Vermont Legislature SmartTranscripts:

[Speaker 0]: We're back in action. We're gonna spend some time with Carrie Stahler from Vermont Puthang. Welcome. The floor is yours.

[Carrie Stahler (Vermont Foodbank)]: Thank you, Chair Ingalls, and thank you, committee, for having me. I heard you had some of my friends here earlier this morning.

[Speaker 0]: We did.

[Carrie Stahler (Vermont Foodbank)]: So thank you for that. I like the theme of your day. Yeah. So I'm Carrie Steeler. I live in Lima, Vermont, and I'm the government public affairs officer for Vermont Food Bank. And I'm here today to ask you for support for Vermont Food Bank's budget adjustment request for the FY twenty six budget adjustment. The Food Bank is seeking $1,500,000 for the Vermont feeding Vermonters program that this body helped to pass last year. Originally, we received $500,000 in funding through the original FY26 budget process. Those funds were extended between July 2025 and October 2025. We are seeking the additional funding to purchase more food from Vermont Farms, and there is currently $400,000 in the house version of the budget adjustment that the senate recently received. Just to remind you a little bit about that program, this funding directly supports farm's bottom line. Our goal, which is funding, is to simultaneously support farms and people across Vermont who use our network of food shelves and meal sites, as well as those who attend our direct distribution event. It's a win win, which is why you all helped us pass Vermont your city, Vermont your spring program last year. Vermonters continue to experience food insecurity, a rate that has increased in recent years, and we know the state of Vermont can make policy choices to support neighbors with the food they need today and to support farm viability by fully funding the Vermontures program with this additional $1,500,000. For scale, at its peak, this program was able to operate at about $2,400,000 a year and support over 300 farms. Right now, we are at about $1,000,000 for this year's budget year because of funding restrictions, and last fiscal year, also because of funding restrictions, we were only able to support about two ten farms. So this really depends the the scale of the program really depends on the resources and how many farms we're able to we're able to purchase from. As you may remember, the Food Bank and our partners purchase food directly from farms and pay farms market rate for that food. That food is distributed in a variety of ways and it goes to the people across the state in all 14 counties. These are folks in our community who need food access support but cannot afford to purchase this local food themselves. And as I know you well know, our farms are also businesses too, and agriculture is a crucial sector to our economic success in Vermont. We know from a UVM study that every dollar spent on local food purchased on Vermont farms adds an additional 60¢ to the local economy, so this is really a multiplier program for the state, for farms, and for people who receive food. The program operates in three ways: to maximize the capacity of our farms and reach as many farms as possible. The first part is large scale direct purchasing. That is what all of the funding in the current FY twenty six budget, that 500,000, has gone to do. We've been able to contract with, I believe it is 17 farms, and to help fill food shelves across the state. This additional funding would allow us to do more of that purchasing from direct distribution. There's another portion of the program that funds grants to network partners. We grant funds to our network partners for them to work directly with smaller scale farms in their communities. Vermont Food Bank generally works with larger scale farms who can deliver food by the pallet or the truckload. Our network partner organizations are able to move these dollars further into communities by working with farms who may deliver their food by Subaru, or pickup truck, or TSA share distribution. There's a third leg to the stool, and we refer to it as culturally responsive food purchases. We purchase produce from key partners to support the distinct needs of neighbors and communities with culturally referred food needs, and additional state funding would also help us support those farms in those communities. A good example is a farmer who had up in house agriculture a couple of weeks ago, Hilary Martin from Diggers North Collective Farm in the Itcher Vale, and they grow a number of specialized produce items that are distributed through our partners at PD Champlain Valley and the family center, the parent child center in Burlington to communities who seek unique foods or some things that are not your regular zucchini to meals that they really specialize in and have spent decades cultivating that knowledge. It's really an honor to be able to pay them to do that work for us that maximizes the existing distribution systems by utilizing folks who already know what they're doing and organizations that already have access to those communities. I do wanna underscore a couple of unique pieces about why we're asking for this funding now. We forward contract with the farms that we directly purchase from, and we time our grant programs so that our partners can forward the contract with their local farms. That means that fees, through your seed dollars, are guaranteed customer for those That is not how produce usually works, and many farmers put their seeds in the ground and hope that they will have a market for that food when it comes. By being able to forward contract in January and February, we are able to guarantee those sales. We, as a food bank and our partners, can accommodate replacement and nonstandard produce. So if we contract for a 100 pounds of potatoes, we can take russets or red potatoes or white potatoes. Commercial or baking accounts, you know, really require a specific product, but we can be flexible. You know, other other grocery stores require picture perfect food. You need an absolutely rectangular bell pepper. We can have, you know, the curvy one that are still delicious and perfectly edible, just maybe not exactly what would stack perfectly on those grocery store shelves. Our system also gives farmers more efficiency through decreased processing costs. We can accept things in larger packages. We can accept things that are not packaged necessarily, but our foot may be into a giant gay lord that can be driven around with the fork.

[Unidentified Committee Member]: Thank you. Fork contracting, what we just heard from the potato farmer, Bob. Oh, I'll do. Yeah. Fork ship and all. When you've contracted, we have, like, we had the drought and say they cannot commit to the full contract. Now, looking forward, contract, do you pay for it, or do you wait till you receive the goods and start paying? So let's say I had a contract with you for £1,000 of whatever. The drought or flood knocked it down that I only could provide 500. You're gonna be £500 short, but have I, in the contract, was I paid for that or not till you get the products?

[Carrie Stahler (Vermont Foodbank)]: That's a really good question, and I will have to get back to you on the answer that, because I know we've had a few unique situations like that, but not, I don't know if we necessarily have a standard colony or no.

