Vermont Legislature SmartTranscripts:

[Sen. Alison Clarkson (Chair)]: Randy, here. Yeah. And your bag. Here. I got your bag.

[Sen. Randy Brock (Vice Chair)]: I got one more to come.

[Sen. Alison Clarkson (Chair)]: Okay. Let's go live.

[Sophie (Legislative Counsel)]: We are live on.

[Sen. Alison Clarkson (Chair)]: Great. Welcome back, everybody, to Southern Economic Development Housing General Affairs, and we are returning, moving from labor back to our vaping bill, our tobacco substitutes bill, and we are turning to the commissioner of the Department of Liquor and the Lottery because they have many there are many sections in this bill that engage them in their work. And I welcome

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Thank you. Great to be here. Thank you for inviting me. Wendy Wendy Knight, for the record, the Commissioner of the Department of Laker and Lottery. So I thought what I would do is just give some shy little bit points, if that's okay, madam chair, and then you can walk me through the sections that you would like us

[Sen. Alison Clarkson (Chair)]: to speak So, yeah, and and you've been filled of what we've turned into studies and what you are now responsible for. Yes. Yes. That happened generously. Thank Actually,

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: it was our idea. Yeah. Her was the The Department of the Curran Lottery's idea, as TAC said, we have never heard of anyone asking to take responsibility. So why don't we start? So thank you.

[Sen. Alison Clarkson (Chair)]: So why don't we start with section 18? Okay, is what we're referring to. Exactly.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: We, as I said, the Department of Liquor and Lottery and CHACS have already discussed this. For numerous reasons, it makes sense for the Department of Liquor and Lottery to have legislative authority of licensing the wholesalers of tobacco. We obviously license the retailers of tobacco as well as alcohol, and so we have offered to take that over. I think what would be needed is language that gives the department the regulatory authority to license in

[Sen. Alison Clarkson (Chair)]: this section. And Jen is not able to be with us because she hasn't figured out how to explode herself here. But if you We will have to work with Jen Carvey. Yep. You have our permission to work with Jen Carvey on that line. Yes.

[Patrick (Joint Fiscal Office analyst)]: She can do tax also free. Tax is needed. Yes. Absolutely. Help you do that.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: The effective date, we would need a year to put that together. There's some moving pieces that have to happen. So we concur with tax, the effective date would be 07/01/2027.

[Sen. Alison Clarkson (Chair)]: To move off January 15. Correct.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: We don't need a report or a study, we just need to make a plan and then we would make that effective 07/01/2027.

[Sen. Alison Clarkson (Chair)]: And have you discussed that? Who had established this date in the first place?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Because collectively we did with tax. The Department of Liquor and Lottery.

[Sen. Alison Clarkson (Chair)]: So you had proposed the January date? Correct. And you're now proposing July? Correct. 07/01/2027. Is that and I see it. We didn't propose January.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I didn't propose January. We didn't propose January. Sorry. I'm saying July. I'd like to weigh

[Sen. Alison Clarkson (Chair)]: in with the AG who's sitting behind you. The wrong date.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: I don't think we knew about that date, but is there a reason why you think you need that much time?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yes, there is a reason why we think

[Sen. Alison Clarkson (Chair)]: you need that much time.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yeah, we would have to do a bunch

[Sen. Alison Clarkson (Chair)]: We just to identify yourself.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: For the record, Brandon King, I'm the Deputy Chief of Enforcement at Liquor and Lottery. I think the intent of us asking for 07/01/2027 is that we need to work with our vendor to produce the licensing and all the backend work in our Salesforce platform to get that enacted. It needs to be tested. It needs to be vetted and giving us until 07/01/2027, considering the time till the end of the session, that would be most appropriate for us to get all that of that word of God. And

[Sen. Alison Clarkson (Chair)]: well, we'll see that in the new language and further discussion then. Right. Right. And now then section eight, we turned into tax and DLL working on the stamping, coming back to us with I mean, it's just that's a super heavy lift at this point, shifting from taxing by concentration versus taxing by weight and volume. And so we have turned section eight. The tax department is gonna come back with a recommendation having worked with you as to and and to recommend the next steps of how that will actually be accomplished. Okay? And so I think then we are you and I sadly, I don't Jen, when she did this great I don't have a section number for the expanded enforcement authority that you have. Yeah.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So Do you have a section number for that? Right. I I have a page number, so I can see what I'm looking at, which is to be reached. Page 13. It's, subsection ten fourteen. So it says enforcement, use of Yeah. It's licensing fees, penalties. Yeah. Okay. So I guess I wanna talk about it in terms of, if I can, it's all tied into a position. You wanted to find the position for the department?

[Sen. Alison Clarkson (Chair)]: I believe you need a position. Position. You need another investigator, and you're not allowed to say it out loud, but I believe that's what you actually need.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So, let me talk about that a little bit. Aside from the fact that the governor, we have an affordability issue in the state. The governor doesn't wanna grow the public sector because he's trying to make the border of Vermont affordable for Vermonters. So we all know that, let's leave that aside for a second, or let's move

[Sen. Alison Clarkson (Chair)]: on because that's actually not in this section.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Right, so I'm trying to, I'd like to talk about the position. So the way the position is structured is it's a perverse incentives because you're proposing to fund the position with penalties. And I think that a couple things with that, right, you're setting up that perverse incentives that we get a position funded if we are issuing violations. You can understand that that might be for for perverse incentives.

[Sen. Alison Clarkson (Chair)]: Sort of like policing and tickets.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Correct. So the department under my leadership and Brandon's leadership and Skyler's leadership has an enormous amount of integrity, but at some point you may end up with, we're not in leadership, so you might end up with leaders who don't have that integrity. So, I think that that's a perverse incentive. I also think that what we're trying to do is reduce the amount of people who are selling to minors. So we would want to see the number of violations going down, right? Because they're, we're educating them, they're doing what they're supposed to be, so we would want

[Sen. Alison Clarkson (Chair)]: to see the number of violations. You are addressing section 17 on page 29, just so that we know where we are. My apologies. No. No. It's just it's okay. It's just we just got Alright. You want

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: me to sorry, madam chair. Oh, no. Bring me back where you want me to talk about. No.

[Sen. Alison Clarkson (Chair)]: If you're wanting to talk about the investigator and how you think it's a reverse incentive. Oh, I I and I appreciate that. And it is here on second in section seven.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yeah. So we wouldn't the other issue is that we are not structured in a silo. So we don't have investigators that just work on alcohol or just work on tobacco or just work on robbery.

[Sen. Alison Clarkson (Chair)]: So How many investigators do you have currently?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: We have 14 sworn law enforcement officers. Two are senior leadership, Brandon and Skyler, and then we have 12 that are investigators, and sorry, she's a team of 12. So, we don't we don't structure the way the language is, we don't structure our investigators to just work on any So

[Sen. Alison Clarkson (Chair)]: that's not how we operate, the way the language is reflected of how we operate. Do you feel your investigators are actually given the number of young people who are getting vapes delivered straight to their homes, do you think your investigators are actually are I mean, are we one of the frustrations is how many minors are actually getting vapes at the moment from adults, from minor from from online sales. How effective are your investigators actually being at the moment if we and enforcers are being at the moment if this is just growing like topsy? I mean, our revenue was going down, but our use is skyrocketing.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: We could certainly get you data on that. I don't have the data We have

[Sen. Alison Clarkson (Chair)]: the data on that. We have been presented the data in this committee on this problem, which is vape use and nicotine use is rising at an alarming rate. Our revenues are falling. And I'm happy to have the tobacco and vaping revenues falling, but that's falling for a reason, which is we are if use is rising and rates are and revenues falling, there's a research gap. And that means we're not probably capturing those sales. That means those sales are either happening illegally or they're happening, you know, for you know, or or they they're getting in some fashion. So I think that's one of our committees. I think biggest concerns is how is this being enforced at the moment?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: And that's what I'm talking about. I can

[Sen. Alison Clarkson (Chair)]: get the data from our department on the compliance and the violations and the enforcement. That would be That that we can get. And so your testimony on section 17 is that you don't need another investigator. That's correct. Okay.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Okay. So now you wanted sorry. You wanted me to go back to enforce you.

[Sen. Alison Clarkson (Chair)]: Right. We run section on page 13 of section ten fourteen. Okay. Where you are.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yes. Right. I'm gonna have the deputy chief speak to enforcement and how we handle enforcement.

[Sen. Thomas Chittenden (Member)]: Sure.

[Sen. Alison Clarkson (Chair)]: Sorry, here. Pull up a chair.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Morning. Good morning. This is the section that Madam Chair Leguis focused on.

[Sen. Alison Clarkson (Chair)]: Well, I think that there is an expanded enforcement authority for vapes like you have a burn of alcohol.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Believe that we already have that enforcement authority because of the licensing of the retailers that sell those products. Does that make sense? As you know, the department licenses all retailers that sell both combustible traditional tobacco products and other tobacco products such as vapes. We routinely issue violations, etcetera, for illegal sales of those products such as selling to a minor and the various provisions in our general regulations.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yeah, so that's it. This section here already exists.

