Vermont Legislature SmartTranscripts:

[Sen. Alison Clarkson (Chair)]: We need to go. Welcome back, everybody. It we're back in Southern Economic Development Housing and General Affairs Friday, January 30, and we welcome join us on

[Sen. Rebecca White (Windsor County)]: S two zero

[Sen. Alison Clarkson (Chair)]: seven. S two zero seven, an act relating to prohibiting surveillance pricing, a new subject area for us, and always a a senator who entertains the cutting edge. Yay. We welcome Rebecca White. Senator Rebecca White, take it away.

[Sen. Rebecca White (Windsor County)]: Thank you for that introduction, and good morning, senators. It's great to see you guys. Since it's like the three of you, I guess I'll just kinda chat a little bit more formally. Introduce yourself. Yeah. I know what Yep. To will. Windsor County state senator. Hey. Hey. I'm just late taking it off. So if you are at all someone who purchases things online or goes and looks at flights or even takes a Uber That's what we this yeah. This bill will be relevant to you. But also, Hanna Fruit has just been under fire for this tonight. Just more, let's get let's get started. Even your grocery store at Santa Robbinsdale has already rightly pointed out, could be potentially using the tactic of surveillance pricing. Surveillance pricing is when a company takes data about you, whether that be information related to your income, it could be your personal, it's personal as I've got a couple examples, but it could be your browsing behavior, for example. But essentially companies are using your pain points to decide the price of a good a service, not based on the demand for that product. So they can individualize the price of a good or a service to you using data that they have collected or purchased. That should be very scary, because that means the price of something is extremely variable and it's not fixed. Like if you were to go into Best Buy today, and you saw a TV and it was $500, and then you walk up to the register and the guy in front of you is actually being charged $450 and then the guy in front of him is only paying $350 and there's no sale sign, there's no special discount, there's no loyalty program that they're a part of, well that would make you pretty mad. And that essentially is what we're trying to do in S two zero seven, is to prevent those types of underhanded corporate tactics, in my opinion, that use data against your better interests. And I think what we can do by passing this bill is set a standard to protect Vermonters against that kind of corporate surveillance tactic. So we're protecting their interest, and we're also saving them money. Because even if you aren't the person whose pain point is the highest, they're still able to inflate the value of that entire good when they can change the price without you having a fixed amount that you can see. So it's very scary. There's a lot of information out there about it and there's a couple other states working on bills. New York, has a bill, that I think Governor Hochul, there's a whole conversation about it in New York as well, they're moving forward with legislation, but I think Vermonters deserve protection as well. So Especially when it comes to consumer.

[Sen. Alison Clarkson (Chair)]: Has any state actually passed this yet? This is our consumer protection umbrella.

[Sen. Rebecca White (Windsor County)]: Yeah. No. My understanding is that the One Fair Price Act, which was has some momentum, oh, sorry, I apologize. It was introduced by Kirsten Gillibrand, so it was introduced in Congress. Not So in your state. But it's called the One Fair Price Act, in advance companies charging different customers different prices for the same product based on personal data. So it's essentially the same concept. Right. And

[Sen. Alison Clarkson (Chair)]: can and we're gonna learn obviously more on this. We would appreciate some if we take the sock witnesses that we would want to so we'll we'll work on witnesses. I guess my question is, how does a, let's say, a grocery store even know who I am because Oh, wow. No. No. Other than the fact that your local grocery store knows who you are. But if you're just checking out, your stuff goes through. You they don't know who you are until

[Sen. Rebecca White (Windsor County)]: you pay. So I see the hypothetical you're asking. Think it more like Instacart, where let's say

[Sen. Alison Clarkson (Chair)]: you It's online that this is most insidious. Yeah,

[Sen. Rebecca White (Windsor County)]: because you can't, you don't see the price changing like you would in a physical store. However, there are a lot of concerns about how grocery stores are moving towards online purchasing, whether it be through the Instacart app or not. They could be changing that price. They know you love a certain brand of tea, and then you buy it multiple times a week. Well, they're making it $5 for you and $2 for me. And you don't see that because you're not on my app. So that's a little bit of the real aspects of it in the consumer experience now. If you go into the grocery store, they are changing to digital price tags. I mean, I mean, I don't know. Think there's ways that they could be using it and we should nip it in the bud now, before it becomes something that we're seeing in a grocery store. And there's two scenarios I'm trying to understand for for like loopholes or just how Number it's one, I learned about this last night, so I won't keep mentioning the name of the company, but, you know, it sounds like it was different prices in different stores. So Oh. And and this is a huge equity issue that comes up in the country about actually, like, things can be higher priced of something in lower income areas,

[Sen. Alison Clarkson (Chair)]: which That's been for a long, long time. That's that's

[Sen. Rebecca White (Windsor County)]: that has been for a very long time. Maybe pay attention to that too because I think that's it's like that's coming to Chittenden County, and that's the concern that's been raised. And then two is VPNs. And That's You know What's a VPN? A VPN is atomic and exploiting it. They're not affected by this. Okay. I mean, I guess what we're trying to say is you you will have the same pricing in The United States. Right? Because a lot of people get VPNs to buy a plane ticket that looks like they're from another country where the plane ticket's gonna be cheaper. Right now, that's a loophole that they can exploit. I'm not you know, I just don't we can't really do much about the international nature of the Internet, I would imagine. Oh, I thought you were trying to say would VPNs be required to meet certain regulatory? I don't know. And I don't know. Like, that's just a huge loophole and everything that, I have been on the side of the consumer getting, like, a cheaper flight. But Yes. I see what you're saying. How do we so it's more of a question of how would we regulate these if they're not baked in their operation in The United And at that point, I don't know. No. Like, It's not I don't that. It's you can change your location to another country Yeah. To get a better deal. Yes. So that they could be hurt by this if we're not paying attention to how, like, if if that's gonna be not allowed anyway.

