Vermont Legislature SmartTranscripts:

[Ellen Czajkowski, Office of Legislative Counsel]: We're live.

[Senator Russ Ingalls (Chair)]: Good morning in Center Agriculture. We're in business for Tuesday, February 17. We're going to spend some time doing a section walkthrough on four, five, and seven with legislative counsel Kirby Keaton. And as custom areas start of each week, I just wanna go around the room and introduce the committee's term.

[Senator Joseph "Joe" Major (Vice Chair)]: Yep. Brian Collamore represent the Rutland District. And I'm Robert Plunkett, the Bennington District. Steven Heffernan, the Edison County District.

[Senator Russ Ingalls (Chair)]: Joe Major, the Windsor District. Senator Russ Ingalls, Essex District, Northeast Kingdom. And, Kirby, the floor is yours, sir.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: I think it's pretty getting a bump for me to join. Guess Please go. I see. Let's see. Yep.

[Senator Russ Ingalls (Chair)]: Good morning. Good morning.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: It's Kirby Kimos of council. I was asked to come by to talk about S three twenty three. I previously stopped by and talked about the tax provisions. I'm the legislative council attorney who handles the tax portfolio. Beyond that though, what would you like from me?

[Senator Russ Ingalls (Chair)]: Well, just go down through the language of it and a lot of the stuff we're unfamiliar with. We're filling other needs throughout the building and trying to help farmers in the meanwhile and if we could just go down the the language of four, five, and seven. I don't think we've done that yet, this committee. So just to have your take of it would be very helpful. Okay.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: I I did stop by before and talk about some of this, but we can we can go through again. So starting in section four on page nine of the bill, which I pulled up here, we have changes to Vermont's personal income tax, the definition of taxable income, and on page 10, there's two subdivisions here that would exclude certain income from Vermont income tax. So the the way that this is structured, what you're looking at, would mean that this type of income will be left off of a person's tax return entirely, would not be even reported there. So not a deduction, not a tax credit, just excluded entirely from tax return. And so the first item is the amount of any net farm profit provided the taxpayers' net farm profit during the taxable year did not exceed 10,000. Net farm farm profit is a jargon, you know, tax term that's practiced at the federal level. There are certain types of farm income and then there are certain farm expenses that get taken out of that, and then that's put on to a schedule f that's filed as farm income, at the federal level. And then the other exclusion we have here is adjusted net capital gain income from the sale of real estate that is part of a farming operation, provided the buyer continues using the real estate as part of a farming operation and the buyer is related to the person was an employee of the farming operation firm in particular prior to the sale. And then there's a prediction after that which has a type of clawback where it says that the buyer that purchased real estate pursuant to this subdivision shall be subject to the tax imposed by this chapter upon development of the real estate by the buyer. If the development by the buyer occurs on a portion of the real estate, the prorated portion of capital gained shall be subject to tax imposed by this chapter. The amount of this tax shall be determined as the date of the development occurs, and the development is defined as the same definition as is used in current use to trigger when land use change taxes do. When I was here last time, we talked about how in the context of current use, you have a lien on the parcel and the Department of Taxes is able to track whether land exchange tax is due or paid based off of that lien that's recorded land records. We don't have that in the context of a personal income tax inclusion like this, so it would be troublesome for this department to be able to track this, especially if you're talking about development that occurs maybe decades into the future. I had mentioned that in the income tax context in Vermont law, we have Vermont's version of five twenty nine plan, and when you make a contribution to a five twenty nine plan up to a certain amount, you can get a tax credit in the current year. That tax credit does deal with something that happens sometime in the future. In this case, if you make a distribution out of that account and use it for a purpose that's not allowable, then there's a penalty. And the penalty is basically making up for the tax benefit from the tax credit that was previously taken, which I think a little bit more added to that. So that would be a personal income tax comparable thing, I think. I also noted that when it comes to that tax credit, the state does have that same issue of not being in a very good position to check on the compliance. When someone takes a distribution out of federal government, the state's not necessarily kind of fed or not, and everyone's done. So I put that forward as if you wanted something that's to be administered similarly to what we do with other personal income tax things, That's an example of something that you could modify this and borrow from, get rid of some of the administrative issues here, but it still is not one of reasons we're perfect compliance, because when it comes to administering income tax at the state level, our department here doesn't have the same kind of resources as the IRS, and so tracking things can become difficult if there's not already some kind of paper trail to work on. I So think that's the issue with this exclusion, that the committee would have to face if you want to basically involve as part of this exclusion some kind of clawback if a person develops a property. If you don't want to go that route and have that penalty, to speak, then this becomes easier to administer. But, yeah, those are all policy choices for you to deal with. But there's some administrative work to be done if you want to proceed with that one, I think.

