Vermont Legislature SmartTranscripts:

[Rep. Bridget Burkhardt, Clerk]: Situation's happening?

[Rep. Rebecca Holcombe]: We have moved Carol's too because it's smart. Fighting rid of dirt wheels.

[Rep. Emilie Kornheiser, Chair]: Here we are in Weeds and Means, still Thursday, March 19, 10:30, continuing our work on oh, we got a bill number while I was drinking coffee. HNI-forty4. And we have Patrick Murphy and Michelle Blumhauer here to speak with us. Michelle, do you want to sit in chair? You saying what's your Well,

[Rep. Rebecca Holcombe]: Madam Chair, it's your preference. Patrick is going to do all of

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: the MBUF related references, and then I'll do the balance of any There are a few questions in this general field. So I don't know if you prefer to hear from

[Rep. Emilie Kornheiser, Chair]: Patrick first, that topic, or

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: if you want to hear from me first.

[Rep. Emilie Kornheiser, Chair]: Does anyone want to say something grand and big picture to start or no? Okay, great. Let's start

[Rep. Bridget Burkhardt, Clerk]: with Patrick then. Cool. I love that.

[Rep. Emilie Kornheiser, Chair]: No, thank you. Okay. No need to waste time on grand big picture. Patrick, hi. Welcome. Good to see you.

[Rep. Bridget Burkhardt, Clerk]: Good to see you, Archie.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Hi there. Good morning. Patrick Murphy, state policy director for the Agency of Transportation. So I'll try and run through a number of your questions that came up this morning. I do have slides if we want to go through those to give you a better sense of how we came to some of the decisions that we made. But I'll just start by, know, one of the questions that came up was why mileage based user fee for battery electric vehicles. Why did we do it in the way that that we've done? So up until early last year, battery electric vehicles weren't paying anything into the transportation fund in the same way that gas vehicles were. With plug in hybrids, there is a difficulty in trying to figure out what what miles were traveled on electric versus which were traveled on gas. People used vehicles differently between cities and towns and seasonally, so it was too hard in effort to, in this first phase, try and figure out what a mileage based user fee would look like for a plug in hybrid vehicle that would be fair. So we are trying to move towards greater fairness. I think I'll pull up my slides right now and we could get into that. Can you all see this?

[Rep. Bridget Burkhardt, Clerk]: Okay. Thanks.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So I'll just quickly review what's been done and where we've got to go. Back in '23 was when the idea first originated with Act 62 to be able to work away at an implementation plan. In 2021, the agency conducted a road usage charge study with a number of stakeholder groups surveying work that was done. And one of the important things that came out of that process was to build on the existing work that we have done in helping to upgrade our core IT systems for the Department of Motor Vehicles, but also to to keep things simple and cost effective. So we are already collecting odometer readings through the annual vehicle safety inspection process. That is a way to be able to use without getting into privacy concerns that you have with more technology heavy solutions to be able to get the data we need to apply a fee.

[Francis Philopoulos, Joint Fiscal Office]: So there was all kinds of things that came out

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: of that initial study, the desire to be able to have a system that reflected the true impacts of a vehicle upon the infrastructure, so getting away from a flat fee model that had been sort of coming up in a number of other states targeting electric vehicles to be a fairer system that's more reflective of how many miles people actually traveled.

[Rep. Emilie Kornheiser, Chair]: And Patrick, I think you came in last biennium and last year to tell us about that and maybe even earlier this session. And I thank you for the review.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. So that's how we got to where we are. What we need right now is for a statutory framework to be adopted, to be able to implement the fee. As we have said in years past, this is being done with federal money. 80% of the project is being funded by a federal grant through the Highways Administration. And to the point about administrative costs, we estimate administrative costs to be somewhere between 3.5% to 5%, but we expect this all to be incorporated into normal course of business. There won't be any new staff that are hired specifically to work on mileage based user fee. It will be handled in the normal course of business in administering all of the other fees that we do on a day to day basis.

[Rep. Emilie Kornheiser, Chair]: Patrick, can I ask you some questions about that?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure.

[Rep. Emilie Kornheiser, Chair]: We just had a rescission with you all, and I know that you are incredibly tightly staffed, and we've heard that in the context of other conversations we've had with you. I know that you have a really great new IT system that you're really excited about, and I am also having trouble getting my head around how you're going to take on this really, like, whole new, what seems to me like a brand new business line without any change in staffing. Well, I'm not inside AOT, so I want to trust your word for it.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. So the EV infrastructure fee, there was a question as well about maintaining two different systems. They're really not going to be two different systems. They're they're going to be the same system that's been upgraded with the $50,000,000 investment by the state. So the EV infrastructure fee is fairly simple. It's administered through the registration process. It's no different than, you know, administering the registration fee itself. A mileage based user fee will will be handled somewhat differently, but it'll still be within that same framework where reconciliation process will happen at the point of registration. People will be able to see what's owed through their MyDMV accounts or through their business in person at DMV, and then they'll be able to pay in a number of different methods that are laid out by this legislation. So it's there's not expected to be, maybe a transaction will be slightly longer than it had been before, but there's not a need for new staff to do specifically work on this versus some other new projects that happen at DMV.

[Rep. Charles Kimbell, Ranking Member]: But at the same time, if you go with a pay as you go model, you're talking about monthly billings or doing that kind of stuff and setting it up. Do you have increased cost in your credit card processing? We had that question come up as to whether or not users would have to absorb the credit card processing fees inside of what you charge.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So right now as a up up until now, I think DMV has not passed on that that per transaction fee for for credit card transactions. And I think the proposal I'd have to defer the DMV on that, but I think the proposal this year was to begin to collect that in keeping with some of other state agencies that do collect a transaction fee. But much of this will be handled within the system itself that's developed through the grant funds.

[Francis Philopoulos, Joint Fiscal Office]: So

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: you're selecting a payment option at the point of registration, which might be on a monthly basis, on a quarterly basis. By the way, that is something that will handled through current staffing levels.

[Rep. Bridget Burkhardt, Clerk]: So with a high level of automation, I would imagine. Yeah.

[Rep. Emilie Kornheiser, Chair]: And That's right. You you said that the whole contract for this is covered by a grant?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: The work to be able to actually build a system is covered by the grant. The ongoing costs are not operational costs in years two and beyond aren't covered by the grant.

[Rep. Emilie Kornheiser, Chair]: Are there operational contracting costs or just the operational costs to your staff that we discussed already?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: No, this is the proposal that we thought was going to be the most cost effective. Other states that have done this and piloted mileage based user fees in other years and years past have relied on third party account managers and instead DMV will have this within its own shop. So there won't be that ongoing cost. Some states like Virginia are paying 40% in ongoing costs because of the solution that they picked, but also in terms of going with third party vendors rather than handling things in house.

[Rep. Emilie Kornheiser, Chair]: And then, is there any cost or extra labor for mechanics on this?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: No, this is another reason why it's much more cost effective than somebody having to buy a plug in device for their vehicle. We already capture these odometer reading readings at the point of inspection, and so what will happen is that, in essence the system that is built to apply the thieve will be able to then receive the data from our AVIP system which collects the odometer readings.

[Rep. Emilie Kornheiser, Chair]: I know we're still on your first slide and we're just jumping into questions. I could go for another one or I can let you go for a while with your slides. What's your preference?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Jump in as you see fit, yeah.

[Rep. Emilie Kornheiser, Chair]: The pay as you go model, I guess I would say I personally am uncomfortable authorizing the full rollout of that rather than you all, if you do want to develop it, developing it and then coming back to us for authorization. Can you talk me through the pros and cons of sort of the timelines around that?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So we wanted to be able to have language that allowed for that possibility because it is what would more closely reflect how people pay for the gas tax right now, and in essence somebody would be able to self report, take a picture of their odometer reading, self report, and pay in increments that aren't even necessarily on a schedule, like a monthly or quarterly basis. They might take a big trip and they want to make sure that they've paid for that trip within the system. But we're not quite sure because we are in the middle of the development process, the contracting process. We're not entirely sure whether we'll be able to implement that by January 1. So we don't want to have the language direct us to do that, but we do want to provide that potential option. In the case, there was a question earlier about moving to two year inspection cycle, and in that case, a pay as you go option would still, would provide the agency a little bit more flexibility in working through a number of different scenarios that are likely to come up because of, you you have a two year registration cycle and now a two year inspection cycle that would allow us, I think, to be able to handle that a bit better. No matter what, at the point of registration or registration renewal, all of these data points have to be reconciled. So whether you're self reporting or you're paying an estimated amount on a monthly or quarterly basis, by the time you get to the end of your reporting period, you'll have the actual number, and I heard some questions about that as well, getting into a process of paying a balance or crediting back to an account, that again will be handled all within the system. The balance will be on there, and if what you've paid up you know, through the end of the mileage reporting period is less, then you'll owe slightly more to kind of become current and be able to move forward with the registration process. If on the other hand you've paid over, then you'd be able to have that credit applied to your next Myospace user fee.

