Vermont Legislature SmartTranscripts:

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Welcome Welcome everybody to a joint hearing of the House Committee on Commerce and Economic Development and the House General and Housing Committee. What we're going to do today is essentially take ourselves through the portion of the housing flow which is the vehicle we're using is the Senate Bill S-one 127. We're not going to go through the entire housing bill. We're going to focus on the piece of the bill that refers to tax increment financing and specifically the CHIP. And what we're going to do is we have three distinguished gentlemen with us today. Charlie Kimball who's a member of House Ways and Means and is the reporter for the House Ways and Means amendments to the bill Kirby Keaton and Patrick Chitterton from Ledge Council. Ledge Excuse me. It's fairly warm in here and despite the vote on the floor I just want you to know that that rule does not apply to committees. What we're going to do today is walk through the bill carefully. And this is really, I urge members to keep an open mind today. I know there's, I know lots of people have questions. And I think questions are the most important thing here. If you want to introduce your question with a concern of course but I think we really want to focus on questions. I want us all to leave here with the same understanding of what is actually in the Ways and Means Amendment. I really feel that there has been a certain amount of misunderstanding people about what's here and what isn't here. I'm not asserting that the misunderstanding is the source of everything but I want people to I want us all on the same page when we leave here. I think it's really important we will not today be taking straw polls or folds of any sort. So this is a chance to ask questions. Do not hesitate to ask and don't hesitate to interrupt. If you have a question just raise your hand and I will recognize you. What about for Pat?

[Unidentified Legislator]: Clarification are we going to go through the whole TIF part of the bill or just the changes that reason means is made from the bill?

[Kirby Keaton (Legislative Counsel)]: I can help with that. John Gray who is the counsel on this, I'm filling in for John by the way so I'll do what I can here. He had prepared a side by side and so I thought that would be the most convenient way for you to just compare the changes.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Right, I think what you want to do is you go through it. At this point we've all shall I say worked on this bill a lot. So we're pretty familiar with them. And so what I would do is you can walk us through the bill but focus on the changes. Yeah. Alright? Yeah, they're all highlighted. Right. And I think that all three of you should feel free to chime in in response to questions and also Charlie I think you should feel free to chime in at any point with a background explanation, etc. We really want a full hearing on this on differences. Does that work?

[Unidentified Legislator]: Should we ask Representative Kimball to provide us an overview before we look at the words? I think that would be a maybe give give two committees an idea of what ways and means was thinking when they made these chambers.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Sure. Thank you, Chair Mark. Happy to meet with you. It's, I've never heard so many people trying to figure out how far they are from the settlement here in the halls, my half mile, my quarter mile to figure out if my development or my town can have a community and housing infrastructure program. Ways and Means got the bill from, as it came out of House General and Housing, and we had very vigorous discussions about the very value of tax increment financing in the weeks before and heard from people such as the state auditor, the top state economist, and also from housing groups. We have people on both sides whether or not TIFF in and of itself makes sense from a state perspective. So what we really were looking to do is to put some meaningful reasonable guardrails around the use of the statewide education property tax, so as to not to create too much of a future liability on the education fund. So that's the purview of the Ways and Means Committee, so that's what we're looking to do is establish what those guardrails are. So there are a few things that we did that are different than that. One is to look at establishing a but for test. I'm only gonna hit the highlights because the other stuff is The but for test is a normal part of any kind of tax increment financing program administered by the Vermont Economic Progress Council and also the Vermont Economic Growth Incentive Program. And that is just to say that if not for this particular financial instrument, then the development would not have occurred or would have occurred in a significantly different manner or delay. That is what the purpose is, and that's to determine that state funds are necessary for this development to occur. That's the intent of including the but for tests really suggested by the auditor. We're willing to attest to the fact that it's not always auditable, meaning that you can't always prove that the but four is true or false. Number one, eligible locations. When it came to us, it was for tier one and tier 1A and tier 1B, and also had a reference to tier two, but in a future state where the improvements might make it eligible for tier one. We reviewed that and looked at the existence right now of is there tier 1A or tier 1B, and they are not created yet, there's a long timeframe for those districts to be created, they won't be effective until 01/01/2027. So what we did is we reverted to some of the languages already in the bill to look at those designated centers that are currently exempt from Act two fifty as made possible by Act 181, and also look at existing settlements, which is the half mile from an existing settlement for where you could locate a project that is eligible for the CHIP program. Next, and that's fairly expansive. I mean, that doesn't just mean a designated center that you have now, but also a cluster of homes, everything that is denser kind of settlement, except for strip development. So it explicitly says no strip development, and that's currently in statute. We changed the requirement of floors for area to 65% of the projects must be dedicated to housing. And 65% seems random, except when you think about our concept and looking at it was, you've got a three story building, the first Floor is commercial, has to be able to support the total project and the two floors are going to be residential. So that's where we came up with 65%. We recognize that there are some really different types of redevelopment that could occur like for a school, or for another building, a commercial building, which there could be a gymnasium or a theater. And we're leaving that up to Pepsi and rulemaking to figure out how to apply that 65%. So hopefully that's alright. Next is to look at the retention rate. As it came to us, it was a 75% retention of the tax increment financing, tax increment. And we adjusted that to 60% for all projects, also kept in what had come to us from general housing, which is an additional increment if it meets the definition of you had affordable housing, we inserted middle income housing. I'll tell you why in a second. Okay, now I'll tell you. So middle income housing, what we were looking at is that there was testimony that we took that all housing has to be built. It's not just low and middle and moderate income, which limits it to less than 120% of area median income, but middle income housing, which is 150% of area median income, as defined by Vermont Housing Finance Agency, that you could use that to create housing that's needed and freeing up other space that's also needed for low and moderate income. So we thought it was more expansive. It's just broader. So we're gonna all housing all the time without looking at high end housing or high income housing. Let's see. We limited the use of the funding to focus on those infrastructure projects that are most common. So there were some things that were in the bills that came over that we thought were not really that integral to the development of that project, but really to focus on the development of housing units themselves. And so that was where you'd find, let's see, installation and construction of wastewater and stormwater systems, public roads, streets, bridges, multimodal facilities, public transit, so it goes on and on. And we added back what had been taken out originally as to digital infrastructure and telecommunication services. So that had been taken out, we put it back in. We may have taken it out. Fair moment. Then we require that any excess cash flow from the development is retained in the tax increment special account. This part of the bill is you send it over. There's nothing different there. And then you can adjust the increments after five years to determine whether or not there should be a higher increment or a lower increment. Actually, just a lower increment, not a higher one. And this is the part that most people have a question about, and that is on the cap. We felt that it was necessary to limit the exposure to the statewide education property tax, And that left without a cap, we could face then higher property taxes across the state if the projects didn't necessarily work. So one thing about TIF or CHIP in this case, is you have to believe that the value that's generated within the district or within the projects would not have occurred except for the infrastructure that you put in place. And that is highly debatable. But we felt that we needed to put a cap on the project. So what was the cap? Is it number of projects? Is it geographically oriented? So we said, what if it's equal to 1p on the tax roll, and that 1p on the grand list is equal to $14000000.13.9, but let's round up to 14,000,000. So that in any one year, you wouldn't have more than $14,000,000 of foregone revenue from the statewide education property tax. Working backwards is how could VEPSI, the approving body, manage that? Really hard to calculate, really hard to keep track of what that means. So we've tried to provide something that in the end I think was more confusing, which is what is the lifetime increment retention for all the projects approved in one year? We said that should equal no more than $40,000,000 Remember, that's the lifetime increment, that's not the investment value of the projects. So that's how we backed into it using a few things, the non homestead rate, what the retention rate is. And then JFO went so far as to provide a spreadsheet. Think Pat's going to talk to you about that is what that looks like. But it's important to think that if 40,000,000, you could back into what does that mean in any one year for investment. And if you assume zero percent property tax increase over the twenty year life of the the the chip, that'd be about $240,000,000 and an additional investment in that year, $240 in one year, $240,000,000. If you assume a 5% increase in property taxes every year for that twenty year period, then that's worth $145,000,000 Because then every year you're growing and you're actually retaining more in that increment. That makes sense people? Anyone?