[Unidentified Committee Member]: Because I could understand 20% the head, because I need to buy the seed in that, that would make sense. Usually, we don't get that larger devastation, but he his devastation was pretty bad, didn't he? Yeah. So, yeah.

[Carrie Stahler (Vermont Foodbank)]: He was dramatically impacted, and I do know that we have had some of those impacts when the flood happened, too, so I thought that's a great question, and I will find out more. Thank you. Sorry, distracted the line anyway. But

[Speaker 0]: My apologies.

[Carrie Stahler (Vermont Foodbank)]: That's okay. That's okay. I let's see. Oh, simplified distribution. Yeah. So so I was pointing to the fact that, like Bob, instead of having to distribute to small markets or farm markets or farm stands or households around the state, the partners that we work with deliver directly to our three warehouse size distribution centers in Rutland, Berry and Brattleboro, and we often repackage and redistribute the cash. We are using our system and currently the the help farmers work more efficiently. Yeah, I think that is most of the review that I have for you. I'm happy to answer questions. Committee,

[Speaker 0]: Let's make sure that we insist on these asks that we're getting. Let's get them in writing someplace so that we can, you know, give those to Linda and get them in a file so that we will be aware of that. And we're gonna ask the same as you. Could you just go down through your ask one more time? What you got last year? What you're asking for this year? And what's in the government's script? Yes.

[Carrie Stahler (Vermont Foodbank)]: I can definitely do that. And I brought a handout.

[Speaker 0]: Good.

[Carrie Stahler (Vermont Foodbank)]: Here. I can give you the paper copy of these documents. Currently, and this is all on this document, and I believe Linda has a copy of this proposed to your committee page, but if she did not receive that, Linda, did a really bad job handing this out.

[Speaker 0]: Linda, you probably won't like drunk coffee as well. Yeah.

[Carrie Stahler (Vermont Foodbank)]: So in the current fiscal year FY '26, there's $500,000 for this program. That money has been invested in the first three times. We are seeking an additional 1,500,000.0.

[Speaker 0]: We have 500,000 more next year.

[Carrie Stahler (Vermont Foodbank)]: We have $500,000 so budget adjustment, we have $500,000 in the current budget that we're living through right now. We would we are asking to have the current budget adjusted to add an additional 1,500,000.0 to fully fulfill this program. But the originally, last year, we came to you and asked for 2,000,000. Mhmm. We received 500,000. Okay. We still need 2,000,000.

[Speaker 0]: Okay.

[Carrie Stahler (Vermont Foodbank)]: And so the 1.5 is to true up that with with the actual scale of the program as we know it can be. And on top of that, in the House version of the budget adjustment, there's currently $400,000

[Speaker 0]: Is that an ask? That's an ask, or they have it in there?

[Carrie Stahler (Vermont Foodbank)]: So it was not included in the budget recommended from the governor for the budget adjustment. Right. We were not we were not able to get ahead of that process enough.

[Speaker 0]: But does the house have it in some form of ask? The

[Carrie Stahler (Vermont Foodbank)]: house has it. We we went to the house and also asked them when they were doing their budget adjustment process early in January, and they have put it into their recommended version of the budget adjustment that has been handed to the Senate Appropriation Creepittee.

[Speaker 0]: Okay. Are we clear on that? Yep. Okay.

[Carrie Stahler (Vermont Foodbank)]: That's a lot of numbers.

[Speaker 0]: Well, yeah, just wanna be straight.

[Carrie Stahler (Vermont Foodbank)]: Yep, and it should be on And the

[Speaker 0]: as we said, Carrie, you weren't in the room when we said it, but we're not a money committee, so it's very important that we're very clear about what we're asking for because we do have to go out and advocate.

[Carrie Stahler (Vermont Foodbank)]: Yeah.

[Speaker 0]: So that's where that's why that's why to have it in front of us is very important.

[Carrie Stahler (Vermont Foodbank)]: And if it is helpful at all, the bid committee, I've had conversations with the Leader Norah, the Appropriations Committee about this, and I believe he has a pretty good understanding of it. Okay. So we're working on those conversations as well. But we appreciate the committee's support as a mutual.

[Speaker 0]: Sounds good. Wonderful. Thank you. Thank you. Don't see any reason why we can't get started earlier. Everybody Yeah, absolutely. We're gonna spend some time on some sections. We're going get Paul all sitting here, Inspector Blackwell or I'm sorry, Emma. And I think you've got about three or four sections of the bill, Mr. Lawson. And so come on out if you're ready and the floor is yours.

[Paul Ralston (Farmer)]: Thank you, Mr. Chairman. For the record, my name is Paul Ralston. I'm appearing before you today as an individual, retired business guy, who

[Speaker 0]: made Are we ever retired?

