Vermont Legislature SmartTranscripts:

[Emilie Kornheiser (Chair)]: Here we are in ways and means, continuing our work on our miscellaneous tax bill, and Kirby Keaton is going to take us through it. And there's a section by section.

[William Canfield (Vice Chair)]: Good morning, everyone. I

[Kirby Keaton (Legislative Counsel)]: may sound different because I thought in January and December I had contracted every virus known to science, but there was one out there that found me. We do not know yet if Pat gave it to me, but he denies it.

[William Canfield (Vice Chair)]: For the record?

[Kirby Keaton (Legislative Counsel)]: Would the chair elect me to go through the entire miscellaneous tax bill or start with decoupling?

[Emilie Kornheiser (Chair)]: Let's start with decoupling and

[Kirby Keaton (Legislative Counsel)]: then we'll go through the

[Emilie Kornheiser (Chair)]: whole thing just in the interest of our brains.

[Kirby Keaton (Legislative Counsel)]: That means we start on page 38, section 55. And specifically for changes, we start on page 39, line six. And we'll start by looking at the definitions for taxable income for corporations or Vermont net income rather is the term used for corporate income tax. So we are starting with the corporate income tax definitions. And on line six, this is nothing new, but this is the provision decoupling from the bonus depreciation for qualified production property. Nothing that I go over should be new to you. It should all be things that Pat had just touched on. So as a refresher, part of the proposal here is to decouple from the changes allowing bonus depreciation on qualified production property from HR1. Vermont previously already decoupled from bonus depreciation for certain business personal property. Those two were lumped together in this new language, this new provision. If you remember from the last time I walked through this, we also added some language from the Department of Taxes dealing with the administration of when Vermont decouples from bonus depreciation to help taxpayers know the exact steps that are expected to go through. And we'll be going over that when we get together. That's your lines six through eight. And then we have some extra language here relating to the deductions for domestic research and experimental procedures. Previously, I showed you this language, it was to have Vermont fully decoupled and not allow those deductions in Vermont at all. Some significant changes have taken place for this language. And as Pat said, for what Vermont Law will be treating as small businesses, they'll be able to follow the full HR1 treatment, which means those small businesses will be able to fully expense their domestic research and experimental procedures in the year that those expenses are incurred, just like HR1 allows, but for larger businesses, they'll have to amortize those expenses over five years, which is the free HR1 treatment, but there's no, in no case will a business or taxpayer not be allowed to take those deductions at all. So pretty big difference from before, the language from before. So getting into it, you'll see for, corporate taxpayers, it says for any taxpayer that does not qualify as an eligible taxpayer, that is the terminology we're using. This is where I stop and say, there was significant help from John Burkhardt, Department of Taxes. So shout out to John for being incredibly helpful.

[Emilie Kornheiser (Chair)]: Since you said it, I'd just like to say whether the tax department can speak to their view on the full bill, but the level of cooperation and collaboration from a technical perspective with both attorneys and fiscal staff has been such a gift this last month.

[Kirby Keaton (Legislative Counsel)]: So a lot of this language that we're looking at was suggested by John, including setting this up as using the term eligible taxpayer. Then we define eligible taxpayer with their reference to the federal code at section four forty eight. So that you understand this though, Pat went over it, but so eligible taxpayer is going to mean a taxpayer with average gross receipts of the entity for the three taxable years preceding the current year. And if those average gross receipts over that three year period does not exceed 25,000,000 is what federal law says, but it's adjusted for inflation. So it's actually 31,000,000. So if those gross receipts over that three year period proceeding do not exceed 31,000,000, they'll be considered a small business or an eligible taxpayer under this. And they'll be able to basically have the same treatment as at the federal level to fully expense. And if a taxpayer for the current year does not meet that, we'll go into what happens. So that's what's being set out here. I'm going to skip down so we can see the follow-up. We were just looking at the decoupling as far as things that have to be added back. Now we're going to jump ahead to the deductions that Vermont will allow. So things that can be taken out of income. So there's three scenarios that the language is dealing with after that basic rule that I just went over. The first scenario is for the larger businesses. What do they do? So Roman numeral large V, large V here, this language is saying that for domestic research and experimental procedures, the businesses that don't meet that $31,000,000 in gross receipts test, they'll have to amortize for five years, those expenses. They'll still get to take them, but they'll just have to be across five years. And the way that we get at that is that if you want to get another way to put it or to get more technical about it is we're conforming statically to 12/31/2024 federal law for that. So by doing that, we're bringing in that five year amortization. Page 41. You will find versions of the same language in three different places. We are looking at corporate now, but we have it also for individuals and then for estates and trusts. Page 41 is the corporate language. Okay. So that's, that's the first scenario. The second scenario in Roman numeral six is what do we do about tax years '22 through '24 when it comes to the eligible taxpayers? Because under previous federal law, they were to amortize over five years and that's they'll still have some expenses that are moving forward. So the way that this language deals with that scenario is it allows that amortization to proceed like it was under HR1. It does not allow full expensing for those years so that, you know, the next tax year, current tax year doesn't get hit with all those expenses. They're still going to be amortized over five years like the HR one treatment for those taxpayers for that time period. So that's what's happening in six. And then in seven, it tells you the scenario of what happens when a larger taxpayer or in the terminology we're using here, one that's not an eligible taxpayer, but comes an eligible taxpayer has their gross receipts drop. And then all of a sudden they become an eligible taxpayer. In that case, we have language dealing with that scenario here that allows those taxpayers to continue to amortize from when they were a larger business, like they were before. In other words, if we had no language here, there's an interpretation where they would no longer get to amortize because they're now an eligible taxpayers that don't do that. So this language clarifies, continue to amortize what the expenses you had from before, but you can start full expensing for any current year expenses now. So that's what this language in seven means. And I understand it's really dense, but that is what all of that means for all those references.

[James Masland (Member)]: Can you go back to six for a second? Yes. I'm trying to think if you qualify as an eligible tax payer of less than $31,000,000 in revenue, and you've amortized four years of your capital expenses, that ordinarily would be maybe thirty nine years in an amortization schedule. You're saying you can't deduct more than what you've already deducted in the past.

[Kirby Keaton (Legislative Counsel)]: Yeah, there's language here for that too, to make sure that because we're dealing with these different scenarios, we have the extra language to make sure that there's no taxpayer that ends up expensing more than they actually spent. So we're extra clear about that.

[Chris (Joint Fiscal Office)]: We need the language there.