[Sen. Alison Clarkson (Chair)]: We already have that enforcement. And

[Maggie Lenz (Vermont Retail Grocers Association)]: Brandon, how

[Sen. Alison Clarkson (Chair)]: you know, we're just hearing the data on the increased number of abuse among our young people. How how are you guys addressing that now? How are you taking that onboard as a problem, and what are you doing? What's your plan to address that?

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Are you specifically in the online marketplace? Both, I think.

[Sen. Alison Clarkson (Chair)]: I mean, I think that what we're hearing from doctors, parents, students, counselors at schools, kids are getting it through parents, other kids, and mostly a lot online.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yes, so to address your question related to the online compliance that we did, we did over 100 online compliance checks last year with our team and referred, call it around 35 cases to the AG's office. To answer your question, we do do those checks. It is part of our expectations for our team that they are doing those checks routinely. Now, I will just say that that's a complex world, right? That involves basically just an investigator doing a Google search and trying to find a website that sells those products, entering the website, seeing if they can purchase a product and have it shipped to Vermont. And then when that happens, those cases get referred to Rose over at the office.

[Sen. Alison Clarkson (Chair)]: And so a third, just over a third of the cases are roughly And that's the data we can specifically have you. So, Brandon, in an ideal world, given how complex that is, how can we have a more effective, how could we have a more effective enforcement? I mean, appreciate it's complex. I mean, I think we all appreciate it.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yeah, you know, I don't think I have a great answer for you on that quite frankly. I think all the states are struggling with this in the online marketplace, both both only for tobacco, but all regulated products, right? There's this giant universe of the world wide web and then all these different websites and states are really struggling with how to write that in. I don't know if we have a perfect system, but we do have a system that we do try to address as best we can.

[Sen. Alison Clarkson (Chair)]: Yeah,

[Sen. Randy Brock (Vice Chair)]: Randy? Can you tell me a little bit about how effective your system is? How do you measure results, and what kind of results are you seeing? Well, to answer that question,

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I think that really what we're trying to do is identify the companies that are shipping into the state illegally, and so that we as a state can go after those companies and stop them from having, right? Now, are we able to identify every company that is doing that? No, I think that's quite frankly an impossible task, right? Because like I said, there's no list of these, there's no national database of these websites that are selling these regulated products. It simply involves labor of somebody sitting in front of a computer, trying to do a Google search and seeing if that

[Sen. Randy Brock (Vice Chair)]: company will then ship to Verbond. Then when you do that, and you make some solicitation and one or more companies send to Vermont, what do

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: you do then? That case, we document that case through a report. We log the evidence like we would in any case, and then all that gets packaged up and sent over to the AG's office for their action.

[Sen. Randy Brock (Vice Chair)]: Then what action do you see as a result?

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I would refer to the AG's office on that. Rallis, would you be kind of

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Sure. I'll say that the DLL's investigators on this front are amazing. They spend a lot of time looking at websites, trying to get the package shipped to them. We're looking to see if the website actually enforces even an age gate. They're not supposed to ship any of these products to Vermont but at least are they trying to make sure that the person is 21 and a lot of the websites don't. When they send us that, when they actually get the product and it is either a tobacco or nicotine product, they'll let me know. We then perform a civil investigation where we subpoena the company and ask for their records and how many other shipments have they sent into our state in violation of Vermont law. I'll tell you the frustrating thing is that some of these companies will then close and they probably resurface under a different website. It's hard to figure that out, but if they remain in business, then we enter into negotiations for penalties on the shipments that they've put into Vermont. The penalties, are

[Sen. Randy Brock (Vice Chair)]: you seeking it through civil suit?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yes, if we need to. I mean, far I've taken this over, I think, about a year and a half ago, and so far, there hasn't been a lawsuit, but there's been settlement negotiations.

[Sen. Randy Brock (Vice Chair)]: Any settlement negotiations result in anything of value, even the value approaching the investigative costs?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: So what we try to do is under Vermont law, can seek somewhere around $15,000 in penalties per sale. So we negotiate less than that, but also injunctive release, like you can't do this to Vermont, you have to put on your website clear language that you will not ship into Vermont, so that like if someone actually goes to the website that will pop up and they'll see that. So that's all included in how we try to resolve these

[Sen. Alison Clarkson (Chair)]: And how does somebody verify their age online?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: They should ask for like a driver's license or some other government identification. A lot of these websites we're learning will just say, are you 21? And if the DLL investigator says yes, that seems to work in some of these situations.

[Sen. Randy Brock (Vice Chair)]: We dealt with self abastation in our last session.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yeah. So not agreeing in this context. Right.

[Sen. Randy Brock (Vice Chair)]: And that of the monies that you have recovered from the civil suits that you filed, you said you've been doing this for about a year. What have you recovered?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: So far, I'm still in negotiation with a few companies, but so far only $2,500

[Sen. Randy Brock (Vice Chair)]: $2,500 and what do you figure

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: it's

[Sen. Randy Brock (Vice Chair)]: That's cost do all

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: a good question. I'm not sure.

[Sen. Randy Brock (Vice Chair)]: Or that's $2,500 Is this an effective program to both deter and to recover costs punish it? You think it's an effective program if we have it established right now?

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I think that the importance of this is pretty clear, right? And I think that if we aren't doing it, then nobody else is going to do it. So I think to the, you know, is the return on the investment there? I think the answer to that is probably no, but it is important work, right? So sometimes that's what you need to do in the regulatory environment.

[Sen. Alison Clarkson (Chair)]: Yep. And Rose? Senator, I

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: would just add, I mean, I'm in constant conversations with other AAGs from other states and Vermont does have a reputation of being sort of strict about their online sales ban in the industry. So, like I said, sometimes it's I've never really heard the expression whack a mole until I took this job and it's truly a whack

[Patrick (Joint Fiscal Office analyst)]: a mole

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: situation because these websites can close down or they can be anywhere. But I do think that we do make progress because we do get websites to shut down and at least temporary and if they reemerge somehow, we'll try to figure that out. Money isn't the only thing that's of value here. Think we have a pretty good reputation of going after online sales.

[Sen. Alison Clarkson (Chair)]: And we will know that we've been successful when this alarming increase of nicotine usage among young people starts bending in another direction. Right. That is, I think, probably our signal for how we're doing. So, continue your, because there are quite a few other places where DLL is involved in this bill.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So, we've already talked about the wholesale licensing. We talked about the position, we talked about enforcement. We're not in favor of additional fees for the retailers. Retailers are really struggling right now. They're struggling to stay in business, they're struggling to pay their workers. Some of the suggested language is suggesting a thousand or 2,000, I don't know the exact numbers,

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: but a lot of money I for

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: think that's really unrealistic and not fair to issue a high fee to someone who's making minimum wage. I think that there is I

[Sen. Thomas Chittenden (Member)]: don't know if you were going to still speak to it, but I do have a question on this.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: The fees.

[Sen. Thomas Chittenden (Member)]: I think it's been presented to us that Vermont is more relatively unique in that we combine alcohol and tobacco. Like, our neighbors all buy for alcohol license or to sell it and tobacco license. If the fees were the same, so if we basically made it revenue neutral, would you support us at least allowing to split those two apart so that stores could just choose to sell alcohol and choose to not get the license to sell?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So I think Brandon will be able to speak to how it's structured right now.

[Sen. Alison Clarkson (Chair)]: Yeah. So So we're talking about so a number of years ago, we coupled Yeah. The alcohol and tobacco license. So if you had an alcohol license, you could get a tobacco license for free. I think that's what we're reviewing here, and it's being proposed that we decouple those. And important study. Because, basically, quite honestly, we're enabling tobacco licenses tobacco, which is having such negative impacts on our taxpayers and on Medicaid and on the health of our young people and our adults. We are basically giving that license for free. It's sort of talking about reverse in perverse incentive. That's a perverse incentive. So that is, I think, what we're trying to get at, and that is what is at the moment and decoupling those I

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: think, Brandon, we'll talk about the current structure because I think there's some confusion about that, and then I can speak to whether or

[Mike Kelly (President, Core-Mark New England)]: not we would support We

[Sen. Alison Clarkson (Chair)]: just anchor ourselves where we are in the bill because, actually, without our legislative council, I don't we have, as I said, the summary of the sections, but we don't have the section numbers. Can anyone, or Jill, or Okay. The actual sections

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: we're dealing with. Talking about the fees. Stage four.

[Sen. Alison Clarkson (Chair)]: Is it the decoupling fees there or the fees there? Yeah.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yes. It's here. Page four.

[Sen. Alison Clarkson (Chair)]: Okay, license required. Required. Required. Is that right, Rose? Go The on decoupling area. Okay. Terrific.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: So I guess I'll start with this. So there are two, so retailers in Vermont need both a tobacco license to sell combustible tobacco products, traditional tobacco products, and then a tobacco substitute endorsement to sell vapes and the like. In Vermont, you have to have a tobacco license in order to qualify for a tobacco substitute license. The problem that you are addressing here or asking me to address here is the fact that in the statute currently it talks about if you're applying for a liquor license, applicant shall pay the fee in section seven BSA two zero four. Now there is no tobacco license fee in seven BSA two zero four.

[Sen. Alison Clarkson (Chair)]: There is only an alcohol

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: license. So, is the couple, if you will, provision. We don't internally call it couple, but that's our read on the statute that if they are applying for a tobacco license with an alcohol license, they do not pay the $150

[Sen. David Weeks (Clerk)]: fee. Right.