[Paul Ralston (Farmer)]: You know, who decided to start a little farm. And so I've I've worked hard enough. I didn't think I have ever worked when I was in business. The bill that that you we're gonna talk about, the miscellaneous agriculture bill, is a really important document. I'm so pleased to see it here. And I'd like to go through a few issues that I think I might be able to help you clarify and get some some more detail on. In the four years that I've been farming or learning to farm, I should say, my neighbor Spencer is a real farmer. He'll talk to you. I've been confronted with a number of barriers, a number of contradictions, a number of unexplained policies that the state has around our ability to grow food here in Vermont. And the three agencies, health, agriculture, and natural resources, all have significant amounts of legislation that do not seem to be integrated in a way that ordinary people can understand and that people who are trying to make a living and I I'm not trying to make a living as a farmer, but people who are trying to make a living as a farmer have a very difficult time complying. And I believe that there are cases where, the ambiguity of a statute leaves someone to just say, let's just do it and see if anybody notices. And I think there are good reasons to have protections around, for instance, the waters of the state, and that's one of, ANR's purview. But we need to be realistic about growing food in Vermont and that everyone who is involved in food production is not the same size, the same scale, or has the same impact. So with that said, as a kind of a preamble, I look at this bill and I see opportunities where legislative intent can make it clear that it's in the public interest that we allow and encourage Vermonters to grow and process more food. We need that. We have a high degree of food insecurity here in Vermont, our aging population That that's you know, peep people are struggling with affordability, and food is one of the things that they struggle with. We have other, areas of the government trying to reduce our carbon footprint, and our food imports, 86% of what we eat in Vermont, comes from distant fields often in other continents with high carbon impacts. So these are things that all of us, I think, can understand would be in the benefit of Vermonters to clarify, improve, and help Vermonters actually help their neighbors, friends. So, the first part of the bill, mister chairman, is, your reaction to the Supreme Court decision, and I don't have anything, of particular to note on that other than someone was very smart to distinguish between chickens and roosters. And I think that was a smart move. So the one thing I will say, is that on page four is it okay if I just Absolutely. Okay. On on page four, lines three and four, there are a number of places in statute where farming, farmer, accessory on farm business, these terms are defined, and they are almost always defined differently in different statutes. This bill before you says farming has the same meaning as 10 VSA six zero zero one. And I think that statute and we're gonna talk a little bit about, an amendment to that statute later on in my discussion. I think that should be the baseline of how one looks at it. And I think later on, you'll see that there's, there's a reference to a '24 BSA, definition of farming, and I think they can be harmonized. We're gonna spend some time Tuesday on that as well. Okay.

[Speaker 0]: So we're we've got them coming in. We're talk about 24 VSA, and we'll bring them to attention to this as well, and we're also gonna be talking about wraps and the official language of what wraps are.

[Paul Ralston (Farmer)]: So the only thing I would suggest on page four, eight, is to include accessory on farm business as under the definition of farm structure. And because that is in statute in 24 of the VSA, but now that you're restating it, I think it's useful to add that to the definition.

[Unidentified Committee Member]: And do you mind leaving us a copy of what you put in there so that

[Paul Ralston (Farmer)]: What what I can do, senator, is actually do a proper, sanitization and then send it electronically. We'd we'd like that. Yeah. Yeah. Because I just did this, you know, for my own. And, because on page eight, lines 12 to 14, you have another attempt to define I'm sorry.

[Speaker 0]: What were the lines again?

[Paul Ralston (Farmer)]: So there are lines twelve, thirteen, and 14 on page eight. Yep. So where it says the on-site preparation sale of agricultural products, and then it goes on to say principally produced on the farm, and we've made some progress in allowing farms to take inputs from other farms. And so this, language principally produced is, at odds with decisions that the legislature has already made vis a vis accessory on farm businesses. So I I call that to your attention.

[Speaker 0]: Principally produced would indicate fifty one percent? One

[Paul Ralston (Farmer)]: could argue it. Okay. One, you know, you could argue this thing. You put two lawyers in a room give them a chance to argue it, and you can come up with a lot of different ways to interpret that. Well, does. Well,

[Unidentified Committee Member]: we've witnessed that. So The numbers on that one is a little

[Unidentified Committee Member (Attorney)]: bit off, but we'll see. I'll talk to you about that later. Was gonna make a joke about that.

[Paul Ralston (Farmer)]: And are you a lawyer senator?

[Unidentified Committee Member (Attorney)]: Yes, I am.