[Kirby Keaton (Legislative Counsel)]: Okay. Yeah. Just a few pages of undecipherable language. We'll back up to the other things as a reminder, nothing's changed, but from the last time I walked through this, for corporate income tax on line 16 of page 39, you'll see the language that is decoupling Vermont from those federal deductions that are for foreign sourced income. I think as Pat mentioned, but also as a reminder, the idea here is that those deductions exist to help do allocation of apportionment between foreign and The US. The logic is that Vermont already does apportionment. Allowing these deductions basically has that income apportioned twice or reduced down twice. So that doesn't happen with this decoupling. Think also Pat said this is not a direct response to what happened in HR1, it's just related. So then you have on page 40, starting at line 11, where we put in the language spelling out what happens in Vermont for cases of bonus depreciation. And in a nutshell, this language allows the taxpayer to do normal depreciation to do depreciation on that property as if they did not claim bonus depreciation at the federal level. It also has that additional language we just talked about a second ago, preventing a taxpayer from using this different treatment to expense more than they actually spent in the first place. This is for the 168 ks bonus appreciation. This is not new, although we did talk about how the department had one of this extra language because it wasn't spelled out in the law before. So it's really helpful for them when there's a disagreement with the taxpayer say about how to do it. We're going to have that treatment in statute. And then subsection N is the qualified production property, which is the new thing out of HR one that we're decoupling from. So those two are together for this language. And those are the changes when it comes to the corporate income tax. So next we'll get into individual. Also on page 43, line 13, you have the same decoupling from both types of bonus depreciation that Vermont would be decoupling from. Same thing as before. Starting on line 19, this is the domestic research experimental procedures, same exact treatment, except we, there is, if you feel closely the language, there is a little bit there about including any amount of these deductions carried over on the taxpayer federal income tax return as part of a net operating loss from the prior year. You have to address net operating losses when it comes to individuals states and trusts because under corporate income tax, Vermont does not allow a net operating loss to carry forward. So we didn't have to address that since it can be carry forward for an individual, we're addressing that scenario. Otherwise the language is the same. The same eligible taxpayer terminology is used to differentiate between the quote unquote small businesses and the larger ones, and the same gross receipts test used for personal income taxes. We also have line seven here, decoupling from the federal exclusion for qualified small business stock. That was something that we did not have to put in the corporate definitions because this exclusion is not allowed for corporations at the federal level, but it is allowed for individuals with states and trusts. So you'll see that the decoupling language is in the definitions for personal income tax. So we have the same explanation for the treatment for bonus depreciation at the bottom of page 45 and on to 46. And then we have the same language for domestic research experimental. Starting at line 16, going down, same thing that we just went over for corporate. And then starting on page 48, line 15 are the definitions for states and trusts. And it's the same as the individuals. We have the bonus depreciation decoupling. We have the domestic research experimental procedures decoupling and the small business stock, qualified small business stock decoupling. And also the same language spelling out how bonus depreciation decoupling works and spelling out how the domestic research experimental procedures decoupling works. Section 56 is not new, but this is the language that the department I believe had asked for. Yes, having to do with personal income tax apportionment for Vermont. The statute that we have now for apportionment is dated and we had talked about how the language for apportionment for corporate income tax is newer because of the more recent reforms. And so under corporate income tax, you determine the Which one is it that we determine tax first for? Under corporate income tax, you determine the income of the entire taxpayer and then you portion it down and then you apply tax. And that works out pretty logically. The way that our portion of works for personal income tax right now is that it determines tax first and then it tries to apportionate out based on AGI, but that means our apportionment is not taking all of the decoupling into account. So this new language makes sure the decoupling is taken into account so that basically the amount of tax that's due for a taxpayer is getting the same treatment related to decoupling when you have a tax return that involves income that's Vermont income and also income from other places as you would if the income was all Vermont income. Without these changes, the current state of things is the department can run into situations where, especially if a taxpayer's going to benefit by not taking the decoupling into account when it comes to apportioning their personal income tax, they can push back and say, hey, follow the statute. I don't owe as much tax as you say I do. And there's not a lot they can do about it because the statute's pretty plain about that. So what this does is it corrects that problem.

[James Masland (Member)]: Like a K-one statement. An individual has a K1 statement for income and a sub S corporation that is able to now reduce their income because there's no

[Kirby Keaton (Legislative Counsel)]: There's bunch of different scenarios. Any of the things that we decouple from, an individual could have And remember, the decoupling goes both ways. There are certain things Vermont can't tax, such as federal bond income. This apportionment does not take that into account either. So you could have a scenario where a person has a whole lot of federal bond income, and then our statute is not taking that into account. So when we could do apportionment, we say, you had $10,000 of rental income from Vermont, from this property you own here. That's the only Vermont income you've had. But we look at how much money you made, and we do owe us $15,000 in tax, because basically we're indirectly taxing that bond income. So it goes both ways as far as it could increase or decrease how much is owed, but it's out of sync with the intention and the law for how Vermont intends to tax things. Right? Yeah. So section 57 is also part of the apportionment clarification. Section 58 is the increase to the research and development tax credit that Pat talked about. Section 59 is the increase to the downtown and Miller Center tax credit maximum award amount going from a total of 3,000,000 in annual awards to five. That should be four. Talk about this. Has that changed? Great. Has that been And then sections sixty and sixty one are the link up to 12/31/2025. So everything out of HR one that flows through to Vermont that you have not seen decoupling from in the language we were just looking at, this link up language would have Vermont couple to. And then I'll go to effective dates. So as of right now, the effective dates has the decoupling stuff and the link up retroactive to 01/01/2025. So there's no gap in treatment. And the language has the increase to the Vermont research and development tax credit as 01/01/2027. So that would be starting next year. And that's the income tax.

[Emilie Kornheiser (Chair)]: Very excited about it.

[William Canfield (Vice Chair)]: Yeah. I

[Kirby Keaton (Legislative Counsel)]: was gonna say that.

[Chris (Joint Fiscal Office)]: Symptoms of ureters.

[Kirby Keaton (Legislative Counsel)]: Do Yes. You want to go back and go to the rest of the slave tax now?

[Emilie Kornheiser (Chair)]: We do, yes, we can, thank you.

[Kirby Keaton (Legislative Counsel)]: Think Michael Brady will It'll be

[Emilie Kornheiser (Chair)]: at eleven to do that part. You want do the parts that are not

[Kirby Keaton (Legislative Counsel)]: To help him with his time, wherever I'm at, I'll just plan to switch over. So as a reminder, until now we've been looking at the corporate changes, the decoupling stuff separately. So that everyone's clear, it's in the miscellaneous tax bill now. That's what we've been looking at. We're going to go back to the beginning of the miscellaneous tax bill.

