for the program. In many states, it's the state treasurer's office. And in Vermont, then treasurer, Jim Douglas, said, why doesn't VSAC do it? So VESAC has been doing it since its inception. The state income tax credit was added a few years later. It was not in the initial bill, And it provides that for someone who's a Vermont taxpayer who makes a contribution to their plan, they can get a Vermont tax credit when they file their taxes. And there was a lot of discussion and debate when the tax credit was established about how broadly it should be available. And the Internal Revenue Code has a list of permitted uses of the funds in a 05/29 plan. Vermont piggybacks on that, but has a separate list, a narrower list of uses for withdrawals that are compatible with the Vermont tax credit. So another way of saying that is that there are some uses that are permitted under the Internal Revenue Code that would result, if used in Vermont, a conflict with the state income tax credit. And so that if you used, for example, under the internal revenue code, you can use a withdrawal for k through 12 education. If you k through 12. If you did that with your Vermont plan and you were a Vermont taxpayer and you had previously taken advantage of the income tax credit, that would be inconsistent with that section of of the Vermont tax code, fifty eight twenty five. Yeah. And you would be subject to a penalty and interest for doing that. Historically, this committee and with BSAIC's support has kept the focus of the tax credit pretty narrow. Currently, if you use your plan assets for post secondary expenses, there's a definition of what that is. Registered apprenticeships, I think that was added relatively recently, the death or disability of the beneficiary of the account, or student loan repayment, which is a permitted use under the Internal Revenue Code with a $10,000 cap over the per beneficiary. So it's not $10,000 of student loan repayment per year. It's over the lifetime of that particular beneficiaries. The Internal Revenue Code was amended a few years ago to also add rollovers to a Roth IRA account provided that your five twenty nine plan account had been in existence for at least fifteen years It's presumably an effort to avoid people opening a five twenty nine account, putting money into it, getting some tax benefits, and then rolling it over the next year into a Roth IRA. So you have to wait fifteen years. Draft of Section 12 will put that at twenty years. VSAT So is interested to know more about, I'm using the term profile for the time being, of who it might be who has opened a Vermont five twenty nine plan account, has named a beneficiary, has had the account open for fifteen or twenty years, and has no other permitted use for the funds anymore. That's supposedly the student or the beneficiary graduated from college and they didn't need all of the money in the account or they didn't need any of the money in the account. Maybe they had other resources. They had scholarships, work study, and so forth. Did the Did this owner of the account not have any other children? You can transfer beneficiary status from one beneficiary to another. Are there grandchildren that might be coming along the way that could be made the new beneficiary? Is the student who didn't use it all likely to go to grad school, which would make it eligible for use? And again, there's the student loan debt component. And we can do some research to see if there is available data that shows what profile, what types of scenarios are out there for rollovers into Roth IRAs to see if that's a significant component in Vermont. If we also it also may make a difference as to how much money the account owner has in the account. If the account owner has $4,700 in the account and they've used the credit once and they got $250 tax credit, the consequence of of, you know, the penalty for $250 credit, it's one thing. If if the account has $60,000 in it and they use the credit seven times, then you're and if it's husband and wife scenario, it would be $500 per year, then that's a much more significant amount and subject to the penalty. And so those are some other things we'd like the committee to ask about if the committee wants to pursue this. And I can also if the committee's interested, I can send we sort of have an annual report that we do about how the plan is doing, what the balances are, how many contributions were made in the prior year, how many withdrawals were taken, and so forth. So, madam chair, we'll stop there and be happy to answer questions.

[Speaker 3]: Branagan and then representative Woodman please tell the question. Can I just suggest that you send us maybe one copy of that report and we can share it?

[Rep. Emilie Kornheiser (Chair)]: Yeah. I think it would be interesting to read.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Yep.

[Speaker 1]: Thank you.

[Speaker 3]: Yes. Representative Woodie, did you have a question? Thank you. Yes. Does it help the state of Vermont to have a plan that is open in Vermont?

[Speaker 1]: Well,

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: if you if somebody opens a Vermont plan under under you know, VSAT sponsorship, and they use the tax credit, and that is reducing the revenues to the state of Vermont to the extent that they get the tax credit. And the incentive is that that prompts them to save more and help their make it easier for their child or grandchild to pursue post secondary education. I'm not sure that answers the question. No. Okay.

[Speaker 3]: I'm just whatever the restrictions are or what the credits are, someone who's opening a five twenty nine doesn't like what Vermont has to offer, That you could go and invest to another state. Right?