[Sen. Thomas Chittenden (Member)]: Are they separate forms?

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yes, separate applications within our system.

[Sen. Thomas Chittenden (Member)]: Okay, so they applied for a liquor license, they applied for a tobacco license, then maybe the alcohol. Correct. But they only pay one fee for both.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Would Correct. They would pay the alcohol fee. Yeah. For the alcohol license that they are applying for.

[Sen. Alison Clarkson (Chair)]: But they pay nothing for the tobacco.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Right, so don't think of it as one fee. You have an alcohol license fee and then a zero fee for the tobacco. Right, they pay zero. Correct. Correct.

[Sen. Thomas Chittenden (Member)]: So I don't like that.

[Sen. Alison Clarkson (Chair)]: No. And and that one sort of slightly so sorry. Dave, David, you have a question.

[Sen. David Weeks (Clerk)]: Well, I'm just wondering why not take the opposite perspective. That is just have one form and pay once and follow the business twice. Statute statute dictates that those are separate

[Patrick (Joint Fiscal Office analyst)]: applications. Statute is what we're doing. Statutes just about a couple word changes. Just curious why we can't take that approach as we We put them together a number of years ago. I can't remember when. It's been united for a while, separate forms,

[Sen. Alison Clarkson (Chair)]: but united fee. And I think what's being proposed here is tobacco separating them out and and having the fee increase substantially as a disincentive for continuing to sell these challenging products. Thomas.

[Sen. Thomas Chittenden (Member)]: So I remember Dick Moss. Dick Moss's general store. He's like, I'm I sell cigarettes, but but tomorrow. But I remember, I think he has a liquor store, so he just kept selling cigarettes. But I I really think it could be good policy for us to break these apart so that you apply for I don't I'm the thousand dollar thing, I don't wanna make money at any point. I don't wanna break the facts to the little guy. Here. But the the fair at the very same point, like to be able to sell beer and wine. And then if that store owner consciously just doesn't wanna sell bag, I I think putting a small p in a separate process for them to be able to put cigarettes in front of all their customers makes a lot of good policy sense. It was said that other states do that. Is that is this abnormal as far as you know that we couple these things? I can't really

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: talk to what other states do. We can get

[Sen. Randy Brock (Vice Chair)]: Jen to weigh in on that. I'm

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I don't have the raw numbers on that. I think, you know, obviously you all have seen vape type shops in maybe your jurisdictions, but a vape shop, a true, you know, smoke shop, if you will, that only sells, that is those were the people that would pay both fees for a tobacco license and a tobacco substitute license because they do not have a a liquor license.

[Sen. Alison Clarkson (Chair)]: And you enforced that them as well? Yes. Brandon, if you'd be kind enough to get us the statistics on how many vape shops there are, how many tobacco licenses are sold independent of alcohol licenses, how many Yeah. Can both. We can both. I think that would be helpful just to get people.

[Sen. David Weeks (Clerk)]: Just for clarity, it's been a couple of weeks since we've been into this one. So you're advocating a third license, which is a non tobacco substitute. So it's a third license for a company.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Wasn't, no, I was not recommending anything.

[Patrick (Joint Fiscal Office analyst)]: Was just trying to answer your question.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: It's already present.

[Patrick (Joint Fiscal Office analyst)]: We already have it fixed.

[Sen. David Weeks (Clerk)]: But you're not advocating like a nicotine license. This is Which would be both.

[Sen. Thomas Chittenden (Member)]: So what I'd support is an alcohol license and then nicotine, which includes license with no addict. So that's maybe your point to simplify things. Yeah. Know how that would cost you.

[Patrick (Joint Fiscal Office analyst)]: Complicated. We can go back to Rose's. That's when she's behind

[Sen. Alison Clarkson (Chair)]: us after you guys are done. So

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So we will get you data on how many are the combined alcohol, tobacco licenses for the retail stores, how many just have tobacco only. And back to your point, Senator Chittenden, I hear what you're saying.

[Sen. Thomas Chittenden (Member)]: Just if other states are splitting it apart, then I

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Right. Would like philosophically, understand what you're saying.

[Sen. Thomas Chittenden (Member)]: So here we have 700 stores that sell cigarettes, and I'd love it if we had less stores that sold cigarettes for coupling I these think we're encouraging more cigarette sales throughout the state.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: So we can get back to you on that. I mean mostly it's the fees for the retailer we do not support. I think the penalty is a different conversation, right? I think that there's a lot of, could be a lot of agreement on the higher penalties. Because if you think of philosophically, just because someone wants to have a fee to sell a product, a legal product, should not be paying such an exorbitant fee in my view. Right? But the where you want to incentivize them to do the right thing, you don't want them to be selling to minors. Right? That's that sort of falls in the penalty area, and I think that there's

[Sen. Alison Clarkson (Chair)]: So you would support increasing penalties?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Perhaps. I think that there's I'd like to get some data from you on how many violations do we have now. Are we seeing an uptick in the amount of people who have retail tobacco licenses or that are not abiding by our laws? There's a lot of violations, I think that just ifies a higher penalty.

[Sen. Alison Clarkson (Chair)]: Well, I think we turn to Brandon then and say, are as you enforce vape shops in particular, and but many of the tobacco shops sell these sort of insidious devices that pretend to be something else. Deceptive devices or whatever you wanna call them. What how are you how's enforcement going on those? And I know you send people in to pretend to be minor or who are minors and see how they do. How are we doing with that?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I guess that's what I was suggesting we would send you the data. Like, have a whole list of data of are we seeing an uptick in compliance issues? Is there an uptick in violations? I mean, that data we can share, gather and share with you.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yeah, I think our compliance rates are traditionally right around 90% year over year. That has not changed. I did our, sign our reporting for this last federal fiscal year, and it was right at 91%, I believe.

[Sen. Alison Clarkson (Chair)]: That's true for vape shops too.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Well, that is all the tobacco. That's all yes. That's whole you decide. It would be anything from a convenience store to a vape shop at. Yeah. Or

[Sen. Alison Clarkson (Chair)]: I guess I'd go back to the comments you made, Wendy, and I can't remember exactly what you said. But for me, tax tax affects behavior. Tax tobacco, nicotine addiction, and tobacco are costing the state hundreds of millions of dollars. It's just the impact of selling this, you know, of of this product these products with Vermonters is having a huge impact on our state budget, on our lives, on our public health. So while you don't support increasing fees or taxes, those if we're trying to reduce and affect behavior and reduce the public spend, I don't know how you can't support increasing a barrier to continued addiction.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I am simply saying that asking retailers, Vermont small businesses to pay a thousand dollar fee to have a license is not something we would support. That that's what I'm saying. That that going from a $100 to a thousand dollars just to have that license is not something that we could support. So jump too far.

[Sen. Thomas Chittenden (Member)]: I agree with your sentiment there. I think a thousand dollars might be a bit much for now. I just really like the idea of tracking with our neighbors and also just splitting these things apart. So you have the alcohol license, you got a blood work. Right. Agree. Be structured, be reasonable.

[Sen. Alison Clarkson (Chair)]: But I also say that all of us who enable things that are harming Vermonters and harming our state budget need to be accountable and need to be appreciated. That's a piece of what they're partaking.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Well, I guess that's where I get back to the title piece. If the retailers who have a license are not doing what they're supposed to be doing and are selling to minors, because it's not just selling tobacco and vaping products. They're allowed to do that if you're 18 and older. But if you're selling to minors, that's the problem. That is and that's where we can, you know, like I think we can all get behind that, especially in the deceptive products as well. Like, we don't want that. We don't want minors to be having access to this. That's what we do on our end, is we try to prevent that. Yeah. Rose.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Just for your information, I mean, think the thousand dollars is something we can discuss, but I did do some research. The fee hasn't been increased since 2016 and it went from a 100 to a 110 and then the endorsement license cuts got added on to that. So it has been quite a time since the fee was increased.

[Sen. Alison Clarkson (Chair)]: Thanks, because I remember somebody asked that earlier.

[Sen. David Weeks (Clerk)]: Great well thank you we would look David just one question so I'm curious what position is on your agency on removing the cons once of your decisions to purchase or removing completely removing a section about

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I'd have to get back to you on that. That wasn't in my,

[Sen. Alison Clarkson (Chair)]: I don't know what section The

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: penalties for use in purchase or are in the next

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: scene. Page seven, Wendy?

[Sen. Alison Clarkson (Chair)]: Page seven. Yeah.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Let me

[Sen. Alison Clarkson (Chair)]: get back to you on that. Sorry, David. What what was your question? That this is I was saying. But

[Sen. Thomas Chittenden (Member)]: because conflicts do not penalize kids at

[Maggie Lenz (Vermont Retail Grocers Association)]: all. Right.

[Sen. Alison Clarkson (Chair)]: This is something we've been trying to get at for a

[Patrick (Joint Fiscal Office analyst)]: long time. It's not penalize the the. It's also the perspective that decisions in life

[Sen. David Weeks (Clerk)]: have consequences and you learn that as a youth. 11 years old is certainly a point of maturity where calling kids, call whatever you want. They have to understand the consequences of decision. To remove that consequences, send me another message. Is equally disturbing. I

[Sen. Alison Clarkson (Chair)]: take it.