[Emilie Kornheiser (Chair)]: Remember there's a section by section for anyone who

[Kirby Keaton (Legislative Counsel)]: There is. And we're at draft 5.1. The section by section should also say 5.1. So a lot of the stuff that I'll go through right now at the beginning were the requests from the Department of Taxes. First one was to repeal Vermont's statute denying tax credits for S corporations. Since we've gone through this two or three times now, I won't dwell too much unless you ask me to. Section two is the change to the property transfer tax, expressly giving the department some more authority to investigate transactions that look like they may be attempts to use a loophole to get around paying the higher rates that was put into effect for second homes. Sections three and four are those changes relating to PBR conducting evaluation for under rolled parcels from current use in order to speed up the timeline for taxpayers to know how much land use change tax they might owe. The current use provisions or change relating to grazing rights have been removed here.

[Emilie Kornheiser (Chair)]: I don't know if folks remember we like okay great. Thanks.

[James Masland (Member)]: That's why there's no section four or is

[Michael O'Grady (Legislative Counsel)]: there not section five?

[Kirby Keaton (Legislative Counsel)]: There's a section four. I re numbered. That's why I put in the the notes that it was removed because there's no other indicator. It's also why you should use the most up to date section by section because there's been renumbering. Section five is the change to calculations for the municipal grant list stabilization program so that it uses the same calculation process using the previous year tax rates, like what we did for pilot. Section six, add provisions addressing cases where communication service provider fails to submit inventory to PVR. PVR is taking over the valuation of that property. Section seven relates to equalization study and it clarifies that the treatment of chip sites is the same as tip districts. For purposes of the study. Section eight, also relates to the equalization study. For purposes of the equalization study, it requires PBR to use a 100% CLA for determining tax rates for municipalities that just completed the matchup and reappraisal. Sections nine and ten, extend the Health IT fund sunset for five years. Section eleven, twelve, thirteen, fourteen are the updates to the inflators for education finance provisions. Section 15 is the request from the taxpayer advocate in cases where there is legal separation or divorce, that the property tax credit will be calculated using 100% of the property value instead of being split up for those people. Section 16 is the change for the estate tax to make sure that the filing threshold lines up with the same threshold as having a tax liability.

[Emilie Kornheiser (Chair)]: We're just going to pause here for one second because we left this outstanding last time, but I think it was just because I wanted to. Everyone else was okay with it. Right?

[Carolyn Branagan (Member)]: It's just the thought. Yeah. Great. Okay.

[Emilie Kornheiser (Chair)]: Great. Onwards. Onwards. I've accepted it now. Glad we could all do

[Carolyn Branagan (Member)]: that with me. Thank you. Section

[Kirby Keaton (Legislative Counsel)]: 17 is the change to down payment assistance that Pat went over earlier. This increases the award amount to 350,000 for the year and also extends this program to 2,031. Sections eighteen and nineteen preclude Vermont from participating in the new federal tax credit program for contributions to scholarship granting organizations.

[William Canfield (Vice Chair)]: We really haven't talked about this so very can we talk about it now?

[Emilie Kornheiser (Chair)]: Yeah, that makes sense. Except Mike's going to walk in in five minutes.

[William Canfield (Vice Chair)]: I can do it

[Kirby Keaton (Legislative Counsel)]: in five Let's come.

[Emilie Kornheiser (Chair)]: Okay. I would like to narrow this language, I think, to say to have it less be about prohibiting and more about, like, if we're going to participate in a tax benefit program, the governor needs to get the approval of the legislature.

[William Canfield (Vice Chair)]: Say the last part again, please.

[Emilie Kornheiser (Chair)]: So I would like to narrow this slightly to have it say that if we're going to participate in any federal tax benefit program of any kind, the administration needs to get the approval of the legislature, just like we would do with anything else. Like what? We have, like, a bunch of provisions for, like, any fees or taxes or anything. That's, like, how we do our fiscal policy. Yeah. It's just separation of powers. Yeah. It's like taxing. It's like all the things. Yeah. No, no, thank you. I was having trouble finding an example. Was like, all the examples. Yes. Totally.

[William Canfield (Vice Chair)]: So again, really wouldn't approve of that. But again, I think it's important for people to understand what the program is.

[Kirby Keaton (Legislative Counsel)]: I did

[William Canfield (Vice Chair)]: some investigation to find out. And it is used for qualified elementary and secondary education expenses. I think it's important to go over what those might be. Tuition, mandatory school fields, books, supplies, academic tutoring and services for students with disabilities, computers, technology, hardware, school provided services, room and board, uniforms, transportation, whatever it might be. Supplemental programs such as extended day or after school enrichment programs. Key provisions are the program covers expenses of public, private and religious K through 12. These people don't realize that. Effective dates are the credit donation begins in the 2027 tax year. It's for a refundable federal tax credit up to $1,700 annually for cash contributions to the qualified scholarship branding organizations. I found out what those are, say in a minute. Eligibility for scholarships are generally restricted to students from households earning at or below 300% of the area's median gross income. Again, SGOs are organizations, such as Vermont Student Assistance Corporation, the Curtis Fund, Vermont Community Foundation, Vermont Association for Education of Young Children, and Vermont Catholic Community Foundation to I

[Emilie Kornheiser (Chair)]: everything you said was my understanding as well, except for that last part, because I don't think any SGOs have actually been selected in Vermont yet. So

[Kirby Keaton (Legislative Counsel)]: So, yeah, I think it's fair. It has to be a five zero one(three). I don't know how VSAC is structured, but I would want to look into whether, for instance, they would qualify under the federal language. Because SCO is defined under the federal language as a five zero one(three) that follows all of these requirements under this new law, it's hard to say that any exists yet because like, why would they exist? Do know what I mean? Because they will be created for the purposes of this, if that makes sense. I think that is an open question about what would or would not be an SGO. I did receive some questions in the Senate about how hard would it be to set one of these up. My guess from the legal side is a person with experience in setting up nonprofits could probably set one of these up pretty easily. It wouldn't be as much as doing it all in a day, but it could be pretty quick, I think. But you would set it up in a way and then manage it in a way that you make sure you follow-up with federal requirements, because you need to do that in order for the credits to work.

[William Canfield (Vice Chair)]: Well, appreciate that regardless. My opinion is from many of my constituents that certainly supports food choice. I mean myself, in Delight, had our daughters in the same grade every other year, which didn't work out and we chose to send them to St Paul's school on our own dime and transportation and program like this, my understanding is could possibly help with that. So I don't see any reason why we shouldn't, you know, I think that if I heard the comment initially that it kind of goes against what we're trying to accomplish in that seventh journey. I don't agree with that at all. I think it's totally outside of that and an opportunity for my constituents that I've talked to, to have an opportunity to take advantage of some of this.