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Yeah. There is that's

[Speaker 3]: That's why I'm asking, does it help Vermont to have these five twenty nine plans? Established in Vermont

[Speaker 4]: for 2019.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: There lots of other five twenty nine plans, and many of them are the one that we have in Vermont is known as a direct sold plan, which means the state itself, VZAC issues, the plan makes the plan available. In many states, it's a broker sold plan where there's a large financial institution that has the plan and you go to someone who works for Wells Fargo, for example, if that's the plan administrator in your state and you have a relationship with them. You may already have a relationship with them, and that's you have to go that way to buy to set up a plan. Some states have both. I know that New Hampshire has a pretty substantial plan. So you, as a Vermonter, could say, I already have a relationship with Wells Fargo. They have a plan that's cited in Illinois. For example, I'm just going to go with my financial advisor at Wells Fargo up there, and you forego the tax credit. And I'm sure I don't know that we are able to track how many Vermont residents are doing that. It's probably those who have a long time stable relationship with a stockbroker. Think that we competitive product in Vermont. And I think we have really good customer service and that we're available to respond to questions or concerns. We had We farm out the record keeping and the investment management, but we also back them up with customer service and winnowsky. I mean, the choice was made in 1999 that it would be better for Vermonters to have their own direct sold plan that was from a nonprofit basis and not a large financial institution. Like to think that's better.

[Rep. Emilie Kornheiser (Chair)]: I have heard that the organization that's managing the five twenty nine plan is the same organization that's managing Vermont Saves profits? Correct. Does that make it easier for anything?

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Well, we've just the VSAC just changed over its vendor last fall to Vestwell. And they are the the treasurer's office has contracted with them to do that other plan. We're hoping that we will see some good harmonics there and that we may be doing some things across, not marketing, but outreach to some customers who may need both.

[Rep. Emilie Kornheiser (Chair)]: It's sort of too soon to tell.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Yeah, too soon.

[Speaker 3]: Any other questions?

[Speaker 4]: Just wanted to think, Tom, from what you were saying is that you would want to know to how many people this would apply.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: How compelling are some of those scenarios if you can construct one where a parent or parents have one child and the child had an athletic scholarship and had a full boat and they have a bunch of money sitting in this plan and there's nobody else on the horizon. They don't want to wait until maybe they have grandchildren or they don't have nieces or nephews and they don't want to wait to see if the child may go to graduate school. There's no student debt. And so you can sort of construct a hypothetical that thinks, wow, that's really compelling. They shouldn't have to pay the penalty. But it'd interesting to know what the penalty would be in that case, how substantial a financial penalty or hit would that be. What we generally like someone to do in that is to contact us and say, make sure they understand that there are these other options for using the fund that they may not know about.

[Rep. Emilie Kornheiser (Chair)]: If we can't get an answer to that question,

[Speaker 2]: what would you advise we do?

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: Wait until you get an answer.

[Rep. Emilie Kornheiser (Chair)]: Okay. Cool. Thank you. I love that answer. Thank you very much for your time.

[Speaker 7]: You're welcome. Good luck. I

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: did send you and George Anderson a drafting suggestion. If you do go with it, I just think it would blow better a little bit.

[Rep. Emilie Kornheiser (Chair)]: Wait, wait. Sorry, we have representative Sorry. Late breaking what? I believe

[Speaker 1]: you're breaking up. When do

[Speaker 3]: you think the pros are having a more restrictive use than the IRS does.

[Tom Little (Vermont Student Assistance Corporation, VSAC)]: I think it focuses the plan better on the original, I think, mission or goals of it was to try to focus on families that may not otherwise be saving a lot. They may not have thought about saving, and this is an incentive to do that. And it seems to be I mean, we've that there's we've just reached 700 don't know if you see that in the report, 700,000,000 in plant assets. Nobody would have mean, it blows our mind that that is what we've reached. A lot of that goes out every year. So it goes up and down, we get new contributions. And there are now ways to do it through a payroll. Some employers, including the state, have a payroll deduction option. So it's relatively easy if you have the resources to save a little bit. But I'll I'll if I have more on that representative, I'll get back to you on that. Okay? You're welcome.

[Rep. Emilie Kornheiser (Chair)]: Laura? Hello. Tada. Thank you for joining us.

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: Thank you for having me. Can I jump in?

[Rep. Emilie Kornheiser (Chair)]: Yes, please. But first, I want to make sure that we all know what section we're talking about with you.

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: For the record, I'm Maura Collins, the executive director of the Vermont Housing Finance Agency, and I'm looking at section 19 on page 17 of draft one Give point

[Rep. Emilie Kornheiser (Chair)]: us one brief moment to find it. Of course.

[Michael O’Grady (Legislative Counsel)]: Page number?