[Sen. Alison Clarkson (Chair)]: So I I I think for as we go into questions, unless we have questions for Becca in terms of why she Oh, yeah. Sponsored this. Is that, do you have Rebecca, a question for Okay, great. I'm more

[Sen. Thomas Chittenden (Member)]: interested in a tent. So this has, you brought the example of an online purchase. It's a national effect, not just a state effect. How do you enforce something which we have national distributors when we're just one small state? How do you enforce those?

[Sen. Rebecca White (Windsor County)]: Well, would say most, I would just say when we pass laws, for the most part, corporations tend to follow them. You know, I just say that. I mean, that's why they come and lobby to us and say, don't want you to do something. It's because they do follow the law. So I'd say a lot of national distributors, if they were to be selling in Vermont and knew that they couldn't use this tactic, could geofence this location and limit the use of that tactic in our state. And I think they would follow it. Can we, you know, shake our finger and go get every single one of them who doesn't do it? Maybe. I mean, but that's for the FTC to

[Sen. Thomas Chittenden (Member)]: make How a police it? Or how do we?

[Sen. Rebecca White (Windsor County)]: I don't think they need to police it. That's Well, is actually an enforcement mechanism in here. So I would refer to the bill itself actually, because there is an enforcement mechanism under the prohibition with violations. It's very simple. It's that the attorney general, essentially, if something's deemed a violation of this sub chapter, a consumer would basically, it expands consumer protection rate under my understanding of the So no PRA. Let's get Mike in. No private right of action.

[Michael O'Grady (Office of Legislative Counsel)]: No there is a private right

[Sen. Randy Brock (Vice Chair)]: of There

[Sen. Alison Clarkson (Chair)]: is a private right of action. And that's appropriate. We have that in our consumer protection. Well there's

[Sen. Rebecca White (Windsor County)]: a PRA there is a built in PRA to the consumer protection act, we do not need to spell it out. So it's not spelled out in Okay. The

[Sen. Alison Clarkson (Chair)]: Let's get mine in.

[Michael O'Grady (Office of Legislative Counsel)]: It's built in to the Consumer

[Sen. Rebecca White (Windsor County)]: Protection So there's no additional spelling out of this in the in the law. It goes to the E- just

[Michael O'Grady (Office of Legislative Counsel)]: that if

[Sen. Alison Clarkson (Chair)]: I'm Mike, would you introduce yourself and join back up?

[Sen. Rebecca White (Windsor County)]: Do mind you if I wrap up my one final thought because before you I'm gonna go back

[Sen. Alison Clarkson (Chair)]: to my You are vice chair of transportation. Yes.

[Sen. Rebecca White (Windsor County)]: I'm have that there now. But I did just wanna say thank you for taking up the bill. I know that we're all online digital consumers, and this will protect our constituents from predatory practices. And you're going to hear from a lot of lobbyists from companies saying that they're going to be affected and you're going to see some shiny shoes in the room on this topic. And I really just hope that we can think about folks who are going to see jacked up rates for goods and services if we don't get this in the bud. Can I just ask

[Michael O'Grady (Office of Legislative Counsel)]: you a question, Jen,

[Sen. Randy Brock (Vice Chair)]: in terms of Is what the intent the intent to ensure that you have an effective same price of being charged for something that was purchased within the state, regardless of where it purchased?

[Sen. Rebecca White (Windsor County)]: Is that part of the the idea is that if you, Randy, walk or purchase something online, it's the same price that David would pay, and the

[Sen. Alison Clarkson (Chair)]: same price that Alison would pay. And then having specific information about you That's solely that an online purchase as opposed to a purchase in a particular store or outlet of that dead good that you found out the price online.

[Sen. Rebecca White (Windsor County)]: Yes, I think I see what you're saying. Yeah. The physical locations are not quite impacted by this bill yet, I would say. It's more because you can't know what someone else is paying independent online, but you can know when you are in a physical location.

[Michael O'Grady (Office of Legislative Counsel)]: Right. But

[Sen. Rebecca White (Windsor County)]: I do think we could see a crossing over to physical locations if we don't prevent it online as well because it's a very profitable tactic potentially for businesses. Great. But I love that question.

[Sen. Alison Clarkson (Chair)]: Yeah. No. No. It's a good one. And already there's differential pricing depending on the store, who's selling it, and we already have differential pricing. We would have to so that's a cute that's a cute topic. Becca, thank you. This is Thank you for letting me edge and protecting Vermonters, and thank you very much. Mike O'Grady, we welcome you. Good morning.

[Michael O'Grady (Office of Legislative Counsel)]: Before I get into the bill, I just want to discuss some concepts. And introduce you. This is Mike Grady from Budstead Council. Why am I here? Because I normally don't come to your committee and I don't come to your committee on consumer protection issues, so why is it me?

[Sen. Alison Clarkson (Chair)]: We're glad it's you.