[Sen. Thomas Chittenden (Member)]: Anecdotally, I hear that kids are walking to stores buying vapes and they're not getting carded or they're using fake IDs that they're buying online. So, don't know how valid that is or isn't but I gotta say, I'm interested in having my 13 year old go out and try to buy some vapes this weekend and I'm gonna report back if that works. But if he does that, what what are

[Sen. Alison Clarkson (Chair)]: the Get Brandon some. Get Brandon some. Right.

[Sen. Thomas Chittenden (Member)]: It's not breaking the rule. I mean, what would what would be the slap on? What would he get? He'd rather do that. Yeah.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: So, currently, it is a $25 $25,

[Sen. Alison Clarkson (Chair)]: I think it is. Pound.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Through a through a still amount of additional

[Patrick (Joint Fiscal Office analyst)]: Good point. A traffic ticket. It's it's as I recall, pretty modest. It's $25 $25.

[Sen. Alison Clarkson (Chair)]: But for a kid, that's a lot. I mean, or maybe not now, but it it certainly was when we got lessons. And

[Sen. Thomas Chittenden (Member)]: So the store clerk Yeah.

[Sen. Alison Clarkson (Chair)]: I had thought we had I had thought we had gotten rid of that. There was an attempt to get rid of that to not punish.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: I see don't.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Maybe it may currently go to diversion with the other possession.

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

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I Consumption tickets that were issued in the past as a fine that now go to diversion.

[Sen. Alison Clarkson (Chair)]: When Jen gets to join us, we'll have an answer on that.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: The one thing I would like to add is that for the deceptive tobacco products, there's a whole section here where supportive of that. Just give a He's actually 12. Sorry.

[Sen. Alison Clarkson (Chair)]: No. We don't have a good

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: In the know. In sections,

[Sen. Alison Clarkson (Chair)]: I see ten thirteen. It's ten thirteen. 12. Yeah. And you support this, I assume. Yes. We do. Yes. We do. Great. Thank you, TLL, for supporting this. Great. Now, are We got to see some of these the other day.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yes, and I've seen

[Sen. Alison Clarkson (Chair)]: them too. They're really a little enraging. I guess enraged financially qualified. Not okay. Yeah. Not okay. Great. We look forward to the statistics and the thing because it's always interesting. Guys generally come in and give us an update on enforcement, so this is interesting. And if Thomas was to send his 13 year old, then how would we protect him?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Could be a could

[Sen. Alison Clarkson (Chair)]: he be a temporary employee of yours?

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yes. Theory. In theory. Yes.

[Sen. Thomas Chittenden (Member)]: The retailer would call the local police. The police would come, and they could issue a $25 behind.

[Sen. Alison Clarkson (Chair)]: That's a civil ticket.

[Sen. Thomas Chittenden (Member)]: They don't have to they don't have to call you. They can Correct. Oh, they can do it.

[Sen. Alison Clarkson (Chair)]: But you you could be deputized. Thomas would be deputized by to go and do this. No. That's not how

[Mike Kelly (President, Core-Mark New England)]: I would. What is

[Sen. Randy Brock (Vice Chair)]: the the experience in terms of issuing tickets or holding responsibility because of these kinds of violations.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: And that's the data that we could follow-up with. Yes, it does.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: Yep. Do compliance checks regularly on these businesses, right? And so if, say, a clerk sells to an employed buyer, the clerk gets a ticket through a Vermont civil violation complaint That's currently $100 and light, more importantly, the licensee also gets a fine through an administrative violation from the department. And that's the penalty you're okay with our taking of?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Perhaps. I would like to get you some information on that. Okay. There's some opportunity for agreement on penalties. Yeah.

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: I will I will be clear that the penalties assessed by the department through the administrative process, those are sent by the board, and we do have the ability to increase those when

[Sen. Alison Clarkson (Chair)]: Under. On our own. Correct. So Jen Kirby, our legislative council, has arrived and has joined us, which is wonderful. We welcome Jen. And I believe Jen probably knows quite a part the the penalty that we still have for kids who are trying to purchase. We think it's still $25 and or diversion. So and we'll we'll come back. If you'd be kind enough to get us that day, it's gonna be Absolutely. Yeah.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: And we will see you probably next week. I'm on vacation next week. Do you mean I don't like to. You mean

[Sen. Alison Clarkson (Chair)]: the weekend? Meetings next week.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I'm glad you're in vacation. I need signing up for an interview. Oh, ma'am.

[Sen. Alison Clarkson (Chair)]: Well, can we have some of that? Yeah. I will. I'll bring back the So on the following week. Yes. The next week, we're in session. How about that? That sounds great. Great. Brandon, good to have you. Thank you, Wendy, as always. Thank you. Thank you. Thank you. And next up, we have a bunch of changes. Jesus.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: It's almost stripping. Goodbyes.

[Sen. Alison Clarkson (Chair)]: Yeah. We may have to. Maybe you could come and just quickly present it at the end when we're voting 02:30. Okay. We're way behind schedule, but we've had a thorough conversation about labor, and we're having a pretty good conversation here about reducing the nicotine addiction of our young people and how we're accomplishing that. And I'd like to keep that front and center for why we're even doing this as the consumer protection bill. Jeff Willett, you have been extremely patient, and we are very grateful to you for being so patient. The legislative process, you cannot say we're not thorough. Are we're thorough and thoughtful, and you are seeking to be at love it today. So welcome to Senate Economic Development. It's good to have you. We also have the jurisdiction of consumer protection as you are now appreciating and labor and labor and labor labor and and all the other things. So, we welcome you. If you'd be kind enough to introduce yourself and give us your testimony.

[Jeff Willett (Progressive Policy Institute, Project to End Smoking)]: Bet. Well, you know, thank you so much for the opportunity to testify today. No problem waiting for this opportunity. My name is Jeff Willett and I'm testifying on behalf of the Progressive Policy Institute where I serve as director of PPI's Project to End Smoking. I've spent more than twenty years in senior leadership roles in tobacco control from 2018 to early twenty twenty five. I served as a national vice president with the American Heart Association, where I helped lead efforts to reduce youth vaping and advance tobacco endgame strategies. Prior to that, was a vice president at Truth Initiative, really at the time where Juul cigarettes were emerging on the market. Most of my effort was focused on the emergence of Juul. And I've directed state tobacco control programs in New York and, Ohio. So throughout my career, I've remained focused on the three long standing goals of tobacco control, which are preventing youth initiation, promoting smoking cessation, and eliminating exposure to secondhand smoke. Those are related to the key public health outcomes. And the Progressive Policy Institute focuses on advancing pragmatic science based policies that both protect youth and accelerate smoking cessation. So the Food and Drug Administration Center for Tobacco Products has determined several nicotine pouches meet a regulatory public health standard and offer lower risk alternatives for adults who smoke. And we believe there should be risk proportionate taxation on tobacco products, and FDA authorized lower risk nicotine products should be accessible and affordable for adults who, smoke cigarettes and want to quit. So, Senate Bill one ninety eight effectively doubles the excise tax on all nicotine pouches. You know, these are products that are much safer alternatives for adults who've been unable to quit smoking. And with that in mind, we opposed opposed the proposed excise tax on nicotine pouches. And really our concern reflects, our position is reflecting the concern for the roughly 30,000,000 Americans who continue to smoke cigarettes. These are largely working class Americans. These are veterans. These are people with mental health challenges. Many of them work paycheck to paycheck. Most of them want to quit smoking, and most of them at this point have tried to quit smoking, probably multiple times. And it's cigarette smoking specifically, not nicotine use generally, that remains the leading preventable cause of death in The United States. Each year, cigarette smoking is responsible for one thousand premature deaths in Vermont. It's responsible for nearly a third of all cancer deaths in the state and more than $400,000,000 annually in direct health care costs. And, approximately a 100,000,000 of that is covered by Vermont's Medicaid program. So given the harm caused specifically by smoking, reducing combustible use as quickly as possible is the most impactful public health objective for, for tobacco control. So, you know, we believe that tobacco tax policy should be risk proportionate, and maintaining price differentials between products will help more adults who smoke move away from cigarettes, which remain uniquely lethal. And, you know, to be perfectly clear, young people should never use nicotine products. And I think everyone testifying on this bill wants to protect youth and would agree with that. PPIs, tobacco policy positions are based on the best science available and with a factual and pragmatic understanding of both youth use and adult smoking cessation. And really, I've just you know, for those suggesting there's an epidemic of youth pouch use, the primary national data tells a different story. The National Youth Tobacco Survey, which is conducted by CDC and FDA, shows that overall youth nicotine use in The United States is currently at the lowest level in twenty five years. And nationally, only one point eight percent of teens use nicotine pouches at any point over the last month. But if you look at just those teens who use pouches on six or more days in the past month, it's less than one percent of teens. And FDA, you know, they carefully evaluate youth use when making, their authorization decisions. And, you know, FDA has authorized several nicotine pouches, concluding they quote, have the potential to provide a benefit to adults who smoke cigarettes sufficient to outweigh the risks of the products, including youth. So I'll just wrap up here. You know? So why would FDA reach a conclusion that seemingly contradicts what many tobacco control advocates are saying? It's because they're balancing the needs of both youth and adults. The FDA knows that while youth pouch use remains low, fifty six thousand Vermont adults still smoke cigarettes. FDA recognized tobacco products exist along a continuum of risk and that it's cigarette smoking, not nicotine that kills half a million Americans every year. FDA also knows that seventy percent of people who smoke cigarettes want to quit, and although half try to quit every year, fewer than one in ten who try to quit succeed. The reality is that many adults who smoke are turning to lower risk alternatives to improve their health and to quit smoking, and they're choosing products that significantly reduce exposure to the toxic chemicals found in cigarette smoke, and they should do so. And then finally, we believe that s one ninety eight includes several measures that will strengthen youth protections, including prohibiting deceptive youth oriented product designs, strengthening penalties for underage sales. You know, we support the proposed repeal of civil penalties for youth possession of nicotine products. And importantly, none of those measures would discourage adults who smoke from trying and hopefully switching entirely to nicotine pouches. So at a time when public health policy can better support adults who wanna quit smoking, significantly increasing excise taxes on nicotine pouches will undermine that transition. And for these reasons, we strongly encourage you to proposals that would substantially increase taxes on nicotine pouches. So thank you so much for your time.