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: Page 17. It's section 19. So it's halfway down the page.

[Speaker 4]: Yep. Yep. Thank you.

[Rep. Emilie Kornheiser (Chair)]: Okay, I think we're good. Thank you.

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: Great. I'm here to say thank you. Thank you for including Section 19. You remember that maybe two weeks ago I was in your committee talking about VHFA's very successful down payment assistance program, helping over 2,100 Vermont renters become permanent residents when they became homeowners. And the value of this program is that they've accumulated approximately $15 of wealth for every dollar that the state has loaned them interest free. And so I take it that that testimony was compelling because I see this language in here, which is what VHFA requested, which was if we could have the ability to continue selling these tax credits for the next five years. Previously, as you can see on line 16 that this program had sunset, but the repayments coming back to VHFA for us to reloan out has dropped off as interest rates have gone higher. We've seen fewer folks refinancing their mortgages. So we did ask for an increase up to 350,000 of selling these five year tax credits. And so I'm here to endorse the language in section 19, but there is a memo on your website that I sent in today where I'm not a lawyer. I'm a housing finance person, but I'm a little worried that the way it's drafted now, someone could misunderstand and think that we had the authority to go up to 350,000 for FY 2020 through 2026, which was not the case. We only could have sold 250,000 those years. So I've I'm wondering to the lawyers if instead we should have a third subsection there that just leaves subsection two alone and doesn't make any edits, but instead adds identical language as a number three that just says in fiscal years 2027 through 2031 that we can sell 350,000 in total first year credits. And it would be the same language as section two that has been edited, but it would just be clear that the additional amount of going up to 350,000 only applies to fiscal years '27 through '31.

[Rep. Emilie Kornheiser (Chair)]: Laura, I'm gonna ask you and Kirby Keaton to follow-up offline with each other about any edits, and then Kirby can come back to us on what makes sense so that we're not all hanging out here at Wordsmithing together. Yep. Thank you. That's all

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: I had to say about this section, unless there's questions Something about

[Rep. Emilie Kornheiser (Chair)]: better than a witness that just coming in and say thank you. Anyone have any thoughts, questions for more? Thanks for popping in with us. Appreciate your time.

[Maura Collins (Executive Director, Vermont Housing Finance Agency)]: Thank you very much.

[Rep. Emilie Kornheiser (Chair)]: Thanks. We're really making good time today. Jeff, do want to join us? Thanks. I call you Jeff in my head. It says Jeffrey on the piece of paper. I don't know what you prefer. So sorry. Jeff is fine. Yeah, great.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: So my name is Jeff Dulie, and I am the taxpayer advocate for the Vermont Department of Taxes.

[Rep. Emilie Kornheiser (Chair)]: On behalf of all my constituents that I send to you, thank you very much.

[Speaker 4]: You're welcome.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: This position was created in 2001 and later codified in statute. I won't read the statute for you, but basically, the way I see it, I fulfill two roles in the Department of Taxes. One, I'm the voice of the taxpayer in all discussions when they're making policy decisions or in directors' meetings. If they're talking about actions that the department is going do going forward, I try to represent the taxpayer in those discussions. And then also on a more micro level, when a taxpayer finds themselves either having gone off the rails and dealing with the department and need to be put back on track, I assist them with that. And there's also a program in statute called Extraordinary Relief, where the letter of the law applies to a taxpayer in a way that's unfair, unforeseen, or creates a financial hardship. They can come to me. I can look into their case, summarize it for the commissioner, present it to him with my recommendation, and then he can choose to use his power to either approve or deny that request. In the past year, I've gotten approximately 70 extraordinary relief requests. We've been able to grant relief in 63 of those cases. The vast majority of those cases are property tax credit cases where someone has missed the deadline or filled up form incorrectly. And I'm sure as you're all aware, the requirements around the property tax credit are very strict and can be harsh. And generally speaking, it's dealing with lower income individuals who may not be as sophisticated as other taxpayers and don't have the means to hire a preparer to help them with those issues. So that's the individuals who tend to come across my desk. So what new initiatives have we done in the past year? One, and this may be a little bit in the weeds, but I'm excited about it, is we added a taxpayer advocate case to our vTax system, which is our main tracking system for taxes in the federal department. And prior to February, we were just tracking all the cases that came across the tax bureau desk on a spreadsheet in Excel, which was not ideal. Things felt between the cracks were not updated as well. So now there's a case in our system that can show when the case was created, what stage it's in, how long it's been in that stage. And so it really