[Michael O'Grady (Office of Legislative Counsel)]: Because I in part staff agriculture, and agriculture is the agency in the state that regulates weights and measures. And pricing is a weight and a measure of our students' component that's part of their jurisdiction. And one of the things that they do is that they enforce unit pricing and advertised pricing. So when you go to the store and you see what a unit price is or what the label price is and you go to the checkout and it scans at a different price, that's the violation. And they actually do go into stores. They do they have an inventory of advertised prices, and they check those. And that they're they're for a while, there were there were a couple of violators, frequent violators who would not not conform because it was easier for them to pay the penalty than to conform. But they've they've moved to enforcing unit pricing and and pricing at the at the cashier, and that that's working well. What is happening now is the use of AI, and it and and it's coming into play, and it's coming into play in two ways. One is called dynamic pricing. It's when you are actually in the store and they use electronic price labels and they change the price of the product while you are in the store. So you get it off the shelf and it reads one price. You take it up to the cashier, and it cashes out at another price. They are not violating the current law right now because when you brought it to the cashier, it is the same price that's laid on the shelves. So That is so insidious. So the agency of agriculture has been working well, let's step back. Many of your agencies work with national associations on the specific issues that they work on, like wastewater. There's the new mainland wastewater, whatever, NumiPic. You know? There is a group that works on national uniform pricing. And just this summer, they worked on dynamic pricing, and they're gonna bring forward most likely legislation to address dynamic pricing. So you're gonna see that. But what surveillance pricing is, it's the use of your personal identifiable inner information or an aggregate that places you in a group so that they can use that aggregate information to change the price that is offered to you. And so they might know that you buy a certain product every week, and they might know that from your use of the app. They might know that from your rewards card. Because, Cherry said, oh, they don't know who I am when I check out. Soon as you scan that card, they know who you are.

[Sen. Alison Clarkson (Chair)]: Correct. But at in right now, you Right. You can't that would change your price.

[Michael O'Grady (Office of Legislative Counsel)]: Unless it dynamically change.

[Sen. Alison Clarkson (Chair)]: Unless it dynamically changes it. So you could have two things working at the same time.

[Sen. Randy Brock (Vice Chair)]: Right.

[Michael O'Grady (Office of Legislative Counsel)]: So this is about and it's not about you changing your information in order to get a better price by changing the location where you are located when you are purchasing it. That's not them using your personal information to change the standard price or deviate the standard price. Right.

[Sen. Alison Clarkson (Chair)]: And

[Michael O'Grady (Office of Legislative Counsel)]: with regard to enforcement, the Supreme Court, the US Supreme Court had said when retailers consume people selling products use the Internet to sell you a product, they are reaching into the state, and they are providing contacts with the state. And that's important because states only have enforcement authority when they have regulatory contacts over an entity. So that's why you get to tax Yes. Internet products. That's why you get to dictate, you know, the type of products that come in through an Internet because they have regulatory contacts with you that the that the attorney general can enforce. And I'll give you an example. Years ago, the the attorney general was trying to enforce the use of the word Vermont and have a Dream Outland or any other thing that was identifying the product as being from Vermont, but it actually wasn't from Vermont.

[Sen. Alison Clarkson (Chair)]: Right.

[Michael O'Grady (Office of Legislative Counsel)]: There's a company that sells Vermont Curry.

[Sen. Rebecca White (Windsor County)]: That's right. So I am a huge fan of Vermont Curry.

[Sen. Alison Clarkson (Chair)]: I know.

[Sen. Rebecca White (Windsor County)]: And Japan loves it. So

[Michael O'Grady (Office of Legislative Counsel)]: It's in Japan. It's

[Sen. Alison Clarkson (Chair)]: from Japan.

[Sen. Rebecca White (Windsor County)]: When you go to Japan, they will come up to you if they knew you're from Vermont and say, Vermont Curry. Love Vermont Curry. And you're like, what's Vermont Curry? And where can I get them?

[Michael O'Grady (Office of Legislative Counsel)]: The attorney general was sending that company letters saying you cannot using appropriately using that term when it is being sold Right. In the safe and it was not being manufactured Here. In Vermont. You can still it's still on the shelves.

[Sen. Rebecca White (Windsor County)]: I buy it all the time.

[Sen. Alison Clarkson (Chair)]: We should have the stuff. We stuff. Have should the ready dinner. And it

[Sen. Rebecca White (Windsor County)]: makes for an off payment.

[Michael O'Grady (Office of Legislative Counsel)]: So that there is enforcement authority. We're not talking about dynamic pricing. Talking about surveillance pricing. And so when you look at the bill, one of the things that that market Rick and I decided on doing is creating a new chapter in title nine, new chapter in consumer protection about the use of artificial intelligence because you've already heard right now several different ways AI is used, and it can be probably will be used for other in other ways. So Rick thinks it's best to create a new chapter, and so we're creating a new chapter about artificial intelligence for Which is chapter one eighteen? Yep. Consumer protections.

[Sen. Rebecca White (Windsor County)]: So that would help it apply to, like, Amazon as well.

[Michael O'Grady (Office of Legislative Counsel)]: Well, it it not necessarily. It it will if if Amazon is gonna be using surveillance pricing and collecting personal information about you, but it's not nest this is to help with all the future AI coming that will

[Sen. Alison Clarkson (Chair)]: be Okay. Affecting consumer. Right. This is preparing us for the future.

[Sen. Thomas Chittenden (Member)]: I would submit that you don't need AI to do this.