[Sen. Alison Clarkson (Chair)]: Thank you, Joe. I I'm just curious, given you're such a fan of these pouches, what's the what's the success rate of people actually weaning themselves off the pouches? Because nicotine is a bad addict. It's bad to be addicted to nicotine too. So I guess my question is, yes, I appreciate that they're being used to wean themselves off cigarettes, which are far more harmful, but these are not great for you, and they certainly aren't pleasant socially. What's your rate? What are the statistics on how long it takes them to wean themselves from bees?

[Jeff Willett (Progressive Policy Institute, Project to End Smoking)]: Sure. Well, there are emerging studies that I'm happy to send you from Rutgers and Yale universities that look at, nicotine pouch use, across the whole population. Nicotine pouch use among adults is mean, use is most common among adults who have recently quit cigarette smoking or using other tobacco products. So that's at the population level when you look at current prevalence rates. In terms of studying them as a smoking cessation aid, there are studies like that underway. I'm not aware of published studies to that effect. We do know that folks are choosing these products as an alternative to cigarette smoking and as an alternative to other more harmful smokeless tobacco.

[Sen. Alison Clarkson (Chair)]: And we appreciate that. I'm just wondering if they're successful. I mean, because being addicted to nicotine isn't much better. So I guess what you're concerned with, we have just, I believe, turned into a study that the tax department and the Department of Liquor and Lottery are going to be doing on all the proposed taxes and they're going to weigh and look at them in terms of how we do this as an excise, how we're actually gonna manage it because it's fairly complex. We have never taxed by a concentration. And so they are gonna come back to the legislature with a recommendation on actually how we go forward to this. So at the moment, we are not proceed we're we're turning that into a piece of work that the tax and JLL are gonna do

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: along with Yeah. Bet.

[Jeff Willett (Progressive Policy Institute, Project to End Smoking)]: I can appreciate that. I think that nicotine pouches, the milligrams that by the companies are generally listed by milligrams per pouch as opposed to a like a a milligram per per gram sort of thing as kind of a suggested by S one ninety eight. So, yeah, good that you're looking in into that and, you know, how best to approach that.

[Sen. Alison Clarkson (Chair)]: So Complex. And what's not gonna

[Sen. David Weeks (Clerk)]: be Complex.

[Sen. Alison Clarkson (Chair)]: We're able to actually resolve by the time that we have to get this bill out of our committee. Does any of, does any committee member have a question for Jeff? Oh, David? No, that was a no. Jeff, thank you very much. Have you submitted your testimony to our committee assistant, Pierre Mead?

[Jeff Willett (Progressive Policy Institute, Project to End Smoking)]: I will submit written testimony as soon as we're done. Bet. Okay. Thanks so much for the opportunity.

[Sen. Alison Clarkson (Chair)]: The concentration piece would be helpful for tax and DLL as they review this.

[Jeff Willett (Progressive Policy Institute, Project to End Smoking)]: Thank you. Sounds good. You bet. Alright. Bye bye.

[Sen. Alison Clarkson (Chair)]: Mike Kelly, please join Yeah. Absolutely. The hot seat.

[Mike Kelly (President, Core-Mark New England)]: The hot seat. Alright. I You're welcome. Thank you. I appreciate you having me.

[Sen. Alison Clarkson (Chair)]: You're Happy to have

[Mike Kelly (President, Core-Mark New England)]: you. Hopefully, you know, I'll keep this brief probably under ten minutes, but I do think I have some information for the group.

[Sen. Alison Clarkson (Chair)]: And I believe I'm sorry, but I believe you kindly have provided us with. Yeah. Yes. Thank you. It was there somewhere. Yeah. And So if you'd be kind of to introduce yourselves. Certainly. Certainly. Go for the gossip.

[Mike Kelly (President, Core-Mark New England)]: My name is Mike Kelly. I'm the president of Core Mark. We're a wholesaler in Maine. Core Mark is an nationwide company that supplies convenience stores and retail outlets. As supplier, like I said, we supply convenience stores and retail products, retail locations in the state of Vermont with a variety of goods, including tobacco products. And while my company supports increased enforcement of the illicit nicotine products and appreciates the state's interest in protecting the tax revenue on tobacco products. I'm here today to voice my optician at 98, specifically as it relates to the stamping of individual packages of paper products and oral nicotine products. As a wholesaler, our business is based on efficiencies. The margins we work on are very low, literally a penny or 2 per dollar after operational costs. And our warehouses set up to stamp any mixed cigarettes. Currently there's no technology available to stamp the sealed roll of nicotine pouches. Vermont would stand alone in the nation as the only state to require stamping on Victor and Victorian pouches, placing an extreme technological and financial burden on wholesalers to comply with unclear regulations. Until such technological advances become available, we would need to physically open each sleeve or box and hand stamp each unit, then figure out how to reseal the product so it maintains the original integrity of the packaging. Not only would that be extremely time consuming and require additional staffing and warehouse space, But if opening a role means that one is relabeling the product and the federal interpretation of manufacturing says that the federal designation changes from a supplier to manufacturer in that case, There is concern that this subjects Core Mark to additional regulations and compliance issues that have only been applicable to actual manufacturers previously. But Core Mark takes compliance seriously. We're a publicly traded company and knowingly put ourselves at a disadvantage in the marketplace by adhering to federal guidelines around tobacco products, especially in the vape category. A couple years ago when several US senators, including Bernie Sanders, sent warning letters regarding the sale of illicit vape items to some of the larger wholesalers and convenience retailers in the country, we were already in compliance as were most of the recipients of that letter. We played by the rules, the legitimate wholesalers would ultimately bear the appliance costs associated with F-one hundred ninety eight, while bad actors evade responsibility. For decades, Core Mark and others in the wholesale community have taken pride in collecting and remitting state taxes for Vermont and other states around the country. And I'm encouraging you to work with us versus against us when it comes to efficiently and compliantly misreading age restricted profits. And we have had a few calls at the time, or we had one call at the time it was at the Brandon before it was under their auspices around regulation and enforcement. And we are in favor of the removal of illicit products on the market. Would help us as well as obviously help the use of everything else. What I think, it's complex business and it's a complex topic. So I just took together a few slides here just to kind of be Yeah, no,

[Sen. Alison Clarkson (Chair)]: were you here when we, it's like you heard that tax is taken on

[Sen. Randy Brock (Vice Chair)]: Yeah. It's an honor to

[Sen. Alison Clarkson (Chair)]: be in. So that we're not jumping into this right away. No. It is complex. We recognize that.

[Mike Kelly (President, Core-Mark New England)]: And we are we are very willing to work towards a means of And actually your testimony, if you'd be kind

[Sen. Alison Clarkson (Chair)]: of a send that electronically, I think tax, I think they would be interested in seeing

[Mike Kelly (President, Core-Mark New England)]: it. Right. Because

[Sen. Alison Clarkson (Chair)]: I think what we want to do is make a system that's efficient.

[Sen. Thomas Chittenden (Member)]: Yeah, don't know if you're here for Rebecca Smear not from the tax department, but she echoed lot of what you're advocating for, and I definitely supported the fake directory as she started this.

[Sen. Randy Brock (Vice Chair)]: Okay, great. Great.

[Mike Kelly (President, Core-Mark New England)]: Superb. Would you mind, Kara, just going to the videos? I think most of these are obviously This is

[Sen. Alison Clarkson (Chair)]: what tax does here in harvesting. They do this stamping. Do want the videos? Yes. Stop. Sorry.

[Mike Kelly (President, Core-Mark New England)]: Just to kind of show you the difference right now between.

[Sen. Alison Clarkson (Chair)]: You have preference, which one first?

[Mike Kelly (President, Core-Mark New England)]: The cigarette stamping machine first. So we have two cigarette stamping machines. They're expensive to run, but they do help us stay within compliance They run the tax rate system.

[Sen. Alison Clarkson (Chair)]: So do you run those for other states? Because tax does our stamp, I guess, my understanding. Is that right?

[Mike Kelly (President, Core-Mark New England)]: No. We we stamp the cigarettes that go into the state of Vermont.

[Sen. Thomas Chittenden (Member)]: We sell you the stamps in your.