[Senator Joseph "Joe" Major (Vice Chair)]: Thank you, Mr. Chair. Kirby, I've just Is there a definition of farming operation? In that section, it's underlined, so I'm assuming that somewhere else in the bill, there's

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: a definition of farming operation that agrees with that? Farming operation is a term that's used. We don't have we're not there's no reference in this language to a definition, so I can't tell you exactly what this means, but we do have, you know, like the statutes, you define something for the purpose of the section of the chapter, and that's very clear that that's what the definition is. In situations like this, we're we're using that term, but it's not defined in that same section. I I don't think the income tax uses that. It's farming operations that was used. I could look I could look at current use. It also is ringing a bell with me that for purposes of certain sales tax exemption, speechless farming operation. I can look into that for you, basically, but for now I can tell you, yes, the Department of Taxes has something to work with as far as trying to figure out what that means. No, it is not defined very, like, clearly here,

[Senator Russ Ingalls (Chair)]: and these are sort of Okay.

[Senator Joseph "Joe" Major (Vice Chair)]: And then my other question, are you suggesting that we delete Roman numeral III, which is at the top of that next page? Yeah, on page 11. I was just saying

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: that I think to make sure the administration of this would be done as cleanly as possible, the Department of Tax should be brought in to talk about ways to work on this. I am definitely not suggesting any policy change there. I agree that. It's very Poorly. It's very clear that this seems to be a big part of the whole thing. The idea was to provide a tax benefit, but if the buyer doesn't follow-up and use it the way the legislature intends, that there'll be consequences. That seems like a key part of the policy that's trying to happen here, so I'm not trying to comment on that. My comments really are going to detract any administration.

[Senator Joseph "Joe" Major (Vice Chair)]: Yeah. Okay. I think we did a tax in. Seems like they had a comment. And as I read that, I'm assuming that it means as long as it continues to be 100% farming operation, that other section takes care of. But as soon as say it's a 100 acre parcel, and half of it gets developed, that half would then fall to the buyer in terms of capital gains.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: Capital gains will become Oh, pardon?

[Senator Joseph "Joe" Major (Vice Chair)]: Yeah. It's that's the way

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: it's drafted. Basically, the tax gets kinda deferred. There's not too many instances in Vermont where we do that exactly. That's one that's one reason why I was saying that the five twenty nine plan approach.

[Senator Russ Ingalls (Chair)]: Yeah. In that approach, you don't have

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: to pay the tax back because, technically, it's a penalty that comes in post. So the nuance difference there is instead of telling somebody, you need to pay tax from twenty years ago, you're just saying, no, you didn't have to pay that tax, but now that you've done this new thing, there's a penalty down, and you're paying this penalty that isn't down. Is it you see the

[Senator Joseph "Joe" Major (Vice Chair)]: difference But as long as I buy Kirby's farm in total and continue to operate the way Kirby did, there's no penalty or implication in terms of Yeah.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: Just like current. Okay. Yep. Well, I mean, the the way it's the way that it's drafted and using that current use, that should develop it. I would I would note, though, that the development under current use, there's many parts to it, including, say, sub subdivision of the parts. So just just be aware that it it might be different than than, you know, building a building. Mhmm.

[Senator Robert Plunkett (Member)]: So you're kinda going down that. So say that some main, use is farming, but they do something else with it. There's a penalty for for that or

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: It depends on what something else is under track. But the the basically, you're saying, like, how

[Senator Robert Plunkett (Member)]: is how is So for, you know, 80% of the land they continue to do, but they build a structure and say they have a a store.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: What's that? I'm just like, just how does it work in our current use? They're like, if you if you decide to build, say, a good general store, we'll say. Yeah. Because there's there becomes a question of, like, is it a farm building? Yeah.

[Senator Russ Ingalls (Chair)]: Yeah. There's a process

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: for that. But let for your example, I'm gonna say not a farm building.

[Senator Robert Plunkett (Member)]: Yeah. Not not a farm building. Right. A general store.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: So Yeah. There's a there's a couple of there's a couple of choices for the taxpayer. One could be to unenroll that portion before you build and pay language change tax because you plan to develop it. Or go ahead and build, and then you would be found to be out of compliance, and then that would get the development and view. Yes. But but at the end of the day, language change tax needs to be paid on the portion that is being withdrawn, that's that's being developed. And so if it's two acres out of the 100, I think you said? Yeah. Just Then what would happen under current law is that the local listing essential assess the local lister or assessor assessing official, I think is what I was trying to say, come by and value that two acres like it's its own stand alone parcel, and then you pay a percentage of the value of that No. No. No. No.