[Michael O'Grady (Office of Legislative Counsel)]: You you don't, but it's easier to do it. Which is why

[Sen. Thomas Chittenden (Member)]: I'm I'm just playing devil's advocate. Right? This isn't necessarily a good spot for surveillance pricing because the perpetrator may not have any need for AI to exercise this capability.

[Michael O'Grady (Office of Legislative Counsel)]: It would

[Sen. Alison Clarkson (Chair)]: be much harder just without AI.

[Michael O'Grady (Office of Legislative Counsel)]: Right. And and I'll give you an example that is exempted that you use most likely every year of your life. Insurance is surveillance right is surveillance pricing. Yes. It the product changes depending on your circumstances and personal information that the insurance provider has about you. So that that is surveillance pricing book. It's being exempted from the prohibition, and it doesn't necessarily need AI to set that that surveillance price.

[Sen. Thomas Chittenden (Member)]: I'd also submit that every plumber, carpenter, snow removal guy, they're all doing the same thing. We live in the big house, 10% up.

[Sen. Alison Clarkson (Chair)]: Anyway, that hasn't happened for us yet, Tom.

[Sen. Kesha Ram Hinsdale (Member)]: You see that there's a more framing to recognize that there is surveillance pricing that where prices are lower all the time, like so you get the manufacturer suggested retail price on the car lot and there's always negotiation there. Also with rewards, they lower the price for me once I recognize who they are. But the concern here is is using surveillance data collected to charge higher than a manufacturer, what the display price is. Is there a distinction there worth highlighting?

[Michael O'Grady (Office of Legislative Counsel)]: Well, discounts and your membership in a club and etcetera, etcetera, that's accepted because you

[Sen. Alison Clarkson (Chair)]: Have voluntarily joined the membership group and

[Michael O'Grady (Office of Legislative Counsel)]: And the services, this applies to commodities and consumer products. So it's not about your professional services that are being provided.

[Sen. Alison Clarkson (Chair)]: I think David's point is we all have to really look at service pricing properly and carefully and negotiate it.

[Sen. Kesha Ram Hinsdale (Member)]: I just, if we ban this, could see the companies always wanting to have a much higher manufacturer, it's just retail price so that they can just do a lot of different mechanisms to discount to So health that's what's gonna happen anyway.

[Sen. Alison Clarkson (Chair)]: That would be broadway to make pricing. That's broadway ticket pricing. Right there. Okay. Mine.

[Michael O'Grady (Office of Legislative Counsel)]: So aggregate consumer information is information that relates to a group or category of consumers from which the individual consumer identity information has been removed. That's not reasonably thinkable to any consumer or household. It could still be used in setting that that surveillance rights. Consumers, any purchaser of your kind of product. Consumer commodity has a pretty broad definition. It's any food, drug, device, or cosmetic or other article products or commodity. It does not include prescription drugs. And then a consumer product is any product that is regularly used or purchased to use for personal, family, household, commercial, or business purposes. They're not services, but it's pretty much any drug, device, or cosmetic that's not a prescription drug. Covered information means your personal information or the aggregate. And then for electronic surveillance technology, it's a system software process using machine learning, statistics, or other data processing, used to collect, capture, report, retain personally identifiable information. Personally identifiable information, that's we're using the definition that's in the chapter that protects personally identifiable information. And and that is the consumer's first name, the first initial and last name in combination with one or more of the following digital data elements, Social Security number, driver's license number, financial account number, password, unique biometric data, genetic information, etcetera. But that is what you're talking about. That's the type of information that's being used for surveillance pricing. Now the standard price is the price of a good or service that's set for all consumers. That's not based on the use of covered information. And surveillance pricing is using that covered information through electronic surveillance to set the price of a consumer product that differs from the standard. So on page three, except for the exception, something that we've already talked about. A person shall not use surveillance price action to distribute, sell, or offer for sale of consumer product in the state. Should balance technology, set a surveillance price, differ from the standard price that's offered generally. Excuse me. So covered information, personally identifiable information collected by surveillance technology to adjust the price that's being offered to.

[Sen. Kesha Ram Hinsdale (Member)]: Is standard price a new deposition to this bill, or is it we have to buy that elsewhere in statute? I see the definition here, but it's just a common frame that that's It seems like there's a lot of interpretation of the standard prices.

[Michael O'Grady (Office of Legislative Counsel)]: Think it is used elsewhere. It's not used in the unit pricing chapter. I would have to go and look and see look at the dynamic pricing. I do think it's in the dynamic pricing language that that association looked at this summer that I will have to check. Right?

[Sen. Kesha Ram Hinsdale (Member)]: It it just seems like a very vague term.

[Sen. Thomas Chittenden (Member)]: Yeah. Thinking about senator Chittenden's point, you know, standard pricing, you could you could circumvent this whole intent of this bill by setting a standard price then reducing that various amounts based on personally protected and connection happens the opposite effect of what you're intending to do.

[Sen. Kesha Ram Hinsdale (Member)]: Many people have to identify themselves and give up that private information in order to get the discount. They

[Sen. Thomas Chittenden (Member)]: don't get the information, they don't get the discount, but you give the good weight, that's where they could do the vertical, that's supposed to going up.

[Sen. Alison Clarkson (Chair)]: Yeah, but that's equally bad. I mean, I think they have to, that's a great program.

[Sen. Thomas Chittenden (Member)]: How do you circumvent that ruleful?

[Sen. Kesha Ram Hinsdale (Member)]: We don't regulate pricing or free market. So, I mean, we're not gonna tell them they can't. But Yeah.