[Sen. Alison Clarkson (Chair)]: He has the machine. We, okay, so we sell you the stamps. Correct. And you apply them. Correct. So there

[Mike Kelly (President, Core-Mark New England)]: is a machine, a red stamp machine. It's two of my and a Stop. There you go. So this is an order that's been picked. She scanned it. It's going into the system to see if one of the product is regulated or is authorized, deauthorized for that particular state, making sure that the correct amount of stents are fixed. The machine opens up the carton, applies the stamps, reseals the carton, and then it's pushed down into this red box here that's aggregated and stacked so they can be put into bundles of 30 which we then go out and deliver to our customers. We run this probably ten hours a day. We can supply in Maine, Hampshire and Vermont and a little bit of New York with cigarettes. So the machine is able to determine which stamps to apply to which products and then we're alerted and the machine stops if there's a card missing or something happens. And then the next.

[Sen. Alison Clarkson (Chair)]: So it's quite a sophisticated system when you look at it. What percent of your sales are cigarettes and vapes?

[Mike Kelly (President, Core-Mark New England)]: Between the two, I'd say around 78%. So a huge percent of what you distribute, or? Yeah, off the top of my head. I'd say between seventy and seventy eight. Obviously cigarettes are shrinking, carton decline is around six or 7% per year. So you know there are other categories such as food service and other categories within the store walls that are kind of making out that difference.

[Sen. Alison Clarkson (Chair)]: And how many stores do you have in your cart?

[Mike Kelly (President, Core-Mark New England)]: Between 120 to 150 depending on when the cans open or Oh, it says here right here at the top.

[Sen. Alison Clarkson (Chair)]: Seasonality. And what percent of that, I think that just, you just emptied it. We had stuck in video.

[Mike Kelly (President, Core-Mark New England)]: We have about 15 Vermonters that work for us as well between drivers and salespeople.

[Sen. Alison Clarkson (Chair)]: Hank, where are you in Maine?

[Mike Kelly (President, Core-Mark New England)]: We are in Gardner, Maine, which is about forty minutes north of Portland. This is a gentleman. He's applying stamps to a pack like, a carton of filtered cigars, and this is him trying to get the same stamp to stick on one pack three times before he finally gets it to go. So you can imagine, over 600,000 of oral nicotine, To do that by hand would be, know, seemingly more just. But it sounds like you have discussed some alternatives, which is great. Well, we're going

[Sen. Alison Clarkson (Chair)]: to have some recommendations. I'm to look at this because it is very complex, as you say, and we don't the inefficiency of hand stamping. Understand that everything basically other than cigarettes in boxes are hand stamped.

[Mike Kelly (President, Core-Mark New England)]: Right. And I mean, I I have some props if you'd like to handle

[Sen. Alison Clarkson (Chair)]: a little bit of props. We love props. Props.

[Mike Kelly (President, Core-Mark New England)]: Do you love props? We do.

[Sen. Alison Clarkson (Chair)]: I'm a former theater producer. Oh, okay.

[Mike Kelly (President, Core-Mark New England)]: That's great. To kind of give you an idea of the difference between the packages. Creating theater. Get into the disposable Chinese vape or anything like that. These are all been going through the PTMP. But this is on. This is a normal nicotine pouch. That's a pouch? Is a there are Put that

[Sen. Alison Clarkson (Chair)]: in your mouth, the whole thing.

[Sen. Thomas Chittenden (Member)]: You don't

[Mike Kelly (President, Core-Mark New England)]: see No. There's there's this is four milligrams. There's probably plenty pouches in here. Oh, okay. Not super clear than that, but it comes with a drink wrap on it. This is probably one that you see a lot more out there or a lot of companies like that.

[Sen. Alison Clarkson (Chair)]: I've actually heard of that.

[Mike Kelly (President, Core-Mark New England)]: Yeah, there's a lot of them like that. This is it. It also comes in- And what's that? This is an oral nicotine pouch. That's a pouch also. Yeah. This is Vuse. This is a vaping unit. And this is Juul, which I'm sure you've heard. And this is also- And you

[Sen. Alison Clarkson (Chair)]: just stamp each one of those?

[Sen. Thomas Chittenden (Member)]: No stamp.

[Mike Kelly (President, Core-Mark New England)]: No. No. No. It's all those. We what we do is we, you know, we pay the tax, charge the tax to the customer, then the customer passes on a retail price. Right.

[Sen. Alison Clarkson (Chair)]: All the pictures worth a thousand words.

[Sen. Thomas Chittenden (Member)]: You know this market well. We're hearing that there are people that are importing not within the confines of the law. Are you seeing that as well? Like people are buying these things from all over the place and selling it to retailers and they're reselling them without paying the taxes that you're paying?

[Mike Kelly (President, Core-Mark New England)]: You do see that? I've, you know, like, discussion earlier was about online sales and they don't see that as much, but we've certainly seen in the past people buying products in lower tax rate states and we call them the white vans, you know, and that's driving them up and selling them direct to retailers. I do sympathize, it's very hard to determine, you know, if we were talking to Brandon about it, they could buy product from us from one week, have a record of that, but then buy three weeks worth from that counterfeit slow down chain. So

[Sen. Thomas Chittenden (Member)]: You 92% markup, right? So what is the low tax state out there that they're buying from?

[Mike Kelly (President, Core-Mark New England)]: Well, in New Hampshire, for example, probably a four pack of this costs $38 in Vermont, it costs about $18 or $19 in New Hampshire. Their wages went up, they raised their taxes 75%, so

[Sen. David Weeks (Clerk)]: they were regular, like, dollars 4 range neurologists. David, did you have a question?

[Sen. Thomas Chittenden (Member)]: 92% of market. Isn't that

[Sen. Alison Clarkson (Chair)]: what we're marketing That's what you have. Is it No.

[Patrick (Joint Fiscal Office analyst)]: No. We don't promote it.

[Mike Kelly (President, Core-Mark New England)]: Yeah. That's that's what you guys put

[Sen. Alison Clarkson (Chair)]: on the top of our minds. Yeah. We do. Yeah. We don't want people smoking or vaping. Taxing education, learned, and ways and means.

[Mike Kelly (President, Core-Mark New England)]: Yeah.

[Sen. Alison Clarkson (Chair)]: Tax the bads. Right.

[Mike Kelly (President, Core-Mark New England)]: So No.

[Sen. Alison Clarkson (Chair)]: No. Not 60,000. It it clearly and and I think you've been yeah. Thank you. Thank you very much. Thank you for And thank you for supplying our convenience stores. Oh, you're welcome. Wait a minute. Yeah.

[Sen. Thomas Chittenden (Member)]: I don't know. People afford to smoke these days. Like, a cigarette's almost a dollar a piece.

[Sen. Alison Clarkson (Chair)]: Yeah. I don't know how

[Sen. David Weeks (Clerk)]: they're how it's worth? 14. 14

[Sen. Thomas Chittenden (Member)]: plus the sales tax. So it's 20

[Sen. Alison Clarkson (Chair)]: to 21% at least. Thank you very much. So I appreciate it. We are very grateful. Thank you for coming all the way with me.

[Sen. Thomas Chittenden (Member)]: For these gifts? You're

[Sen. Randy Brock (Vice Chair)]: keeping these?

[Patrick (Joint Fiscal Office analyst)]: No. It's for

[Sen. David Weeks (Clerk)]: your kids. So

[Sen. Alison Clarkson (Chair)]: I know he won't have. Don't know this anymore. Just to show us the pouches because Yeah. Of course.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: You can't find out

[Sen. Alison Clarkson (Chair)]: the pouches. The pouches are quite small, it sounds like. Yeah. They're pointing in that little tiny package.

[Mike Kelly (President, Core-Mark New England)]: There might be 15 and on, but there's 20 and and it's

[Sen. Alison Clarkson (Chair)]: in thing. They're, you know, they're just about the size of a tablet. Yes. They still require spitting. It's totally disgusting. Thank you. I am welcome. We are now up for Maggie. Maggie, I saw you arrive. I am here. Welcome. Thank you.

[Maggie Lenz (Vermont Retail Grocers Association)]: I don't I'm pretty sure it's in person name, but I'm just leaving very single.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: So I'm gonna do my

[Sen. Kesha Ram Hinsdale (Member)]: best to you. Thank you for making the

[Maggie Lenz (Vermont Retail Grocers Association)]: effort to join. Yeah. Thank you for inviting I wanted to be here for the fun.

[Sen. Alison Clarkson (Chair)]: Well And the drama. And the juul pump. Welcome.