[Rep. Emilie Kornheiser, Chair]: And Patrick, if we authorized you to develop that pay as you go process, but did not authorize you to implement said process and asked you to come back for authorization for the implementation, what's the amount of money you might have in sunk costs or sunk labor or confusion? Can you talk through the dynamics of that?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I think it's more a question of just being able to explore that with the developer. I don't know that there'd be enormous amounts of money that would have to go into that specifically. I mean, just the ability to be able to pay on a different frequency based on estimated payments, a lot of the same principles are at play, so I'm not sure that there'd be a sunk cost that's huge because we've been authorized to develop something that we can't later use for whatever reason because of concerns by the legislature.

[Rep. Emilie Kornheiser, Chair]: Okay, I'm going to take that as permission to do that. Thank you, Patrick. I have one more question. It's a little bit obnoxious, so I'm just gonna warn you.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Okay. Perfect.

[Rep. Emilie Kornheiser, Chair]: And I know that you are not the commissioner, but you are there on the screen, and he is not. How is this not a new tax or a new fee?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Well, think the argument is that and maybe I'll just go to my next progress to the next slide. Think the argument is what's that? Sorry.

[Rep. Emilie Kornheiser, Chair]: We're thrilled that we helped you for our career. Next slide, yeah.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Oh, the mini celebration. So I think the argument is that you know, for a long time we've had this inherent unfairness because of the way that fuel efficiency and, you know, the development of electric vehicles has taken place, in that you have vastly different amounts that are being paid by different vehicles even though their impacts on the road system is fairly similar. So you have highly fuel efficient vehicles and electric vehicles paying far less, highly highly fuel intensive vehicles paying far more, somewhere in the average, we have a fleet wide average about 23 miles to the gallon. A fair system, if you're looking at a user's pay principle, would be that each is paying roughly the same amount according to the impacts that they have on the infrastructure. When we first used the gas tax as a proxy for use of the highway network, it was a much better indicator of how much pressure or impact you've had on the infrastructure, public infrastructure that we've developed, because vehicles were much closer in terms of fuel efficiency. Over time that has diverged, and so we have this system now where different models are paying vastly different amounts. So getting to the point is, it's really, if you look at it as the gas tax was originally intended to be a user pay model, it accurately reflected the use of the driver, what we're doing here is updating that model to incorporate electric vehicles, which had not been contemplated at that time, and so it's not in a sense a new tax, it's an adaptation of an existing tax to account for what we think will be a large part of our future.

[Rep. Emilie Kornheiser, Chair]: I love that for us. Okay, thank you Patrick.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. So this is the language here that you all approved last year directing us to have the MySpace user fee roughly approximate to what the average gas vehicle is paying in fuel tax.

[Rep. Emilie Kornheiser, Chair]: And so how did Nope,

[Rep. Bridget Burkhardt, Clerk]: keep on going.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Okay, so this is just to give you an example of sort of what I just described. So back in 2013, thereabouts when you last raised the gas tax, a Ford F-one 150, which is one of the more popular vehicles here in the state of Monct, a Ford150 was paying about $270 annually. That same pickup now in 2025 is paying far less at $185 The hybrid version of that is paying closer to the average amount at $153 and you can see even with the $89 fee on electric vehicles, it's still far lower than that average.

[Rep. Emilie Kornheiser, Chair]: Patrick, aren't more Vermonters driving cars from 2013 than driving cars from 2025?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sorry, what was the question?

[Rep. Emilie Kornheiser, Chair]: Aren't more Vermonterous driving cars from 2013 than from 2025?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Mean, I have to look at the vehicle distribution. I I yeah. I mean, I get get your point that there are more older vehicles than newer vehicles. Yeah. Okay. But I I don't know what the actual distribution of that is. If you're interested, I can get it to you.

[Rep. Emilie Kornheiser, Chair]: I think I saw that somewhere in the last year, so I could probably find it in my computer. Thanks.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. So the point is to be able to at least bring electric vehicles up to even what the most fuel efficient Ford F-one 150 is paying at 1.4 a mile. So this is the purpose that was approved by the House Transportation Committee and base basically to do this, to have battery electric vehicles contribute in a way that reflects those annual miles traveled. There was a report submitted to your committee, and then there's a policy brief that is much shorter if you prefer to go there, but it goes into basically how we came to this 1.4¢ per mile recommendation. I don't know if there are any specific questions on this, but it's basically taking a five year average because we do have a gas tax that can fluctuate at least part of it, and then dividing that by the most recent fuel economy data that we have for the fleet, which is, as I said before, about 23 miles to the gallon, and that's distance weighted, so it's not just taking average of all the vehicles. This recommendation was developed by the UVM Transportation Research Center diving into all of the odometer reading data, all of the registration data that we have up until 2023, which was the latest we could get, and being able to see what people's travel patterns were and making sure that we had a rough approximation of of where we are right now. Any any questions on this?

[Rep. Bridget Burkhardt, Clerk]: Nope. Thanks.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So this is the language that does that. For reference, I've included these other programs that were mentioned before.

[Rep. Emilie Kornheiser, Chair]: Are any of those programs mandatory and fully implemented for all EVs?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Hawaii will become mandatory in July 2028. It is now an operational program, but it is voluntary in the respect that you can pay either their flat fee or opt to pay the Miler Space user fee.

[Rep. Bridget Burkhardt, Clerk]: Thanks.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So that is one of the bigger reasons for why some of these rates are different. Vermont for its gas taxes, right in the middle of the pack for states ranked at somewhere around 24 out of 50. Virginia comes in higher at 1.9¢ per mile, Oregon as well to propose for 2.3¢ per mile. Utah was roughly where we were at 1.5¢, but then because of the voluntary nature of their program, in order to encourage more people to take advantage of the MySpace user fee, so that they could get more data and more volume into their program, they lowered that amount. And then Hawaii is a bit of an outlier because this 0.8¢ per mile does not include their different regions, their counties, which also have their own DMVs that then apply their own mileage or will be able to apply their own mileage based user fee.

[Rep. Emilie Kornheiser, Chair]: So Hawaii's infrastructure has a lot of tax Yeah. Capability, like enabling thing across the board. They also have a really cool property tax structure. So in, like, say, Utah or Oregon, are those sort of, like, early bird fee specials to some degree? Like they're planning on increasing them in the future and they're just trying to get people in the door?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Yes. They don't have mandatory programs, and they're also using different technology that in, you know, like telematics, in some cases the geo fencing with plug in devices, and so it's a much higher administrative costs and they actually need more and more people to enter their program for it to become more viable. So it's just the nature of how they're running things as more of a pilot rather than a mandatory program.

[Rep. Emilie Kornheiser, Chair]: Thanks. Can I ask you some more questions before you About different Not this slide? I'm just gonna sort of jump.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Go ahead. I can't see anybody really in

[Rep. Emilie Kornheiser, Chair]: the No, I'm so sorry. It's that's so awkward. The there's a forty five day payment window, but only a fifteen day appeal window. If we had the appeal window match the payment window, do you see any big challenges with that?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: No. As I think Damian had mentioned, a lot of this will just be through email communication, but yes, there's still going to be the traditional mail communication and that kind of thing, so I don't see a problem with that.

[Rep. Emilie Kornheiser, Chair]: Thanks. And if we exempted state vehicles, state owned vehicles and rental cars who have an ability to register anywhere, do you have any big red flags about massive losses of anything there?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: No, I think state vehicles was maybe in our initial draft, the committee decided to limit the amount of exemptions to just what was sort of constitutionally required, but I don't see any big issue with that. We also did hear from folks representing the car rental industry and the challenges of being able to apply this to their model. I think there are some different ways you could work around that, whether it's adjusting the 9% rental tax or having just a flat fee continue.

[Francis Philopoulos, Joint Fiscal Office]: I

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: don't think it's a huge amount of what we expect for revenue.

[Rep. Emilie Kornheiser, Chair]: Okay, thank you. And that reciprocal enforcement language seemed very intense, and it's not clear who we would be reciprocating with for a very limited number of dollars. Is that something that maybe we could hold on? And if you see lots of interstate issues, we could add that language in a couple of years?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I think so. You know, I think part of the work that we'll be doing with the grant is also working with our neighbors and others within the Eastern Transportation Coalition to figure out the issues around interstate travel, how we might in the future apportion revenue based on in and out of state miles traveled. Right now, that's not a concern because I think the example was of one of the representatives spending all his money at the Creamy Stand in New York and Vermont would still be keeping his mileage money here in Vermont. The reality is that New York does not have any sort of mileage fee that is for out of state vehicles. No other state has really figured that piece out. There have been some states that have assessed per kilowatt hour fee at public charging stations. The nearest one to us is Pennsylvania, so the risk of double taxation just really isn't there. A vehicle won't be paying much more than what a gas vehicle would be paying in state gas tax if they're traveling over the border. They're still not paying a federal gas tax and there are lots of other savings and reasons to move to an electric vehicle, but as this program evolves and becomes even more fair still, I think we want to have the ability to work with other states on figuring out how those interstate travel arrangements might work.