[Michael O'Grady (Office of Legislative Counsel)]: But that you you can't this what would be prohibited, say, they know that this consumer is an eel seeker, and this consumer will buy this product if it's just 10% lower than than it is standard price. They might offer that to you, but then they might offer it to the next purchaser consumer at a higher price because they know that consumer buys that product every week regardless of the price. So they just keep it

[Sen. Thomas Chittenden (Member)]: at the standard price. Standard Yeah.

[Michael O'Grady (Office of Legislative Counsel)]: And then they kept it at the same same effect. Well They make their

[Sen. Alison Clarkson (Chair)]: What time where the center pricing came from and what it I mean, this is defined I mean, I I I see your point and that taking it down, nobody would necessarily be as upset about it. On the other hand, to take it down only if you offer precious information that you don't wanna give up.

[Sen. Kesha Ram Hinsdale (Member)]: That happens now, Yep.

[Sen. Alison Clarkson (Chair)]: Yes or no? I don't think so.

[Michael O'Grady (Office of Legislative Counsel)]: So let's talk about some of the 10%

[Sen. Alison Clarkson (Chair)]: if you give me your email. Yeah. Yeah. No. I'm sure.

[Sen. Kesha Ram Hinsdale (Member)]: Get a huge discount when I tell them who I am.

[Michael O'Grady (Office of Legislative Counsel)]: But but that's That's Let's talk about these acceptance because that that's part of the that's part of it. So what is accepted from the prohibition is that the difference from the standard price charts from consumers based solely on the cost of the person providing the consumer product to that consumer. Their transportation costs. If they're shipping it to Alaska versus shipping it down the road, the transportation cost is different. That that is not surveillance price. No. Also, is not is the difference from the standard price is a discount offered to all consumers on equal terms by your email address in a manner consistent with applicable anti discrimination laws. That's you, baby. So if the person gathers personally identifiable information in connection with the provision of this discount, which they might do based on the the consumers purchasing habits, the person shall insure both of the following. We get a written notice describing the terms of that, which you would see in, like, the terms and conditions of entering a discount program or membership club, and the consumer provides written affirmative consent for any purpose described in subdivision a before the consumer's personally identifiable information. So there are discounts. Right. Discounts are And they can use your PII if you consent to

[Sen. Kesha Ram Hinsdale (Member)]: Comments. Thank you. I I get that.

[Sen. Alison Clarkson (Chair)]: Knows who comments I

[Sen. Kesha Ram Hinsdale (Member)]: could restate my previous point, but I think what I'd rather shift the conversation. My my larger concern is, and I've heard that New York City was taking this up, but maybe you heard, like, think it intersects this topic, that AI agents have been used to price models, which has been in a way circumventing antitrust laws because it's not an entity or a person. That doesn't fall into this scope. But is there another bill floating to that?

[Michael O'Grady (Office of Legislative Counsel)]: I I don't know. I do know what you're saying. I do I could see because basically you would use AI to collude on the pricing that's being offered in an area or neighborhood or etcetera for for a product. This isn't that. Yep.

[Sen. Kesha Ram Hinsdale (Member)]: That I have valid concerns over this. I just think the market in Vermont did this. Everybody all the prices go up online if you have to qualify who you are so they can step it down based on what you're so I I sure. I gotta go. I'll be back.

[Michael O'Grady (Office of Legislative Counsel)]: So I just wanna know page four. Another exception is insurance. This insurance is surveillance. And then page four, line five violations are consumer product, consumer trade violations. The attorney general has the same authority, and there is a private right of action as Senator Ram Hinsdale. Which

[Sen. Alison Clarkson (Chair)]: already exists.

[Michael O'Grady (Office of Legislative Counsel)]: Right, because it already exists under the consumer protection chapter. If you can call this a consumer protection violation and you say they have the same rights and authority, I guess. Right. So the private right of action. If you don't want the private right of action, you have done that before, you said the private right of action does not apply. You have that option.

[Sen. Alison Clarkson (Chair)]: What are you thinking, team? A few of us that are left. Yeah. What's your thought? What's your thought? This is the lean team.

[Michael O'Grady (Office of Legislative Counsel)]: I One more law.

[Sen. Alison Clarkson (Chair)]: Well, know, but this is consumer protection in a new world where a lot more of our information is now available.

[Sen. Randy Brock (Vice Chair)]: It also suggests to me that one of the aspects of consumer protection would be a product that I sell to consumers to detect surveillance pricing and the game.

[Michael O'Grady (Office of Legislative Counsel)]: Well, it's spy versus spying. Well, the one point I will make is I referenced the agency of agriculture, how they have addressed dynamic pricing. They're gonna have to address surveillance pricing. Yeah. And they're probably gonna wanna do it in a uniform way through the associations that they're working for. If you're going to go forward with this, I would request that you or I would recommend that you talk to Mark Kochat at the Agency of Iverness.

[Sen. Alison Clarkson (Chair)]: This is thanks, Mark Kochat. Does this make sense as something for us to further study and not act on without? When

[Michael O'Grady (Office of Legislative Counsel)]: I first got into dynamic pricing, went to Mark and Mark was like, Oh, we want to deal with that, but let us go to this national association first to figure out how to do it in a uniform way. I think if you went to Mark with, we might do a survey on this person, he probably said, yeah, I wanna deal with that too. Let me go to this national association and figure out how to stop.

[Sen. Randy Brock (Vice Chair)]: So the other question is, about any other state is dealing with this?