[Maggie Lenz (Vermont Retail Grocers Association)]: Thank you for the record, Maggie Lenz. I'm here on behalf of the Retail Grocers Association today. Chair Clarkson, members of the committee, the retail grocers represent over 300 members right now. Representing all 14 counties are job creators for over 108,000 jobs and contribute about $9,200,000,000 in total impact to Vermont's GDP. BRGA opposes the proposed increase in tobacco retail licensing fees and the restructuring of nicotine substitution taxation. I just want to thank Commissioner Knight for coming in and saying what she said. I think we obviously, no surprise, agree with her on the licensing piece. I will just go off written testimony folk, but to say, you know, the numbers are compelling. Our members are compliant. They are following the laws. They are law abiding, store owners. They are not the problem. The committee took out last year, I believe it was the flavored tobacco bill at eighteen. And I think you saw numbers there. Most of these issues that you're seeing, these illicit purchases and failed are coming from online. These are not our members. And so we're strongly opposed to this steep, steep increase in licensing fees that would be something like, I think, Bless you, madam chair. So, yeah, the data is showing that these are this purchasing is coming online from illicit markets, and so I think it's important that you're focusing on where the problem actually exists and not on hardworking Vermont businesses that are really struggling. You're hearing this in, you know, across committees, jurisdiction, that business owners are really struggling to make ends meet, and this is not a small fee for them. I think one of the members informed us that this increase would look something like $50,000 across stores, because don't forget, this has nothing to do with how much they're bringing in, it's not proportional, it is per location. So this is really, really cost prohibitive for many people. So we do support enforcement that's meaningfully addressing the illicit market, but a 12.5% increase in licensing fees, combined with a structural tax change that really, from our perspective, could drive people even further to the illicit market. If we make those kind of changes, that's what tends to happen. So, I'm to submit this written testimony so you'll have this, but I don't need to read it.

[Sen. Alison Clarkson (Chair)]: What I feel free you have done. Okay, great. Sorry. Were you in the role where you where section eight is being totally drafted as a study that tax and Yeah. On the on the taxation. Yeah. Excise taxes. Yeah. I just want

[Maggie Lenz (Vermont Retail Grocers Association)]: to say, think we definitely We can support enforcement. I think we support a more level playing field where you are enforcing the laws and hopefully diminishing bad actors. To create just one position in DLL, they are an incredibly effective partner. They are an incredibly effective regulator. But just question how one position is going to the risk ward, I think, analysis needs to be done. That's a lot of money for retailers. Is that one position really going to make that much of a difference in terms of compliance? We're already reaching 90% compliance.

[Sen. Alison Clarkson (Chair)]: Yes. Right. Randy. Thank you. Brandon. Brandon said, we're going to do an amazing job.

[Maggie Lenz (Vermont Retail Grocers Association)]: It bears repeating 90%, over 90%. Yeah.

[Sen. Alison Clarkson (Chair)]: So if you support enforcement, would you also support increased penalties on?

[Maggie Lenz (Vermont Retail Grocers Association)]: I'm not gonna say failure to comply. Yeah, I think being more open to that discussion. Don't feel like I'm at liberty to sit here right now because that wasn't the question that I was responding to earlier to say yes, that's what we support. But certainly much more open to that discussion, I think that may get at the problem more directly than what we're talking about here with our clients and owners. And I think we could absolutely support, seems like there's a broad agreement here that we could support a ban on deceptive devices. But I think the taxation piece is very concerning, and then obviously our strongest opposition is against the licensing increase.

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

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: think that just about covers it.

[Maggie Lenz (Vermont Retail Grocers Association)]: I will submit my great comments

[Sen. Alison Clarkson (Chair)]: You about deal with online competition all the time. How are we actually gonna get at producing online purchases? Oh, I think

[Maggie Lenz (Vermont Retail Grocers Association)]: that is a question for the regulator that I cannot hear never.

[Sen. Alison Clarkson (Chair)]: But you're a creative thinker. What and you have felt with this market now. VRGA has had to deal with online competition now for quite a while and illegal competition. Some of it's legal, some of it not, obviously, cigarette's not. You know, we'd appreciate your thoughts on this because this is our biggest challenge. If if this is where our young people, in particular, are getting their vapes and their nicotine and their cigarettes and, like, you know, I I say that broadly to everyone online, around the world. This committee would really appreciate some creative solutions on how we enforce that, and we may have to do that through

[Patrick (Joint Fiscal Office analyst)]: you know, it's unclear to

[Sen. Alison Clarkson (Chair)]: me how we how we do that other than having enforcement people drive around with FedEx and UPS. You know, every time I get sent a bottle of wine or something for Christmas, I have to show my ID. How is that not possible for everybody who's getting

[Maggie Lenz (Vermont Retail Grocers Association)]: Why would I see you at

[Sen. Alison Clarkson (Chair)]: the bar when I bartenden? I

[Maggie Lenz (Vermont Retail Grocers Association)]: don't have I'm not gonna on the

[Sen. Alison Clarkson (Chair)]: spot, I cannot answer that

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I will. Mean, it's a conversation.

[Sen. Alison Clarkson (Chair)]: To all of because we have to figure out how to practice that.

[Maggie Lenz (Vermont Retail Grocers Association)]: Yeah, absolutely. I will say that we would be happy to come to the table and have that conversation

[Sen. Alison Clarkson (Chair)]: and try to absolutely take away how to figure that out.

[Maggie Lenz (Vermont Retail Grocers Association)]: I just, I don't think it's not, it isn't for

[Sen. Alison Clarkson (Chair)]: the most part, not all our members that are called increased increased to the. They take a very seriously. Right. Thank you. Any questions for Maggie? Thank you. So we have twenty minutes. Patrick Chittenden is gonna join us. And so, Rose, we are you are up if you would like to do sort of cleanup for today. I appreciate the opportunity. Thank you. Good to have you.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: So, for the record, Rose Kennedy Assistant Attorney General tasked with tobacco enforcement at the Attorney General's office. So, I think first of all, what you heard is that there's widespread support on banning the deceptive products that are meant to look like kids or highlighters or inhalers, those stealthy products that are actually vapes that may be attractive to kids and adults wouldn't recognize. Hopefully you act on that. I think what's important in this bill is that we're actually asking you to enforce the laws that we have and to make sure that they're being enforced. We're not really asking for a whole lot of new stuff, but making sure that our regulation is meaningful. So for instance, right now, the tax on vapes is collected at the wholesale level, and I think we met recently.

[Mike Kelly (President, Core-Mark New England)]: Yeah. Yes, we did.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: And there is a value in making sure that the vapes and nicotine products that are in the retail stores, that we have a very clear way of understanding where that if the tax has been paid. Right now, it's a bit of a black hole because it gets paid at the wholesale level through the Department of Tax, but no one's going into the stores and saying, Oh, that matches what the wholesale paid the tax on. So I think you would support a better system about going into the brick and mortar stores and actually making sure that the Vermont tax has been paid and collected.

[Sen. Alison Clarkson (Chair)]: Particularly on vapes. Or on on tobacco. Tobacco substitutes.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yeah. And I think we recognize the problem that you're not dealing with these uniform packages like cartons and packs of cigarettes, but and I also appreciate that Vermont is out there, but we gotta get there because these products are going away and we need to make sure that we're we're regulating them. And I will tell you that after we met with you, we did meet with a member of the industry who has a product that is an MSA product, Master Settlement Agreement, so has to have a tax stamp, so has to come up with a solution, and they're doing it. They found a machine that will actually do this, and we also know that some states require it on little cigars, which are different than typical cigarette. So you talk about twenty first century solutions. The time to have that conversation is now. I appreciate a study. We didn't wanna, like, force this down people's necks and say, You need to have this stamped by 07/01/2026, but please don't push this out for years. Let's get this done, let's get the stamp done, and come up with a solution. That when DLL goes into a store, they can see that Vermont tax has actually been paid. Make sense? Yes. And so we would ask to be part of that study. I know you talked about tax

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yeah, and I've talked about you guys being

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: part it. Great. I think it's important to sort of go back to my original testimony the majority of these products that are on the store shelves, with all due respect to the retailers, have not been FDA authorized. They are technically illegal. So retailers have been making money off them,

[Sen. Alison Clarkson (Chair)]: and they are So majority of the tobacco substitutes.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Correct. There's only been, I think, 39 vape products that have been authorized and 26 pouches. So the rest that you see on the shelves are illegal. And so we're doing our best to deal with a federal government that hasn't taken action on it, and one of that is to make sure that the Vermont tax laws are being upheld.

[Sen. Alison Clarkson (Chair)]: So, sorry, just to back up for those of us who don't live in this world. Yeah. So if it's not FDA approved, no one should be selling them?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Well, so the Are you

[Sen. Alison Clarkson (Chair)]: saying to us that it's illegal to sell them if

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Technically, they're not they are illegal products. The FDA has taken the position that they will not use their prosecutorial discretion and go after these products right now because of the backlog that I talked about in my first testimony in trying to get these products authorized. And they never say approved, just so you know, they say authorized because they are still dangerous products. But yes, technically these are illicit products, the ones that

[Sen. Alison Clarkson (Chair)]: have not been FDA authorized. David?

[Sen. David Weeks (Clerk)]: Can you expand that into the greater market? Like if you went into Hannaford, how much of the store is FDA?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Don't know that Hannaford sells them,

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: but

[Sen. David Weeks (Clerk)]: like Okay. State The question's different. So you're focusing on vapes, right? I'm asking, if you walked into Hanover, how much of that store is FDA authorized? I really just don't know. Not every little bit

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: different because of it being a tobacco substitute product, which gives FDA the authority to, I don't know offhand what, in general, products land to FDA.

[Sen. David Weeks (Clerk)]: They don't want overworked and they just don't have the bandwidth to do that kind of security.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yeah, no, it's kind of confusing because why are they there then? But I think in my first testimony, I explained that this market sort of grew overnight. Yeah.

[Sen. Thomas Chittenden (Member)]: It's good.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: I know. And so that's why we're here trying to come up with a state law solution to sort of help us regulate this market. That's kind of, in my opinion, out of control. It. Okay. Can I

[Sen. Alison Clarkson (Chair)]: get it?