[Speaker 2]: helps

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: me service the taxpayers that come across my desk. It's going to, I think, in the long term, provide a lot more robust data that I can provide to this committee coming forward. So I think that it's going to be a win win for myself, taxpayers, and for the committee. I'm excited about that. The other big administrative initiative that we've done in the recent years is we've fully staffed our communications team, which is a big win for the department. And one of the things that they've been focusing on is improved access, ADA compliancy and also language access. So we're able to now translate our forms into the 14 most common languages that are spoken in Vermont and provide translation and interpreter services if someone needs that to deal with the department, which I think in the long run will really improve our ability to communicate with Vermonters, especially those who don't speak English as their first language. So we're proud of those two initiatives. In terms of statutory proposals, I think this was already added to the miscellaneous tax bill, which I'm appreciative of, is there's there's an issue in Vermont with the well, there's many issues in Vermont with the property tax credit, but one of them happens to be

[Speaker 3]: rent reverse. Yes. It

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: doesn't really deal with divorce in a way that the real world deals with the divorce. It basically treats divorce as if you file for divorce on a Friday, and by Wednesday of next week, the divorce has been finalized and you can go on with your life. Anyone who's gone through a divorce or knows anyone who's gone through a divorce knows that's not really how the system works. So the way the law currently works is if you were subject to a divorce proceeding and your spouse has moved out of the house and you file property tax credit, you not only have to include your spouse's income in household income, which therefore lowers your property tax credit, even though nine times out of 10, the spouse isn't contributing to the household expenses, but also because that spouse is not physically living in the house, you have to claim 50% ownership on the property tax credit form, which reduces your property tax credit even further. So someone who, if they were just including their income in the household income and were claiming 100 percent, might be getting a $2,500 tax credit. But because they have to include their spouse's income and they have to claim 50% tax credit, might only be getting a $300 or $500 tax credit, which doesn't reflect the reality of what their expenses are and their ability to pay the property tax credit. What this statutory proposal does is it still includes the part where you have to include your spouse's income in your household income, and that just basically avoids people gaming the system. But it doesn't require the person to claim 50% ownership. They can claim 100% ownership if they and their spouse own their property together. So that's what statutory proposal does, and I appreciate that it was included in the miscellaneous tax bill, and I hope that it gets passed. One other issue that has come across my desk in recent weeks, and I

[Rep. Emilie Kornheiser (Chair)]: Before you go to a new issue, does anyone have any questions about that issue that's in miscellaneous tech?

[Speaker 1]: Yeah, of course.

[Speaker 4]: I think we talked about this last year, and I'm just wondering how often this comes up when your dealings with taxpayers, property taxpayers, has majority of the issues. Is this related to that specific issue about divorce?

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yes. I would say it probably comes up, two or three times a year across my desk, which, you know, across the population of Vermont is not a huge number. But then whenever anything comes across my desk, I wonder how many people are affected by this that don't elevate the issue just because that's what the tax form says or that's what their preparer says or that's what someone says. So

[Speaker 4]: always I was there at ten and a half.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yeah, I see my inbox is kind of a canary in the coal mine where if I see a couple issues, there's definitely more out there that I'm not seeing.

[Speaker 4]: Why didn't we move on this last year? I can't speak to that.

[Rep. Emilie Kornheiser (Chair)]: I don't remember. Did we talk about

[Speaker 2]: it last year? We did.

[Speaker 3]: Oh, I don't know. Maybe it

[Rep. Emilie Kornheiser (Chair)]: just got lost in the mix of the year where many things got lost in the mix of the year. There's so many other things we're still happening. Anyone else? Okay, the other issue. Sorry.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yeah, one issue, and I think you may Representative Kornheiser has spoken to this taxpayer as well where there's an issue where if there is a mistake made at the town level where someone's property is over appraised or a building on their property is over appraised or something along those lines, where the money goes to the education fund straight from the town and the person can apply for an abatement at the town level and they'll get the municipal money back. But there is no effective mechanism to get the education tax that was overpaid back to the taxpayer. And I know that

[Rep. Emilie Kornheiser (Chair)]: There is a mechanism. The town just needs to cover it.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Well, and most towns are not willing

[Speaker 3]: to

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: cover it, which is what creates the problem. So I know that this committee and the legislature at whole is doing a lot when it comes to property taxes. This may not be an area that you want to laser focus on, but it is an area where it does create some inequities where someone may end up not being able to get back education property tax that they've overpaid and probably are rightly entitled to a refund on. So I did say that I would bring that up. So So