[Speaker 0]: Oh, So

[Paul Ralston (Farmer)]: moving on to page 10, where we're talking about some of the the tax implications of farm income and later on on, capital gains from the transfer of farms. I would suggest on page 10, line eight, that you include the word Vermont. Line eight would say the amount of any net Vermont farm profit and down in line 12, it would say the sale of real estate that is part of Vermont farming operation. We're not trying to make it easier for people to own Addison, California as an investment, and not pay, taxes. So those are a small, piece there that I think would help clarify that. Okay. So then if we go back if you go on to page 12, starting at line 10 where it says accessory on farm structure per and, again, this is where, we come into the issue of in one case, it said principally produced. In the current statute, this is about how to define how much inputs an accessory on farm business can bring in from outside of their own farm. And this one says qualifying products as defined by 24 PSA, etcetera, etcetera, provided that more than 50% of the total annual sales of the procreating process qualified products, blah blah blah. So in one case, we have, just a, a statement of principally. Another, we have volumes, amounts. And in this case, we have value, sales, all of which are really hard to reconcile, are confusing, and I would argue are almost impossible to measure. And if you can't measure them, you can't enforce them. And if you can't enforce them, I don't understand why we would, make that a lot. What's really important about this part, and, again, you'll hear from, my farmer friends, If a farmer basically, there's only three ways or basically three ways that any business, whether it's a farm or or any other business, can grow their their business. One, they can scale up. They can get bigger. And in Vermont agriculture, we've seen that in dairy, but we haven't seen it in any other sector. You can get closer to consumers. And in agriculture, we have farmers that have CSA programs and where people prebuy. We heard from someone just testifying about forward contracting. And third, and I think most importantly, you can add value to what it is you grow or produce, whether you're a vegetable farmer, a meat farmer, a poultry farmer. If you can add value, if you have an orchard and you're growing apples and you can make apple pie? If you are berry farm, you grow blueberries. I think orchard is a good example. I think we could all agree that an apple orchard that makes and sells, apple pies would probably meet the definition of principally produced. Might meet this different definition of 50% of sales. But then I would ask, what about apple cider donuts? And can is it legitimate to sell apple cider donuts when the only part of the donut that's grown on the farm is a subset of a process that the cider. And then there's flour, eggs, butter, all that all that goes into it. So in effect, the donuts wouldn't comply with any definition of this statute. And I don't think we wanna prevent orchards from making really great outsider donuts. So but the other thing that is really important to understand is some farmers have invested in in capital building and equipment in order to add value to their crops. And it can be if you're a beef farmer, you may be aging your beef, or you may be making salami from pork products, or you may be making tomato sauce from your vegetables. And that capital investment is an attempt to increase the value and therefore increase the return that one gets from the activity of farming. If you have catastrophic event, a late frost, a flood, a drought, a hail storm, and or a pest or infestation, and you lose that crop that's essential to, as an input, for your capital investment. Why can't you go to your neighbor and and buy the product that you need that year from them? But you can't because it isn't principally produced. It is maybe 50%. It it doesn't make sense. And if we want farmers to survive, I believe they need to ride the value chain at least to some degree. And to ride the value chain means an investment of capital and that means an acceptance of a certain amount of financial risk and the ability to go down the street, and you'll hear from Spencer about an experience that he had, the ability of an accessory on farm business to buy a certain amount of products from other farms, I think is essential to the whole idea of having an accessory on farm business. Now in this case, there's a number. It's $250,000 And in in my experience, that number makes sense because $250,000 is still a small business in Vermont. It's likely to be an amount similar to what a small farm may earn not earn, but their gross sales might be in a year. And without the ability to buy outside of your farm, you're now not only do you lose the revenue, but you you are, not gaining any value from that capital investment you've made. This may not be an every year kind of thing, but, you know, changing circumstances in farming today, you know, make it really difficult to rely just on the produce of one piece of land. So I encourage you to support that provision. This piece, if it modifies 10 VSA and 24 VSA, then it would be the standard, the statute that could be referred to in all the various other places. So I'm happy later or now to, talk about that, but that this is, like, really important, I believe, for the future of food production, Not just farm, but actually, because remember, like in my farm, we grow What do we change, Paul?

[Speaker 0]: Help us to understand why we're changing by So doing

[Paul Ralston (Farmer)]: what you're changing is you're removing three amorphous, measures and substituting an absolute easy to understand measure, one that can be mod monitored by just looking at that farm's tax return because that number will show up on the tax return, whereas principally produced, that's not gonna show up anywhere. 50% of volume. How does that get measured? 50% of sales. Who keeps track of where the tomato, the value of that tomato, whether that was from this guy or that guy? What you would do with this is replace unenforceable language with definite, absolutely measurable language, which would give farmers the confidence to invest knowing that they're not gonna be caught off guard. They're not gonna be subject to a legal wrangle about principally produced. And and remember, it's the principal all those measures are what go into a product that is made on the farm. So this is something after the growing. So this is the cider donut and the apple pie. This isn't the apples because we can all understand the apples. Alright. So what you're doing in in this is you you're the intent of the legislature is to allow Vermont farmers to mitigate risk due to, natural things or short labor shortages or where whatever the issue and be able to make up the difference by supporting another farm and purchasing from that farm. And in doing so, we helped make it so that farmers can do what they do best, and maybe what they do best isn't making apple pies. Maybe, you know, those three orchards only need one apple pie bakery, and they can each sell to the apple pie bakery, and they all don't have to make apple pies.

[Speaker 0]: So we're dealing a lot with dollar figure amounts from 2 to $5,000, and we're we're just we're wrangling over that type of stuff right now. Where is the pushback of the argument gonna come on the $2.50 amount as far as with this?

[Paul Ralston (Farmer)]: The only thing I can think of that there's even a statute limiting what a farm can produce is that the legislature has decided that there should be some limit, some guardrails on these farm activities. Because remember, they are exempt from Act two fifty. So there must be a recognition that it is in a public interest to ensure that they don't become a large factory, that they don't become and and I frankly don't believe that's even a threat because having been in manufacturing for for almost fifty years in Vermont, we build our processing facilities in Pop in areas where there's labor. We build them where on good roads. We build them where there's town water and sewer. We build them where there's three phase electric power, and that's not what farms are. No one's ever gonna build an apple pie factory in short. They just aren't. So but I have to think that that's what previous legislate legislatures had intended here, that they put some kind of limit. Okay. And there are those three amorphous unmeasurable limits, and this suggests one measure. So I can't imagine it. I can't imagine it or whatever. I just can't because I don't think anybody's gonna jump into

[Speaker 0]: the weeds of this. I think it's just gonna get down to us being able to explain it in that way. If somebody said, Well, how come you're not at 200 or 300? Okay, well, okay, well, that's the number you want? Fine. That is not going to hurt us.

[Paul Ralston (Farmer)]: It's still measurable. Okay. Yeah. And again, like you said before, Mr. Chairman, about the 2,000, 5,000, these are, I don't know, compromises people are making along the way in order to say that we've made some changes. The

[Speaker 0]: two fifty is basically a number that makes sense to a business person, and it's not a large scale operation, and it's not a small scale operation. It's not even an aberration. It's just a number that's picked because that's of a small business. It kind

[Paul Ralston (Farmer)]: of represents what might be, so if a farm, you know, had a catastrophic loss, and they needed to, if that, orchard had a late frost, like, you have

[Speaker 0]: to Well, it's kind of kinda real with what we heard today. We heard a 100,000 loss on Potato Farm and all of that stuff, so it kind of falls in line with what you're talking about.