[Rep. Bridget Burkhardt, Clerk]: And then

[Rep. Emilie Kornheiser, Chair]: this whole thing for anyone else is welcome to ask the question anytime, just

[Rep. Bridget Burkhardt, Clerk]: for the record the

[Rep. Emilie Kornheiser, Chair]: whole mechanism for a new car or someone whose registration timeline and the new program don't line up well, to do that pay in advance rather than just have fourteen months counted, It strikes me like you're adding a level of complication that's not necessary and adding a cost to someone's purchase of a new

[Rep. Bridget Burkhardt, Clerk]: car at a time where

[Rep. Emilie Kornheiser, Chair]: that might not be necessary. I'm wondering, sort of your policy thinking on why you did that rather than just having someone do the sixteen months.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Well, our intent is not to have the infrastructure fee and this fee overlap in a way that costs people a month or two or however many months. The intent is just to have the EV infrastructure fee be credited towards their next payment, but in the circumstances where it's a new vehicle, you're just beginning with an estimated payment, so it's $154 but there is not the need to pay that upfront. Somebody would have the choice of saying, well, I'll pay on a monthly or quarterly basis, unless the language changes, being able to opt into a pay as you go system, so that you're just staying ahead of it, so that you don't get to the point fourteen months from now of having to pay all that money. That would defeat the purpose. One of the main reasons why we want to work with a mileage based user fee rather than a flat fee is because of the fairness of it, and a key piece to what came out of the road usage charge study was preserving that ability for people to pay on more of an as you go basis, whether that's strictly as you go or more on a payment frequency that resembles that like a monthly basis. That is one important element to this program design.

[Rep. Emilie Kornheiser, Chair]: I appreciate that, and I appreciate how a monthly payment is a fairly manageable amount, and I appreciate the ability to pay monthly or annually or quarterly. And then once someone's rolling, it will be mostly Quarterly is mostly function Or monthly is mostly functioning in a keeping up with someone's budget. It's sort of that first big payment that I think would be a shock, especially for a new, something that's brand new and people might not hear about until the moment they get it despite whatever I'm sure good communication you would do, most people are just living their lives.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Well, that's what I'm saying is, that's what we're hoping to avoid is that big one time payment. So instead by saying, alright, here's the invoice for this estimated payment, how do you wanna break this up? You know, your your first payment might only be that $12.13 dollars, and then you're paying that on a monthly basis. So it's not you know, you're paying the 154 upfront as you are right now with the $89 fee.

[Rep. Emilie Kornheiser, Chair]: What does your system look like for being able to credit someone who has overpaid?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: So you'll be enrolled in an account. The account will have that the balance of what somebody has paid. So if somebody there are, you know, few possible ways to overpay, if you're paying as you go, you can't, but maybe if you're paying on a monthly basis, you won't ever get hugely above what the actual payment would be, but that balance would show and then at the end when you go to renew your registration, you'd be able to see, okay, I've paid x amount, but here are the miles traveled, here is the actual final tally, and then that amount would just be credited to your next registration. Or in the event of that dramatic terminating event, you would just have a a refund at that point.

[Rep. Emilie Kornheiser, Chair]: So it's not gonna be a situation where the state is mailing checks for 5¢ to people?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: No. That that's why we wanted to have this design that allowed for payment credits towards the next MilerSpace user fee. Wanna avoid the situation of, you know, costly mailings that, you know, end up exceeding the amounts that are returned.

[Rep. Charles Kimbell, Ranking Member]: Thank you. So, Patrick, in the case of Virginia, they

[Rep. Bridget Burkhardt, Clerk]: offer the pay as you go methodology too, right now?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I believe so. They have a different system that's not really a true mileage based user fee. I don't know if you want me to get into the details at this point.

[Rep. Charles Kimbell, Ranking Member]: No. I was I was just wondering if the in the experience of other states, how many of the users are opting for a pay as you go versus paying in an annual fee?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I see. Yeah, I think it's we wouldn't be sort of comparing apples to apples because they are such very different systems. Some allow for like a transponder type device in their vehicle and their accounts are attached to that. So they're just paying as you go similar to like the E ZPass.

[Rick Segal, Office of Legislative Counsel]: E ZPass, yep.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Yeah. So that's not really comparable to anything we're talking about here.

[Rep. Charles Kimbell, Ranking Member]: Yeah, was just trying to get to what you anticipate in terms of that breakdown of the percentages, who you think might pay on a monthly, and that really speaks to who owns an EV as to where they fit economically and how many of them would rather pay all at once.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Yeah, and then it depends on what was developed as a system for that pay as you go option because some people might really stay away from it because it involves doing something active, proactive, where you're taking a picture of an odometer reading and you have to then upload that to your account. So it's really hard to estimate, and I think that speaks to some of what Logan had talked with you all about in terms of trying to estimate revenue in these first six months, because you do have EV infrastructure fees that will carry forward and be applied forward to some portion of the next mileage based user fee. And then you have others that would elect to pay on a monthly or quarterly basis in a way that you don't have right now, where it's just a flat fee. We're sure that the number of vehicles in the system will have to pay X amount before they move on to the registration.

[Rep. Emilie Kornheiser, Chair]: Patrick, I want to make sure we have time to hear from Michelle. I haven't had all my questions answered. I'm not seeing other questions from the committee. Is there anything else you want to make sure to tell us?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I don't know. I'd have to look through the slides. But if there are no other questions, there's certainly an ability to follow-up. Think

[Rep. Emilie Kornheiser, Chair]: Oh, that one. I have a question about that. Thank you.

[Rep. Bridget Burkhardt, Clerk]: Okay, sure.

[Rep. Emilie Kornheiser, Chair]: I'm gonna solve flat fee at 98 percentile. Yes.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Why not? Because what we want to do is be able to encourage people to make sure that they get their vehicle inspected before coming back for registration renewal. And so rather than create all kinds of penalties in the way that Damian alludes to with the diesel and gas tax that maybe aren't the best fit for just a personal vehicle. If there's an absence of an odometer reading, there's nothing that, you know, you can calculate for a MySpace user fee. And so if you default instead to a flat fee before being able to move forward in the registration process, the hope is that that would encourage more people to to go through the process of getting their vehicle inspected.

[Rep. Emilie Kornheiser, Chair]: After 90 a why 100? Why not 50?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I think be just because of, the reality that there are some outliers, and that would kind of approach being quite punitive if you went with the 100 percentile because somebody's traveling an insane amount of miles per year.

[Rep. Emilie Kornheiser, Chair]: Oh, so, like, to some degree, you looked at a graph of miles traveled and picked what, like, looked like a natural curve point?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Yeah. And we can we can share that with you. But what it represents is about $375 $380

[Rep. Bridget Burkhardt, Clerk]: Thank you. Sure.

[Rep. Emilie Kornheiser, Chair]: Anything else?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Alright. So there are just a couple of things that I think Damian flagged for the language that still needs some reworking. And then this last bit, the section 22 on how this MBUF revenue would be allocated in the first year. What I read this language to mean is that all revenues generated by the Milerspace user fee in the first six months would go towards town highways, but there is this difficulty of trying to estimate out what that might be because of the variety of payment options, and because of the transition language, so that there are, I could foresee circumstances with this language that would result in a net reduction to the transportation program as it was recommended by the governor.

[Rep. Emilie Kornheiser, Chair]: So if it went to I'm, like, just brainstorming here. So if in '27, it just went into, like, the big pot and then it went and there was and then in '28, it went into the highway aid, would that straighten out some of those problems?

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: I'm trying to I think there's also a a timing issue. I think you'd you'd probably wanna hear from our CFO, Candice, as well in terms of how this might be better handled.

[Rep. Bridget Burkhardt, Clerk]: Okay.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Timing issue of when we'll actually know how much there is to then apply to the following fiscal year.

[Rep. Emilie Kornheiser, Chair]: Okay. I'm sure Logan and Candice talk to each other pretty regularly. Cool. Nice.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. Any other questions?

[Rep. Emilie Kornheiser, Chair]: I don't think so. Thank you so much for all your work on this.

[Patrick Murphy, State Policy Director, Vermont Agency of Transportation (AOT)]: Sure. No problem.

[Rep. Rebecca Holcombe]: Hey, Michelle. Hey.