[Rep. Emilie Kornheiser (Chair)]: the specific scenario, to add more color to it for people, is someone had a building on their property long, long ago, perhaps even before they owned the property, that burned down or was torn down maybe before they owned the property. The folks who were valuing the property thought that building was still there, and they had been paying property taxes for years based on this extra building on their property, and then caught it. And so I think there's as we think about this conversation, I think there's a question of, do we do something about it in the context of the new regional assessment districts when we'll have a very different state level ownership management oversight and standards around assessment than we do under current law. Because I think one of the pieces that we really One of core interesting pieces of the Regional Assessment District conversation is where does the work, the authority, the oversight, and the financial incentives, do they all sit in the same place? And I think under the new regional assessment districts, having the state issue the refund has policy consistency. I think under the existing assessment regime, it's the municipality that should be responsible for the fulsome, if we're sort of keeping money and accountability in the same place. Doesn't mean that that ever makes a taxpayer whole, which is a sort of a third piece of the question that we need to answer. But that's just sort of the back and forth that I have shared with this person who's been writing to both me and Doug. Yeah. Who just wants their problem solved and does not care about all the hypotheses. Reasonably so, yes.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: So, and I will say what, just talking about frustrations that taxpayers have had that I've dealt with in the past year, one that has been consistent, and I don't don't think there's anything that this committee can do about it, but I will at least flag it is when someone does file their homestead declaration late, the town has the option to assess a late file penalty on that individual. And most towns or many towns, I've noticed have told that taxpayer that the state tells them they must charge that penalty, which is not accurate. And then the person comes to me and says, can you help me get get rid of this penalty? And then I send them back to the town, and then they feel like they're getting stuck in this feedback loop where everyone's pointing a finger at each other. So I would just like it on the record that it is the town's discretion to charge penalties on late filed homesteads.

[Rep. Emilie Kornheiser (Chair)]: And so you don't think we need to change any statute? It's just that we should all say on the record that it is the town's

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yes.

[Rep. Emilie Kornheiser (Chair)]: Think that's that fee.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yes. And maybe the town it's the League of Cities and Towns.

[Speaker 3]: Get that message.

[Rep. Emilie Kornheiser (Chair)]: Believe there are plans to testify

[Speaker 3]: tomorrow Yes.

[Rep. Emilie Kornheiser (Chair)]: So if anyone just bring it up at them.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: And then the last thing just is something that I've noticed because I identify industry or class issues where people have struggled to deal with the Department is there have been a lot of movement in the local option tax area in recent years. And I know that there's a couple of administrative effort when we institute any of these local option taxes, and it does cause a decent amount of confusion among businesses that are in those towns or adjacent to those towns. Who charges the tax, when they charge the tax. And we have to do a lot of outreach and which we try to do as proactively as possible to let people know when they're in charge of this. Then we also have to do a lot where this business isn't charging it when they're supposed to, this business is charging it when they're not supposed to, and then we have to do a lot of one on one interaction with a lot of businesses order to every time that we stand up one of these local option taxes in order to get it working so that everyone's on the same page.

[Rep. Emilie Kornheiser (Chair)]: I'll say one of my, really my primary concern when we changed the local option tax authority last year was that we wouldn't be able to just look the town manager in the eye when they came in and say, this is more complicated than you think it is, and it's not the tax department's fault. Yeah. I know don't if we could record a video that gets sent to every town that wants to do this, because it is. It's really like a It's a significant challenge, and there's lots of blame to go around that I don't think deserves to land necessarily anywhere. Do you have any fixes that you might suggest for it, or it's just an ongoing issue?

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Other than not instituting new ones, no. Okay.

[Rep. Emilie Kornheiser (Chair)]: So I don't I think we're just gonna have more and more as the state doesn't raise revenue, I think municipalities are doing it more and more on their own, so I don't see a choice.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Yeah. And as in that's I'm sure one of those communities is aware in Vermont, ZIP codes are not necessarily as clean as they are in other states, and so that also creates an additional

[Speaker 4]: If a business really wants to comply, they have to invest in software to enable them to do it, which adds another burden. Yes. Yeah. Flowers throughout Chittenden County. Yeah. Town has a local office tax, how much it is. Yeah. There are

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: CSPs, which are the acronym I'm failing to remember exactly, certified something, But who who provide that service. But, yeah, that they're that's a cost. And then in addition, even we've even ran into issues where they haven't been doing it correctly for a couple months, we had to contact them and get them to on the right page. It is an issue.

[Speaker 3]: There's a big picture observation based on what you just said. I think I heard you say, the state doesn't raise the money to fund things that are needed across the state, municipalities are raising money themselves. Now, this is what ended up leading to the Brigham decision, which is where if you didn't have very much grand lists, couldn't easily fund your students to be educated. And this not raising enough money on the state level puts low brand lists towns at a tremendous disadvantage. Have the greater grand list where it's easier to raise with a smaller tax rate. For municipal services. Services. Or for things that fall upon an account, like a garage, house your snowflows, whatever. So I just wanted to say that.