[Paul Ralston (Farmer)]: And and just so you know, the the Chappells grow our potato seed. Mhmm. So when it hurts them, it hurts us too. So, yes, these are the kind of things that happen, and hopefully, they don't happen a lot. But, I think more important, this gives people confidence because it's clear and measurable.

[Speaker 0]: Who's gonna argue this?

[Paul Ralston (Farmer)]: I don't know. I don't know because I don't know what the downside is to allowing me to buy tomatoes from my neighbor and turning them into soup because I made the investment in our little facility to do that because we need food more than just during heart season. We need to process it. We need to, you know, take the squash and cut it up and freeze it. We need to take the tomatoes and turn them into something that will keep. So these are the things that are gonna improve our, our our food, sustainability because we're going to, save food. We're gonna put food by so that it's there when we need it now in February. And we need there are no big businesses in Vermont that do this. There are a few small businesses that do it, but these are things that farms can do to improve their economic outcomes. So the $250,000 to me was just a metric that aligns to perhaps, and maybe you have some data on this, the size of a a small Vermont. That should be fine.

[Speaker 0]: Correct. Fair enough.

[Unidentified Committee Member (Attorney)]: Paul, it looks like you're looking at available not as introduced, but a prior draft, so you might wanna refer to section numbers instead of page and lines of Okay. At this time, we'll cancel bills introduced for the Okay. Or do you agree?

[Paul Ralston (Farmer)]: Will do. And I will get the proper one when I I do the annotations. And so then on section seven, which on my copy is page 13, and it's line 17. And, again, I'm very happy to see this addition of annual gross income from the sale of farm crops or the equivalent value donated farm crops. And I would just suggest that donated farm crops to a nonprofit. It's not just like I can donate them to my neighbor. I think it's just important to state that this is for nonprofit reasons. So donation to a food shelf or Because

[Unidentified Committee Member]: you could donate it to the neighbor in a naysay.

[Paul Ralston (Farmer)]: In a naysay. Yeah.

[Unidentified Committee Member (Attorney)]: So It's a

[Paul Ralston (Farmer)]: small thing, but, you know, again, these are ways that there's a little creek where things get away from us. Does that make sense?

[Speaker 0]: Yeah. And give us your vision of this section seven, you know, as far as why the language is needed in the way that it is as you go through it. Right.

[Paul Ralston (Farmer)]: So, again, I look at, this section and a later one where the legislature attempts to define farming, attempts to define farmer. And and one of the reasons is, what size or scope of an operation is required to comply with the RASP required agriculture practices. I think that's where some of this stuff starts. Right. You'll see it's not on on your appeal, but in the current use statute, farmland can be exempted, can be valued at, use value if it follows these things. It's referenced back to this six BSA. So I think that's what's going on here is an attempt to say, and you'll see at the beginning of the bill where people are trying to say that, it really is an agricultural process if it is less than certain amount of know, it tries to put some measures and some kind of so, again, I I will object to later on a definition in here of the word farmer, but I think this thing is about the wraps and what and whether people voluntary comply voluntarily comply or are required to comply. Again, we come to the section on farm kitchen operation, which I'm very, very happy to see. And I have had this experience, and just to give the committee a little background. So for three years, I started this farm and growing vegetables. And then and and we were donating those vegetables to our local food shelves. And then we had a real lot of tomatoes. We had a real lot of squash. And, and I thought, wow, if we could just, you know, cook these, freeze these, make soup from them, we could extend the value that we, of the product that we produce, and the food shelf can have food perhaps year round. So we built a small facility, a kitchen, facility. And when one does that, one wants to get a license from the Vermont Agency of Health, the Vermont Department of Health. So the the person from the Department of Health arrives, and he has a checklist, and he has to decide your little farm kitchen what category it's going to, be covered under because there are different rules for different categories. I'll just say them very quickly. Is it a restaurant? Is it a commercial caterer? Is it a temporary food service? Is it a limited operation like selling hot dogs at the fair? Is it a seafood vendor or is it a shellfish reshipper or repacker? So the health department says, well, you're not anything, but maybe you're a commercial caterer. And so they tick that box for commercial caterers. That then goes to the age of agency of natural resources for potable water and wastewater. A commercial caterer, this term, could be a very big operation. They can cater the graduation of of a college. They can create cater a large wedding. So we were the engineer who designed our wastewater system designed it. I said, just make it big. I don't want any problems. He designed it for 24 employees. I only have two and they're only seasonal. But I said I just don't want any. I got good soil. I just want, you know, a good system. ANR says that that system isn't, adequate for a commercial caterer, that we need not only do we have our in ground septic tank, but we need a thousand gallon in ground grease tear out. We need our toilet waste separated from our kitchen waste. We need to double the size of our leach field. Even though our leach field was designed on very good soil to handle 24 employees. And so that any farm that wants to comply with health department and a and our rules is gonna stop right there. Because now I can afford it, and I'm not saying that for any other reason, but the additional cost is $50,000 for me. Okay? That's after maybe $30,000 of the initial system that I put in. And then there was, you know, the engineer and all that stuff. So this is a deal breaker, because we don't have a statutory definition for our small size operation that runs seasonally as a, you know, bacon, soups. And we are not a commercial caterer. We are hoping maybe we could, you know, maybe we could make the equivalent of, you know, 50 meals a week or something like that. So

[Speaker 0]: So where so where is this different as we just had some folks in that do have a commercial kitchen that are doing exactly what you've just said.

[Paul Ralston (Farmer)]: Yep.

[Speaker 0]: How is their definition different than what your definition is here?