[Senator Joseph "Joe" Major (Vice Chair)]: It's just Yeah. That's all

[Senator Russ Ingalls (Chair)]: a hard thing to figure out. It's not always it doesn't always seem to be a $7 far as completely fueled that whole thing.

[Senator Joseph "Joe" Major (Vice Chair)]: Yep. Go ahead. I was I was just gonna let you

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: know that there's in the miscellaneous tax bill is coming out of possibilities and means, there's some tweaks to that. I don't know if you wanna be aware or you have to wait till it stops.

[Senator Russ Ingalls (Chair)]: Any more questions about that? I can tell you that one of the reasons I wanted Kirby to come back in here is that I didn't know about how far we were going to take this. I wanted to hear it one more time, and I wanted the committee to make a decision at some point in time. We are going to talk a little bit more about some current use stuff, about some farm structures and stuff, but I just want to get the pulse when we're all said and done about how far we want to take this. There's other things that we're willing to dive into and go and how much the committee want to do as far as all this. Just keep that in mind as we move forward. It might be something that makes our bill unless you guys tell me otherwise that it's something that you think that we have bandwidth to do. I'm more worried about the bill going further into another committee, and a lot of the time that we put into it, we don't get the bill back as far as the section of it. That's where I'm a little bit going with this.

[Senator Joseph "Joe" Major (Vice Chair)]: Section five just seems to be a repeat of Section four.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: Yes, but that's for the property transfer tax. So you have a property tax, or property transfer tax exemption proposed there in section five. This says transfers property to this part of a farming operation, provided the transferee will continue to follow the same requirements we ran through before, including the penalty, if that's what we'll call it, for the for development.

[Senator Russ Ingalls (Chair)]: Yep.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: And transfer tax is a different animal. It's not income tax. But some a lot of the same issues as far as tracking when development occurs would exist with that, because again, in the context of transfer tax, you don't have the lean that current use has. Gotcha. And that's another one that if you wanted to take a different approach that could help with the administration, make it a penalty instead of actually paying the tax back later, you know, that'd be one place to start. And again, like, I have not spoken with part of taxes. Like, they might have ideas with their experience that are like, hey, we could administer it this way, possibly. I don't know if they have those ideas or not. There is one other tax thing, because I was scheduled also for section seven here, which I don't I don't recall if I talked about this last time. But in section seven of the bill, you have a change to the definition, of agricultural lands,

[Senator Russ Ingalls (Chair)]: or there's

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: a presumption that land is used for agricultural purposes if that part of current use enrollment statute. This comes into play usually when a parcel is being enrolled for as ag land, but it's less than 25 acres, and in that case, there's some more requirements that the vendor needs to show in that case. Current use enrollment works for ag lands, for the larger parts of 125 acres, it's a bit more relaxed as far as, okay, that's a big chunk of ag land, kinda more relaxed. But for the smaller parcels that are trying to be enrolled, there's more of a screening process that gets used here. So in that case, it's on page in the bottom of page 13 of your bill. There shall be a presumption that the land is used for agricultural purposes if, a, it is owned by a farmer and is part of the overall farm unit. In that case, farmer is defined in current use, so it's income based. It is used by a farmer as part of the farming operation farmer's operation, underwritten lease for at least three years. So I think you know what that scenario would look like. Or should be an or here. Yeah. There we go. Or it has produced an annual gross income from the sale of farm crops in one or two or three to five calendar years preceding of at least $2,000 for parcels up to 25 acres and $75 per acre for each acre over 25, the total income required not to exceed 5,000. So that's the current law, is there's this other avenue if you produce and sell enough farm crops. So what's being proposed here would be an alternative that instead of selling farm crops, it would also count the equivalent value of donated farm crops. The thing that comes to my mind for you to consider is I don't know to what extent the department would have an issue with trying to determine, hey, when it comes to the sale of farm crops, we have income tax returns we can look at and try to figure that out, but as far as the donation of farm crops, I don't know what ability they have to actually confirm that, so I think that would be the question.

[Senator Russ Ingalls (Chair)]: I think we talked about with this part right here that would have to be specifically to a nonprofit, somebody that would have to actually do a reporting as far as what they've taken in and do the work for the department and to file. I think that is not changing the rule very much other than the fact that we're talking about donated product. I think that's something we could probably figure out how to do that with some different language in there. Yeah. And I think that's why we wanted to is to find out, you know, what's

[Senator Joseph "Joe" Major (Vice Chair)]: the best language in order to say donation to a nonprofit that will cover that issue, where there'll be some record of it, and none of us knew what that would be. So hoping that you'd be able to help us

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: out with it. I can work on what you understand. If you want me to, just let me know.