[Michael O'Grady (Office of Legislative Counsel)]: Well, wait for you. It it there are bills. There are bills, and there have been enforcement actions just on consumer protection as as basically fraud. You know, one crisis offers and the crisis change. A couple of, grocery stores, in Vermont, have agreed to change their practices, because of that, but not any specific surveillance pricing ban that I know of.

[Sen. Alison Clarkson (Chair)]: So I let's get Mark in to talk about it with you so that you're both here together. I think it does make some sense given how many other areas it touches that it might make and given that no other state, as far as I know, has already passed this. I'm I'm always happy to be first if we've done a lot of homework, But this is, I think, just the beginning of this discussion. And we may want to talk to Mark, and see where he is and see what a thoughtful path forward might be because it may be that we wanna act on this next year after we get more information and we understand fully all all the impossible impacts. Also, wanted to ask, say NCSL. Oh, yeah.

[Sen. Randy Brock (Vice Chair)]: Nice change whether or not there's a study group or any committee that's actually looking at the issue Yeah. Right

[Michael O'Grady (Office of Legislative Counsel)]: Yeah. I mean, I do think, as I said, these agencies use these multistate associations to try to find that uniformity on these types of issues, and I think that they will have to address this at some point.

[Sen. Alison Clarkson (Chair)]: Yes. Dave?

[Sen. Thomas Chittenden (Member)]: Is there a reason for you may not notice, but is there and let me just step back. I I I get it. You know, I I support the concept. Any reason why services were not included? That's something that can also be, online, validated with the right side.

[Sen. Alison Clarkson (Chair)]: I think that's another thing to consider.

[Michael O'Grady (Office of Legislative Counsel)]: You know, when we were drafting a bill, Frank maybe never talked about services because was on products, whether it's being ordered or electronic and super green. Absolutely. But I think it's a good consideration going forward.

[Sen. Alison Clarkson (Chair)]: Mike, who in addition to Mark would you suggest if we decide that we wanna have this looked at more fully?

[Michael O'Grady (Office of Legislative Counsel)]: Well, I don't know who's in charge of retail. The retail

[Sen. Alison Clarkson (Chair)]: Oh, yeah. The retail name or The grocer's not. What? Edge Fox.

[Michael O'Grady (Office of Legislative Counsel)]: Ed Fox.

[Sen. Alison Clarkson (Chair)]: Ed Fox. Thank you. Is that the Vermont Retailers and Grocers Association now that's Ed Fox? It hasn't been in this yet. Thank you, Carrie. Okay. And, yes, retailers and okay. Great. Those are two good ones. I think Yeah. You got the regulator and the regulated. The regulator. Okay. Thank you. Any other questions for Mike? And and, Mike, think about that path. I think that might make some

[Michael O'Grady (Office of Legislative Counsel)]: I mean, can reach out to Mark if you would like.

[Sen. Alison Clarkson (Chair)]: That'll be great. Okay. That'll be great. Because I think we probably wanna hear and make a decision about that, and we can include it in our depending on what we decide to do. We could if it was gonna be a sign that we could charge ag with, for example, we could charge marks mark with, we could then add that to our economic development bill. Okay. As a consumer protection piece. Understood. Okay. Thanks. So appreciate your, help on this. Very interesting. Our first piece of real AI and intersection with the economy in here. Thank you. Carrie, why don't you come join us because we have a moment and we would love

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: to have you join us. Thank you. I have some handouts for you.

[Sen. Alison Clarkson (Chair)]: Introduce yourself and tell us why you're here in the Economic Development Committee and why sweet food matters in this wild world.

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: Okay, so I'm Carrie Taylor. I'm the senior manager of government relations for Vermont Food Bank. I do not usually get to join this committee, but Chair Clarkson was kind enough to give me a little bit of time today to make sure you all are in the know on Vermonters, feeding Vermonters, which is a farm purchasing program that we operate, and we're seeking budget adjustment funds through the AGNC for that. So, me just pull up my testimony and get started. Have plenty. Oh, you have

[Sen. Alison Clarkson (Chair)]: to I think that's think that's

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: not a line yet. Had one

[Sen. Alison Clarkson (Chair)]: more time to see it right now. Okay.

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: She has a copy. Okay. Karen and have been in very close communication

[Sen. Kesha Ram Hinsdale (Member)]: Great. With

[Sen. Alison Clarkson (Chair)]: Which I appreciate. We all appreciate.

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: So thank you for giving me a little bit of time this morning. I'm glad you had a few extra moments. I'm here to introduce you to our budget adjustment request and talk to you a little bit about the economic impact of the Vermont Teachers' Food and Vermont Teachers program. Vermont Food Bank is seeking 1,500,000.0 in budget adjustment for f y twenty six, which would fully fund the state portion of the Vermont or speaking Vermontric program. It's what we were seeking last year during the budget process. We received $500,000 in the f y twenty six budget. Those funds were expended completely between July and October 6. The scale of this program is much greater than $500,000. In the years when we were able to operate it at full capacity, it was about 2.3 to $2,400,000. Got it. And you've so far in the budget adjustment, you have what? We have $400,000, which is great and a wonderful starting point. And so I think I just wanna underscore for this committee, the funding we're seeking directly supports farms bottom line. Although Vermont Food Bank is the entity seeking that money, we are essentially spending all of those funds with Vermont farms. And the goal with this funding is to simultaneously support farms and the people across Vermont who use us and our network food shelves and meal sites and direct distribution events, really a win win for folks who are receiving this food at no cost to them. And that, I believe, is a big part of why this you know, the legislature chose to pass Vermontras Feeding Vermontras as a state grant program last year. It was act 34 of 2025. As most of you know it, I believe Vermont continues to experience food insecurity at an increased rate year over year. We are seeking to support farm viability through this, but also to address that food security rate for folks across the state. Through this program, Vermont Food and our partner purchase Vermont grown food directly from farms. Food is distributed in a variety of ways through our existing infrastructure, from food shelves, meal sites, direct distribution events at housing sites, schools, hospitals, and other locations. That food goes directly onto the tables of neighbors and all partners at no cost to them. These are folks in our communities who need food access support and cannot often afford to purchase local food for themselves. Local food's a little more expensive. If you're cash limited, you are making difficult choices whenever you shop. As you also know, farms were Vermont's first businesses agriculture entrepreneur. First entrepreneurs. Sorry. Which