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: For the record, I'm Michelle Boomkhardt from our agency of transportation. So I know that there were a couple of other questions that arose during the presentation that Logan and Damian provided. One that I picked up on was related to the Transportation Alternatives Program, which was the one where we were suggesting that we increase the amount of the award maximum from $600,000 to 1,200,000 for just this one fiscal year. To provide a bit of context, the Transportation Alternatives Program is a federal program. It's a set aside program that's dedicated to providing monies to bike and head and trail programs, as well as clean water initiatives that relate to the transportation network. So for building stormwater facilities, for recovering salt sheds, those sort of things. So it's kind of a blended program that the federal government has had in place for a number of years. The current federal transportation bill, the five year bill, allocated us a specific amount. It's about $4,200,000 annually for the TA program. The current statutory requirements are that 50% and this has been in place for a number of years, maybe four. I'm not sure. 50% of the available TA funds will go to clean water related projects, and then 50% will go to bikeped projects. And the way we have carried this out is that if we make awards for the 50% on both sides, we have plenty of interest in these grants. We always receive more applications for the grants than we have funds available. Although I would say that we have less demand on the clean water side, more demand on the bike pad side. Many of the projects that have been awarded on the clean water side have not been able to go forward. A lot of these have been salt shed projects. A lot of the delays have been related to the increase in construction costs over the years. And so we find a town that might have gotten a $600,000 award. And now all of a sudden, the project is going to be 1,800,000.0 and the town can't afford it. So they canceled the grant. So the

[Rep. Emilie Kornheiser, Chair]: grant wasn't big enough to enable the actual project.

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: Exactly. And so now we have these built up funds in this category. We're not getting the federal dollars out the door. We have five years plus three after the end of the transportation program authorization period to deploy all the funds. And we're getting into a place where funds have built up in the program, and we may risk having to send them back to the federal government. So this program flexibility we've asked for, recognizes the fact that, we've had difficulty getting the money out the door on the clean water side. It won't restrict the boards being made on the clean water side, but it will allow us to more flexibly deploy the money, not miss the federal deadlines in terms of getting the money out. And also, a lot of the projects, just like the clean water example I gave, even a lot of the bikeped projects are fairly costly projects. These projects all have to go through federal environmental reviews, state environmental reviews. Many of them may involve right of way. And so they can take a period of time to do. Counts often will have to cobble together a number of grant sources to make these projects happen. And so this is a way to make sure that we draw down our federal funds with this one time bump and then return to the $600,000 after we see how the next grant cycle goes. And if the next grant cycle doesn't yield the outcome we're looking for here, we would come back with an alternate proposal. Representative Holcombe, does that answer your questions?

[Rep. Rebecca Holcombe]: Yeah. We actually got it explained to me by two different places. The

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: only other thing I remember noting was there was a question about the Agency of Commerce's Yes. Fee And that program was originally stood up using VW settlement funds. There was a period of time when there were some capital funds put into it. And then more recently, when the infrastructure fee for plug in hybrids and all electric vehicles came into place, there was a desire to begin to start charging some amount of a fee. And rather than just have it go to the transportation infrastructure, it was kind of a compromise whereby people that are the EV owners are going to be paying this fee. It'll go towards an infrastructure that they benefit from for this interim period until the MBUF is implemented. A lot of these installations have been at workplaces, at multifamily unit buildings, and at public locations, state parks, that sort of thing. In terms of where money to continue this program may come from in the future, unknown. It wouldn't be funded through the transportation program in a

[Rep. Emilie Kornheiser, Chair]: budget we would propose.

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: Do have program exists and doesn't have money. Yeah. We have a much larger federal program, the National Electric Vehicle Infrastructure Program, whereby we are still going to be deploying, I think it's 12 new sites at least.

[Beth St. James, Office of Legislative Counsel]: We have approved a grant

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: for that recently. Yeah. Okay. Like a large one. Large one, yeah.

[Rep. Emilie Kornheiser, Chair]: Like how many millions approximately? I'm so sorry. The overall program I believe the overall program, when

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: it started, was $21,000,000 There was a federal injunction on the program. We had gotten the Bradford site bill. And then it's like, are we even going be able to get the rest of the money? That injunction became lifted. We got in there, got the money locked down through federal obligation. And now our sites are going forward. And so we'll see construction over the next eighteen months. I think it's 12 additional sites. The Bradford site's beautiful. Yeah. So Thank you, Michelle. Really appreciate it. You're welcome.

[Rep. Emilie Kornheiser, Chair]: Folks, we're gonna transition from this topic and come back to it at 01:00. It's not clear if we're gonna stay off the floor after announcements or not. Still waiting to get some air traffic updates on that.

[Rep. Bridget Burkhardt, Clerk]: We have just we have this one bill from us.

[Rep. Emilie Kornheiser, Chair]: Yeah. And we'll get a text. Will monitor the floor. And if when we have a bill coming up, that person can run downstairs.

[Rep. Bridget Burkhardt, Clerk]: K. Thank you.

[Rep. Emilie Kornheiser, Chair]: If we are off the floor past announcements. So we're gonna move away from transportation. We're gonna move to h two eleven, an act relating to the brokers and personal information with Rick Siegel. Oh, there you are.

[Rep. Bridget Burkhardt, Clerk]: Good morning. Thanks. Yep. Anyone else need to exit or enter? Good. Great. Let's have a full changing of the guard.

[Rick Segal, Office of Legislative Counsel]: Good morning. Rick Segal with the Office of Legislative Counsel. So H2-eleven, the 43 page bill, I can give maybe the high level view of the things that aren't affecting the revenue of the state and then maybe down when I get to numbers, dollar signs. Okay, very good. So H2-eleven overall is a bill that will regulate data brokers. That's the biggest part of it. The other part is in this chapter is really the protection of personal information. So, there's a chapter on security breaches, notification of those breaches. Those won't affect the revenue in the state, but I will kind of go through chronologically and indicate what each section does. So that's not what I want share.

[Rep. Emilie Kornheiser, Chair]: Anyone over there wants to be less crowded over here, you're welcome to.

[Rep. Bridget Burkhardt, Clerk]: Okay. Testing my bullet and

[Beth St. James, Office of Legislative Counsel]: focus here. Sorry, back to you. We

[Rick Segal, Office of Legislative Counsel]: have the first section, two thousand four thirty is the definition section for the entire chapter. I do want to highlight a couple of things that you may be interested in as far as even the writing is concerned. So 3A, broker personal information. This is what data brokers deal in, the brokered personal information of people. So the reason this matters is because the current definition is an exhaustive list of things that is considered brokered personal information.

[Rep. Emilie Kornheiser, Chair]: Can you remind me what year we passed the original date of birth?

[Rep. Rebecca Holcombe]: 2019? Yes, 2018.

[Rick Segal, Office of Legislative Counsel]: So inaccurate. Thank you. So the 2018 law was just a registry, is currently what we have, data brokers, if you do business in the state, must register. Okay, so the current definition of broker personal information is an exhaustive list of name, address, so forth, those key categories of what that is. The new proposed definition is any information, including derived data and unique identifiers that is linked or reasonably linkable to a person or a device that links to a person. So what that means is this could potentially expand the scope of what a data broker is, and that could affect the revenue, if more people have to register as data brokers, that will affect the revenue in the state. Continuing, the next definition you care about is actually the definition of data broker. So the main part remains the same. It is a business that collects and sells to third parties brokered personal information of a consumer. So that's why I brought up that definition, because you're expanding the scope of what that broker personal information is. That's one thing to know. The second thing to know is you are changing this direct relationship. So typically a data broker, you don't know who a data broker is for the most part. These are, like Alexis Nix, some of them are household names, a lot of them are not. And the whole kind of way they do business is selling our information to third parties without us really knowing, because we don't have a first party interaction with these data brokers, right? So the definition of what this direct relationship is has been changed a little bit. You see, currently we have in statute examples, this is what a direct relationship is and is not.

[Rep. Rebecca Holcombe]: Get a language clarification on that before you scroll down. Company named Fred sells maple syrup products. They collect data on all their customers, and they sell that to a company named Susie. Is that

[Rick Segal, Office of Legislative Counsel]: They are not a data broker.

[Rep. Rebecca Holcombe]: Even though they're collecting linkable data and selling it to a third party who doesn't have a relationship.

[Rick Segal, Office of Legislative Counsel]: Because the consumer, you have a relationship with this company.

[Rep. Rebecca Holcombe]: So I'm allowed to sell my relationships with them, but I just

[Rick Segal, Office of Legislative Counsel]: It's that second transaction. Let's say What

[Rep. Rebecca Holcombe]: defines the relationship though?

[Rick Segal, Office of Legislative Counsel]: Let me try to get it out. So it's defined here. You have a relationship with a, let's say, grocery store. You're a loyalty member with the grocery store. They collect your information. They are not a data broker. They sell it to marketing company X. Marketing company X now has your information. If they were to sell it or share it with us, they would be a data broker.

[Rep. Rebecca Holcombe]: So the fact that you swipe your credit card means you are a customer and that data can be sold?