[Senator Russ Ingalls (Chair)]: I would like that, right? As a senator's stat, we've spent quite a bit of time on this as far as figuring out that we could probably keep this one stick, and the language would be helpful. Okay. So I'll

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: reach out to the department if that's okay. Yep. Please. And we'll figure out what they need, and my understanding is that you're interested in possibly tying it to a particular type of nonprofit, possibly a viable secret, something like that, but something that would have a verifiable

[Senator Russ Ingalls (Chair)]: Something that they would have reporting mechanisms to where we don't have to

[Senator Brian Collamore (Member)]: reinvent the wheel. Okay. So. This came up from, we have a farmer that's a nonprofit that donates and has no way of writing off. So that was his ass. You're right. And I'm sure there's others throughout the state that would like the same thing.

[Senator Russ Ingalls (Chair)]: So, I'm gonna go on a limb and say that four and five might be a little bit of life support as far as the way I'm feeling about it. That we could probably keep on working on Section seven And committee, you guys, how does everybody feel about that? I agree. I do. Okay. Kirby, thank you very much. Appreciate it. Okay. We're gonna spend time, on Section 10. Ellen was gonna go through that. She is. Is she on the screen? Yeah, she's our host. Okay, there we go.

[Ellen Czajkowski, Office of Legislative Counsel]: Hi, can you hear me?

[Senator Russ Ingalls (Chair)]: Yes, we How are you?

[Ellen Czajkowski, Office of Legislative Counsel]: I'm under the weather, so please let me know if you can't hear me.

[Senator Russ Ingalls (Chair)]: Can hear you. Thank you for coming in. We were actually just looking for a walkthrough on Section 10, if that would work for you this morning.

[Ellen Czajkowski, Office of Legislative Counsel]: Yeah, no problem. Do you want me to share my screen? Would that be easiest for you?

[Senator Russ Ingalls (Chair)]: That would be, if that would be okay.

[Ellen Czajkowski, Office of Legislative Counsel]: Sure, no problem. Ella Tchaikowski, Office of Legislative Counsel. I am here on Oh, I'm not good at this. Can you see the document?

[Senator Russ Ingalls (Chair)]: Yeah, we can see that. Great. Can you maybe make it a little larger?

[Ellen Czajkowski, Office of Legislative Counsel]: Sure.

[Senator Russ Ingalls (Chair)]: Senator Plunkett has trouble breathing.

[Ellen Czajkowski, Office of Legislative Counsel]: How's that? It's good. Bigger? No?

[Senator Russ Ingalls (Chair)]: I got it on my ear. There we go. That's perfect.

[Ellen Czajkowski, Office of Legislative Counsel]: Okay, great. Ellen Jaikowski, Office of Legislative Council, I'm here on S323, your miscellaneous agriculture bill. And so section 10 is amending 30 VSA two forty eight, And section two forty eight is the statute that establishes the process for the Public Utility Commission to issue certificates of public good for energy generation facilities. And so basically this is the section of law that gives the PUC the authority to issue permits for electric generation facilities. It includes renewable facilities, but also any other facility as well, including fossil fuel facilities. So there's a couple of changes proposed to this section. On page 18, there isn't a change being proposed to this subsection, but this subsection is describing that the Public Utility Commission can hold a public hearing on an application for a permit, either of their own decision or if there's a request from one or more members of the public or party to the petition. And so on page 19, there is new language being added. Currently, the agency of natural resources is required to be a party in any proceeding on a permit application. This language under section 10 of the bill would change that to also require the agency of agriculture, food, and markets to also be a party for any application. And I would point out though, I included this language further down on this page because currently the agency of agriculture is required to be a party to a petition if it's going to be a large facility. So if it's an electric generation facility greater than 500 kilowatts or an energy storage facility greater than one megawatt and will be cited on attractive land containing primary agricultural soils, the agency is required currently to participate as a party. So the amendment farther up on this page would now require them to be a party to every permit proceeding.

[Senator Joseph "Joe" Major (Vice Chair)]: Ellen, can I ask you a question? Excuse Line fifteen and sixteen on page 19 Just says the agency. I'm not sure it's clear which agency is being referenced.

[Ellen Czajkowski, Office of Legislative Counsel]: Sure, so if you look at line 10, subdivision F specifically says

[Senator Joseph "Joe" Major (Vice Chair)]: Yep, I got it. Thank you.

[Ellen Czajkowski, Office of Legislative Counsel]: Sorry, and I'm happy to read through the rest of the language verbatim if you'd like to hear it. Just figured I would do the short version for you.