[Emilie Kornheiser (Chair)]: I appreciate that. I think for me, as a basic tax principle, in some ways, sort of similar to removing the checkbox yesterday for animal welfare, I think it was, Our taxes pay for education and a lot of those exact items that you named. That's what our taxes are already paying for. So to have sort of tax avoidance or tax credit in order to pay for that strikes me as just sort of an end run around the principles of the tax system. I we can have I think charity is a fine and great thing. I think the market is a fine thing sometimes. Taxes And are a fine thing. But I think when we get them all mixed up with each other, it's hard to have a solid set of tax policy. My secondary concern is just to make sure that the legislature retains its separation of powers and its ability to set tax policy and the others. I'm happy to open up this conversation. I think for the purposes of the bill, we can straw poll each section and maybe have differences on certain sections. And then we'll vote the whole bill, people can make their decision based on Yeah.

[Carolyn Branagan (Member)]: Does anyone else wanna add anything? K.

[Kirby Keaton (Legislative Counsel)]: Section 20 here has the changes to the definition of parcel that I feel like we've looked at so many times. This is intended to help get data for mapping. Then sections 21 through 23 were drafted by Michael O'Grady. The need plans to stop by are talking about it, so we'll skip that for now. If you walk in right now, that would be perfect.

[Emilie Kornheiser (Chair)]: It's actually the exact timing, so it's pretty magical, I agenda

[Woodman Page (Member)]: would just say, and I've said it before, I don't care for this portion.

[Emilie Kornheiser (Chair)]: I hear that. And it's been amended significantly,

[Rebecca Holcombe (Member)]: so we'll clarify when he comes back.

[Kirby Keaton (Legislative Counsel)]: Over that for a second, can we have 20 something sections that all relate to moving the grant list to January 1.

[James Masland (Member)]: Effective date on that from therapy.

[Kirby Keaton (Legislative Counsel)]: Good question. I'll look at that before I skip ahead. I've also lost track. 07/01/2031, which I believe is intended to line up with the timeline for the RADS that we have.

[Rebecca Holcombe (Member)]: Still just naming, don't think, but we have to wait that long, but something that

[Emilie Kornheiser (Chair)]: You can ask for a backup about it when she sits in the chair.

[Rebecca Holcombe (Member)]: I'll just speed it up timeline.

[Carolyn Branagan (Member)]: Okay.

[Kirby Keaton (Legislative Counsel)]: Section 49 is a little jump. Section 49 has this is one of the requests from the Department of Taxes from the beginning of the session that didn't make it into the miscellaneous tax bill at first, but it was so persistent. And it paid off. That's

[Emilie Kornheiser (Chair)]: true. That's what happened.

[Kirby Keaton (Legislative Counsel)]: Anyways, these changes just take out the language that's in statute right now relating to the PBR director having oversight of delinquent taxes, municipal taxes, property taxes. PBR doesn't really do that in practice and does not have an interest in doing that. So this feels like a vestige of a different government structure that had previously existed. Then in section 50, there are some changes relating to the pilot special fund. So in second

[Emilie Kornheiser (Chair)]: Wait a You paused as if you were looking for a cube. You were

[Kirby Keaton (Legislative Counsel)]: squinting and I am like, uh-oh.

[Emilie Kornheiser (Chair)]: No, it might end. I am just migraine y.

[Rebecca Holcombe (Member)]: Sorry. Okay,

[Kirby Keaton (Legislative Counsel)]: so Section 50 changes some expenses related to PBR as coming from the Education Fund or General Fund over to the Pilot Special Fund. This particular section takes the $100,000 that's in statute for assessment education, and change the statute so that it comes out of the pilot special fund. A little note here, after discussions with the tax department last summer, I had put this section down as a technical change for the technical corrections bill because it has money coming out of the education fund in statute, but the education fund has a poison pill provision stating that our whole property tax system blows up if you try to take money out of the Education Fund and it's not allowed. So, not because it was necessarily going to blow anything up, why play around with that?

[Emilie Kornheiser (Chair)]: It never came out of the Education Fund anyway.

[Kirby Keaton (Legislative Counsel)]: It wasn't coming out the Education Fund anyways. In reality, General Fund. As part of the Department of Budget, I think.

[Carolyn Branagan (Member)]: Sounds fun.

[Kirby Keaton (Legislative Counsel)]: But now, under this language, it comes from special fund.

[Emilie Kornheiser (Chair)]: So the move away from the education fund in statute, not in practice, has always been away from the education fund in practice. It was in the technical corrections bill. GovOps does the technical corrections bill. They were like, Oh, this is very meaty. We don't wanna touch the education fund and technical corrections bill. So asked us to put it in our bill. This is what we did in budget adjustment already. And this is in the budget already. In an effort to sort of protect our jurisdiction, I pulled it into this bill, but it is in the budget. It's in the budget. Indeed. And it was in budget adjustment as you voted for it. So it's already done? It already happened once, and the appropriations committee plans to do it again. So we can certainly have the constitutional battle. Yes. We're talking on Yes. The

[Charles Kimbell (Ranking Member)]: So the local option taxes portion that's sent to the state goes into this pilot special fund. So there's plenty of funds available for this.

[Emilie Kornheiser (Chair)]: I would

[Charles Kimbell (Ranking Member)]: 1% of the pilot.

[Emilie Kornheiser (Chair)]: Yes. And I would love to wait to have the conversation about pilot special funds. Know people have really big feelings about the pilot special funds. It's really one of the things that I've been reflecting on with JFO over the last, like, two months is there's this strange, like, thing in the legislature where there's, like, one fund that, like, everyone gets really into every biennium, and this is the fund, this biennium. Ted is finalizing his estimates based on the town meeting budgets and the local option tax, and is not yet ready to take us through those estimates, and he will be very soon. So I'm gonna hold that conversation for now. Sorry. Because I think it'll be a better conversation if we actually have any numbers in front of us. So the only thing I wanna get clear is it's what's happening. So house appropriations made this change for this year's budget, but you are proposing that we make it go for years going forward. And Appropriations is planning on doing it for next budget year too. I'm just proposing that we have it in our language. They would rather have it Protect some jurisdiction. Yeah. Yes. I I don't disagree with the jurisdictional issue. I disagree with substance. Right. And we I would and we don't know the substance until we actually look at the numbers from Ted, which she will have suit. Represent Waszazak.

[Rebecca Holcombe (Member)]: More of a curiosity. When you're talking about the poison pill blowing out, what does that actually mean?

[Kirby Keaton (Legislative Counsel)]: It means that 16 BSA forty-twenty five has a provision stating that if money is taken out of the education fund for what not one of the allowable purposes, then it repeals the property tax.

[Emilie Kornheiser (Chair)]: We just leave everything allowable purposes. So

[Kirby Keaton (Legislative Counsel)]: you should remember to not withstand or to make it allowable, but this particular statute, it's written to allow this money to be taken out of the education fund, but it did not directly address the Poisonville provision. Let's counsel, let's say, let's be safe and do that. Not a really high risk thing, the stakes at least are high, though.