[Unidentified Legislator]: Yeah, it's also

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: returning more due to the increase in evaluation?

[Unidentified Legislator]: Yes, yes, right.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: All right.

[Unidentified Legislator]: But I also get confused a little bit. I was trying to I appreciate your clarity on this because the 40,000,000 that getting to that number has been a little confusing for me. Yep. And so maybe when we get

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: the JFO stuff, we'll get a

[Unidentified Legislator]: little more detail there

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: to make sure

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: that we're all good

[Unidentified Legislator]: at points and we're all

[Unidentified Legislator]: broken English right now.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: And that no. No. It it makes total sense. We've had a lot of difficulty in our committee in getting everybody onto the same page with that information as well. And it's complex and trying to figure out how much increments is going to be retained to repay bonds that are taken out to support these projects. So there are a lot of assumptions that are built in. And what we really don't know is how much uptake there's going to be, how quick, when they're going to be built, how long they're going be built. And so I've listened to Pat's presentation a number of times, and I don't want to spoil any of his information because it's really good. But so that's, it's good to think about an $80,000,000 project, just for giggles. And if you had an $80,000,000 project, remember, this is incremental value over the original taxable value. An $80,000,000 project would have how much and retain increments from this education fund over twenty years. And that value is about $17,000,000 not accounting for a 5% increase. Okay, so an $80,000,000 project

[Unidentified Legislator]: over twenty years

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: over twenty years would retain for increments of repay the debt $17,000,000 Okay, so that's out of $40,000,000 you're going to have in any cohort in any one year, that one project $80,000,000 which is a huge investment is $17,000,000 And we've got that cap at $40,000,000 a year.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Charlie, I think a lot of people are wondering not about the increment because they don't fully understand it. They just want to know how much investment will this support overall in housing? And I've heard various numbers that one of them was well north of a billion. Can you sort of talk about that? What level of investment in housing would this yield?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: So thank you for the question, Chair. I think there's two ways to approach it. If you just work backwards from the $14,000,000 in annual increment that's at its peak is how much you're retaining. If you work backwards to figure out what does that equal to, it is well over a billion dollars. Over what period? Over twenty years. So that's a significant investment. It's over a billion dollars, depending on if you include that 5% inflator. It was 1,500,000,000.0, I think including the 5% reduces that. So let's say a billion. That's a pretty significant, but here's the two important things. That represents the investment, not just in the infrastructure, but the investment made in all of the housing development by the developers. That's the value of all the housing created. In terms of the infrastructure that is paying for, I'm not sure of it. I don't know. But the increment is paying for that. So CHEPS and TIFF, when they're working really well, they're generating enough money from the actual property taxes that are being paid on that property to pay for the bond. So it's a self financing tool when they're working well. Sometimes they don't work that well, but most of the time they do work that well. I hope that answered the question on the

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Well, in terms of not over the lifetime, but I want to go back, I think you mentioned a number. What's the amount of housing investment in a year so this would allow in the capital investment in infrastructure what is the 40,000,000 per year turn into in terms of the amount of investment in a year it allows?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: So we don't know. We only know the value of what could be invested in the housing to result in that kind of increment. So it depends on for financing infrastructure.

[Kirby Keaton (Legislative Counsel)]: Is that?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: So that's anywhere from 145,000,000 to $240,000,000 every year,

[Kirby Keaton (Legislative Counsel)]: every year, every year.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: And in this, what you're going to see with the numbers is five years, five cohort years of projects that could be approved in any one of those years, because we're looking at this, did insert the word pilot, to make sure that this proves out, that it's having the intended results that we want from the program.

[Unidentified Legislator]: So just hoping for clarity's sake, when we're talking about $40,000,000 cap, that's a per year cap and not a cap to 40,000,000 over five year period or eight year or ten year period when when the sun sets?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That is 40,000,000 per year that Pepsi can approve based on the plans that are put together in an application to Pepsi of saying, here's my project over the lifetime of the application, over the lifetime of this project, it's going to have an increment capture of what? And so BEPC will have that information in front of them. And currently, all the tax increment financing applications have to go through that process as well. What is the initial original taxable value? What do I think the investment is going to be at the end based on that? And they have an annual report that shows what that is. And the tax increment financing report, I haven't had a copy because it's really almost required reading in Ways and Means. So I mean, they have this, and I'm sure it does in Commerce too. So every year they put out a statement of just looking at what the original value was and what the assumed value was at the end. So Winooski is a district that just finished, right? Winooski is now retired. It started in a long time ago. They estimated that they would have $78,000,000 in value at the end of their TIF. Right? Their actual value was $103,000,000

[Unidentified Legislator]: Of new property.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Of investment. Right. New property investment that is the value of the properties that are in that district in the 5th District.

[Unidentified Legislator]: Yep. Thanks for the infrastructure expansion.

[Unidentified Legislator]: Yes. Okay.

[Unidentified Legislator]: So Charlie, I'm just trying to get my head around, you know, the cap and our clients. I I know we've heard some testimony from a developer or the app developer in Burlington. Nice looking project and everything.

[Unidentified Legislator]: So they were hoping to be able to use

[Unidentified Legislator]: I'm trying to figure out, you know, it was pretty big project, though. You know, do you have any sense of how much of a cap would be used for that kind of a project?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That's where I use the $80,000,000 because if it's the same project I'm thinking of that you might be thinking of, some of the numbers I heard were anywhere from $80,000,000 to $60,000,000 investment of the projects. This is what we're going to spend on this project. Anywhere from 1,000 to 1,500 units. That sound familiar?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Without

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: naming the specific

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: project. I'm sorry,

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: but that 80,000,000 initial investment that they would be making in their housing projects and might have a first floor of commercial maybe, then that increment value over the twenty years would be about $17,000,000 That's the total retention over twenty years. So in that cap of 40,000,000, that's 17,000,000 of them. Now a few years ago, we had a housing bond, what was it $35,000,000 We thought that was enormous, gigantic. And now here we are talking about $240,000,000

[Unidentified Legislator]: Yeah. And I'm just trying to get back to the reason why I asked

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: the question. I'm trying

[Unidentified Legislator]: to get my head around, you know, how many housing projects will we have?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It's a good question because it's almost impossible to know. Because you've got so many different layers of finances in each project. You don't know what the exact development costs are for each one. It could be anywhere from $10,000 to $70,000 per unit, depending on how big it is, where it is, the complexity of the installation. So don't know. I've heard figures from those that are trying to make a pencil out anywhere from 1,000 up to 5,000. But what we have to look at is it a meaningful financial contribution towards the development of housing? I'd say the answer to that is unequivocally yes.

[Unidentified Legislator]: If I'm understanding the math correctly and as general housing often hears testimony on how it's almost impossible to have things pencil out.

[Unidentified Legislator]: Pencil out, yep.

[Unidentified Legislator]: If I'm doing my math correctly, that's going to be roughly five eighty homes if we're saying $500,000 per home per unit. That's kind of what we hear often. If we're looking at the $240 Can you speak up just a little bit? Sure. So I guess the question is, did your committee have any testimony on what our expectations are for homes that we need to see. So, we have all of these goals that each town wants to hit and where we're trying to get. And I guess I'm just not seeing how, and I'm not a math person please understand that how five eighty homes helps us

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: it's not five eighty so let's work backwards for a minute Remember, the uses of this money is only for the infrastructure necessary to build a project. Right? Correct. So we're talking about the infrastructure itself, not about the total cost of building the units. So that is separate pockets of money could be the developer going out to a bank, there could be other equity, other financing stacks that are involved with actually constructing the housing. This is really limited to providing that infrastructure that makes that possible.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: So $240,000,000 is the amount of money that is I mean it could vary but $240,000,000 is the amount of capital available to pay for infrastructure right? No. What is it? The value of the units? That's the incremental value,

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: right, that's going to drive higher property taxes