[Senator Russ Ingalls (Chair)]: I think we're good for that. Okay.

[Ellen Czajkowski, Office of Legislative Counsel]: So then the next change is on page 20. So there's a specific procedure under subdivision J for applications of facilities that are greater than 50 kilowatts and greater than one megawatts for a energy storage facility. So they are required to address a shorter list of criteria in their application, and this is adding some additional language to that. So currently the application does have to include on line 16, the presence of total acreage of primary agricultural to soil defined in 10 VSA 6,001. This is the Act two fifty definition of primary agricultural soil. Language is being added here to read primary, secondary, and local importance agricultural soils as defined in 6,001 and by the Natural Resources Conservation Service, the NRCS. I don't think this language is necessary because the definition in 6,001 already does reference the different types of primary agricultural soil, including secondary and local importance. And it does reference that it is based on the maps from NRCS. So you can include this language here to be very specific, but it is already captured by the definition in Act two fifty.

[Senator Joseph "Joe" Major (Vice Chair)]: And if I'm reading that on sixteen and seventeen on page 20, is there a difference between what's entitled 10 in that section and the Natural Resources Conservation Service? In other words, the conjunction there is and, so it has to satisfy both of those requirements. I'm guessing there's a difference between them maybe.

[Ellen Czajkowski, Office of Legislative Counsel]: Not that I'm aware of. This language in Section 10 came out of age six seventy seven. I think the sponsor of that bill wanted to be as specific as possible, but I don't think, I think that this is already captured in the existing language. I don't think that there is a difference.

[Senator Russ Ingalls (Chair)]: Okay. Then committee, you want it in there, you want it out? What do you want? I'm okay with leaving it. Okay. Then Alan will leave the language in. As

[Senator Joseph "Joe" Major (Vice Chair)]: long as it doesn't Yeah.

[Senator Russ Ingalls (Chair)]: Okay.

[Ellen Czajkowski, Office of Legislative Counsel]: Yeah.

[Senator Joseph "Joe" Major (Vice Chair)]: How do you how do you believe it's upset? Well, Alan's point, think, is that, it's already included in in, that section in type 10. Mhmm. And I'm wondering if it is, it's okay to me to make it very clear what we're talking.

[Senator Russ Ingalls (Chair)]: I can hear you. Yes. Go ahead. Ellen,

[Senator Joseph "Joe" Major (Vice Chair)]: So I'm looking at 6001, and I'm not seeing a definition of secondary agricultural soils or local importance agricultural soils. Am I correct in that? There's just the definition of primary agricultural soils that includes prime statewide or local importance soils.

[Ellen Czajkowski, Office of Legislative Counsel]: And it doesn't reference secondary and local?

[Senator Joseph "Joe" Major (Vice Chair)]: Well, it it it references statewide or local importance. I'm not seeing it. I'm doing this quickly on my phone, and as senator Collamore said, I do have trouble with my eyeglasses now. I'm not seeing there's a definition of secondary agricultural soils or local importance agricultural soils. Hold

[Ellen Czajkowski, Office of Legislative Counsel]: on one second. Let me grab my

[Senator Joseph "Joe" Major (Vice Chair)]: Sorry to spring this on you.

[Ellen Czajkowski, Office of Legislative Counsel]: So but it does reference as mapped by the NRCS.

[Senator Russ Ingalls (Chair)]: Says It

[Ellen Czajkowski, Office of Legislative Counsel]: does then use secondary and local importance.

[Senator Joseph "Joe" Major (Vice Chair)]: I'm I'm literally not seeing secondary in here. Frankly, that's why I'm asking, in part because computer was left at home today, so I can't do it quickly.

[Ellen Czajkowski, Office of Legislative Counsel]: I had looked and I thought it was addressed in the Act two fifty statute. I'm happy to get back to you.

[Senator Joseph "Joe" Major (Vice Chair)]: I just want to make sure that we're not referencing some definition that doesn't exist.

[Ellen Czajkowski, Office of Legislative Counsel]: So I look into that. Understanding is that it is already covered, but I'm happy to do more research.

[Senator Russ Ingalls (Chair)]: So for now until we hear, we'll keep it the way that it is and we'll move on.