[Rebecca Holcombe (Member)]: It would be

[Kirby Keaton (Legislative Counsel)]: fun. What if

[Emilie Kornheiser (Chair)]: your level of preferences is administration.

[Kirby Keaton (Legislative Counsel)]: Even if it means just putting the provision in the 4,025 to make sure that all of the loose ends are met here. Okay. So, section 51. Is the actual language for the pilot special fund and so this section 51 is just capturing within the pilot statute the three changes that we are making. We already covered one of them, the one from 3436. And the other two we will cover here in a second. So in 4041 a, this is the $8.50 per parcel fee that is for grand less maintenance and to pay for mastery appraisals. So the proposal here is to change that from general fund to this pilot special fund for those payments. And then in '53, it is, you probably guessed, the $1 per parcel fee for assistance with the equalization study. So those are the that's why the subject the heading for this is PVR expenses. Those are the PVR expenses being moved to the pilot special file. Which brings us to section 54, which is some session law creating a ten year tax study conducted by the Joint Fiscal Office. I believe Chris has already been over this with you. I will skip the details.

[Emilie Kornheiser (Chair)]: Does anyone have any? Everyone is good with that?

[Carolyn Branagan (Member)]: I

[Kirby Keaton (Legislative Counsel)]: would flag that there is a $100,000 appropriation for this, but there's also language here making it contingent upon appropriation, which means if the study doesn't get funded, then JFO doesn't have to do it.

[Emilie Kornheiser (Chair)]: And this would be our third ten year tax study. Fourth or fourth? Can't stop now, guys.

[Kirby Keaton (Legislative Counsel)]: That brings us to the decoupling stuff that we already went over, so I'll skip ahead and invert your eyes. And we're almost done. Section 62 makes some changes to how revenue is deposited into various funds. Section 62 onward, should say.

[Emilie Kornheiser (Chair)]: These are the graphs that Chris shared on Tuesday? Yesterday. Tuesday.

[Kirby Keaton (Legislative Counsel)]: Section 62, it changes the portion of meals tax revenue, meals room tax revenue that's deposited into the education fund by increasing it by 4%. It goes from 25% of that revenue to 29% of it. And then it also changes purchase and use tax revenue portion for the Ed Fund from one third to 27%. I will note that even though there's no language here, this change affects the transportation fund because the spillover from purchase and use tax goes to the transportation fund. So there's no reason to change to change anything for that. Just note that that is effectively what happens by this. And then section 63 changes. This is the general fund, so the amount of meals and earnings tax revenues deposited in the general fund will go from 69% to 65%. So this should all track the slides that Chris showed you about the other day. And then there's the effective dates. So I'll go through the details since we're near the So end what's retroactive to So

[Carolyn Branagan (Member)]: this is the one third, one third, one third in our $104,000,000 distribution? No. Okay, could you tell me where that money is? Cannot understand this.

[Kirby Keaton (Legislative Counsel)]: It's moving around some revenue to different funds that are supposed to work in tandem should meet some needs in the transportation funds?

[Emilie Kornheiser (Chair)]: The governor recommended more that of the purchase and use tax revenue from the education fund move to the transportation fund, because transportation fund has been steadily decreasing revenue. Yes. In order to make that not a one time but a permanent change, instead of moving a dollar amount, we're shifting the statutory percentages so the transportation fund will permanently get that $10,000,000 until the statute gets changed again, of course. But I'm not planning on changing the statute. And then in order to make sure that the general fund is in order to make sure that that change does not increase property taxes, we need to move money from the general fund to the education fund, which was in the governor's recommend as well, but that was also one time money. And so this is essentially doing that whole thing, but doing it permanently rather than as dollars. It's doing it as percentages.

[Carolyn Branagan (Member)]: I do remember this. Talked about that.

[Emilie Kornheiser (Chair)]: Yes, and Chris had a chart that had sort of a pinkish orange bars on it. Sorry, I'm very visual memory. I don't know if that helped. Anyone else? Okay, so prominently,

[Carolyn Branagan (Member)]: we are taking money out of the ad fund and giving it to transportation, or taking money out of purchase and use and giving it to transportation?

[Emilie Kornheiser (Chair)]: Both of those things mean the exact same thing. So, yes. Yes.

[Woodman Page (Member)]: Are we taking the amount that the governor suggested?

[Emilie Kornheiser (Chair)]: Yes. So the change in percentage is equivalent to the amount that the governor wanted? Ish. It's ish. Can we put up the chart from Can save while we draw it? Chris, can I use it?

[Chris (Joint Fiscal Office)]: Sure, Chris with Joint Fiscal. The governor's proposal, so if you have your computers, my slides were posted under Tuesday's date that you can look at, but I'll say verbally, the governor proposed a $10,000,000 shift. If we are using all round numbers to deal with these tax percentages, this results in $9,900,000 going to the T fund in FY twenty seven and then it steadily goes up a

[Kirby Keaton (Legislative Counsel)]: little bit with growth and so it's

[Chris (Joint Fiscal Office)]: as close to 10,000,000 as we can reasonably get. And then the ed fund gets sort of backfilled from that loss of purchase and use revenue by getting 4% more of the meals and rooms tax revenue. And that results in a $10,800,000 shift. Again, that's as close as we could get to 10,000,000 using full round percentages. So the head fund ends up being like $900,000 a head, which in a $2,500,000,000 fund is essentially net neutral, But this way, it's not just a one off shift in FY27, as the chair mentioned, this is an ongoing shift of 10,000,000 and property taxes are, for lack of a better term, being held harmless as a result of all this.

[Kirby Keaton (Legislative Counsel)]: Well, could tell you.

[Emilie Kornheiser (Chair)]: Say it's like a pinkish orange. It's the best thing you did all day, Kirby. I was like, shoot. You just were all so thrilled. And you pulled up a slide, and you said all this other really hard work today.

[Kirby Keaton (Legislative Counsel)]: So

[Emilie Kornheiser (Chair)]: any other questions about that? Yes. So

[Rebecca Holcombe (Member)]: I'm curious how much help this provides to the transportation fund in terms of the larger structural problem the transportation fund has, but that doesn't feel like a question this moment.

[Emilie Kornheiser (Chair)]: I guess not a question for this moment, but it's a great question.

[Kirby Keaton (Legislative Counsel)]: There's still much

[Rebecca Holcombe (Member)]: I think we should do it.

[Emilie Kornheiser (Chair)]: There's still much problem to solve, but this is what we can And

[Rebecca Holcombe (Member)]: that was just kind of the point that I wanted.