[Kirby Keaton (Legislative Counsel)]: on those units. Right,

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: so then drive how much money is available to support the bond for infrastructure. So I don't know if I know JFO doesn't want to do math on the spot. But in terms of how much money is required to provide infrastructure is going to vary between every single project. That's not going to be the same. So can't tell you exactly how much that is. So imagine we could probably go back and do the math and say on a one year is $1,200,000 and what's the debt service that could be provided the service by 1,200,000.0. I think that's really what might be helpful in that sense as to how much is it being paid for in that.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I think it would be helpful. We know that there's always a lot of assumptions built in but I think people are less concerned about how much increment is generated, how much income, what are the limits on increment. I think people want a sense of the range of the number of housing units that this would facilitate by financing their infrastructure. And one way to do that is simply to make a very rough assumption about the amount of money that is spent on infrastructure for an average amount of money spent on infrastructure or an average project on a per unit basis and I think that's a we could put together I would think such an assumption and it would generate for you what she was reaching for is how many units are we talking about here And I think if it's, you know, dollars 5,000 a unit it's going to be a lot of units. It's 5,000 in infrastructure per unit. It's going to be a lot of units and and it would be good to know that number. That's what people want to know. Want to know how many units per facility.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I understand the point you're making, Mr. Chair. I also understand the fact that it's almost impossible to know. That it would be wrong no matter what number we came up with. Because again, I've heard different calculations as to 2,000, is it 6,000, how many is it from people that are looking at the numbers in different ways. I guess what we're talking from House Ways and Means, our approach was what is reasonable for the state to commit from the statewide education property tax to support infrastructure, to support housing development. And if that number is not $14,000,000 a year, what is it?

[Unidentified Legislator]: Just

[Unidentified Legislator]: to add, I think what we're trying to do is have a program that works anywhere in the state and anywhere in the state is not going to build the exact same housing structure amount all of that right so what we're trying to do is say to you all of you tell us how much housing can we build in the state for this amount of money? And what you're going to say to us is where, right? Like, do you want us to put together a hypothetical if we did it in, you know these 20 towns and had projects and this town can hold 20 homes and this town can hold 100 homes and this town wants six and right and so all of those costs are going to be different and all of the amount it's going to be different. Is that what I'm hearing you say?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It's all going to be different. And this is not a tool that is going to be suitable for every single project. Tax increment financing and SHIP is necessarily complex. Just think about the auditing requirement. And if you think about separating the taxes and the original taxable value, having to report every year, this is not just a simple process. It can work for projects and it just has to be proven to pencil out for them. So I know where you're going and all we're trying to say is we think this is a valuable tool as well. But we're saying there's got to be some kind of limit on it.

[Unidentified Legislator]: Know we have a question.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Leithora, did you have a question?

[Unidentified Legislator]: Yeah, I'm still concerned and maybe because it's not just it just hasn't become as clear to me yet that

[Unidentified Legislator]: putting putting the cap

[Unidentified Legislator]: may exacerbate the trend of building in communities that already have more capacity. And at the same time it feels unnecessary because by building more housing we will maybe not it still doesn't feel like a drain to the Ed's fund just with the way the logic of the the CHIP program works, and I'm still I'm still stuck on the button more argument.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: It is

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: long debated as to whether or not TIP programs or vegging, but TIP programs, the quote is to steal from the Ed Fund. It is foregone revenues. It is a tax expenditure, which in some ways is the same as an appropriation because it's revenue you don't have, but it is not an appropriation. So I understand what you're saying. And part of the rules that we have asked DEPCI to make in this is to make sure that one, that the program meets the purpose of creating more housing. Two, there's some geographical equity in it to make sure there's housing not just in one area of the state, but other areas that addresses blight, and it also looks at the fills the necessary affordable housing elements or creates more housing where it's needed, where there's a shortage. So in that is to make sure that we're not just looking at one geographic area, but that every area of the state is benefiting from. So right now, TIF districts, there's nine active TIF districts. And the annual foregone revenue of the state is about 6,500,000.0 to $7,000,000 It's not everywhere. There's a new one just approved for Rutland, or Williston is looking for one, Newport's looking for one, Springfield is looking for these TIF districts. We've put a geographic limitation on the number of districts that could be created because of the concern over the impact on the education funds. So this is a lot more expansive than that, twice the amount that's what currently in TIP. So it's where we're thinking that this is probably a good number $14,000,000

[Kirby Keaton (Legislative Counsel)]: Yes.

[Unidentified Legislator]: I just have a quick follow-up here. So is do I still have it did you do you still have in the amendment that 30% of the of the increased property value does go to the state and to the

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: The way that tax increment financing works is part of it's retained to pay the education fund and that right now is 60% for those districts that are not affordable. 40%. Well prior to retain I'm sorry so the amount retained from the education fund is 60% and then if it's affordable 80%

[Unidentified Legislator]: wait can you just clarify because passive voice is retained so who gets what money okay you could just say all

[Unidentified Legislator]: right

[Unidentified Legislator]: so 100,000,000

[Unidentified Legislator]: Let me give you

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: a specific example. So you've got a parking lot that you want to renovate into 50 housing units And you need to invest, you need the infrastructure to do it. So you get a loan to do the infrastructure, you're in municipality. So then a developer comes in and develops a project, and that project on that property after you put the infrastructure in is going be a million dollars of tax revenue. Let's just use round numbers, A million dollars. So of that million dollars in tax revenue, the amount that would be sent that would be retained to pay for the bond to pay for that infrastructure would be $600,000. It's 60% of it.

[Unidentified Legislator]: So when you say is retained. Where is that money living? Right.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: So your problem is the word retained.

[Unidentified Legislator]: That means retained to pay

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: for the bonds, not retained for the Ed Fund. The amount retained for the Ed Fund is 40%.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Let me go back. So it's one developer, and they have to pay the million bucks. They pay it to the town like we all do right now. We pay that tax to the town and the town

[Unidentified Legislator]: remits to the education fund.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: The townman takes that, it's going to say, you know what, 60% of this money, I'm going to keep the pay for the bonds. If the town took it out, or if a private developer took it out, which is possible in the construct of the bill, then they could remit that payment, that money, the 60%, that $600,000 to the developer who took out the loan to repay the loan. The other $400,000 if it's a statewide education property,

[Unidentified Legislator]: gets sent to the education fund.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Right. Right.

[Unidentified Legislator]: And that amount would not have gone to the education fund at all had they not built the housing.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes and that's the debate.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: It's contributing to that. Yeah that is the point four debate.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That's the five four.

[Unidentified Legislator]: Right so when we say that when you calculate I just want to clarify so when you calculate the loss to the Ed Fund, are you including are you are you is that the is that only the 50%? Yes. Or is it the whole 10060%. The 60%.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Right.

[Unidentified Legislator]: Okay. And so the F Fund would stand to gain?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes, the other 40% is being paid in. Right. Yes. It's also important to remember the other increment withholding. Sorry, let me step back. You pay a million bucks. Let's say it's a 100,000 because it's going to municipality. So the municipality, again, they collect the property tax, but there's a municipal tax. The municipality keeps on $100,000.08 50 85% of it. They keep 85% of it to also help repay the bond, And they keep the other 15% in this construct to pay for their other operating expenses, because you have that many new developments and new apartments, maybe you're going to have to have a new police officer, a new ladder truck, whatever it is, to help support that development.

[Unidentified Legislator]: And now those people will have listed?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes, but we're just talking about how the numbers work on that.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Is there any other major, you were going to give a sort of overview.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yeah.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Are there any other major overview points you wanted to make besides but for eligible locations? 65%, 60 or 80% increment? Is fine. The cap, anything else you wanted to just point to?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It's in the last section that we affect and that's the sunset on tax increment financing districts. So we put in a sunset to be able to review tax increment financing, to make it expire on 07/01/2028. And that is intentional to try to give us an opportunity to review the intersection of TIF and CHIP, and also what effects may be in place of what's going on in the Ed Fund, because we're not sure what that is yet, and also look at the federal funding sources so it's an intentional review at that point in time.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: What is the sunset, Charlie, in the current draft? I just don't know.

[Unidentified Legislator]: On the pilot.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: What is the sunset on the pilot?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: On the pilot, I'm sorry. So that is on 07/01/2030 or '31? 12/31/2031.