[Ellen Czajkowski, Office of Legislative Counsel]: All right, so on page 21, subsection B of section 48 is the criteria that each application needs to address in their application. So there is already this language in Subdivision 2. So currently applications are required to demonstrate that the facility would be constructed to meet the need for present and future demand for service, as well as farther down shall assess environmental and economic costs of the purchase, investment and construction as set out in 218C, which is least cost integrated planning, and shall consider whether the facility will avoid, reduce, or defer transmission or distribution system investments. So there is already some assessment required of the need for a facility and whether it will be necessary. But new language is being added to this on page 22. So specifically for a solar generation facility, to meet this criterion, a Vermont licensed engineering firm approved by the Department of Environmental Conservation shall perform a full spectrum audit of energy payback time and carbon dioxide emissions at the cost of the applicant. The audit shall include a cradle to grave calculation, including resource extraction, mining and procurement, production, manufacturing and transportation, deployment and disposal of all technologies required, including solar panels, concrete footings, transformers and batteries, forced ecosystem destruction, foregoing twenty five years of agricultural crops, and construction and landscaping of the project. So this would require for solar facilities that the applicant have a licensed engineer approved by the Department of Environmental Conservation perform a full system analysis on the project, including all of these elements. I know that the DEC does currently make lists of licensed engineers who perform the type of work they issue permits for. I'm not sure if they currently have a list of engineers that would do this work. So you may wanna hear about that. But it's asking that each solar project provide this analysis as part of their application.

[Senator Russ Ingalls (Chair)]: If this wasn't solar, wouldn't any other entity that tried to occupy this land have to do all of that as well?

[Ellen Czajkowski, Office of Legislative Counsel]: No.

[Senator Russ Ingalls (Chair)]: Okay. So this isn't anything that any other group of people who are trying to put in a facility would have to do all of this, because I would beg to differ a little bit on that. I would beg that most people do have to show an impact of what they're doing of the land that they're occupying by the time that it's there. I would be very, very shocked if

[Senator Brian Collamore (Member)]: they didn't. If it's industry, you know, you have to do a transportation test study, you have to do a climate impact study, we had that all happen when we had somebody that wanted to build down our way a small project, but they still had to prove all this before, you know, and that ended up filling the project. So

[Ellen Czajkowski, Office of Legislative Counsel]: electric generation facilities are currently required to comply with the requirements of Section two forty eight. This is a full systems analysis. I do not believe that any other that's being added here, I do not believe that this currently exists for any other type of electric generation facility. And while some of this information would also be required potentially under an Act two fifty permit, not a full systems analysis, including all of the aspects cradle to grave.

[Senator Brian Collamore (Member)]: Only reason I believe it's important in this case is because we're putting these devices in to say that we are going green for the plant. And if you do a cost analysis that shows up in twenty five years, you actually don't make anything or didn't help them do the effect of

[Senator Russ Ingalls (Chair)]: what it was supposed to

[Senator Brian Collamore (Member)]: do putting it in, then it should have a question of the product. That's

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: something

[Senator Russ Ingalls (Chair)]: because they're making claims that they're saying that they're doing this, and why wouldn't they have to prove that that's what they're doing? That's what they're doing. Good. Do you wanna move on for now? That's for discussion, as we know, we've been told, and move on? Yep. Okay. On we go, Ellen, please.

[Ellen Czajkowski, Office of Legislative Counsel]: All right, so still on page 22. So criterion five under the list currently asks for facilities to demonstrate that they will not have an undue adverse effect on aesthetics, historic sites, air and water purity, the natural environment, the use of natural resources and public health and safety, with due consideration having been given to criteria under 1424A D is outstanding waters of Vermont and 6086A one through eight and nine ks. These are Act two fifty criteria one through eight and nine ks. And then next is impacts to primary agricultural soils. Agricultural soils of statewide importance or local importance as defined in Act two fifty and as designated by the NRCS and greenhouse gas impacts. It then adds this additional language on the bottom of page 22 into page 23. The siting of a facility or group of physically adjacent or interrelated facilities such that the facility structures and related infrastructure preclude the tilling of soil, seeding and growing, or harvesting of agricultural crops on greater than five acres of primary statewide or local importance agricultural soils or reduce future Vermont based food security or will result in the destruction of forest ecosystems, forest soils and their unique biology, or increased volatilization and release of forest soil carbon on more than five acres shall be considered undue and not in the public good.

[Senator Russ Ingalls (Chair)]: Okay. We're clear on that.

[Senator Joseph "Joe" Major (Vice Chair)]: I do have a question. Ellen, the shall be considered undue and not in the public good, is that a presumption that would go into effect or would that essentially preclude the project that's going forward? I

[Ellen Czajkowski, Office of Legislative Counsel]: think you're gonna hear from the PUC on this, so I think you should hear, but unlike other types of permits, a certificate of public good, an applicant is required to demonstrate compliance with the criteria. However, overall, the Public Utility Commission needs to find that the construction of the energy generation facility will be in the public good. And so the interest of public good is sort of the factor with the heaviest weight, but they do take into consideration all the factors from all of the criteria and also if it's in the public good. So you may want to hear from the PUC how they actually do that weighting. I'm not sure that this would fully disqualify a project. It might. Okay, thank you.