[Rep. Emilie Kornheiser (Chair)]: We actually asked for A lot of states handle that problem very differently than we do. And JFO did a report for us a couple of years ago, fairly recently, about how municipal funding and revenue sharing and things like that work state to state. And there was a great report. I think Ted was the main author on it, but I can unearth it and send it around. It's very helpful.

[Speaker 3]: Yeah, agreed. Back to you.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: That's about all I have. If anyone has any questions about what I've testified on or my role in general, I'm willing to answer them.

[Rep. Emilie Kornheiser (Chair)]: Thank you so much. Oh, yeah. Represent Reitinger.

[Speaker 3]: Go ahead. Do you deal with card

[Rep. Emilie Kornheiser (Chair)]: use issues?

[Speaker 3]: Rarely. Right now with the constituents. So do you want me to send them

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: to me. Probably will loop in someone from our PBR UNH, because I know just about enough about hurt, used to be dangerous. I'm definitely not an expert.

[Rep. Emilie Kornheiser (Chair)]: Thank you so much for your time.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: Great. Thank you very much. Appreciate it.

[Rep. Emilie Kornheiser (Chair)]: You're next up, and you're last on the list.

[Speaker 7]: Hi. Good morning.

[Rep. Emilie Kornheiser (Chair)]: And some of the folks we're hearing from today, this might be the only time they testify on miscellaneous facts. When we have a final bill, we'll have the department in one more time to do sort of a, can we administer all of these random things that people put in here kind of conversation?

[Speaker 2]: The floor is yours. Great. Well, Rebecca Samaroff, Deputy Commissioner, Department of Taxes, the record. Can't wait for that testimony just Yeah, and I'm actually mostly just here to say thank you as well and catch any questions that have come up in the interim since I was here last. The bill draft now includes a state tax filing threshold language that we proposed and some chip equalization language, among other things.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: I was also excited to see the taxpayer advocates proposal in here. It's something that the department as a whole thinks is a great idea as well. That's handy alignment. There is one more proposal that we did put forward that I'm just gonna make another plug for here, which is repealing some obsolete statute around tax delinquency proceedings that suggest that PVR oversees this function. This is actually currently not a PVR function, and a more recent statute has tax sales managed entirely at the municipal level. But it seems like, especially this year, but kind of ongoing, we get tagged or asked to weigh in on these municipal proceedings, which is not currently in our jurisdiction. There's a couple areas of statute that we'd love to get repealed that were originally enacted in 1919, last amended comprehensively in 1959, and have been overcome by other statutes. So there's action in the state house this year that we keep getting asked to come in on to testify. I don't think I can blame this old statute for that, but it just feels great to be able to clean up the traces of areas of administration that we're not involved in, just to help a unified understanding of who does what in this great state. We did send that language to Kirby early in the session, happy to again, if folks have any appetite to revisit that. I

[Rep. Emilie Kornheiser (Chair)]: was trying to figure out how it fits in with the expanding authority we're giving to PBR with the regional assessment districts, and if it makes sense to have that in the regional assessment bill language, because we're moving toward the center between those two things to some degree. So I'm open to vehicles. Yeah,

[Speaker 7]: that would be great. Great,

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: awesome. So that's wonderful, we'd love to keep discussing that. Just curious,

[Rep. Mark Higley (Member)]: is that more in the realm of government operations as well? Well, my understanding is

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: it's purely a municipal function now, like the tax sale process and all aspects of that. Recently, we've been asked for data on tax sales a lot, which is, because we're not involved, we don't have any requirement of municipalities to be reporting those proceedings or outcomes to us. It's just one example. But yeah, actually, it's not something I have expertise in, nor does PVR these days.

[Rep. Emilie Kornheiser (Chair)]: What if someone knew about tax sales?

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Municipality knows about tax sales.

[Rep. Emilie Kornheiser (Chair)]: Or maybe not, yeah. If someone was tracking it at a statewide level. Could just be in Google form.

[Speaker 3]: I don't know. Okay, continue on.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: I cannot deny the coolness of access to data as a, I wouldn't say recovering data nerd, but former data nerd.

[Speaker 4]: Before you go on, are you thinking on the property transfer tax returns, is there any indication from those that it's a tax sale?