[Kirby Keaton (Legislative Counsel)]: You bumped it up for the

[Unidentified Legislator]: room thinking is we said on the chip part of it

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: the chip on the chip

[Unidentified Legislator]: because I was reading it differently Maybe you can help me answer. I can just I was looking at the prior draft. Yeah, it's great form. And it talked about, you know, location, eligible Exhibit Act 181 exempted areas, which is I understand it will go away sometime around January 2027. So, you know, I was looking at a sunset, you know, I know it says something else elsewhere. But if it's only if only the exempt areas are eligible, and they go away in twenty six twenty twenty seven, that's not effective, eighteen months program?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: The line right below it says existing settlements, and that is any kind of designated center or settlement and half a mile from it. So it includes all those designated areas. So

[Unidentified Legislator]: the exempted project, that goes away to the invoice and But then you just left with the Yep. Yeah.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Which is more expansive.

[Unidentified Legislator]: I've been trying to follow this as it's changed quite a bit and earlier I was gonna ask you said right now there's nine districts?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes.

[Unidentified Legislator]: Am I wrong that this amendment brings that back down to six? No. That was at some point in the eleventh? No,

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: no. I swear to God. So it's now there's nine active ones and they are hang on a second. Alright, get no self talk. Albans, Burlington Waterfront, Burlington City, South Burlington, Hartford, Killington. Rutland just got approved. Hartford, and did I miss anybody? Milton. No, expired. That's retired. Same with the old Newport is expired and Winooski's retired. And we have coming online interest in TIF districts of Williston, Newport, Springfield.

[Unidentified Legislator]: At least those are the people

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: that reached out to me to say what the hell are you doing?

[Unidentified Legislator]: Yeah we're gonna do that now.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: We do it by here?

[Unidentified Legislator]: We give a question down?

[Unidentified Legislator]: Sorry. A little bit further on in and not subject to judicial reviews. So does this have bearing on the appeals process? What exactly was the scheme?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I'm gonna let the council answer that question.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Hey, it

[Kirby Keaton (Legislative Counsel)]: means that the CHIP will be treated like CHIP when it comes to the approval process. Said the appeals will not be allowed.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Just got to submit Okay. A new application. Right? That's I start to know well.

[Unidentified Legislator]: Was that a beautiful shot or Charlie, I think

[Unidentified Legislator]: I heard you use the word license.

[Unidentified Legislator]: Yes.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: First of all,

[Unidentified Legislator]: why? Why would she use that word? And secondly, where is it? Is it in the amendment?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It's in the amendment. Often tips districts are intended to address what is considered to be blight, and it could be a piece of real estate that is in desperate need of rehabilitation. So it's not meant with any sense of socioeconomic, any kind of implication that way. That's

[Unidentified Legislator]: I think you could have just my opinion, I think you could have chosen a more specific and appropriate word enlightened. Okay.

[Unidentified Legislator]: I know, Joseph? A delinquent property owner or

[Unidentified Legislator]: I mean, there's like 10 different terms now that are more specific and more appropriate than life temporarily?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I think if we are going to walk through the side by side we better do it. We have until And four as we do that what I think we want to focus on are the things you've been hearing about. But let's walk through. Make it a little bigger. Alright.

[Kirby Keaton (Legislative Counsel)]: So once again Kirby Keaton Legislative Council. We'll walk through the language. On the left we'll be looking at the House General and Housing Amendment. And on the right we'll be looking at the same language from the House Faced Means Amendment. Only the language dealing with CHIP. Then let's get into it. At the beginning of the definitions, this starts around section 25 of the amendment by the way, just in case you want to know the greater context. There's two definitions from the House general version that are removed. And that is because this distinction between low income and middle income as part of the incentive is removed by the Ways and Means version of things. Ways and Means is only using one affordable housing option for an incentive, an extra incentive.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Okay I guess I have a question there. Okay. We're going to skip around a little bit but I think we can do that. I think the members of these two committees they know this stuff, okay? So we defined low income, we defined moderate income Because the purpose clause uses the words low income and moderate income. You did not change the purpose clause. It was changed. It still says low or moderate. Not talking about but for I'm talking about lower moderate. So my question is does middle income include low and moderate?

[Unidentified Legislator]: It does.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: It's cumulative?

[Kirby Keaton (Legislative Counsel)]: I think the purpose section is more generalized language and it's not referring specifically to that definition.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Throughout this bill I think still there are references to people concluding that it meets the purpose in '19 That's oh true. Okay, let's set real fine. So middle income development means a development of low moderate for middle income?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yep, that's the intent. That's just them all.

[Kirby Keaton (Legislative Counsel)]: I think it's meant to be more general and maybe that's something that could be

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: But I just want to know what

[Kirby Keaton (Legislative Counsel)]: you're I asking would say it definitely does not mean what the ways and means definition for middle income housing is which I have pulled up here. Because that's very specifically a narrow version. It means housing that is subject to a housing subsidy covenant. And middle income housing development means that housing development of which at least 20% of the units are middle income housing. So your general person is not gonna think of course middle. So the purpose section here seems lower moderate income. Oh that must mean someone with that housing subsidy. But that's you know, it's meant that purpose language must be broader than just that.

[Unidentified Legislator]: May I ask a question? Yes please. I'm sorry. I was reading through as defined the 27 BSA six ten and I think it be good for us to I'm not it's it is not helping me understand what middle income housing is so we're out there really much appreciate it.

[Kirby Keaton (Legislative Counsel)]: Okay. Okay. Housing subsidy covenant. Are you feeling I mean, should I start from I'll start I'll start like with basic basics where like, it's it's a restriction on on the property. Yes. And like a conservation easement or something like that, there's a holder of that. And then that property is meant to be forever under that restriction. So in this case, it's a covenant, the purpose of which is to encourage the development and continued availability of affordable rental and owner occupied housing for low and moderate income persons. A housing subsidy covenant may be created during ownership or at the time of advance by the owner of a property in the condition of. And there's a list of conditions. I don't work in housing a ton but you know BHCB is a holder for a lot of these covenants in the state. We might have housing trusts I'm not sure that could also be holders.

[Unidentified Legislator]: Would it be subsidized private transaction of the five condition of this five things including allocation of loan and housing tax credits? I'm just wondering where is how does this fit what we're talking about here and how does it is this really just language that allows us to say there is a there is therefore a perpetually lasting covenant or is it in any way defining what middle income housing is besides being stuff that is subject to permitting?

[Kirby Keaton (Legislative Counsel)]: For the purpose of the added incentive you could use this definition and it would mean that at least 20% of the units there would have to have these restrictive covenants. Covenant aside it's 150?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Middle income is generally considered to be 150% as defined by BHFA.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: But it's not in the definition.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It's not in the definition.

[Unidentified Legislator]: Yes, that's my confusion. And I think that

[Kirby Keaton (Legislative Counsel)]: middle income of what's affordable housing, you have various definitions out there so for those things in specific to look at what these definitions say for that.

[Unidentified Legislator]: I guess so one of my concern is that defining it with 27 ESC six ten doesn't it does not help I can't imagine it would help developers or anybody understand what is you know to sort of your comments about how we want to have that be moderate income, middle income, middle class without reaching into the other restaurants. I'm just wondering if the language that's written here prevents us from having a $900,000 home that's subject a couple of them. That's, am I disputing something? I'm just not seeing

[Kirby Keaton (Legislative Counsel)]: the I think the BEPC application would have to be specific about that to inform people. I also this doesn't eliminate CHIP for any kind of project though because this goes to the extra incentive for the affordable. You know, the extra bit of increment you can get for Yes.

[Unidentified Legislator]: So when we're talking about the extra increment, the Ways and Means Amendment brought down the increment to like 60 in my understanding that so this is just a 10% incentive 20% there so they can go up 20% more

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: middle or just low and moderate

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That meets the definition of middle on

[Kirby Keaton (Legislative Counsel)]: It meets the definition of that. Okay.

[Unidentified Legislator]: I guess my question is, and I tried asking in our committee but since you're a money committee and get the numbers, maybe you did, were any of the projections done for 60%?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes, actually all the projections were done using 60%.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Correct?

[Patrick Jitterton (Joint Fiscal Office)]: Yes.