[Senator Russ Ingalls (Chair)]: Any more questions on that? That's the last section. Okay. Ellen, I want to thank you.

[Ellen Czajkowski, Office of Legislative Counsel]: Thank you.

[Senator Russ Ingalls (Chair)]: That's the first time that we've actually gone down straight through the bill, so it was very helpful, very valuable to us. I'm sure we're going to hear on our next testimony some more about what we just talked about. Hope you feel better.

[Ellen Czajkowski, Office of Legislative Counsel]: Thank you. Okay.

[Senator Russ Ingalls (Chair)]: We're going to move on to Greg Faber. Is it Faber or Faber?

[Greg Faber, Vermont Public Utility Commission]: It's Faber.

[Senator Russ Ingalls (Chair)]: Faber. Thank you. Okay. Thank you for coming in Greg.

[Greg Faber, Vermont Public Utility Commission]: Oh thank you Mr. Chair and members of the committee. For the record I'm Greg Saber with the PDC. So I'd have to come in and talk about Section 10. Yes sir. I agree.

[Senator Russ Ingalls (Chair)]: And I think you've heard as far as going down through and where our questions arise and I'm sure you'll have more to add. Well I

[Greg Faber, Vermont Public Utility Commission]: can just go through parts of the bill where I have some questions. Sir. General, we're fine with this. So if you look at page nineteen, second page of section 10, it adds the agency of agriculture as a party. I'm assuming ag is okay with this. Well. I obviously need to hear from them. Yeah. It burden on right?

[Senator Russ Ingalls (Chair)]: I don't want

[Greg Faber, Vermont Public Utility Commission]: to answer that one for them, but you know, they want to be a party to every single one of these cases, that could be burdensome. Yep. That might be the outcome you're seeking, but I would talk to them about that.

[Senator Russ Ingalls (Chair)]: We will. Thank thank you for that.

[Senator Joseph "Joe" Major (Vice Chair)]: Can you, clear up for me what non evidentiary means? Sure. It's not underlined, so it's already law, but I how do you have a hearing and not use evidence? You're referring to public hearings. Yeah. So public hearings. Yep.

[Greg Faber, Vermont Public Utility Commission]: It's not evidence. It's just people coming in to a With their opinions. Yes. Mean, people vent. Quit bluntly.

[Kirby Keaton, Office of Legislative Counsel (Tax Attorney)]: Yeah. Yeah.

[Greg Faber, Vermont Public Utility Commission]: People come in, they vent. We listen. Maybe we give them information. Maybe the the, installer is there. He's talking to folks. Okay. So they gain some information before we get into the evidentiary procedure. So does that carry any weight with the PUC? We use those to maybe develop questions to ask in the evidentiary setting. Maybe issues haven't been brought up by the other parties. Sure. Okay. Usually they are, but that's basically the way we do. We should help with hearing stuff. Thanks. I guess my next point was, oh yeah, this is a page 20 at the bottom there. And I was a little, yeah, I guess I'm confused about secondary back soil It's at six zero zero one or not. I I I don't know, frankly. I'm a little confused now. I thought it was. I asked it, Alan, but I'm not sure. Have to look at six zero zero one. Don't like to think That's why I was asking.

[Senator Joseph "Joe" Major (Vice Chair)]: Right. Yeah. I'm not sure. Because I don't know one way or

[Greg Faber, Vermont Public Utility Commission]: the other. I'm not even sure what secondary I'm no expert in Ag soil. I I yeah. You're telling me secondary. I'm sure Ag can tell me what that is or just natural resources, transportation service. Can do that. So we would take that as evidence in a case that would come in under oath and we'd look at it similar to any other evidence. Then page 22, and this is the part where the DEC goes out and hires a licensed engineering firm to do all of these tasks related to cradle to grade calculation, things like that. Obviously you're gonna have to hear from A

[Senator Joseph "Joe" Major (Vice Chair)]: and R on that. Oh, we will.

[Greg Faber, Vermont Public Utility Commission]: That seems like quite a task, but I know that'll all pan.

[Senator Russ Ingalls (Chair)]: Well, in your profession, in your professional opinion as far as doing all this stuff, is this unreasonable or unrealistic as far as what other anybody else would have to do? Doesn't everyone, when they come and they want to disturb a piece of ground, to show the impacts of what that project's going to do over its lifetime?