[Rick Segal, Office of Legislative Counsel]: Roughly, roughly, yeah. I can't say yes or no 100% to that example, but usually if you have the interaction, you swipe your credit card, if you interact with the business virtually or not, then you would be a first party interaction with that business and they would not be a data broker. So really all we're changing here is how this direct relationship is defined. It means the consumer has intentionally interacted with a business for the purpose of accessing, purchasing, using, requesting, or obtaining information about the business's products and services. Something that came up in house commerce is what happens if I go online and get some insurance quotes? And they then sell my information. Are they a data broker? No, because you have interacted with that company. You have submitted your information, and now they are not a data broker because even though you're not a customer of them, you have that first party interaction.

[Rep. Rebecca Holcombe]: So if you accidentally clicked on a link, you're now a customer?

[Rick Segal, Office of Legislative Counsel]: No, well, if you submit your information with that instance, yeah, then they would have your information. If you just click on a link, they don't have unless there's cookies tracking you.

[Rep. Rebecca Holcombe]: There's cookies.

[Rick Segal, Office of Legislative Counsel]: Which is not, this rule is not about cookies. Maybe one day.

[Rep. Emilie Kornheiser, Chair]: So selling, does it have to be a monetary transaction? It can be a trade?

[Rick Segal, Office of Legislative Counsel]: So we define that here. A consumer does not have a direct relationship with a business if the purpose of the engagement is to exercise a consumer right or for the business to verify the consumer's identity. A business does not have a direct relationship with a consumer simply because the business collects brokered personal information directly from the consumer, they must intend to interact with the business. They are still a data broker and do not have a direct relationship with the consumer as to the brokered personal information the business sells about the consumer that is collected outside of a first party interaction with the consumer.

[Rep. Bridget Burkhardt, Clerk]: Okay. Thank you. Yes. This is Sundance. Does this

[Rep. Rebecca Holcombe]: affect selling of a list for political like if a political candidate collects information and then sells it to another campaign, that's often passed on again?

[Rick Segal, Office of Legislative Counsel]: So if that list contains, which it probably would, brokered personal information, it could, but it wouldn't be that initial interaction. Would be that party, the entity that has the information, that the consumer, let's say you give money to a pack, so they now have their information. They're not a data broker, but let's say they sell that the pack sells the list to a marketing company or to another pack or to another whatever, That entity would now be a data broker if they then sold the information or shared the information.

[Rep. Emilie Kornheiser, Chair]: So a double question. That's why I asked about trades. Well,

[Rep. Rebecca Holcombe]: not But it's a Trade is not a donation, right? People give. We know that.

[Rep. Emilie Kornheiser, Chair]: I asked about trades because often rather than a candidate selling that list, a candidate trades lists with another candidate. And so the third, the sec it sounds like the second time that trade happened, that would then be a data broker.

[Rep. Rebecca Holcombe]: The second time. But also if they donate, it is also that is the data broker, the person they donate to. You can trade it, you can donate your list. Let's ask for you to trade it.

[Rick Segal, Office of Legislative Counsel]: Clarification, get clarification, what's the question about the

[Rep. Emilie Kornheiser, Chair]: So the secondary the secondary holder

[Rep. Bridget Burkhardt, Clerk]: of the list can

[Rep. Emilie Kornheiser, Chair]: then pass on that list to a third holder of the list. When they pass that on, they could sell the

[Rep. Bridget Burkhardt, Clerk]: list, in

[Rep. Emilie Kornheiser, Chair]: which case they're

[Francis Philopoulos, Joint Fiscal Office]: a broker.

[Rep. Emilie Kornheiser, Chair]: You've established that. They could trade lists, in which case you've established their broker. Can they donate that list Can he establish as a broker?

[Francis Philopoulos, Joint Fiscal Office]: Let's go

[Rep. Bridget Burkhardt, Clerk]: with the language because we do define what's selling. So

[Rick Segal, Office of Legislative Counsel]: the phrase sells licenses does not include a one time or occasional sale of assets of a business as part of a transfer or controlled assets. So that would not That's cover different. Far we're going get to the definition of sale, but so far your example, they would be a date of birth, just trading a list would still be sharing brokered personal information. Okay, going again, these are not really relevant to your jurisdiction here, adding definitions. Keep going. This is not relevant. Okay, so sale means the exchange of a consumer's brokerage personal information by the data broker to a third party for monetary or other value considerations. It does not include the disclosure of broker personal information to a processor that process the broker personal information on behalf of the data broker. The disclosure of brokered personal information to a third party for purposes of providing a product or service requested by the customer. Disclosure of consumer, the disclosure or transfer of brokered personal information to an affiliate of the data broker.

[Rep. Bridget Burkhardt, Clerk]: Is it affiliate?

[Rick Segal, Office of Legislative Counsel]: Yeah. We have it defined.

[Rep. Emilie Kornheiser, Chair]: Great, okay, sorry, I'll wait.

[Rick Segal, Office of Legislative Counsel]: No, it's okay, I'll go to the very top. I thought we had it defined. Actually, we do have it defined, maybe within the definition. Affiliate means, yeah, thank you, Subdivision C. Affiliate means a legal entity that shares common branding within the legal entity or controls or is controlled by or is under common control with another legal entity. Okay, the disclosure with the consumer's consent of broker personal information where the consumer directs the data broker to disclose the broker personal information or intentionally uses the data broker to interact with a third party. The disclosure of publicly available information, which we have defined as something that is part of government records or that you have been distributing to or widely distributed media. That's the definition of publicly available information. The disclosure or transfer of broker personal information to a third party as an asset that is part of a merger, etc. So again, the question being is transferring a list without being paid for it, would there be valuable consideration for that? And that's kind of the question.

[Rep. Emilie Kornheiser, Chair]: Thank you. That's helpful. And we're getting pretty deep in the weeds. I think I want to sort of back up, set the stage. We already have data broker laws. We're essentially updating them and changing the fee. And that's why we're here today.

[Rick Segal, Office of Legislative Counsel]: Yes, page 29. So a lot of strikers here, but again, I just want to give you all

[Rep. Bridget Burkhardt, Clerk]: your Thursday crossover week. I needed centering. You did that.

[Rick Segal, Office of Legislative Counsel]: Yes. Thank you. So currently we have registration entities who meet the definition of data broker must register once every year. That's not changing. The fee is changing from 100 a year to 900 a year. That's one change. The second change is that they must register within thirty days of becoming a data broker in the state. Currently, have to only once by January 31. So if you started on February 2, there'd be almost a full calendar year of you not having to register as a data broker. So this law says, well, thirty days, once you become a data broker in Vermont, within thirty days you have to register and then annually after. Okay, so the fee going up from 100 to 900, a bond being maintained of $20,000 by the entity to cover any liability under the subchapter. The next page is information they must provide at registration. How

[Francis Philopoulos, Joint Fiscal Office]: are those rates compared to other states?

[Rick Segal, Office of Legislative Counsel]: So only a handful of states have data broker registries. This is based on the California model, which increased theirs from 400 to 6,000. So 6,006 California also has a deletion mechanism, which was an expensive project that they developed, and part of that increase was due to that deletion mechanism. So I don't know what Texas and Oregon, I believe are the other two states, charge.

[Rep. Emilie Kornheiser, Chair]: We can hear from Scott what the increase looks like in scale from when we first passed it. Can you describe deletion mechanisms? Is that in the bill?

[Rick Segal, Office of Legislative Counsel]: No. There's study. There's a study. Just in really easy terms what it is. So California provides a state government website where consumer gives in their, oh I get it, delayed might be. So

[Rep. Emilie Kornheiser, Chair]: that you don't have to pay like billion dollars to this random company.

[Rick Segal, Office of Legislative Counsel]: Or go through every website. That's right, makes good sense. All right, page 31. Again, this is all information the data broker must submit during the registration. The next fee change is on page 33. So currently, one new fee is the amendment fee. If a data broker amends their application, they pay $100 fee for that application, that's new. Penalties currently, if you don't register as a data broker, you have a penalty of $50 per day up to $10,000 per year. That's being changed to $200 as fine, dollars 200 per day that they fill the register with no cap. So this will only be 200 times how many days they go without registering as a data broker.

[Rep. Emilie Kornheiser, Chair]: And reminding folks that fines are not our jurisdiction, just fees. We have enough problems, we don't have to bring that into our jurisdiction.

[Rick Segal, Office of Legislative Counsel]: Page 34, also a new civil penalty, is that if you fail to provide all registration information like your email address or something, there'd be a civil penalty of $1,000 per day after being notified that you didn't complete your registration information, $1,000 per day. If you file materially incorrect information, it'd be a one time civil penalty of 25,000 and then a thousand dollars per day that you cannot correct that information. The next subsection is about deleting your information. There's no mechanism, but each data broker has to allow consumers to delete their information with a few exceptions. And, I believe the other thing you may care about is an appropriation at the very end for the study that the Secretary of State will do to see if Vermont could create this deletion mechanism, and that is a $50,000 one time appropriation on the last page.