[Paul Ralston (Farmer)]: How are they Are they doing it under the accessory on farm business statute, or are they they doing it under the zoning regulations of their town? I I'd like to know that. Because zoning regulations for Middleburg, Vermont do not allow food production in the agricultural zone. Why that would be? I have no idea, but that's a zoning regulation in Middlebury. Now, naturally, our farm is in the agricultural zone. So absent the accessory on farm business statute, we couldn't have a little kitchen, regardless of how you wanted to buy them, because it's food processing. Yes. So

[Unidentified Committee Member]: it was one man's opinion here, as I said. My guess is that all of this occasioned because someone checked something off on the list, and you don't fit neatly into any particular category, and my further assumption is that once that's checked and we've got ANR involved, you can't uncheck it and go back, and that's a problem that we need to solve here. I don't know whether we need to add another box that just says small guy trying to do the right thing. It's probably not

[Paul Ralston (Farmer)]: ever gonna happen. But I think if if a farm kitchen operation did pass the legislature, I do believe that Elkhart would make rules around that. I because it will have to have a set of rules. But I do think that if engineers and and and, you know, people who work in wastewater are involved, that their their requirements will be significantly less than a commercial caterer. My argument is our operation has nowhere near the impact of a family of five who, you know, has multiple meals every day, who has multiple laundry, every day, has how many toilet flushes every day, who every fourth and July holds a big party. I mean, you know, this is happening all over the state. Witchwater, properly designed and installed, can handle it. And it's just that it can't handle something that where ANR believes that, you know, you might be putting out 200 meals a day. Right. And so that's why I think if we could establish another box to tick, it doesn't end there. A and R through LCAR is gonna, know, go through a process of defining the rules for that. And and I hope, you know, smart people will be involved. We won't. You won't have anything to do with that. But perhaps we could end up in a situation where there's less onerous regulations on such small and ancillary operations.

[Unidentified Committee Member]: Of course, the danger will be you have two employees. Someone's gonna say, well, it can't be more than four. And then you can make an argument on either side of that. Okay. Maybe five. Right. And I don't know that it ever ends.

[Paul Ralston (Farmer)]: I know. And I'm I'm willing to accept, hard limitations like that that are, are measurable. Not you might do this. You might make 200 meals, a day. If they send it to five employees, whatever that number is, I'm sure it'll work. The the the few operations around that I know, that do this and and some do it under local zoning and not under accessory on apartment business, they're small. They're small operations. And we have a little orchard, you know, in in our town, and they make pies and apple cider doughnuts, and there's only a few people working there. And I don't think senator that would end up being a problem, and that's a compromise that I think would be I I would certainly recommend making. And if you want if you want to put, an employee limit on this, I don't think that would be a problem. K? Because if it's five, I think you're good. If it's two, you know, what happens if somebody goes on vacation? You need a few extra people. Right? If you've ever, you know, had an operation, you can't just you you need to have on the bench. I don't

[Speaker 0]: know the fives. Right? Either.

[Paul Ralston (Farmer)]: I don't know. I don't know either, senator. I'm just saying I wouldn't have a problem if because I think if we can if we can unblock this, this to me is the key issue in the whole regime of regulations on health, ag, and natural resources that's so confounding.

[Speaker 0]: I think the only one that we're gonna need some help with because you're a bad man for even talking about this next watcher. Which one is that? Section 25, the floor drains. Oh, yeah. Oh, we we are we are we are hearing about that right now. You bad man. So it was tell us your thinking of that. Okay. So Because this is con consternation all the way through.

[Paul Ralston (Farmer)]: I'm I'm sure it has. I think, again, what's important to understand is that all floor drains, their is not the same. I said in a facility that's inspected by the Department of Health, therefore, has to meet rigorous cleanliness standards, rigorous sanitation standards, rigorous separations of things like, you know, chemicals involved with compounds. That a Bordre in a kitchen, a licensed kitchen, is, doesn't present the same threat as floor drain in a garage where you might have a petroleum product spill. Yeah. Here's the example, mister chairman. So outside of our building, we have a patio. It has a roof, a concrete floor, no walls. There's a slit, drain trench in that. We bring vegetables in from the field and we wash them down. The water used in that operation is exempt from ANR rules. Fact. So I can use as much water out there as I want. Now I have a basket of carrots that I've just washed. I roll them through the garage door into the kitchen facility. The water trips off those carrots and now that water is regulated by ANR because now it's happening inside the building. So, I know that, some people, there's legitimate reasons to be concerned about where floor drains might be appropriate. The other thing is to share, I have a kitchen. I make my soup at the end of the day. I get my mop bucket, I fill it up, I mop the floor, I take the bucket, I pour it down the mop sink. It goes to the same place that the floor drain go to. So what is the difference between the the the dirt or stuff that I might mop up or the dirt stuff that I might squeegee. That to me is the issue. And for a food operation, we're talking about health and safety. So we're talking about slippery floors. We're talking about, wanting to, wet things breed bugs, and I don't mean, you know, animal bugs, but we want clean and safe environments. This is in years of study, which I think is appropriate. Again, our engineer, experienced company, he says, when I see

[Unidentified Committee Member (Attorney)]: the word floor drains, just, you know, I I because So you think the study is okay? I do think the study is okay. Section 25 is okay.

[Paul Ralston (Farmer)]: I think as long as whoever's gonna decide who is on that study puts some engineer guys, you know, and some actual restaurant guys. Because my issue is in a licensed clean room, a floor drain is not at a a risk. It's not the same risk as, it would be in, in another building on my farm where we changed the oil and tractors. That's totally different than and and a floor drain would not be appropriate in there. Let me just see, mister Chairman, if there were any other So

[Unidentified Committee Member]: should we define between produce and animals, floor drains?