[Greg Faber, Vermont Public Utility Commission]: Yes and no. So the things that people have to show are below that, starting on line 12. So with respect to an in state facility that doesn't have an undue adverse effects, aesthetics, historic sites, air and water purity, natural environment, they have to show that the project applies with all of those criteria. Are basically the Act two fifty criteria. In that way they do.

[Senator Russ Ingalls (Chair)]: Okay, so if you're untested or when somebody's trying to sell the product and they're starting to make claims about what this product does or what this is going to do at that point in time, does that bear weight, and at that point in time, they have to prove of what they're saying? And I think this is what they're asking what it's to do at that time. Is that unreasonable, or if somebody's making a claim as far as what's going on, do you take that into weight and say, okay, well show us. Show us that.

[Greg Faber, Vermont Public Utility Commission]: Have to file testimony under oath, showing exactly what they're saying is true. And obviously people can pick that apart, the other parties can. They can file their own expert testimony and say, well, here's why this guy's wrong. Right? He's not looking at X, Y, and Z. This is a very specific new requirement. I'd ask anymore about that. Okay. It's all I'm saying. I don't know if it's even possible. It looks pretty, pretty, I don't know. Yeah. Okay.

[Senator Russ Ingalls (Chair)]: Well That's very helpful. Okay.

[Greg Faber, Vermont Public Utility Commission]: And then we get down to the part, good to go on for '22 to '23. So basically, this would say that solar facilities that disturb more than five acres are pretty much prohibited. That's how I read this. So you're gonna wanna hear from utilities on that because they are required to buy a certain amount of renewable energy. Right? This could be very constraining for them. It could raise the price they have to pay. Is that a good result? Is that what we want? You have to talk to them on that. But the way I read this is it's anything over five acres that's out. Because you're saying it's undue And

[Senator Russ Ingalls (Chair)]: I would agree with you, that's how prohibit it.

[Greg Faber, Vermont Public Utility Commission]: That's how I read this too. You're saying it's undue and not the public good, I can't get around that. If you were just saying it was undue, I could say, well, it's undo, but I can still say why it's in the public good for various reasons. But here you're saying it's undo, not in the public good. That's that. Right. And maybe that's what you want.

[Senator Russ Ingalls (Chair)]: Well, I think it's yep.

[Senator Brian Collamore (Member)]: Go ahead, sir. And I I just

[Senator Russ Ingalls (Chair)]: and why five eight? Right. I I It was just our I I I think that is certainly a I think that that all needs to be discussed in a lot of detail as far as where that is. I mean, you Again, this is really the first walkthrough that we've had today where we have started this to even see if we wanted to talk about it further to get an adjunct of it, and so now coming in and getting down the nuts and bolts of it is very helpful to us. Great. I'm glad to know. Okay, committee. Anything else for Greg? You. All right, thank you. Okay, so we've gone down through our witness list as far as what we're going to do. I think that probably you have some questions that need to be answered by A and R And A. And A. And see how deeply they want to get into it. Committee still feeling like this is something we want to move forward with? Now I see it Yeah. To the Speaking

[Senator Robert Plunkett (Member)]: of A and R, the chair, said she'd ask

[Senator Russ Ingalls (Chair)]: some concerns. Yeah. I've been made I've been made aware.

[Senator Robert Plunkett (Member)]: So what they are.

[Senator Russ Ingalls (Chair)]: Yep. I've been made aware. I will, I I might be having a little meeting today about that. So I'll let you know.

[Senator Robert Plunkett (Member)]: But I'm that that's you know, obviously, that's worth one of you know, all sides if if this

[Senator Russ Ingalls (Chair)]: is going to pass. I I think we're with all that we're trying to do, okay, and everything that we're trying to do in the realm of everything. I mean, when we talk about it, talk about staying in our lanes, talking about what we're trying to do. What we're trying to do is to keep development. This one just happens to be because the solar, this one talks about solar, but we're trying to keep development off of private agricultural land. That's what we're trying

[Senator Brian Collamore (Member)]: to do. Impacted to a minimum.

[Senator Russ Ingalls (Chair)]: They're impacted to a minimum. Absolutely, possibly correct. Some of this may be getting out of our lane a little bit? It probably is. Let's just keep going and have a conversation and see where we're going be comfortable with it. It's the same, no different than talking about cannabis and marijuana and hemp and where our roles are with that, which we've been very clear and very divine. As of right now, we just walked down through a bill. Before that, we had some testimony about why people thought it was important or not. Let's keep on having a conversation if that's what you guys would like to do. Yeah. Okay. Any more questions about what we've done today? Anybody in the room have any comments? Anybody on the screen still? Okay, we'll call it a day. Thanks.