[Rep. Emilie Kornheiser, Chair]: Okay. Thank you. Any other questions for us? Thank you so much. Yeah.

[Rep. Bridget Burkhardt, Clerk]: You're welcome.

[Francis Philopoulos, Joint Fiscal Office]: Good morning, committee, director Francis Philopoulos. I'm happy to report this morning I have things to report, unlike yesterday with my wife. With that said, one second here, let me just share my screen so you can see the fiscal note. Rick did the majority of the heavy lifting for the fees and the fines. A couple of things. This bill does increase the registration fee, which is why we're here, there is an appropriation that we did mention of 50,000 since after there'll be appropriations talking about that. But when we talk about the registration fee, I believe if I'm not mistaken, I think Texas was $300 a year, and Oregon was $600 a year. That's off the top of my head, just to give you an idea. Currently, we're at 100 a year in Vermont, that would increase to $900 a year for data brokers to register. In talking about the fee per day or the fine per day, if they don't register, the $25,000 fine, if they're found to register with materially incorrect information, A lot of those things that we talk about here for DEFINE, the Secretary of State's office and I had a discussion about the registration process. And quite frankly, there is a registration form that they have to fill out. So for them to fill out things incorrectly and not put in an email or something, it just wouldn't be registered, because there's required

[Rep. Emilie Kornheiser, Chair]: Like you have to fill out the bubble to get to the next screen.

[Francis Philopoulos, Joint Fiscal Office]: Correct, yeah. And I did ask the question to them of, if we're going to be looking at anybody that might have Let me just put this here. That has put in materially incorrect information, how many times does that happen in the past? Just as an idea. And they said that they don't have any records of that happening, because someone has input materially incorrect information. So as Rick talked about with Section one of the bill, there would be an increase to the registration fee. Registration fee going from $100 annually to $900 annually. Testimony in house commerce that I did hear was there was an agency in California that presented that they did data scraping to look at how many data brokers were in Vermont. They came up with a figure of four forty one, I think it was. Secretary of State's office told me that there are two eighty three currently registered data brokers, so a slightly different number there. But that number came directly from the director of business services of the Secretary of State's office. And if we look at that, two eighty three times 900 gives us about a quarter million dollars in annual fee income.

[Rep. Emilie Kornheiser, Chair]: What year does that strike mean?

[Francis Philopoulos, Joint Fiscal Office]: It's a little bit of what Rick was saying in terms of if everybody registered in January, where we'd have all of that in fiscal year twenty seven, but if some people registered in January, some registered in August, it's an annual fee. So that's why you say annual as opposed to fiscal year. But that would be about $40,000,000 in annual fee income. Now, the testimony from this privacy advocacy group in California to House Commerce did say that they felt Vermont had fewer registered data brokers than we should. So their number, I think, was an additional 300 or so data brokers. And of course, if anybody decides to be data broker, my number could go up or down.

[Rep. Emilie Kornheiser, Chair]: I think we have two questions. Representative Holcombe?

[Rep. Rebecca Holcombe]: Actually, two questions. One is what constitutes a data broker in Vermont? Because what distinguishes those two eighty three from the others who are operating in Vermont and apparently have Vermont information but aren't registered? And then the second is, is that 254,000 is that going to offset the $550,000 appropriation for deletion? So the actual definition of what

[Francis Philopoulos, Joint Fiscal Office]: a data broker is in Vermont versus other states, I don't know off the top my head. Rick might have a better idea of what the definition is when we look at the statute and how that compares to other states, I don't know. Looking and watching the testimony that was given, there's a lot of that same terminology in terms of being in charge of third party data that we just talked about.

[Rep. Rebecca Holcombe]: Is it that the data is from Vermont, or is it that the person with business registered?

[Francis Philopoulos, Joint Fiscal Office]: It just means registered on the phone.

[Rep. Emilie Kornheiser, Chair]: I think it might just be that there's some folks not complying with the law.

[Francis Philopoulos, Joint Fiscal Office]: That was their concern, was there are folks that didn't comply.

[Rep. Emilie Kornheiser, Chair]: And then that second question that Representative Holcombe asked, why didn't commerce How much So total annual fee income was $254,700 How much is it under current law?

[Francis Philopoulos, Joint Fiscal Office]: It would be $28,300 $283,100

[Rep. Bridget Burkhardt, Clerk]: Okay.

[Rep. Emilie Kornheiser, Chair]: So there's a big revenue I mean, not big, like tiny compared to all the other conversations we're having. But there's enough to it might be enough to pay the 50. Do you know why they didn't have that be one little tidy fiscal package?

[Francis Philopoulos, Joint Fiscal Office]: I don't. Okay.

[Rep. Bridget Burkhardt, Clerk]: Go ahead.

[Rep. Emilie Kornheiser, Chair]: Thanks. Representative Ode, did you have something?

[Rep. Rebecca Holcombe]: I don't know if I should ask, I just, compared to the amount of money that the data brokers are making, The fees to sign up, the fee if you don't sign up, all of those things just doesn't seem to be enough for them to care.

[Francis Philopoulos, Joint Fiscal Office]: Being a Fortune five hundred CEO myself, I wouldn't want to speculate to that, but one of the things that I did hear in house commerce during testimony was the increase in this fee was $100 and you're making how much money from bringing out information from the State of Vermont? $900 would be at least a step in the right direction?

[Rep. Emilie Kornheiser, Chair]: I think the question So there's the fines that might be what brings compliance in, and those are higher. So ideally, we're setting a fee to mostly cover the cost of the registration services of the state. 900 might be enough to actually do the compliance work that they'll need to maybe bring more people in. There's the secondary question of how much a company is making based on activities in the state. And that's something that we would address maybe and say, like, a tax on each transaction or something, which is not what's contemplated in this bill. So if you would like to introduce a bill to do that, I think that would be fun.

[Rep. Rebecca Holcombe]: Perfect. And then I don't see any inflator here, and it's, you know, fears, may never

[Rep. Bridget Burkhardt, Clerk]: approve of the bill.

[Rep. Rebecca Holcombe]: Do want to put inflators on fees?

[Rep. Emilie Kornheiser, Chair]: We usually put inflators on fees, which is because there used to be a system for changing fees.

[Rep. Rebecca Holcombe]: And we can always not withstand the inflator if we get a fee.

[Rep. Emilie Kornheiser, Chair]: It's a good question. I was hoping we were going to vote this out before lunchtime, and this is an interesting question. Yeah, Representative Holcombe.

[Rep. Rebecca Holcombe]: I just want to go back, restated what I was trying to get at. To me, the cost of some kind of easy deletion is part of the cost of the compliance, because you should be able to resist having your data sort cleaned. I would be curious to know if that fee that they're assessing is sufficient cover the cost of the clients rather than taxpayers. Is it too late to address the

[Rep. Emilie Kornheiser, Chair]: Well, I guess I'm yeah, that's sort of a question, Scott. In the way this all moves into a spreadsheet in the appropriations committee, is it that they're going to book the new revenue and they'll book out of the 50,000?

[Francis Philopoulos, Joint Fiscal Office]: Part of this 50,000 is to determine what it would cost to do deletion. It's a little bit hard to really to say, maybe the study comes back and says it'll be about 50, you press a button, maybe it'll be, it's going to cost us four IT people to go through and double check and scrub. But I don't know the answer to that.

[Rep. Emilie Kornheiser, Chair]: I mean, that's $2.54, 700 covering the 50.

[Francis Philopoulos, Joint Fiscal Office]: Basically.

[Rep. Emilie Kornheiser, Chair]: They'll book that as So it seems like, yes.

[Rep. Bridget Burkhardt, Clerk]: I'll just make it. Yes.

[Rep. Rebecca Holcombe]: If we put an inflator in and we also say the intent where this fee is set is to cover all the costs to administer this mopren. So that's the assumption Sorry, of any

[Rep. Emilie Kornheiser, Chair]: I'm sorry, may I interrupt you?

[Rep. Bridget Burkhardt, Clerk]: As that amount increases,

[Rep. Emilie Kornheiser, Chair]: this fee shall automatically increase. I think that's fun. And I remember that this is a Secretary of State fee, and they actually do come to us with a fee bill regularly and bring that up. They are actually doing a fee study with us because they want to look across their entire portfolio and see if there's a better way. And so maybe that would be a first step in us talking about maybe putting I believe that John Gray had this really fun idea where there's just an inflator part of statute and then everything cross references And so maybe if we could do that, and maybe that could be a really fun project for next week. If we were going to do that, we could add an inflator to that part of statute. But I'd

[Rep. Rebecca Holcombe]: like to put it here, and then we can not withstand it.

[Rep. Bridget Burkhardt, Clerk]: After we put one in. I think that would be

[Rep. Emilie Kornheiser, Chair]: a large precedent to set in this exact moment in time.

[Rep. Bridget Burkhardt, Clerk]: Okay. Right.