[Paul Ralston (Farmer)]: So I think the animal waste still goes into the septic system or the wastewater system, whether if it's municipal. I don't think so I imagine that a animal operation has a, because the strength of that wastewater is higher. They their engineer engineered a a a a more robust system. Right? The bigger tanks are more leach fields. I don't think there's any difference. I think you drop an egg on the floor, and, you know, you mop it up or you squeegee it's going to the same wastewater treatment, whether that's venous So your

[Unidentified Committee Member]: floor drain goes into your wastewater system? Yep. Okay. That's Even the outside ones?

[Paul Ralston (Farmer)]: No. The outside one goes into just settling. Right.

[Speaker 0]: Sell the pond, whatever, right.

[Unidentified Committee Member]: And I think that's what we're mainly concerned, not

[Speaker 0]: the one who goes into septic.

[Unidentified Committee Member]: When you said, when I think floor grain and garage floor grain, it's dumps and then it goes out to daylight, disperses on the ground. Right. And that's our biggest concern

[Paul Ralston (Farmer)]: for me. Well, and again, outdoor drain where we're washing, you know, dirt, soil off of vegetables, already that water is not regulated by a Correct. And it's just that that same water now goes into the building, and all of a sudden, it's treated differently. But it will you know, I'd love to see a robust, you know, discussion of that

[Speaker 0]: by this study. If I'm not on the committee.

[Unidentified Committee Member]: Let's

[Speaker 0]: see. Well, don't be absent that day. So later on,

[Paul Ralston (Farmer)]: There's a new definition of a farmer in here, and I would like to just know fast. Yeah.

[Speaker 0]: You know, except you had some Yeah.

[Paul Ralston (Farmer)]: Section one. Section one. So in this one, there are, it says if I can find it, it says, to be a farmer, you have to meet two of three criteria. And one is if memory serves that a substantial part of your income comes from farming activity. Another criteria is that your farm operations is a substantial part of your net worth. Here it is. I I promise you. And on my draft, it's page 38, lines eight through Yeah. 12. So, again, I don't understand why the legislature needs to define farming in a in a new piece of legislation where it's defined numerous times in other statutes. But to me, this means, for instance, you know, I say I'm retired and I'm a farmer. I'm not according to this because it's not my significant source of income. It's not a majority of my assets. Yeah. And I think, I have neighbors that are, that are farmers who also drive school buses, and I bet their school bus income is higher than their farm income. And so I I don't understand why that got to be in there. Fair enough.

[Unidentified Committee Member (Attorney)]: Isn't isn't this one that's just being moved from one chapter to a subchapter? It's already in the statute.

[Paul Ralston (Farmer)]: I know. But, I mean, Lex Komsa could definitely, you know, tell you K. Where that came from. That, mister chairman, is my walkthrough, and I'm happy to answer any questions.

[Speaker 0]: I think we're gonna talk to you just a little bit more and maybe get some more in-depth. I think because a lot of you know, we understand a lot of what you're saying and your arguments are good, but we're want some more detailed of what your, you know, your thought process as far as that sounds. To be very helpful for us.

[Paul Ralston (Farmer)]: Mr. Chairman, when do you, since

[Speaker 0]: this

[Paul Ralston (Farmer)]: is a committee bill, I'm assuming you're going to be able to hold this.

[Speaker 0]: We are and got a very big bill and we just talked about this morning. We're we're we're getting. We're getting on it right now. We're starting to really work on some language now, so it's gonna work.

[Paul Ralston (Farmer)]: We're gonna we're we're moving.

[Speaker 0]: We're gonna not restrict access to the public as far as to come in here and ask what they want because that's not what we do. But we're going to really kind of make it more centric to what we're working on the bill. I don't want to wait till the last minute on this. There's going be some more committees that want to grab hold of some of the languages that we have. We've already been told that. So we're going be working diligently. So I'll talk to you in a minute. And we're going to be moving. I don't see just myself, the whole committees, don't. They're either we're all as one. I don't see anything that I'm troubled by as far as anything that we've gone through with what we did today. Senator Major said it today, and the reason why we're gonna ask for really good details is that we've gotta go and sell this. And so we got to make sure that not just one of us understand it, that we all understand it. And it's more complex than what you're asking to change a lot of stuff and that a lot of people, we're gonna have to make sure that we're able to explain it to them to why we want to

[Paul Ralston (Farmer)]: do that. Right. So that's what's important to us. What I found in conversations with the different agencies, when the focus is on food. So, yes, we I agree with where you're going with

[Unidentified Committee Member (Attorney)]: that. Interesting.

[Paul Ralston (Farmer)]: This is important that, members of the committee, members of the legislature understand that, you know, they're voting on the ability of Vermonters to grow food. Right. And that's really important. Right. So it is you know, we kinda get confused with when we say agriculture farming, people immediately go to big dairy, and they think that that's what farming is all about, but it isn't what farming is.

[Speaker 0]: Well, I think that's one of the things that we've done very well as a committee, very proud of this committee. I just say it all the time because I am. We have distinguished between that very, very well. We have fought hard to get $300 fees removed from the lady that's baking 12 loaves of bread to LFO operations, and everybody in between. We applauded somebody on the screen today who, we believe that the future of farming is growing food. Whether you start out as beech greens at the end of the family driveway, selling out the family garden, and then you expand from there. I think this committee's got a very great grasp of how agriculture is going to survive in future years and from So, yeah, so we hear you. We're confident. Thanks, pressure. It's the hottest. Committee.

[Carrie Stahler (Vermont Foodbank)]: We can.

[Speaker 0]: Yep. Come on. Thank you, Mr. Senators. I prevent your report. I appreciate your help. Taking time.