[Unidentified Legislator]: Can I just follow-up on that? Yeah. So what you are asking specifically is does this help pencil out the the practice? And you heard that 60% would still help pencil out

[Unidentified Legislator]: the infrastructure

[Unidentified Legislator]: the infrastructure yeah

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: we felt that there was a need to have an extra incentive to focus on the housing that didn't that was going to qualify for middle income housing, or low and moderate middle income. So there was enough discussion about we need to create all housing for all projects, and that we wanted to focus on providing extra incentive to get that income restricted housing.

[Unidentified Legislator]: So enough of an incentive means that you want to lower without eating too much into our tax funds. We chose to lower rather than saying oh 90%. Does it seems like a policy voice?

[Unidentified Legislator]: 40 to 40 I think

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: the question to follow on you're being asked is in the past TIF used 7%. The number 60% has never been used. Did you do any modeling or was any testimony produced to you that showed that bond issues that would support infrastructure pencil out at 60% of the proposed incentive?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Mr. Chairman, we did not take specific testimony regarding that. We have experience with TIFF that showed that Winooski was at a 98% tax increment retention rate, and others have been at 90%. So looking at where we've been over time, we're trying to figure out the retention rate that made sense for developments that may not qualify to advance the purpose of the chapter. We were looking at going from either zero or something above zero in terms of retention. We thought the 60% was a reasonable level, especially following testimony given to us by the state auditor and state economists.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: But when you say Winooski was at 98% or

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: was it

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I'm sorry I just don't know enough help me out 98% of what for what?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: It was 98% retention of the statewide education property tax to repay their debts.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: To repay their debt so they went way

[Kirby Keaton (Legislative Counsel)]: over yes

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: they went way over the 70%

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: that's right

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: and were permitted to do so to repay their debt. That's

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: before the ground rules were put in place to bring them all in line to any new tips 70%.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: That's why the ground rules were made. Right. Okay.

[Unidentified Legislator]: And

[Unidentified Legislator]: so that when you say that 98%, you're saying this is a really bad situation for the Ed Finder for the state tax because they basically only got 2% after all this new construction and that's going to affect state coffers and my question is was was that did that happen because were the homes not low to moderate income housing or is were there no guardrails like that in the TIF? Right. Right. Right. So just yeah.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Right. So when Winooski I can't speak to the original application, but they had a compelling application, I believe, in terms of redeveloping their central business district. And that's what the TIFF was really intended to do, and could create a significant number of houses. There was disparity in a lot of the retention rates across different tax agreement financing districts that the legislature and BEPC agreed need to be tightened up. And so that was when 70% was considered to be a compromise, with an eye towards how much was going back

[Unidentified Legislator]: to the education fund as well. So

[Unidentified Legislator]: why it was 70% considered a compromise for a big tip? Or I guess I just don't understand why you go back down to 60.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: The committee believed that 60% was a more appropriate level after the testimony they received.

[Unidentified Legislator]: From somebody who does not like to, correct?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: For someone whose job it is to evaluate the effectiveness of tests. Including our joint fiscal office.

[Unidentified Legislator]: We talk about middle income affordable housing the 80% retention rate,

[Unidentified Legislator]: and we

[Unidentified Legislator]: talk of so that's perpetually affordable.

[Unidentified Legislator]: So

[Unidentified Legislator]: a person purchasing a home in that range is only allowed to make x amount of dollars if they want to sell that property. So they're going to lose the equity that that's built up in that home they can only make so much in order to keep it perpetually affordable?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I I think we'll need to look at what the wording is about the initial offering.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: K?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: There's no concept of a shared equity restriction on these property developments.

[Kirby Keaton (Legislative Counsel)]: Is the question is the question about the housing covenants and what can be restrictive?

[Unidentified Legislator]: Yeah, well I'm just wondering with that affordability clause in there, who's going to buy the homes that they're being built under those covenants. If they can't get the equity out of the property,

[Kirby Keaton (Legislative Counsel)]: it's there's some They're typically subsidized in the first place. That's why they're considered more affordable housing. And so that loss of ability to get equity is factored into what it costs in the first place. So theoretically people who maybe this is supposed to be a $200,000 home. You can't afford one because you can't afford any home in this market that you can afford one that's 150 if it has one of these covenants on it that reduces the value and makes it 150. And the covenants tend to, I'm looking at the law here. It's not set, It's a contract, right? So they could be different from covenant to covenant. But yeah, it's restrictions on the use of real property. Basically it's to keep them as residential and to not change how they're used as residential is the core of what those are about.

[Unidentified Legislator]: So it's not a financial it's not so if I purchased a home, as long as I sold it to someone that's going to continue to use it as a primary home then I still retain the equity that I built up in that home. Is that correct?

[Kirby Keaton (Legislative Counsel)]: It depends on like it's a you should be talking about a contract it could vary from transaction to transaction. So it's hard to just give you a flat answer to that. I

[Unidentified Legislator]: think we were looking at the in perpetuity as part of the housing infrastructure agreement but that's in perpetuity to be a primary residence not in perpetuity to be affordable at middle income. Yes I think that's how it reads.

[Kirby Keaton (Legislative Counsel)]: What page of the?

[Unidentified Legislator]: Nineteen oh nine. Right. Section nineteen oh nine form. Because it we originally

[Unidentified Legislator]: it

[Unidentified Legislator]: was it was primary housing initially offered and then it got changed to primary housing offered exclusively in perpetuity so primary housing in perpetuity

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Bombed by domicile in perpetuity I believe that he didn't change those words. Omar came over to us.

[Unidentified Legislator]: He over not in reverse. He has offered.

[Kirby Keaton (Legislative Counsel)]: Yes that's just the whole life of the

[Unidentified Legislator]: loan. It's a bond.

[Kirby Keaton (Legislative Counsel)]: House housing version was that it had to initially be used for

[Unidentified Legislator]: housing and

[Kirby Keaton (Legislative Counsel)]: this is changing it so that it has to be forever used.

[Unidentified Legislator]: But just

[Unidentified Legislator]: to be really clear

[Unidentified Legislator]: on that, sorry, but the middle income that if you get the extra increment, the extra 80%, you sell the middle income homes at what, at the affordable rate to begin with, and then as they increase in value, the owner of the home can sell it for whatever the market can bear when they sell it. On the affordable or middle on the middle income housing.

[Unidentified Legislator]: It's

[Kirby Keaton (Legislative Counsel)]: I believe that that's possible. Yeah. Releading all the pieces, I believe that's possible. I haven't read the Subhance of the New Covenant statute to prevent

[Unidentified Legislator]: bite You

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: have a question over there?

[Kirby Keaton (Legislative Counsel)]: Again just helpful refresher here for people who want to know the context. This statute applies for the extra 20% of increment to be retained for the incentive right? It's not It's not every project.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Okay. Do

[Unidentified Legislator]: we have any other but for on any other types of infrastructure, sewer, transportation, or things like that?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: All taxing or refinancing.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: And

[Kirby Keaton (Legislative Counsel)]: there's a history of the state auditor for instance criticizing the Buffalo Test We in the context of

[Unidentified Legislator]: have it in my community and it works really great.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Oh South Burlington, I forgot to say South Burlington.

[Unidentified Legislator]: You did. I did say South Burlington but

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: ahead. Yes go ahead.

[Unidentified Legislator]: Provincial affordability is one of the programs that some of the agencies provide for which I think is what some of us have in mind when we see in perpetuity. If I understand you correctly we're referring to BSA 107 with regard to the use. This is a different question than being perpetually affordable. Are the intention here if I'm correct is to keep perpetually residential?

[Unidentified Legislator]: Yes.

[Unidentified Legislator]: Is that

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: what this covenant is this

[Unidentified Legislator]: middle income housing is subject to a housing subsidy covenant instead of the SA and here we are where is the where is this slide the income? Low income housing tax credits which is the tax credit so they make the payments.

[Kirby Keaton (Legislative Counsel)]: It's not necessarily tied to income it's tied to a house that's affordable.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: So this is not also prescribing what that those limits should be each. Each could be different.

[Unidentified Legislator]: Depending on the price.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Depending on the funding stack, it could be depending on the development, where it is, that kind

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: of thing.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: So, so it's pretty, it's pretty open ended.