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: I'm not sure about that. I'll think about that. I would assume not. I don't think those are done through property transfer. I'll get back to the committee on this. But that's not my understanding of how our property transfer

[Speaker 1]: return would work.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: On the five twenty nine issue, that was a really great testimony from Mr. Little. I just wanted to, as we heard from him, there are certain uses of the $5.29 funds that are federally allowable, but trigger tax credit recapture here in Vermont. So this would effectively move that IRA rollover, which is federally allowable from the recapture bucket into Vermont's allowable bucket. The income tax treatment for these funds does flow through to Vermont. So we're totally aligned on that. We don't have any major concerns with that policy choice to pursue that or not. However, would strongly suggest some edits to the language as drafted. When I chatted with Mr. Little about this, we were actually exactly on the same page, and the language that he provided to Sorsha matched our recommendations. It was just moving the new statute rather than putting it in its own subdivision, tucking in it with the rest of these allowable uses. The one further edit I would suggest is that the holding period, the required holding period for an account to make it eligible for rollover for an IRA is fifteen years at the federal level. And this language suggests twenty years for the Vermont specific one. And that's just another example of where a minor deviation from the federal rules could add a lot of confusion to a CPA who's trying to administer this.

[Speaker 1]: Can talk

[Rep. Emilie Kornheiser (Chair)]: about that? That totally makes sense to me that you want to align. But fifteen years, I don't understand the Fed's choice. And I know that there are lot of things about federal choices that I don't understand. But in this particular context, if you start an account when a child is born, when they're 15, you have no idea if they're going to need it or not. And so in all of the intent that I've heard around allowing the rollover, it's that the account's been sitting there, and it's clear that it's not gonna be used for educational purposes. And I don't understand how at 15 years you could possibly know that or not. And that's why the different numbers.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Do you have any Well, I can't speculate for the Feds, but it could be that and I don't actually know about this. I have not opened an account for my children. Just sec. No. No, really not on top of my personal taxes.

[Speaker 7]: I will be, by the time I'm be clear. But

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: I imagine that I could decide to do this when they are 15, when they're 10, decide that this is something I finally have the mental capacity to be planful about. So I guess we are presuming that one would start if they were born, opposed to just any time when they were a kid, by questioning that 15. I guess they could start when they were five or 10 or something. I

[Rep. Emilie Kornheiser (Chair)]: mean, all the advice I heard was that there's actually no point in starting one once your kid is 12. So this type of I didn't follow it, to be fair.

[Speaker 7]: Fifteen or twenty years, that language is about the role.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: It's about how long you have to have the account active to be eligible federally to roll it over to an IRA.

[Speaker 7]: It's not about accessing it for you.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: If you started when a kid was five,

[Speaker 7]: at least fifteen years, at 20, they're in

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: the second year of college

[Speaker 4]: to access it for that.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Depending on the timing of their decision.

[Rep. Woodman Page (Member)]: That doesn't

[Speaker 7]: affect using it for its intended purpose.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Right. Oh, yes. Right. Only for rolling it over. Yeah. And the federal law, was actually looking at this last night to get more familiar. They have an exception where you can't roll over the most recent five years before your election to roll it over, which I thought was interesting. I didn't initially realize that. I guess that's supposed to be some disincentive to make an accurate decision. But yeah, this is no policy darling of ours. It would just be awesome if you did want to incorporate this, that we match the federal timeline, or not do it all speaking purely from an administrative perspective. I feel like it's going to put a lot of onus on A CPA might not know that Vermont's recaptured is more stringent than the federal law, which really just adds another hurdle to voluntary compliance. And then when it comes to the type of compliance that we have to proactively track down ourselves, this is a tricky one. It's pretty labor intensive with the high level data we currently get from DSAC, which just pretty much covers all withdrawals, not a lot of granularity. But what I will say is that this committee discussion inspired a nice conversation between Tom and I, and we're planning to sit down in the off season with VSAT's new contractor and just see what is available data wise, maybe refresh the data sharing that we have to see if we can either tighten up our process or maybe even come back in the new biennium with some miscellaneous tax bill recommendations to tighten up the language to really match enforcement possibilities with the kind of data that BISAC gets. Regarding that, I would love to take this five twenty nine secondtion out of the bill and do it next year. Great. Sounds great.

[Speaker 7]: Okay, cool. Kevin.

[Rep. Emilie Kornheiser (Chair)]: We made such a great decision there, folks. I'm trying not to do something. Okay. I think

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: I'll turn Rebecca. Yeah. So otherwise, those are kind of the things I wanted to proactively bring up. And otherwise, I'm happy to answer any questions that folks have to date on other items. Or come back, all ready to put a vote on it.