[Rep. Emilie Kornheiser, Chair]: But next time. Well, think maybe we should I think we should work on that Bill of John Gray next week. Okay. Great. Okay. Yeah. Would that be fun? It would be so much fun. Yeah. Consistency But consistency matters. Yeah. Thank you very much.

[Rep. Bridget Burkhardt, Clerk]: And if John Gray's working on something, I think I'd much prefer to follow his model and see what we learn.

[Rep. Emilie Kornheiser, Chair]: And he's working on it in his imagination when he walks down the street. I don't know if he's actually typing anything yet. Think you have to ask him

[Rep. Bridget Burkhardt, Clerk]: for typing. He's doing it. It's something that I would be very glad to hear about. Thank you, Scott.

[Rep. Emilie Kornheiser, Chair]: We're working on so I think with that Do you put some anything else before we

[Rep. Rebecca Holcombe]: move this bill?

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: Thank you, Scott. Thank you, Thank you, Rick.

[Rep. Bridget Burkhardt, Clerk]: Happy to move the bill or participate in the move.

[Rep. Emilie Kornheiser, Chair]: So if you're gonna move the bill, I need you to say the bill number when you make the motion.

[Rep. Bridget Burkhardt, Clerk]: I gotta look it up there.

[Rep. Emilie Kornheiser, Chair]: It's 211.

[Rep. Bridget Burkhardt, Clerk]: On the speaker, I'd move that ways and means vote out H two eleven as we received it because I don't believe it change. Second.

[Rep. Emilie Kornheiser, Chair]: Wonderful, thank you. Representative Masland moves that we find H2 11 favorable. Representative Branagan seconds. Any discussion? Seeing none, I'll defer for please file the roll. Representative Branagan. I forgot

[Rep. Rebecca Holcombe]: at first.

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: Yes. Every time. Go.

[Rep. Bridget Burkhardt, Clerk]: This always just gives me surprising myself last week. I'll vote yes as representative Burkhardt. Representative Higley? Yes. Representative Holcombe? Yes. Representative Kimbell? Yeah. Representative Masland? Yep. Representative Ode? Yes. Representative Page is not here. Representative Waszazak? Yes. Representative Canfield? Yes. Representative Kornheiser? Yes. We have voted the bill favorable, ten-one. Thank you, everyone. So

[Rep. Emilie Kornheiser, Chair]: we are going to Represent Burkhardt is gonna report that? Sure. Great. And we are going to move to the miscellaneous education bill, which we have already had a very comprehensive walkthrough of. Beth made some amendments for us. We have a fiscal note. We're gonna run into lunch. Is that

[Rep. Bridget Burkhardt, Clerk]: okay for you? You have to be somewhere? Have to

[Rep. Rebecca Holcombe]: be somewhere. Not give me a choice.

[Beth St. James, Office of Legislative Counsel]: It would tell me where to be. Okay.

[Rep. Rebecca Holcombe]: Oh my god. This is exhausting.

[Beth St. James, Office of Legislative Counsel]: It's Okay. We'll make it work. I'm sorry. I just assumed you wanted me first. Beth St. James, Office of Legislative Counsel. I have an amendment to H931 for you. And part

[Rep. Emilie Kornheiser, Chair]: of this amendment is what we talked about last time that I requested of Beth. Part of the amendment was on the request of the Education Committee because of other things that they're doing.

[Beth St. James, Office of Legislative Counsel]: So there are two instances of amendment here. The first instance is taking out sections three through 12 of H. 31, which was all of the sections that changed the term BOCES to seesaw. The plan for that language, as of right now, is to live in a different bill. So that is what the first instance of amendment does.

[Rep. Emilie Kornheiser, Chair]: That's the request from the Education Committee. The

[Beth St. James, Office of Legislative Counsel]: second instance of amendment is based on your conversations whenever I was here last related to Section 14, the AOE ground check section. And this is a change just to the language around fee. So in Section 14, which is 16 BSA two fifty four, which is a new statute you're adding to Title 16, after the words on a form provided by the Vermont Crime Information Center, So this is saying AOE

[Rep. Bridget Burkhardt, Clerk]: I should have just done this.

[Beth St. James, Office of Legislative Counsel]: What's happening? A request made under this subsection B shall be accompanied by a release signed by the applicant on a form provided by the Vermont Crime Information Center. All of that language remains. We top over to your amendment. You're going to strike out the current language that reads a set of the applicant's fingerprints and a fee established by the Vermont Prime Information Center that shall reflect the cost of obtaining the record from the FBI. The fee shall be paid by the applicant. There was no easy way to just insert a dollar amount there, and I think Edward will go into a little bit more detail about that. So the language that I have proposed in consultation with your chair is, and a set of the applicant's fingerprints period. The agency shall pay the fingerprinting fee required pursuant to 20 BSA 2,062, which is a statute that lives in the section of law, the enabling law for the Vermont Crime Information Center or VCIC. And they have a whole statute related to fingerprinting fees. So we're going to cross reference that statute. And shall pay any fee required by the FBI associated with a fingerprint supported criminal record. The FBI publishes their fees in the Federal Register, and they update them there. And so there was no easy way to reference that, so we're just going to use this language.

[Rep. Bridget Burkhardt, Clerk]: I'm looking at the amendment here. I mean, don't generally when something is stricken that a line goes through it, because it was confusing to me to see underlined.

[Beth St. James, Office of Legislative Counsel]: Not in an instance of amendment. Only if we had struck this entire section and replaced it with a whole new section, you actually wouldn't have seen any change because it was all brand new language, so you would have just seen the new language. But we're telling the clerk, essentially, when she prints the official copy, assuming you all vote this out, to make the swap. And we don't the drafting convention is you don't actually strike through. You just tell the clerk to strike I know, it's very easy to follow.

[Francis Philopoulos, Joint Fiscal Office]: Yep, thanks.

[Rep. Rebecca Holcombe]: Yep, representative Holcombe. So I'm gonna go, did the agency requested the fingerprinting language initially write?

[Rep. Emilie Kornheiser, Chair]: That's my understanding.

[Rep. Rebecca Holcombe]: And I know that in my area, it's taking childcare providers four months to get a response. And now we're adding additional fingerprinting.

[Rep. Emilie Kornheiser, Chair]: I think what we heard was that it was like 25 people or something.

[Rep. Rebecca Holcombe]: But do we know if there are any other bills coming through that are increasing fingerprinting? Because this isn't usual. Usually, it's for people who provide direct service, and historically, the agency

[Rep. Emilie Kornheiser, Chair]: My hasn't understanding is this is just for people with direct contact with children. Isn't that the language, Beth? It is

[Beth St. James, Office of Legislative Counsel]: will have or has the potential to have unsupervised contact with students.

[Rep. Emilie Kornheiser, Chair]: And then Ezra will tell us how many people it was, but I remember it being a remarkably small number of people.

[Rep. Rebecca Holcombe]: My question is, is anybody in the body keeping track of the I was doing a fabulous job with education, but is anyone looking at the totality of our legislation to look at the total impact on fingerprinting? Because it might be de minimis in this particular incident, but de minimis can become demaxivus if you have a lot I of

[Rep. Emilie Kornheiser, Chair]: do not know if that would be a good question to ask the judiciary committee, because I think that the fingerprinting is in their part of the green books. If they don't. I don't know. I think probably not. Any other questions for Beth? Is this amendment Okay for folks? I appreciate it. Does anyone want to hear from Ezra before we've Do we want to vote on the amendment then hear from Ezra about the whole thing? Do we want to hear from Ezra first? Don't know why I can't make a decision. Let's do Ezra next.

[Rep. Bridget Burkhardt, Clerk]: Great. For Beth.

[Rep. Rebecca Holcombe]: Yes, for Beth. I don't think that I heard about the session or if I did, I can't remember. How often are people checked? Because maybe they come up a clean slate and two years later they do something

[Beth St. James, Office of Legislative Counsel]: very lurking. So I can't speak in general. This language is specific to an offer of employment or a contract, so I believe this language translates to one time. Once you are employed, there's a whole host of other employment law issues that kick in. And Damien walked in the room at the exact wrong time if you should have weapons for him. But there can be consequences for criminal behavior while you are in college that are not related to the initial background check for the author.

[Rep. Emilie Kornheiser, Chair]: Thank you, Beth. And folks, Ezra is settling in, we do have permission to be off the floor. And so the plan right now is for us to be back here at 01:00. Georgia will monitor the floor so that if we have a bill come up, we'll go to the floor and that we would be off the floor until H-four ten comes, in which case we are swapping out with the corrections and institutions committee so they can be off the floor. If you anyone wants to look at the calendar and let me know at lunchtime if there's something before that that you're concerned about missing for your own reasons, let me know.