[Emilie Kornheiser (Chair)]: There's still much problem to solve, and I'm hopeful that the two transportation committees are gonna get closer with other pieces of the puzzle. I think this is a good time for us to shift to hearing from the tax department.

[Carolyn Branagan (Member)]: Does that work for you, Rebecca? Yeah. Yes.

[Kirby Keaton (Legislative Counsel)]: So

[Emilie Kornheiser (Chair)]: what I have is I have a section we still haven't heard. I a section that Representative Ode is uncomfortable with. I have a section that Representative Higley is uncomfortable with. And we're about to hear from the tax department.

[Rebecca Samuels (Deputy Commissioner, Vermont Department of Taxes)]: Perfect. Hi. Hi. Rebecca Samaram, deputy commissioner of the Department of Taxes. Great to be here again. I don't have much today. I just wanted to chat about the package that we all heard about today. Great summaries from Pat and Kirby. Thanks so much. And, yeah, just to mirror what you said, representative Kornheiser, I've been so grateful for all parties involved, holding the complexity also that sometimes we have expertise to weigh in on the policies that even are not our favorite ones and just that we can keep great, open communication and sharing expertise between legislative staff and our crew. It's been really great. And I know it's been an awesome learning journey for many of us at Tax who aren't often in the weeds with corporate income and business income tax. I feel like I learned a graduate school level corporate income tax class in the last couple of weeks since I've been here. So feel free to test me. I'm ready. But in general, I know that we had kind of an evolving fiscal situation with the estimates for what a linkup would look like. And I really appreciate the committee's thoughtful approach to working with what we had with that really expensive linkup on R specifically, that could really have a pretty big impact on businesses and with the taxes they pay here. I think that given that we can't afford a full link up, I think that's just generally agreed upon. This is a really thoughtful way approach it. I really appreciate that there's the carve out for small businesses is admittedly gonna be quite a lift for us to administer, but I think the policy outcome is worth that effort. And we've already begun talking through how this will be implemented and how we can play it out in the forms. And I think it will be doable. Administrative considerations are not the only considerations. And I think that's a worthwhile direction to go here. And really appreciate keeping the research and development credit increase as well to help Yeah, for the larger businesses that are gonna have to keep amortizing these expenses as they have the last handful of years and aren't able, for Vermont tax purposes, to kind of go back to the norm of immediate expensing. I think it's really nice that the R and D credit will be there to kind of reward folks who do a lot of R and D qualifying activity here in Vermont, which is awesome and makes a lot of sense. So yeah, I think only good feedback on those fronts. It was a really policy approach. The one piece I did want to just say something again on, I think Will and I spoke a little bit about this when we were here early last month. But just to the topic that representative Ode brought up on the qualified small business stock exclusion, that's like the one the one policy here that does stand out to us and also to the administration is a little different. Because whereas, you know, most of the stuff we've talked about here are policies that affect, you know, like a corporation or a business that's broad taxable income, and then Vermont takes its little slice. This exclusion for the qualified small business stock is really eliminating that exclusion is only going to affect Vermont residents. So these are founders or just early investors or entrepreneurs that are calling Vermont home now. And if they want to realize these in the year that they realize capital gains from that big investment they made a handful of years ago or longer, they're going to see a much higher tax liability because they live here in Vermont than if they lived elsewhere. We've talked about this in this room before, but whereas most of the time, I tend to kind of roll my eyes about the idea of someone moving solely for tax purposes. I think that someone, even if, like, all their friends and loved ones were here in Vermont and they, like, really like their dings, like, might actually change their domicile, you know, if if they're facing, like, a multimillion dollar tax consequence from being here versus somewhere else. You know, the other New England states are all conformed on this treatment, so we do we would stick out regionally. And just, you know, regardless of folks rearranging their domicile around this or not, I think it definitely lends to optics that were not a great place for an investor. And I want to clarify that it's like, this will affect a Vermont resident regardless if the investment was made in a Vermont company or elsewhere. So acknowledging that is not a direct impact on Vermont businesses or Vermont startups. But to the extent that there are Vermonters who are enthusiastic about making a big investment to a local company or a corporation, it could change the environment for those companies here, too. So that's my 2¢. And it's also that's the one proposal, as I've talked through. You know, this package with the administration, that's the one that that, you know, gave the governor pause too. You know? Not not surprising based on where he stands on tax increases that, you know, one that just targets Vermont residents was is challenging for him. So I just wanted to say that on the record, as you guys venture into the policy discussions.

[Emilie Kornheiser (Chair)]: Will you sum up your comments with how much you like the rest of the bill?

[Rebecca Samuels (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, I do. Except for this sore thumb of the qualified small business stock, I think this is a really thoughtful way to approach a very unique link of the year for us. Yeah.

[Emilie Kornheiser (Chair)]: And then the part about the 75% tax credit is we will be leading the nation in this. And I'm curious if the tax department has any ideas on working with the agency of commerce to make sure that Vermont businesses are really aware of this. It's something I know that tax preparers will know about it. But I knew even when we moved to single sales factor, commerce didn't seem to be sharing it. And that was a real boon for manufacturing businesses here. And so we're doing this really cool thing, and I want people to know about it. So I'm wondering if you have any thoughts on how we can be like, Vermont's moving up all those little metrics everyone's always emailing me about.

[Rebecca Samuels (Deputy Commissioner, Vermont Department of Taxes)]: Yeah, yeah. Well, admittedly, I hadn't given that piece of the implementation rollout a lot of thought until now. But certainly, the tax department would love to partner with ACCD and working on how to champion this more with their constituents, help with messaging and things like that. Think it makes a ton of sense to celebrate if this ends up being part of our tax code. With the single sales factor, I think Yeah, it continues to surprise me how I think we were stuck in this three factor apportionment world for so long that folks are still catching up with the new world. And it was, I think, an incredibly beneficial change for our local Vermont businesses and corporations. But also, it was kind of like bringing Vermont to somewhat of the status quo where other states were at. So it might have felt less celebratory. Was like, we made it. We're treating this stuff the way that other states treat it. But this would be we would really be out in front on the R and D credit, which is very cool.

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

[Carolyn Branagan (Member)]: Great.

[Emilie Kornheiser (Chair)]: Thanks, Greg. Michael, what a perfect timing of a moment you have. Really? I mean there was a perfect timing actually magically exactly at eleven but we'd have another you can sit down. This is actually another perfect segue moment.

[Michael O'Grady (Legislative Counsel)]: I don't know what you are reviewing for purposes of

[Emilie Kornheiser (Chair)]: We are talking about the miscellaneous tax bill, and I believe we had some new language that you handed to Kirby. Sections 21, two, three, twenty three. And I would love for you to talk to us about those.