[Rep. Emilie Kornheiser (Chair)]: Other questions? Rebecca, you thought that there was a question about section

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: don't remember. Yeah, yeah. So section seven of the bill, and I have to pull it up myself, too. This is admittedly more of a Jill thing, but I can be a

[Speaker 7]: little bit vigilant

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: sometimes. Section seven, I'm not making trouble pulling up right now. This is about the transition of communications property from the former telephone tax types into the property tax rules. The miscellaneous tax bill in Section seven asks for some enforcement tools for getting our inventories back from communication companies, like telephone, cable, cell towers, things like that. This is language that was lifted from authority that municipalities have to get these inventories. My understanding is we send a workbook of, What is all of your property and where is it? And they send it back. I think the language asked for the ability to levy a $100 fee per violation.

[Rep. Emilie Kornheiser (Chair)]: I think that was one of the questions.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Oh, great. Perfect. Docked your memory?

[Rep. Emilie Kornheiser (Chair)]: Does it seem like a really tiny fee to create any behavior change to a large corporation? Is it per property, per day, per whatever? Our understanding is that

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: it's per municipality. So the utility would or the company would have a workbook and for to mirror what the municipality had the ability to do before. Any inventory that's missing from a town would be subject to a $100 fee per violation. But I do just want to say that we don't anticipate having to do this at all. It's a pretty tight industry. And the department in this industry has been very engaged just over the last couple of years of making this transition. Those inventories were already sent out, and we expect to have them back on March 31. The department's already answering questions about them. There's no early signals that we're gonna have to be wrestling these out of companies.

[Rep. Emilie Kornheiser (Chair)]: Thanks. Yeah?

[Speaker 7]: I thought of something completely unrelated. Great.

[Rep. Emilie Kornheiser (Chair)]: You'll see

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: how it

[Rep. Emilie Kornheiser (Chair)]: is. Anyone have anything related to what we were just talking about?

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Great. I

[Rep. Emilie Kornheiser (Chair)]: understand why it's that.

[Speaker 7]: Last time we talked about this bill, I was just wondering about moving the grant list date to January 1, and that's not effective in this draft until 2031. And I think there's some merits of aligning with the RADs and stuff, but it seems like something we could do quicker. Just curious to hear your thoughts on that or if that's a joke.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, well, think there is some flexibility there as to what future year we make this effective. We definitely wanna give folks some runway and heads up that it's happening. I think the one policy that we've been discussing in the RAD context of the regionalizing appeals, that's really where this is gonna be carrying a lot of water. Because for a contractor to be able to manage the increased appeal volume from the contractor and the appeal board from these new regionalized process. I think it would be really important to have that longer appeal window now between January and when the Grand Accessi Lodge, instead of April and when the Grand Accessi Lodge. So I think that's kind of the key timing to hit, make sure it's effective in that year, or ahead of that year. And beyond that, I'm not It shouldn't be next year. Right.

[Jeff Dulie (Taxpayer Advocate, Vermont Department of Taxes)]: And it

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: should be after that. And I think that there could potentially be some flexibility. But I think aligning those The timing of those two things would make a lot of sense.

[Speaker 4]: Another totally different subject, the lady who's changed tax, you guys are Okay with it, the language that's in here?

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Yes, although I do I guess I understood that this was the language that we had proposed, and maybe it's not. Okay. If it is, then absolutely, we really Just a normal thing. Yeah, no, thank you.

[Rep. Emilie Kornheiser (Chair)]: Yeah, we haven't changed it at all for you.

[Rebecca Sameroff (Deputy Commissioner, Vermont Department of Taxes)]: Okay. Yeah. I'm really happy where that landed. Seemed like a logical administrative solution instead of a high-tech mathy solution, which we've been hiding around the last couple of sessions. Very obvious in hindsight.

[Speaker 4]: Representative, were you talking about the timeline, basically? Yeah. Okay, yeah.

[Speaker 1]: It's all about the timeline. Okay, thanks.

[Rep. Emilie Kornheiser (Chair)]: Thank you, Rebecca, and I'll see you soon for something else. Maybe that's soonest. See.

[Rep. Woodman Page (Member)]: The or something.

[Rep. Emilie Kornheiser (Chair)]: We're waiting the grazing rights, we're waiting to hear Representative Kimbell just asked me about the grazing rights language. Waiting to hear back from ag and natural resources about that language so that they can define all the things that need defining there. Okay. Switching gears entirely, team. H five sixty seven, which is the unclaimed property bill we looked at yesterday. I didn't hear from anyone that they needed any more testimony. Do you wanna take a break before

[Speaker 3]: we do it? Cool.

[Rep. Emilie Kornheiser (Chair)]: I wanna take a break too. We're gonna be back here at 10:45.