[Unidentified Legislator]: Okay that's why I'm asking you. We I'm jumping ahead a little bit. When we're offering these as a bona fide domicile chewing, residences are not second homes or

[Unidentified Legislator]: whatever. Who's

[Unidentified Legislator]: verifying that perpetually

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: and how so

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: if there's a covenant agreement on the property then it's going to be the owner of the property it's not going to fall on the municipality to continue to monitor monitor that So in the case of an apartment building, whoever is managing that apartment building or homeowners association of condo, then they're going to be enforcing what that looks like. There's a whole infrastructure agreement as well that spells out who does what. So we anticipated that would be in that agreement.

[Unidentified Legislator]: So it ownership as opposed to rental?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: As the unit owner who wants

[Kirby Keaton (Legislative Counsel)]: to verify

[Unidentified Legislator]: it sometimes.

[Kirby Keaton (Legislative Counsel)]: As I was saying before, there's a holder of the contract, another party like the HCV, and they will enforce that contract. They'll enforce that covenant if they need to.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: You know given the time here, I'm wondering if it would be okay with members of the committee if we ask you to walk through the sections on location. How does that sound?

[Unidentified Legislator]: Herb says yes. Could

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: you take us through the location? I think that would be valuable for you to walk us through and explain it as you go. Yeah, it's like page 11.

[Kirby Keaton (Legislative Counsel)]: This is where location. So this is to give you some context in deciding whether to approve a proposed project. There's many steps that are being considered and each step has either one or more criteria. Location is one of them. So what the Ways and Means version does I'm skipping the project criteria because that's a different thing and Ways and Means did have changes there. But I was asked about location here. Is it removed all reference to location criteria that Okay, so there's one big change which is the way that the House government or I'm sorry House Housing amendment went was a person could pass this criteria if they showed up with Act two fifty permits in hand. Plays and means removed it.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: They just took out it was a reference.

[Kirby Keaton (Legislative Counsel)]: There was also an Act two fifty tiers in reference to those were also removed. This is the part about the permits. That's an Act two fifty. Okay

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: the reason why we took that out is that we didn't want the application to be contingent upon having the permits in hand. We want somebody to be able to apply to BEPC without the permits necessarily

[Unidentified Legislator]: in hand.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Okay, I just want you to know for what it's worth we did not interpret that section meaning that. We interpret it simply saying wherever it was it should have been written as one, two, three. It was just another criteria. It said no matter what whether you're 1A, 1B, whether you're whatever you are, if you happen to have an Act two fifty permit you could be in two tier anywhere, tier two anywhere. If you have an Act two fifty permit you're in. That's all it said. It didn't mean that everybody else had to have an Act two fifty permit. It was just an additional thing but I guess maybe it wasn't seen that way. Right. Right. Okay. So

[Kirby Keaton (Legislative Counsel)]: there's So the previous amendment did have an or it was a one, two or three. Ways and Means took those out and so now I'll just read through what the locust criteria is without the Act two fifty references. VEPSI shall review the housing infrastructure project application to determine where the house development is located within one of the following. One, an area exempt from the provisions of 10 VSA Act two fifty pursuant to specifically the interim housing exemption. Or an existing settlement in an area within one half mile of an exist or within an area or an area within one half mile of the settlement as it's defined in 10 VSA 6,001. And I can pull up that definition of settlement if you want but I think you might be familiar with it because that is not new language that was there before.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Again because tier one and tier 1a and 1b is not fully defined in terms of rule or the applications aren't actually open to municipalities then they do not currently exist.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I just want to say I understand this. I think year one is very similar to R1. What we're essentially doing is saying the interim, I think the intention was to say, and this was our, not being as precise as we could, an area designated in 1A and 1B now. In other words, they're the interim exemption areas. They're preliminarily mapped. It would have made them permanent for chip purposes. And this one is doing the same thing. It's taking the exact I don't think it's any different. And probably better. And two is the same, right?

[Kirby Keaton (Legislative Counsel)]: The two is the same except that there's a three that was included before that was removed. Just the tier two Act two fifty area.

[Unidentified Legislator]: Why was that removed?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Same reason. Tier two isn't defined yet. It was defined but not mapped. We don't know what it is.

[Unidentified Legislator]: Question over here?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yes.

[Unidentified Legislator]: Two questions. That particular issue seems you could solve pretty easily, you know, exactly in terms of the way that House General managed it and frankly the way that Senate managed it, know in terms of well yeah that's not going to happen until '27 but in the meantime you know these are the areas that are also eligible and I'm just still curious about in the house general definition location definition it has that from ISO section in there and it basically says if you have an active department or if you don't need one right notwithstanding everything else in terms of the list there you're going to be eligible for CHIP and that seems to be a very big difference between what the general committee would say in terms of location much broader than what you have and I'm still struggling to understand you know why you wanted to restrict this on

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: our interest was reflecting what the current law is what the current districts are

[Unidentified Legislator]: right but there are ways drafting wise there are ways you you know, and the Senate didn't and general did it. So at the end of the day, I think it's probably just how simple it's right. You know, in terms of where you want to be what locations you want to have and take advantage of the chip code. And one version, I think your version, it's, you know, existing settlements, you know, dense areas, that kind of stuff. And in the other version, it's my product, virtually anywhere in the state. And I think that's maybe the main difference, but maybe you see it differently.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Well, it's interesting we're having this debate now, a year after the legislature vigorously debated more housing developments should occur.

[Unidentified Legislator]: I hear that and this is smart growth, you know, that'd good to get that out of the table. That's right. Know that's a fair thing and people are gonna have this appendage to that. I hear you. We're in here,

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: excuse me one other question and the side by side we also had or was it only 2028? One of the criteria we also had was that the project would at the time of the approval be mapped or application be mapped as a transition

[Unidentified Legislator]: and The interim exemptions?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I'll tell you what I'll ask later. There was another criteria. Remember that it only applied in 2028. Is that in this side, outside?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I think that's much later in the contingent's due date to tier two as of 2028

[Unidentified Legislator]: when Yeah tier twos were fully

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: and it was for areas that came out of our committee areas that by then would have been mapped as something rather. Getting the names transitioned. But it's not. Okay. I don't have our original bill in front you so I would draw the question.

[Kirby Keaton (Legislative Counsel)]: What do you want to do now?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I'm sure we could take another time for this area. We talked about the cap. You mentioned the sunset was now twelve at the end of 2031. It was the 2030?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Right, we extended it after conversations about making sure that it gave enough time for rulemaking to be completed and then five years with the new rules in place. Okay right but now you assume the rulemaking will take a year?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yes. Okay but there's no requirement?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Now it says they'll do it. Yeah.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Eligible locations. I think probably should we look at the butt four language? Why don't we look at the butt four language just so we get down to the blanks. You want to walk us through the Butt four language I in the 10

[Kirby Keaton (Legislative Counsel)]: found your if you look I won't go into it but the chair what the chair was referencing I believe is on page 29 on the side by side if you want to. Section 26.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Do you think those areas would be Transitioner info areas would be included within a case of settlement language?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I can't speak

[Kirby Keaton (Legislative Counsel)]: for you.

[Unidentified Legislator]: Okay. Alright. Do we have anybody here that can't?

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: We don't.

[Kirby Keaton (Legislative Counsel)]: What's the question?

[Unidentified Legislator]: Is the transition or infill area covered by the settlement? Do we think that the way the settlement is listed that it also covers the transitionary and further?

[Kirby Keaton (Legislative Counsel)]: Under Act two fifty definitions? No I would have to look into that. I'm sorry.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yes. Just one more question on the location.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: We even had a conversation with a representative from Fairhaven about a project that he would like to see in his area, and it's 100 housing units to go on the site of a former racetrack. Initially someone he was told that it didn't qualify and actually it does qualify. That's

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: happened a lot where people are worried something won't qualify and it turns out it will.

[Kirby Keaton (Legislative Counsel)]: Okay so the BUC IV test is included in the application approval process. It's on page nine of the side by side, section nineteen ten of the proposed statute here. Subc? I have a

[Unidentified Legislator]: question on the Bot four clause. I

[Kirby Keaton (Legislative Counsel)]: was about to walk through it. Go ahead.