[Michael O'Grady (Legislative Counsel)]: Okay. You should all recall this is Microbating with Flexitive Counsel. You should recall that you had discussion about the authority of the department to establish by rule fees for the use of department lands, roads, buildings, and facilities. There was concern that the department might use that authority to establish the need for a license for persons to access department lands. And I think it also raised for you the question of whether or not you want to give the department this authority because, generally, by statute, agencies are required to propose their fees to the general assembly, and the general assembly is supposed to set those fees. Usually on a three year basis. Not recently, but that's what statute requires. Okay. What has come up as part of this conversation is that the department issues licenses for the use of land, and it's generally multiyear licenses for things like research, academics, used by utilities to, say, a microwave tower on microwave relay on a on a fire tower. And so they are concerned that they don't lose that authority. And plus, they also set the tuition for the Green Mountain Conservation Camps. So what the language generally does is it lets the department retain license authority for multiyear licenses for research, academic, futility, etcetera, lets the department set the tuition for the conservation camps, but requires the department to report back to you and reenter the normal fee making process for all other fees for the use of apartment facilities, roads, buildings, vans, etcetera. And it specifically prohibits the commissioner from requiring a license or permit for user access of department mask. That's generally what it does. We can walk through it specifically if you would like.

[Emilie Kornheiser (Chair)]: Questions? You folks want to walk through it specifically?

[Carolyn Branagan (Member)]: Representative Elliott? Just so I understand, so that thing we were initially worried about is gone?

[Emilie Kornheiser (Chair)]: Maybe we need a

[Carolyn Branagan (Member)]: permit to go fishing or

[Michael O'Grady (Legislative Counsel)]: So you still will need your fishing license or hunting license to access Department of Lands to engage in those activities. But just to access the land, that'd be either, say, you want to put your kayak in, or you just wanna go for a walk on department lands, you won't need a license or permit to do that. Okay.

[Carolyn Branagan (Member)]: And then, Michael, again, I'm showing my age, but I thought we allowed them permanently to set that tuition rate years ago.

[Michael O'Grady (Legislative Counsel)]: You did in 2006, but you were continuing that.

[Carolyn Branagan (Member)]: Yeah, Okay.

[Michael O'Grady (Legislative Counsel)]: So let's look at the exact language. You'll see on page what I have is page 16, section 21, you're in 10 b s a forty one thirty two, which is the general duties of the commissioner. And you can see the existing language goes on page 16 to page 17, where the commissioner has the ability to adopt and publish rules, setting fees for or charges for the use of land, roads, buildings, or other property and the use of and tuition of the Green Mountain Conservation camps. So that first general authority, not including the tuition, was added in 2005. The tuition was added in 2006. And the fees collected under this subsection go into the Fish and Wildlife Fund, which is used to support the general activities of the department. So you would replace that authority with saying, notwithstanding 32 VSA six zero three, that's the normal fee requirement where agencies submit to you a proposed fee and you approve it. Notwithstanding that, with the approval of the secretary of natural resources, the commissioner may issue those licenses for long term use. Those licenses are already authorized underneath the department's existing rule. So those are the licenses that have that maximum fee of $10,000. You remember the last time I was in? So they have that would remain that long term license for a research academic study, commercial use, and use by regulated utilities, and the commissioner may set the tuition for the Green Mountain Conservation Camps. Page 17, line 10, the commissioner shall adopt those by rule, but the commissioner is prohibited from adopting by rule requirement that an individual possess a license or permit in order to access lands owned or controlled by the department. Fees would still go into the Fish and Wildlife Fund. License is defined as license is defined in the current department rule as, a written instrument that authorizes research, academic study, commercial use, or use by regulated utilities, but does not vest the licensee of any property rights. And then on page 18, section 22, the department's current rule, which I was misimportant when I talked to the chair recently. I said that that rule hadn't been finally approved by LCAR, but it has been finally approved by LCAR. I just went through the LCAR actions, and it was approved January 29. And it just hadn't shown up on the LCAR minutes that I had reviewed previously, but they are now it's now there as being approved with the LCAR minutes. Think, representative Higley, I think you were the one that moved to approve it as according to the LTARR Act.

[Mark Higley (Member) — time-bound overlap]: Now are you talking specifically about the provisions that you're looking at for that inclusion for people who use the access facilities? Because I don't remember that.

[Michael O'Grady (Legislative Counsel)]: So this is where I get that? It's this rule and the specific language of that rule.

[Emilie Kornheiser (Chair)]: Representative Ode, were you at Elkhart when that happened as well? Sorry. I was just trying to figure that out. Oh, no. Go ahead.

[Michael O'Grady (Legislative Counsel)]: So that rule is in place now. It would stay in place for a year. And then in July 2027, it would be repealed. In January '27, the department would be directed to come to you with a proposal for the fees for the use of the lands, facilities, and buildings. If this would stay in place, it would be good law. It does not require a license or permit for a general user to access department land. But then you would reinsert the department back into the normal fee making process beginning 01/15/2027. And that's what the language of page 18, line six through 13 does.

[Carolyn Branagan (Member)]: Another question. Okay, so we're putting them back into the three year fee process. What happens if our administration decides that they don't wanna do a fee? Well,

[Michael O'Grady (Legislative Counsel)]: their rule would repeal and they would no longer have authority to collect fees for the use of the facilities, buildings, etcetera. So they would lose revenue if they did not come to you with proposed fees for you to approve.

[Emilie Kornheiser (Chair)]: To be fair, that makes them like every other agency. She loves it. I I understand. I understand. Thank you. It's pretty drastic. We used to think that I'd Let's have one person speak at a time, please, everyone. I'm done. Thank you, Madam Chair. Absolutely. Representative Page.

[Woodman Page (Member)]: So those fees are for everything, it's just for, you know, like, for fishing access and land and things like that?

[Michael O'Grady (Legislative Counsel)]: So so the fees are things such as use of the Edward Teddy Waszazak, $300 The cabin rental, $60 a night. School use, $5 a student. Weddings, $5,000. Things like that.

[Woodman Page (Member)]: But at a later date, the commissioner could come to this committee and request fees for the use of the phishing ad sets or Yes,

[Emilie Kornheiser (Chair)]: for absolutely anything, yeah.

[Michael O'Grady (Legislative Counsel)]: And it doesn't prohibit the department from proposing a user license for Department of Lands, but the department would have to do it for you, Not by rule. And as far

[Woodman Page (Member)]: as hunting licenses and fishing licenses? Not affected.

[Michael O'Grady (Legislative Counsel)]: And the fees for them are already set in statute and are not settled.

[Carolyn Branagan (Member)]: Any other questions about what happens here? Thank you. Thank you. Of course.