[Sen. Alison Clarkson (Chair)]: is sort of the umbrella we're seeing this under because it doesn't really actually have any direct direct correlation to this committee's work, but we can certainly individually advocate for it as we as we may have as we may see fit with appropriations. Yes. And it certainly affects all of our individual food shelves and hospitals and

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: Yes. And agriculture is a really crucial economic sector

[Sen. Alison Clarkson (Chair)]: economic the issue. Sector. So that is the that's our next tier.

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: Yeah. And one fact that this committee will appreciate is that a study done at UVM in 2016 found that every dollar spent on local food purchase from Vermont Farm in this way adds an additional 60¢ to the local economy. So it does a 1.6 multiplier on any dollars contributed to this program. We like multipliers. I know. Me too. It makes it make more sense. This program operates in three ways to maximize the capacity of our local farms. First is large scale direct purchasing. That is what the full $500,000 and FY '26 have gone to so far. And if we receive just $400,000, it will also support that direct purchasing. What that means is that the food bank is able to purchase large quantities from farms who can deliver by, you know, the truckload or on Gaylord pallets, really larger scale. And the reason we're seeking that money right now is because we're making those contracting decisions for this upcoming spring and summer growing season now, and I'll get into that a little more in a bit. The other two parts of this program are grants that we re grant to our network partner organization to purchase a smaller scale from smaller local farms, farms doing CSA, farms who do not have an 18 wheeler to deliver their food. They have a pickup truck or a Subaru. Really matching the scale of those partner organizations with the scale of the local farm to make sure that these dollars are getting as far out into Vermont communities as we can put them. And then there's a third portion for culturally responsive food purchases, and this is food purchased from from key farm partners and and going to specific network partners that we have to meet the food needs of, you know, cultural communities around the state, often new American populations who maybe have a special kind of melon that they use or a particular green that they're seeking, and we work with farms to grow those. I'm just going to go through a couple of the ways that this supports farm representatives and then I'll leave some time for questions. Right. Forward contracting means that we are a guaranteed customer for farms. You may know that's how dairy works. Right? Dairy knows that they produce x amount of milk in it. So that is not how it works for produce and, you know, vegetable farmers, essentially. A farmer recently told me that he buries all of his money in the ground and then hopes that in the spring, he can sell what comes out of it. And and what we're really doing is To raise the balance. Yeah. What we're really doing is trying to create consistency and capacity, thereby saying we'll buy x amount from you. We can accommodate replacements in nonstandard produce. So if we contract for a thousand pounds of potatoes, we could take russets, we could take red potatoes, we could take white potatoes. If you're a commercial account and you form a contract for baking potatoes, you need russets. You can't take red potatoes. You can't take another type. We're very flexible in that way. For other produce, grocery stores often require standard sizes or picture perfect vegetables. We and our partners can take a bell pepper that is not perfectly red and perfectly rectangular or a flunky shaped potato. Everything that's in you know, that can be eaten, we can process through our system. We also give farmers efficiency through decreased processing costs. So we receive whole foods, we can receive those in bulk crates, we can receive those in giant Gaylord pallets that you can drive around with a fork truck. Farms don't need to process food to be cooked. They do not need to package it into smaller sizes. Apples are a good example of this. We can get you to get rid of apples with volunteers who can pack them into smaller sizes if needed, or we can send those to a partner organization who can put that gate lard out and people can pick on that themselves, as opposed to I need this in three pound plastic bags stacked in a certain way so that my shelters can stock it. We also offer simplified distribution by means of farmers making one stop. So instead of deliveries to little locations all over the place, farmers deliver it to our warehouse distribution center. We have one in Brattleboro, one in Rutland, and one in Barrie, and then we use our own existing network and system to redistribute that food across the state, saves the farms and money, it maximizes capacity in both ends of the system. And I mentioned a little bit earlier, we're asking for the spending now because we are doing planning for farms. Farms are making decisions And

[Sen. Alison Clarkson (Chair)]: the business now appreciate the need for them to plan and know what will then be purchased, so they're not just putting investment into the ground without knowing where it's being sold.

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: Yes, and a partner told me earlier this week, we're making our seed buying decisions right now, we need to know much you can contract for so that we know how much we can grow. So that is sort of the economic side of the program that I'm really happy to have a moment to So introduce you all

[Michael O'Grady (Office of Legislative Counsel)]: we have

[Sen. Alison Clarkson (Chair)]: 400,000 in the BAA right now. Yes. Good for our farm, good for our farm businesses. We have a plan, which helps them. Yes, and

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: this sets us all up for continued continuity progress through the Great Lakes Grant program.