[Spencer Blackwell (Elmer Farm)]: It is my house. My whole life. I don't have a whole lot of specific language like Paul does. I'm just to testify that what he's advocating for is gonna be a benefit to me at the small farmer. I'll just start with what I've been doing. Absolutely, Thank you. My name is Spencer Blackwell. I own the Elmer Farm in Middlebury, an organic farm throughout seven acres of over 30 different types of vegetables. My partner and I are the founders, and 2026 is our nineteenth year in operation. Currently, all of our sales are direct to customers or stores within Middlebury. I'll add here, because we

[Speaker 0]: were

[Spencer Blackwell (Elmer Farm)]: talking earlier about some specific numbers. Sales are $225,000 on seven acres. We pay our employees, which are two and a half full time equivalents, 11 people. We pay them roughly $90,000 out of that. And then the remaining is split about halfway between variable capital expenses and the personal income, which amounts, and the personal income element of it varies. That's where yield comes in. Yield and the quality of the year. So some years I make $50,000 a year. The most I've ever written on my tax forms is $99,000 But I have three kids. You all know it's not a lot of money living in the state. So I grew up in a small player, started growing vegetables as a summer job at UVM, and I've been growing vegetables commercially in either Chittenden, Washington or Essex County for thirty one consecutive years. The most remarkable change I've witnessed in Vermont agriculture over the past fifty years is the reduction of the people involved in this profession, in growing food. Just as the dairy industry is consolidated, so has fluctuating. Consolidated so that fewer people are on more acres, so as vegetable production. That may not be intuitive right off the bat because there are way more vegetable farms now than there were fifty years ago, but there are way less people growing their own gardens and preserving their own food. The amount of people that are growing are lower. So I'm here today to help ensure that we have a voice, the people that are growing the food have a voice and wants it to stay. So secret that it's becoming increasingly difficult to maintain a profitable farming operation and a reasonable livelihood for farmers, the cost of inputs and labor are outbursting our ability to increase efficiency or prices. If we want to sustain viable agricultural economy in Vermont and encourage young people to participate in this essential profession we need to lower the barriers. I am in strong support of the provisions in this bill that would allow the proliferation of small farm kitchens that could, or I think as it's written, it's farm kitchens bill, that could produce substantially more inputs from other producers, that could purchase substantially more inputs from other producers. I do not have the capacity to develop my own facility, but if farm based facilities were common and not prohibited by local zoning, I would be able to find a market and utilize a greater percentage of what I grow. Every year we have some crops that don't meet retail standards, as Paul was talking about. And also every year we have crops that produce way more than expected bumper yields. And both of those scenarios end up being a drag on probability, obviously the first, but the latter, you spend all the time and labor hauling this stuff in, can't sell it, just spent more money than needed to. So that would be a great outlet to be able to just easier it is for people to do the things Paul's doing, better off. We all will be. That's also the, you know, my business is entirely vertically integrated. We start by the seeds and we do everything in between to reach it to our customers short of like putting it in their mouths. We wash them to drink so they don't have to wash it, you know, do everything. And that takes a lot of, it takes a lot of skills. I mean, it's, and it's not, not everybody wants to be that specialized. I've made a lot of sacrifices in terms of like the things I do with my family, the things I choose to do. It's just like, yes, there are a few of us out here who, for whatever reason, have made those choices, but it's in order to get more of these young people that are, that we need in order to have five farms continue is that we've to just make it so that it's it's easier for someone to live in kind of a more normal life, and where they don't have to be the owner of six different businesses under one roof. To be able to, it'd be easier to have these auxiliaries kitchens around me. I'm also in support, and all didn't talk about this, but I believe it's also in my bill is the capital gains and property transfer tax exemptions for bona fide farmers who wish the chance to transition their up versus the next generation. Is a values based profession. You all know that. It is not any profession that we're looking to get extraordinary financial rewards out of. Low pay for owners and employees are common across the board. For a young person to develop the skills necessary to run their own farm, they need to spend many years working for others. Paul told me on the way over here, I don't know, need to think about a farm. I've only been doing this for four years. You can't just be a retired guy and open a farm and know what you're doing. You have to spend a long time doing it.

[Unidentified Committee Member]: Or me, young couple coming in thinking you're going to think, Oh, this is going to be great.

[Spencer Blackwell (Elmer Farm)]: I'm start planting. Yeah. It's like, this is a lot worse. So many people fail that way and to have these Let me see if I can get back on track here.

[Speaker 0]: You're fine. Don't worry about it. Don't find it. Okay.

[Spencer Blackwell (Elmer Farm)]: Yeah, so only an exceptionally successful operation can provide enough income to sufficiently save for retirement without cashing out the equity of their business. So if a business is exceptionally successful, they can't cash out their equity if they want to pass it on to the next generation, and the next generation doesn't necessarily have 50,000 or $100,000 to pay a property tax for a higher

[Paul Ralston (Farmer)]: mortgage transfer.

[Spencer Blackwell (Elmer Farm)]: All right, as you've contemplated aspects of this bill, please consider the unique value that viable farms trade for our state. Farming is unlike any other business and that the products created to literally become who we are. The federal government understands this and supports massive subsidies to ward off the potentials of food shortages. Given increased instability in the federal government, the fragility of the global food supply chain, changing climate, we're monitoring why we to do everything in our power to make it easier to be a farmer in our state. Thank your time. Thank

[Paul Ralston (Farmer)]: you for your great service here. Well, thank you, thank you for what you do.

[Speaker 0]: We are very protective of you. You don't know that, but you should. We understand what you're doing. We understand the hardships of what you face. Yeah, gonna say it again. You got a great city that's got your back, and thank you. Yeah. Thanks, Vincent. Thanks. Anything else? Good talking. Linda.