[Mark Higley (Member) — time-bound overlap]: No, so I guess my concern now is there has there been, do you know if there's going to be any discussion with the Commissioner of Fish and Wildlife to not go to the whole extent in the next year of creating this possible new permitting licensing fee or access to, you know, folks that have a lot of tie up or whatever can use these facilities?

[Michael O'Grady (Legislative Counsel)]: Well, if if the commissioner did if you pass this and the commissioner did, the commissioner would be prohibited from doing that. It goes on page 17. It says the commissioner prohibited from adopting by rule or requirement that an individual possess a license or permanent in order to access science or anything to be held by the department.

[Emilie Kornheiser (Chair)]: And I talked to the agency before the session started and before that rule was passed, and we've had versions of this language since pretty early in the pandemic. So I don't think any of it's a surprise to them.

[Michael O'Grady (Legislative Counsel)]: And I have scanced that efforts to have a user license or user fee for access areas or even to the waters, it is not an easy subject. And I would think you as the supreme policymaker could want to be the one set of the entity that the chairman.

[Carolyn Branagan (Member)]: You've heard about the Trump Supreme

[Emilie Kornheiser (Chair)]: policy. Yeah, mean,

[Carolyn Branagan (Member)]: there's

[Emilie Kornheiser (Chair)]: the policy, and then there's sort of our responsibility to the institution of the legislature and the institution of democracy to make sure that the three, you know, branches of government hold and respect each other's power. Thank you.

[Carolyn Branagan (Member)]: Thank you.

[Michael O'Grady (Legislative Counsel)]: And that's your rulemaking power. It's your power.

[Emilie Kornheiser (Chair)]: Absolutely. You

[Michael O'Grady (Legislative Counsel)]: just gave it to them. Mhmm. You can take it away.

[Emilie Kornheiser (Chair)]: Thank you. It is maybe it's a

[Carolyn Branagan (Member)]: very tricky top, which I remember.

[William Canfield (Vice Chair)]: We did what? Are there any other towers?

[Michael O'Grady (Legislative Counsel)]: I would do it twice.

[Emilie Kornheiser (Chair)]: Very good cook, that percentage. That's quite fun.

[Kirby Keaton (Legislative Counsel)]: Any other towers that we've given over there?

[Emilie Kornheiser (Chair)]: Yeah, I mean, is one place that we delegate authority sometimes. Representative Ode. It's a very tricky topic. We tried to do it ten years ago or eight years ago, and it's actually, on a really tricky topic, easier to deal with through LCAR, just I think sometimes having a really tricky I'm just saying that it is smoother to LCAR. I think that's because no one's paying any attention, to be honest with I don't mean like, I mean, the full body's not paying attention. The people in LCAR are paying attention, I'm sorry, didn't mean that to come out the way. I didn't take that I'm at trying to say something. Representative. It's representative of Holcombe. Thank you. Enjoy wherever you're going next, Michael. That's okay. I think probably whether it's easier or not, that's where you sit.

[William Canfield (Vice Chair)]: But Ken, just further on the tube, talking about healthcare, because this is a rule that they were allowed to submit under law without legislative approval, there isn't that look back to whether or not it meets legislative intent.

[Emilie Kornheiser (Chair)]: Oh, that's really interesting. We always sort of see if it meets legislative intent, And if we believe it does, then we have to pass it, even if we think, even if the LCAR members are concerned. But you're saying in this case LCAR members write a letter to the committees of jurisdiction, write letters to us, and point out that they may wanna look at this again and write a law that would prevent something, prevent a rule that we think that we might not prefer, Yeah. And so And write a new law and be more specific so you end up with the policy result that you prefer. But we don't get to Well, what I heard We don't want to end. We don't get to say that. But what I heard Representative Higley say is that this particular rule was not set up in such a way that you actually, that LCAR even needed to check legislative intent. Is that what you're saying?

[Kirby Keaton (Legislative Counsel)]: That's fine.

[William Canfield (Vice Chair)]: Right. Because it wasn't through a bill and That's law that true. The, you know, environment committee passed. Right? And so generally, if that's the case, your rule, we will send a letter to the chair of the environment committee and say, does this meet legislative rights?

[Emilie Kornheiser (Chair)]: And generally, if there's rulemaking related to taxes or fees, I receive an enormous packet about it as chair. And I didn't even know about this until I read an article about it in Digger.

[William Canfield (Vice Chair)]: Well, to be honest, maybe it's, I mean, Carol knows as well as I do, how car is pretty much, you know, fast moving process with unless there's some outside intervention from somebody that really has the wherewithal to know all the ins and outs of a packet this thick. A lot of times you don't see all the ins and outs. The thing that I'm concerned with, I don't remember the conversation with Fish and Wildlife who talked about all the fee increases for the camps and all that, ever talking about this particular fee for access to

[Emilie Kornheiser (Chair)]: Oh wow, at Elkhart you didn't even. So I think that's even more reason we should be I think it's representative of folks. I just wanna say, you have, you may have some sample bias because you only see what has made it through child color, meaning in terms of committee. And so if there are other rules that they don't wanna advance related to other fees or other initiatives that they want, it never even gets to. So it's just, I think the healthy piece of legislative oversight is that we are forced to do that check back. Particularly in Texas. It's only the second time I've been off six years? It's only the second time that a fee has been imposed, not by us. The first time was maybe six or five years ago. And that was a great journey. And we are gonna also, I believe, receive a bill from natural resources about tags and jurisdiction over tags that is much, much narrower than this. So we'll have a chance to have this conversation again. Dear Dear tags. Yeah. Because they added a new tag this year and did not and it had it was a free tag because they actually did not have authority to charge a fee for it without talking to us. Oh, but there's, and just respectfully, there's lots of ways that the rules processes have implications that are financial implications that don't involve fees. That's true. And I'm just saying that there's a lot that happens outside the legislative process that has an impact on the bottom. That's true. And it's bipartisan. Although we're always asked, Every rule, it always says, what's the economic impact? What's the impact on schools? What's the impact on people? There's a list of your budget. I know. And it's bipartisan, both those those. Positions. We have Chris here. The fiscal note's not gonna be ready for this bill till tomorrow. Tomorrow. Tomorrow. Okay. Great. So what we're doing for what I see as next steps for this is people are gonna do some thinking about everything, but I imagine extra thinking on the conformity issues. We will have an opportunity to talk about that again after lunch and then tomorrow morning again, and then planning to vote tomorrow afternoon. I'm gonna hang out here if anyone wants to talk about any of it. And then we are back here at 01:15. Amy Spear from the chamber has been as have and the accountants association. Is that what they're called? Yeah. VP and A. Society. Thank you. Have both been really involved in this process and working with tax and JFO and me to and they're sort of around the building. And I think Amy will be back here later if anyone wants to talk to her about the chamber's perspective on the bill as well. So with that, see you after lunch.