[Unidentified Legislator]: So in the past we've done this with TIP, the spot for. Am I right in assuming that there were some TIP applications

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: that were denied

[Unidentified Legislator]: because of the spot for clause?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I can't speak to that exactly. There are many communities that express interest in tax increment financing districts that don't progress that far for a number of reasons. I don't know if BUT4 is one of them. Usually it's about the sufficiency of the increment that might be generated to repay the debt that needs to be taken out.

[Kirby Keaton (Legislative Counsel)]: I think that's the reality. The VEGI program is the other one that uses the BUC4. And I would imagine that there's been a veggie advocate at some point that did not meet the BUC4 test.

[Unidentified Legislator]: This is what I would really like to know because we can't predict what never happened. All these places that were denied out of maybe there aren't any and we don't have any data. I'm curious to see on and but for denial, if that area developed at all.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That's a good question. Know in the veggie program, can definitely point towards people who have applied or denied because of the background growth in their particular industry, and they went ahead and hired the people anyway. So it's a good question as to how auditable the but for is, and we're willing to admit that it's not always that black and white.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Was this added what do you remember when the Bud Ford test was added? I

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: don't know if it was 2006 when it was codified in law or when it was added but know, Veggie was recreated from a previous economic development incentive program that didn't necessarily have a but for test. It was more of a anyway, it was a revision to the program.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: It's my impression, it's just an impression I've heard it, that number one, I don't think any project has been any TIF project has been denied because of the BUT4 test. But that the BUT4 test was put in place precisely because of prior earlier tips that failed in the sense that the increment necessary to pay off the bonds wasn't generated by the development or a fear that the development would have happened anyway. They're almost opposite problems. But that's one of the big risks with TIF is you know you pledge your full payment credit that you're going to pay off these bonds and then the development well the worst would be the development doesn't happen at all But or the market falls apart or they don't they're not worth what you thought they were worth and so the amount of increment that's what must have happened that got the new ski to 98% right? It's just they couldn't they needed every penny they could generate was that not right? No they were just there wasn't there wasn't any guardrails that we have now yeah well now that created that that project was is the reason why we had carded up including the word this perhaps

[Unidentified Legislator]: that I don't know

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: okay all right why don't you quickly walk us through the button it

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: may surprise you but I actually really support itself.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yeah, yeah, no it doesn't surprise me. I understand that.

[Kirby Keaton (Legislative Counsel)]: Okay so in reviewing an application, BEPC has to one of the many things that has to do to review is determine whether the infrastructure improvements that are proposed for the development that's proposed would have occurred as proposed in the application or would have occurred in a significantly different and less desirable manner than as proposed in the application, but for the proposed utilization of the CHIP. The review shall take into account, so this is like breaking down the parts of the but for questioning. One, the amount of additional time if any needed to complete the proposed development. And the amount of additional costs that might be incurred if the project were to proceed without the increment. How the proposed housing development components and size would differ if at all, including if applicable to the housing development and the number of units of middle income housing without the CHIP increment. And third, the amount of additional revenue expected to be generated as a result of the proposed housing developments, the percentage of that revenue that shall be paid to the Ed Fund, the percentage that shall be paid to the municipality, and the percentage of the revenue paid to the municipality that shall be used to pay for the improvements.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: You have a question.

[Unidentified Legislator]: Yeah. So the amount of additional revenue expected to be generated as a result of proposed housing development, so, 3A. I guess my question is, the intent of CHIP is to provide a toolbox, or to put another tool in our toolbox, for all municipalities regardless of capacity. If VEPSI is looking at, let's say, three different applications, they all look the same except one of them has substantially more revenue going to go in. Is there a possibility that Pepsi says no to the other two, but because of this stipulation in the but for they say yes to the other one?

[Kirby Keaton (Legislative Counsel)]: I can take a shot at it. So looking at this, it doesn't tell Pepsi how to cast a judgment on this information. And maybe that's something that there's some info in here about Pepsi issuing rules around this. So maybe that's something that they would flush out in the rules. But assuming some things looking at this, I might think if I were to review and I were to apply this language, I might think, okay, well I know that the legislature's concern is how much is the Ed Fund is losing. So if I look at these pieces of information and there's one project that stands out as basically needing less increment and more of it could go to the Ed Fund than the other two, maybe that would be a reason under this analysis. This now it just gives you bits of information such as, if you have three projects and one of them is gonna add a lot more value or a lot more housing than another one, Maybe that's a factor. But I don't read this to tell Betsy how to use this information to make a judgment. Is true and both

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: of you guys are my impression is this generates information. Here three generates information. It's there's nothing in here in this act actually that tells VEPSI that directs VEPSI which project how to prioritize that right?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: There is a prioritization in the application process for them to consider whether or not it meets the housing needs, identify housing needs, geographic equity, to make sure that there are projects all over the state, to make sure that it addresses

[Unidentified Legislator]: bring that question up.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes, that's in the bed. That's the application process. I think it's sixteen ten. Yeah, or nineteen nineteen ten. But before we go on on that point, Representative Bartley, think if that section is is intended to indicate they have the ability to generate sufficient revenue from the increments of pay down the debt.

[Unidentified Legislator]: I guess that's not how I read it. Yeah. Because it says the amount of additional revenue expected to be generated as a result of the proposed code. I

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: just Right.

[Unidentified Legislator]: I'm really concerned that once again, rural communities are getting shafted.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: No, and that's not this at all. It's not it's not compared

[Unidentified Legislator]: to entire amendment to be completely honest. And I'm trying to make sure that so act 181

[Unidentified Legislator]: was great. It was great.

[Unidentified Legislator]: It was fantastic. We've seen how good it's worked for Chippen County, Brattleboro, Middlebury. It's come from Fairfax in Georgia. Georgia doesn't have a designated downtown and Fairfax County Roads, don't have infrastructure. This is not going to help either of my towns again. And I'm really frustrated that we're putting so many barriers into something that could have been still had guardrails. And yet we are just putting barriers in front of Smart Grove in our towns that we want it. I'm sorry because you guys are in the hot seat. But I'm here because I have to stick up for my towns because when I do die, I want to make sure my towns are still there and

[Unidentified Legislator]: this doesn't do it for me.

[Unidentified Legislator]: So I do see this as a detriment. I see that language as a detriment.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: That's not how it's intended. And believe me, the Ways and Means Committee is completely agnostic on where the developments occur. So we've got good representation from rural areas of the state on our committee, and those that are in urban areas. So it's pretty widespread. But this is about the ability of the town to be able to satisfy the debt requirement from that extra generated revenue because there are some tips that are struggling to meet their debt service.

[Unidentified Legislator]: Absolutely. But I also am saying that I think if you do two applications, one would assume that even if both applications have the ability to pay their debt services,

[Kirby Keaton (Legislative Counsel)]: that

[Unidentified Legislator]: they should both be approved.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Sure, why not?

[Unidentified Legislator]: But this language makes me very concerned that that's not the case. If one has if we're expecting one to receive more revenue, I mean, let's use common sense. That's who's going be more apt to say yes to that one than over the other.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: There's a geographic effort.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yeah I'd like to see that language.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Right up there.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: I know but I can't read it. Page

[Unidentified Legislator]: what? 25.

[Kirby Keaton (Legislative Counsel)]: Okay. Well I was looking at the roommate. The geographic equity. Where

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: is

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I your don't know where to select. Regional equity. It's right there on Okay. Item

[Kirby Keaton (Legislative Counsel)]: So this is something that speaks certain rule maintain that.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Yes. Okay.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Prioritization of applications one, right? Like regional equity verifiable housing shortages and laborships.

[Unidentified Legislator]: Laborships? We have a question over here from John. We have a question over there from Tom. We're gonna go ten more minutes folks. We're at 04:00.

[Unidentified Legislator]: So John, President Braves' commentary, the question is around 5%. The presumption was of three stories and it occurs to me that thinking through municipalities, three stories I don't think is a given throughout the state for structures. Is there any, was that a point of discussion? When raising means around 50%, I'm sorry, basically two stories, but three is not

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: on that.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: When we got the bill of 70%, so we lowered it to 65%. Yeah. So it's actually more forgiving.