[Sen. Alison Clarkson (Chair)]: Perfect. Any questions or caring?

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: A curiosity, and I'd love to ask since I get some of them. But I was really glad to know when we went with Senate Education to visit some schools that they also are trying to do a lot of local meat purchasing and that helps meat processor. Does this this apply to meat purchase? I know that's usually a big request for food bank. Yeah. The the portion that we do of direct purchasing does not apply. We do not usually purchase meat with that money, primarily because we have other sources of meat. We get USDA meat from the TFAP program, which donated meat through our fresh rescue program. We do pork eggs, which are protein items that are high in high demand. The grant part of this project, you know, our partners can purchase meat. There's a partner in the Northeast Kingdom who buys, like, a cow. Mhmm. A whole cow. It's processed by USDA. They get the whole Oh, cool. The all box of the meat and then distribute those. It does require a little bit more capacity because our partners need to have freezer capacity, and it would take up freezer space than ours. So there's a there's some capacity and logistical issues related to protein purchasing. But yeah, that's how we hope to make that protein piece work in here. David?

[Sen. David Weeks (Clerk)]: I'll just add that I was absolutely impressed with the food bank distribution points and the scale professionalism of the organizations just unbelievably Efficient. Thank

[Carrie Taylor (Senior Manager of Government Relations, Vermont Foodbank)]: you. I appreciate that. And I think that's your point. Like, really just trying to add efficiencies to to to existing systems that are not always particularly efficient, right? But we have to make that better.

[Sen. Alison Clarkson (Chair)]: And we applaud that. Thank you. Thank you, Carrie. You. Yeah, thank you for your time. We will thank you, committee, for your patience and extension of faith in our committee's work in passing those two committee bills so that we will get them back. We'll begin hard work on those next week. We have some joint meetings planned both with house commerce on data privacy because we're gonna get that filled back. And data brokers, we've got a couple of those bills coming at us once they come out of the house. So we're doing common education so we don't have to do it again, given how short our time is. So we'll be taking out food because we have the Tuesday morning we sat in a very constrained time because we So,

[Sen. Rebecca White (Windsor County)]: okay. Sorry. Are they they are going to the floor? Are we taking education before they go to floor on those data bill?

[Sen. Alison Clarkson (Chair)]: Yeah, we're doing it next week when they've lined up all these people doing, it actually, and they're gonna be passing it out and it'll be coming to us.

[Sen. Rebecca White (Windsor County)]: Okay. Probably good education, but I think it's a good

[Sen. Alison Clarkson (Chair)]: change on the floor. If

[Sen. Kesha Ram Hinsdale (Member)]: it's coming back, it's the bill we passed. It wouldn't get recommitted to a committee. Think that's what your question is. Is this a different bill that's coming over to us, that H bill?

[Sen. Alison Clarkson (Chair)]: The data broker bill is coming at us. That we haven't had. That will come to us. And the data privacy bill, we did that share with the institutions because we didn't have time as you'll recall last year and Wendy did. But it it will probably go back there. I mean, I don't know. My guess is that there will be changes given the house. Inevitably, there are changes.

[Sen. Rebecca White (Windsor County)]: So that I mean, I'm just saying that bill could face some changes on their house floor. Absolutely. It's awesome. So I just don't wanna get too attached to any language. It's not attached to language. I don't think it's attached to any language. That's good.

[Sen. Alison Clarkson (Chair)]: This is our this is further education on both these subjects, which we all need because we all need to be up to it and brought up to speed. But the other so those the committee bills will be sent to us either today or Tuesday, and we will we're beginning work on those. After our vote on Tuesday, we have the supreme court nomination discussion and debate, and we may or may not have another and that we're gonna start on Tuesday as a result.

[Sen. Rebecca White (Windsor County)]: There a shared understanding of both committees getting possession of the data bills. We haven't discussed it. You mean in the senate? Haven't discussed it. That needs

[Sen. Alison Clarkson (Chair)]: discussions. Think about the consumer protection things we have in front of us. We will also and we're as you know it well, anyway, there's lots on our wall. We're gonna have to prioritize further. Anything we can include in the buildings that we have, builds that we can combine like our firefighters over time and the nurses, we need to begin to think creatively about how we can either combine things that are priorities for us or with my dear, I'm gonna have Kierra send us out all bills so far that have been committed to this committee with their subject matters so that and you can look them up also so that we can begin to prioritize. I'd love to make sure we everybody gets a chance to prioritize what we what we want to try and take action on. And remember, we can also add things to bills that are coming to us from the house. So even if we don't get to it, and explore it fully before crossover, there are things we can continue to work on after crossover. So I think that is it. Well, somebody else anybody else somebody else at the moment. One thing I would like to do is because we didn't do it last session. I or

[Michael O'Grady (Office of Legislative Counsel)]: at least I don't remember.

[Sen. Alison Clarkson (Chair)]: I'd love to do a committee dinner. So let's think about it. We did a breakfast. We did a breakfast. Thank you. She did a creative breakfast. Because I I better That's what we did. We did. We did. We did. Breakfast. We could do that too. Okay. If you felt like it. But let's yes. We did our creative breakfast over at

[Sen. Rebecca White (Windsor County)]: Should we go off high? Or I don't think people care about our Our

[Sen. Alison Clarkson (Chair)]: social life is very Thank you. Let's go off high. Pricing.