[Ezra Holden, Joint Fiscal Office]: All right, for the record, that's where Holden joined fiscal office. Beth has already given you a walkthrough of the amendment, so I will just move to the change in the fiscal note, which is starting at paragraph three here. So you heard from Beth to the change in language, and I think some of the difficulty she was referencing in setting a fee in dollar figure in statute is you actually have two different parts that go into what's being asked here. So first, the AOE would need to pay for a potential employment applicant's fingerprints to be taken so that they can actually conduct the criminal records check. And so the fingerprints would be taken, in this language, by the agency set in statute. So that would be a local law enforcement agency. And the fee for that is set in statute and is up to $35 but it's determined, the exact dollar amounts is determined by the agency that's taking the fingerprints. And then the second piece is that once you have those fingerprints, the agency would use those to retrieve the criminal records, and those records are retrieved from the FBI. As you heard from Beth, they set the fee that they charge themselves, and the records are retrieved through the Vermont Crime Information Center, and they also would retrieve the fee and pass that along to cover the cost from the FBI. So putting those two pieces together, for fiscal year 'twenty six, we estimate that it would be excuse me, fiscal year 'twenty seven, we estimate it'd be about $47 per applicant. AOE estimates that they would have about 34 people every year who would need this criminal check. And so the total estimate would be about $1,600 in fiscal year twenty twenty seven. This would be, again, as Beth mentioned, paid for by the agency of education.

[Rep. Bridget Burkhardt, Clerk]: Thank you.

[Rep. Emilie Kornheiser, Chair]: Any other questions for Ezra? Yes.

[Rep. Rebecca Holcombe]: I'm just trying to understand the timing, you may not know this, but the Interstate Compact for Education, was that a request to the agency or was that a request to the legislature codifying that end?

[Ezra Holden, Joint Fiscal Office]: I would have to direct that to that St. James.

[Beth St. James, Office of Legislative Counsel]: I don't know who the initial request came from, but I do not. I believe it was the agency.

[Rep. Rebecca Holcombe]: So that brings my follow-up question. How did you get that 53,000?

[Ezra Holden, Joint Fiscal Office]: Sure. So I reached out to the Education Commission of the States and one of their representatives, Annie Fiani, from the House Ed Committee last She sent over this figure and said that this is the same amount that the state of Vermont has been paying in prior years. And I also spoke with the agency of education, and they confirmed that they have this dollar amount in their budget for fiscal year 'twenty seven because they have paid these dues on and off throughout the years.

[Rep. Rebecca Holcombe]: So this is my question then. So this codifies that. When we say it codifies that, does this mean we are getting out of Vermont to pay that $53,000 or whatever set fees, regardless of The agency is also part of CCSSO, they're part of a whole bunch of other things that they pay membership fees to, but this one's different because we will be mandating that whatever else they had to cut, for example, they couldn't touch this. Is that right?

[Ezra Holden, Joint Fiscal Office]: So I believe that this language enters the state back into this compact officially. And so as an official member, dues are sent out to each of the member states. I don't know if that is there any more context you'd like to add?

[Rep. Bridget Burkhardt, Clerk]: That's right. And

[Rep. Emilie Kornheiser, Chair]: we could change this next year or if we wanted to join. But it seems like this was something that the education committee was interested in staying part of. Any other questions, Rosa? Thank you.

[Rep. Rebecca Holcombe]: Madam Chair,

[Rep. Charles Kimbell, Ranking Member]: I would make a motion that we would amend nine thirty one as presented.

[Rep. Emilie Kornheiser, Chair]: I'll second. Representative Kimbell moves that we amend h nine thirty one. Representative Burkhardt seconds. Any discussion of the amendment?

[Rep. Charles Kimbell, Ranking Member]: Yes.

[Rep. Emilie Kornheiser, Chair]: Draft 1.1. Thank you.

[Francis Philopoulos, Joint Fiscal Office]: I agree.

[Rep. Emilie Kornheiser, Chair]: Seeing no discussion, if the court

[Rep. Bridget Burkhardt, Clerk]: could please follow the roll. Representative Branagan? Yes. I'll vote yes as representative Burkhardt. Representative Higley? Yes. Representative Holcombe? Just amendment. Just the amendment separately. Yes. Representative Kimbell? Yes. Representative Masland? Yes. Representative Ode? Yes. Representative Page is not here. Representative Waszazak? Yes. Representative Canfield? Yes. Representative Kornheiser? Yes. We have a of

[Rep. Rebecca Holcombe]: the amendment favorable ten-one.

[Rep. Bridget Burkhardt, Clerk]: Thank you. I'm sure.

[Rep. Emilie Kornheiser, Chair]: I just make a motion that we find nine thirty one favorable as amended. Thank you. Representative Waszazak, it looks that we find H-nine 31 favorable as amended.

[Rep. Bridget Burkhardt, Clerk]: Have I'll

[Rep. Rebecca Holcombe]: leave this in one second.

[Rep. Bridget Burkhardt, Clerk]: I'll start that.

[Michelle Boomhower, Director of Policy, Planning & Intermodal Development, Vermont AOT]: I've got representative seconds.

[Rep. Emilie Kornheiser, Chair]: Is there any discussion? I have

[Rep. Rebecca Holcombe]: concerns about this, I have concerns about several things that having sat on the other side, mainly mandate expenditures that are coming out of the top of AOE appropriation, when I started there was never room for a decision and that fee is about half of a position and we cut positions that were critical to support technical assistance to school districts, to support ongoing operations and preserve things that have been named in statute as mandatory things. So it's just hard for me to see that given what we meant as a county. A state, I have severe concerns about the sheer volume of changes that we're making that affect the field and are going to require implementation. Some of that is going to play out, particularly around the class size stuff, and I counted just 19 votes this session, and my fear is nothing's important if everything is important, and I feel like we're just doing way too much, and we're losing track of what matters. I have severe concerns about the class size language as it's written, because I don't think we have clear enough definitions of what we mean, and I'm concerned based on what I've seen in terms of initial guidance, that we could actually create quite a bit of chaos and gaming and incentivizing, which is just a waste of everybody's time. And the reason we don't have it is because we don't have time to develop definitions. But then why are we moving to work fast? I mean, I just feel like we are becoming the chaos agents right now. So I just feel I have to say that on behalf of the school districts who can't even get invited into the Senate and don't take that time to get to all the candidates in the House. Thank you.

[Rep. Emilie Kornheiser, Chair]: Representative Masland?

[Rep. Bridget Burkhardt, Clerk]: Yeah. I respect representative Holcombe for her experience and knowledge base, which I clearly don't have, haven't been a secretary or any of that sort of stuff like that. So I suspect, representative Holcombe, you're correct, but I don't not having your knowledge base, I'll vote yes for where we are right now, and we'll wait and see what happens back and forth, the House, Senate, and so forth.

[Rep. Emilie Kornheiser, Chair]: Thank you, Representative Masland. I know that the education committee put some work into this bill, I need to trust the decisions they were making, given our main jurisdictional burden. Any other discussion? On the question, I

[Rep. Bridget Burkhardt, Clerk]: would say, was I?

[Rep. Rebecca Holcombe]: With the moratorium on falsely approved independent schools, I I'm a little unsure exactly why we're doing that.

[Rep. Emilie Kornheiser, Chair]: Oh, on the therapeutic schools? Yes. I think that is a question that would be well directed to the education committee. So if you wanna follow-up with them after the vote, think that's a great thing to do.

[Beth St. James, Office of Legislative Counsel]: All right,

[Rep. Bridget Burkhardt, Clerk]: Thank you.

[Rep. Emilie Kornheiser, Chair]: I understand that there have

[Francis Philopoulos, Joint Fiscal Office]: been a

[Rep. Emilie Kornheiser, Chair]: number of fairly significant issues that the agency has had to deal with with therapeutic schools, I imagine they're seeking a path forward from that. But I do not know for sure.

[Beth St. James, Office of Legislative Counsel]: I did follow-up. And there is one

[Rep. Rebecca Holcombe]: for profit vendor therapeutic education who is trying to sell to actually, I believe it's a non profit vendor of education services. It's based on one person. Do you know where that is? I have no idea. I mean, I think that there's a larger conversation that has to happen about this, which is this is a very significant driver of higher costs in the Ed Fund that is very poorly managed right now. This individual decision is not judging into that. This is just one provider trying to sell to another provider. And they're trying to figure out a path through that.

[Rep. Bridget Burkhardt, Clerk]: Thank you, Rebecca. Anything else? It's a perfect place to call the roll. Representative Branagan? Yes. I'll vote yes as Representative Burkhardt. Representative Higley? Yes. Representative Holcombe? No. Representative Kimbell? Yes. Representative Masland? Yep. Representative Ode? Representative Page case abstinence? Representative Waszazak? Yes. Representative Canfield? Yes. Representative Kornheiser? Yes. We have voted the bill favorable as amended nine-one-one. Thank you, everyone.

[Beth St. James, Office of Legislative Counsel]: Do folks need until 01:15 or can we come

[Rep. Bridget Burkhardt, Clerk]: back at one? One. Okay.