[Unidentified Legislator]: And I think I'm the forgiving mood. So I mean, 50 would be something knowing that two stories gets you somewhere gets you something much more applicable.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: One of the things we can do I just can tell you real quick you guys had 60 we up to 70 they did 65 I know that I know from my own life my experience of work if you want to get into floor area ratio you got to define it very carefully and that is beyond the scope of what we are doing. Mean it's like ages. So I think our intention and correct me if I'm wrong I think you shared this is really that's the adoptive rule as to what this means and I think they ought to put in that reuse it depends. They should say something that just says if it involves reuse that it depends on the particular project and it's really give a lot of flexibility on reuse. I think that we need flexibility. I don't know how we put it in the statute but I think the regs have to be very flexible. Is that, Charlie, is that accurate? We got to look for things we share. We share that, right?

[Unidentified Legislator]: That's awesome. So

[Kirby Keaton (Legislative Counsel)]: I guess one thing to note here about the rulemaking in general is that the ways and means version does require making.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Didn't have any restrictions.

[Unidentified Legislator]: Where does

[Unidentified Legislator]: it say that? Says

[Kirby Keaton (Legislative Counsel)]: may adopt rules that are reasonably necessary and then next to the next line the council shall specifically adopt rules too. So they may adopt rules about whatever they want but they shall do these others. And there was some may adopt with language in the other amendment as well.

[Unidentified Legislator]: Is there a definition in state statute of regional equity?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: No I'm sure there's not. Along those same lines, just by my comment, if have projects going in Bennington, Brattleboro, Rutland, White River, St. John's Berry, Willis, and Vestas.

[Unidentified Legislator]: That's dispersed geographically, but it's not rural equity.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: They're different.

[Unidentified Legislator]: Geographic equities is how are we covering the state actively but that doesn't mean that we're addressing towns of under a thousand or 2,000 because they can put believe it's passed by and still you know dispersion around the state So I'm not sure I'd like to see a definition. Certainly.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: And the rule might be right.

[Kirby Keaton (Legislative Counsel)]: Well, seems like a lot

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: of guidance being taken out

[Unidentified Legislator]: of the statute of the bill and and made discretionary as far as that's these concerns and certain reason all of this discretion has to go through that

[Unidentified Legislator]: too not so much guidance it's

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: that's the stuff has to come back with the actual rules part of it is to submit them right there on item number B on the page, as before submitting them to interagency committee on rules, is to submit them to the JFO office.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: GIPC? JFC. Joint Fiscal Committee. Yes. Why did you add joint fiscal?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Because in the past there have been emergency rules adopted by Joint Fiscal Committee when there wasn't enough time for the legislature to review them in full.

[Unidentified Legislator]: So it's to expedite the rule making. This doesn't give expedited rule making in court.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: Expedited approval process.

[Unidentified Legislator]: Well generally what happens, LCAR, the chairs of the committees and jurisdiction get the rules. When it goes to LCARD, there's a time for I think JFO also has the ability to look at the rules, and the chairs have time to talk with legislative council to go through that and give their recommendations to Elkhart as well so I'm wondering why we need that extra step.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I think it was a step honestly. It's not ringing

[Kirby Keaton (Legislative Counsel)]: a bell to you it may have been like John might be able to answer that because it may have been a subtractive decision where he took that from somewhere else that Betsy does a similar process And I can try to look at that, find the work you may have got them.

[Unidentified Legislator]: Ten days to expedite it,

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: not slow it down.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Patrick, you've been sitting here patiently and we're almost out of time. Is there any highlight that you were going to talk about that you'd like to talk about in the remaining three minutes? Forgive us for doing that to you but I thought I'd add.

[Patrick Jitterton (Joint Fiscal Office)]: No certainly. So I guess I should myself, Patrick Jitterton, joint fiscal office for the record. Yeah, I would just you probably heard Ted say this a bunch of times. This proposal in any of the states you've seen it, whether it's in your committees or this amendment, we're still not able to estimate a cost for it. You do have the caps, right? And so I would just point to the cap that that is not a cost estimate. It is more indicative of a limit on potential upper bound of exposure to the education fund. You know, it's possible that you can't approve enough increment retention to hit the $40,000,000 each year. It's possible they can. But in terms of actual estimated costs, we're still not able to provide that for you. And I guess if you have any other questions about If the accounting

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: we were to give, suppose we give you a low and a high number for the cost per unit of infrastructure. Okay, we give it to you. We say assume a low of $2,000 and a high of $10,000 cost per unit. Would you be able to calculate how many units the $40,000,000 would increment over the lifetime would produce?

[Patrick Jitterton (Joint Fiscal Office)]: If you're able to provide me with sort of you know reasonable average per unit estimates it's simply just dividing one number by the other.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: So I thought so, okay thank you. Yes.

[Unidentified Legislator]: So you can Google it. I'm sure you could. It costs an average of $100,000 per home of an infrastructure cost.

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: We did have a presentation on unit on a development that was for the first like 20 units of 75,000 for the additional 40 units it was 24,000. So I was like, okay, yeah, It was really hard to know what what that was, and I think I might have the number of units wrong, but it gave that to me

[Unidentified Legislator]: very well.

[Patrick Jitterton (Joint Fiscal Office)]: And it's it is possible that folks that maybe get the pay or HCB might be best to answer that particular question.

[Kirby Keaton (Legislative Counsel)]: Thank you.

[Unidentified Legislator]: $40,000,000 a year on a verbal scope of increment of increment that can be used and how I'm trying to I'm trying to picture this that you have this is truly something that small communities so we need to make sure small communities can access it. What's the likelihood of hitting $40,000,000 a year?

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: There are constraints as to how many projects can you really build.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: And

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: so that's one. The permitting process is something else again. Getting the other financial stack of the financial stack together. So all those are fairly complicated.

[Unidentified Legislator]: And would it did you talk about the possibility of if the legislature is out of session, Betsy has a great project, but they've met the cat that they could go to the Joint Fiscal Committee for approval to extend the cat. We did not discuss that. I'm just wondering if that's something

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: I can't tell you what the value is of existing home projects that are under construction now. It could be. I know that there's 330,000 units that we have in the state, but I can't tell you how many we've

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: in

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: terms of total number of units

[Unidentified Legislator]: unless that's a good thing.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yes. We've got one time for your question and then I think we have to Oh go ahead. So the

[Kirby Keaton (Legislative Counsel)]: sub B end of the rulemaking, someone must have asked for the legislature to take a look at it because I found that other areas of law like best management practices, rules really the best management practices for agriculture have statutory language to basically allow the legislature to take a look at the rules before pre filing. So it seems like John would not have grabbed you know that he wouldn't have grabbed it arbitrarily. I think there must have been a request to have the legislature take a look at that. That's why they haven't done with this.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Yeah it wasn't I don't think the problem was the legislature it was concern. Last question.

[Unidentified Legislator]: Well I

[Unidentified Legislator]: just I think to the other side

[Unidentified Legislator]: of the coin of the power rural community who's going to take advantage of this is also how desirable is this?

[Unidentified Legislator]: I

[Unidentified Legislator]: mean for a Burlington or a you know

[Unidentified Legislator]: a community that that properties just are more expensive they're going

[Unidentified Legislator]: to reach the maximum very easily with you know bigger bigger projects that are going to

[Unidentified Legislator]: produce property that is worth more may not be

[Unidentified Legislator]: able to take advantage because they might they might take up way too much of the of the cap of the proportion so here we have and we've been trying to work towards adding more housing where there is already infrastructure or where there is already, you know, and we just like, like Champlain is getting garbage spewed, you know, wastewater into it all the time because we need even in places where there is infrastructure like Burlington, we need this infrastructure development. When they build a massive unit

[Unidentified Legislator]: and it's and we have this cap, they may it may not it may not make sense anymore for them

[Unidentified Legislator]: because they're they may be told you're you know so it's just like it's the other side of the coin like are we really solving any problem?

[Unidentified Legislator]: We think we are

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: but obviously.

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: Any last statements by the three of you we've got to stop. Oh

[Rep. Charlie Kimbell (Reporter, House Ways & Means)]: that's right. Perfect challenge. Okay

[Rep. Michael Marcotte (Chair, House Commerce & Economic Development)]: well thank you very much and we are thank you very much for all of your help and this is obviously too short and fitted and appreciate it. I have a feeling it's not the end of what you might get asked.