[Sen. Kesha Ram Hinsdale (Member)]: I I became additionally concerned about the ones with the screens and the game from the paint. Oh, those kinds of screens.

[Sen. Alison Clarkson (Chair)]: I was thinking, like, flies. I was thinking, like, screen doors. But we saw some of those Yeah. Once with screens on them, and those are deceptive, and and that's what this bill prohibits

[Sen. Kesha Ram Hinsdale (Member)]: So can you remind us what the provision and the bill is there and if if this would change that?

[Mike Kelly (President, Core-Mark New England)]: So

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: I think the ones it would hit some of them pretty obviously, like the gaming devices that would have smartphone capability. Okay.

[Sen. Kesha Ram Hinsdale (Member)]: Meaning they connect to the Internet?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Well, yes. And they're they're specifically meant to look like a game that kids would be attracted to.

[Sen. Kesha Ram Hinsdale (Member)]: Wait. I just wanna make sure that our definition

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: For the deceptive products, I think it would cover that. It's page 12 here. You wanna I'm not sure that every single vape that has a smartphone capability would be covered by that language. Okay. But

[Patrick (Joint Fiscal Office analyst)]: Could we? That

[Sen. David Weeks (Clerk)]: is a vape.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yeah. I mean, I think there's, like, ones that look like smart watches. I think that technically that would be covered. I mean, obviously, these would be litigated issues, but Mhmm. That's our

[Sen. Alison Clarkson (Chair)]: understanding. Okay. Got it. So it's an interesting question. And Mike while we have you in the room I mean do have a policy about FDA approved products and not? Yeah that

[Mike Kelly (President, Core-Mark New England)]: was the basis of that letter that got sent out I think it came out from Dick Berman, Senator Bernie Sanders and others you know and we're limited to a very you know limited range of SKUs in the vaping category that we distribute. You abide by that?

[Sen. Alison Clarkson (Chair)]: Yes. By that what has been FDA authorized?

[Mike Kelly (President, Core-Mark New England)]: Correct and you see the offset the numbers where we're selling 600,000 units of oral nicotine and only 45,000 units of vape because you know the with the 92% tax in order to you know make it affordable has to be really cheap coming in the first place. So whenever the 92% is added it's a you know it looks like an economic economical alternative.

[Sen. Alison Clarkson (Chair)]: Thanks. Keep going, Ms. Rosebank.

[Sen. Kesha Ram Hinsdale (Member)]: Does the definition Is it possible to get the ones where you can inject additional megatigans covered?

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: I mean, didn't we tried to come at that with differential tax rate. Okay. Okay.

[Sen. Alison Clarkson (Chair)]: And so worse, but it's not

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: right now. Right. So we we tried to attack you know, sort of attack that kind of product in

[Sen. Kesha Ram Hinsdale (Member)]: a different way. Yeah. Trying to think of all the things. Right. And that's not easy to

[Sen. Alison Clarkson (Chair)]: why don't you finish because then I have another question for Mike after

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Yeah, I mean, I'm glad that DOL came in and said that they are ready to take over some of the regulatory. It makes sense. They're the ones going into the brick and mortar stores and looking at the tax stamps on the cigarettes. We think it makes sense for them to sort of get into a place where they do that equally for vapes and nicotine products. Again, we understand the idea of converting this to a study. We've just asked for a small timeframe. So on the timeframe? They asked for 07/01/2027?

[Sen. Alison Clarkson (Chair)]: I mean, I'll leave that

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: to your discretion. I mean, they gave you a reason why it, I'm not sure.

[Sen. Alison Clarkson (Chair)]: They don't want it to be '28.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: Right, and especially on the conversation about how we actually verify that the Vermont tax is being paid from, you know, what's on the shelves at the stores, I think that

[Sen. Alison Clarkson (Chair)]: should be something that lingers. Perhaps they could do that.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: There's other questions, I think I mean, I'm happy to answer anything more, and I'd be remiss if I didn't say that in prior years, before me coming in, I guess we had collected more, closer to about $1,000,000 on online sales enforcement action. I should also mention that we have gone after big platforms. We had a huge settlement with Amazon who was selling tobacco products for $400,000 and I work with other states on other big platforms. So it's something that we're constantly trying to get at, but I do think that S-one 198 was meant to sort of address not only what's happening online, but what's actually happening in our stories.

[Sen. Alison Clarkson (Chair)]: Okay, great. So, Rosemary, you're happily with us for most of this bill. Mike, I just love to get a sense of what you, by complying with what's authorized by the FDA, what, do you have a notion of what you're giving up as it were? What other supply I mean, are most other suppliers and wholesalers complying with FDA authorization? Or are many are are are are are because my guess is the loss of revenue to you is substantial by not doing all these things.

[Mike Kelly (President, Core-Mark New England)]: Correct. I would say most of your larger wholesalers are and that's where the opportunity Aren't complying. And I think that you see the people that, you know were traditionally based around just distribution of tobacco products you know there are a lot of smaller wholesalers that just did cigarettes and tobacco so they've kind of painted themselves into a corner now where you know you have declining carton consumption and you know it will increase taxation you know and so that the volume is going down so they're looking at these alternatives and it has a way to make up profit. Yeah. They're getting probably from China or Maggie, do

[Sen. Alison Clarkson (Chair)]: you is there a policy with our VRGA that would require anything in this in the tobacco substitutes line have FDA authorization before they agree to sell it.

[Maggie Lenz (Vermont Retail Grocers Association)]: I'm gonna have to check-in on that and get

[Sen. Alison Clarkson (Chair)]: back to you. I think we'd appreciate that. Absolutely. And I think it maybe is a new antenna or a new

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: criteria. Anything else? I guess just one last thing. Forgot to mention the point about separating out the tax.

[Sen. Alison Clarkson (Chair)]: Yes, I that's not

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: think

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: the time is to make

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: this more an intentional act of selling tobacco and nicotine, and I understand sort of the desire to sort of lump them together, but they are different products and having an endorsement remain in place, a endorsement license remain in place for nicotine products, I think makes sense. It, gives some retailers the ability to say no, instead of just like, Oh, I got this license for free, might as well put it on my shelf. Again, these are highly addictive. They are products that are growing a new generation of addicts, and so the time is to make it more intentional on everybody in the chain.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Yeah, and

[Sen. Thomas Chittenden (Member)]: I'd like it if there was an enforcement action and they get a bind and then they basically take away their tobacco license and they're like you know what it's not worth the headache and then they just have less tobacco being sold so on. So

[Sen. Alison Clarkson (Chair)]: that penalty would be certainly more meaningful.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: And happy to answer any other questions or come back if you have more.

[Sen. Alison Clarkson (Chair)]: My dear, they're next door. So we can, we happily have, have you we will be, as you know, addressing this and hoping to come to some conclusions next week. Not next week. Oh, the weekend. Okay. The week after town meeting break. Okay. Good. And we'll see you then. And if you have any twenty first century thoughts between now and I'm

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: sure people could come up with something. Yeah. Yeah.

[Sen. Alison Clarkson (Chair)]: Listen. It's a I mean, I think that's where the gap that's where we're seeing a lot of this

[Sen. Randy Brock (Vice Chair)]: accent. Right. So Hope you get some more of the Amazon cases. I mean,

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: you can look at it as though it's getting harder for some websites to sell, but,

[Sen. Alison Clarkson (Chair)]: no. I hear you. Well and if they just keep morphing and creating different websites, it's then hard to also follow-up with compliance. And, yeah, it's and and then I know there's a lot of pushback in terms of having to verify your ID online. You know, we've heard concerns about that. But with young people, if we can't verify their age, I don't know how we do it because, clearly, it's failing at the point of the bad door where they're accepting parcels. Great.

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: So Thank you for your time.

[Sen. Alison Clarkson (Chair)]: Thank you very much. Patrick is coming back not with an interim measure on the joint fiscal note, on the economic development bill. And at 11:50, we're going to get the new draft of that's to thirty years. Patrick right now Patrick, the seat has been vacated just before. So I'm gonna go see. You and Rosemary just vacated it. It's just for you. Good morning. Thank you very much for I think we have a copy of this for everybody. I appreciate you complying with my old eyes.

[Patrick (Joint Fiscal Office analyst)]: Oh, so open up the screen.

[Sen. Alison Clarkson (Chair)]: Great. That's terrific. Alright. And if I stop right here. So and this is because of getting a fiscal note this past. This is Patrick's interim measure, which we really appreciate because this is what we are needing for us to weigh our decisions as we go through the economic development bill, and we'll be having the same thing with housing and,

[Patrick (Joint Fiscal Office analyst)]: well, those are the other two. So,

[Sen. Alison Clarkson (Chair)]: Patrick, you wanna run us through this?

[Patrick (Joint Fiscal Office analyst)]: Yep. I'm just trying to get into the Zoom, but while we

[Patrick (Joint Fiscal Office analyst)]: Thank you. Of the Joint Fiscal Office for the record.

[Sen. Alison Clarkson (Chair)]: Thank you, president. I

[Sophie (Legislative Counsel)]: just have another one for our case officer.

[Patrick (Joint Fiscal Office analyst)]: I guess I'll do a

[Patrick (Joint Fiscal Office analyst)]: little commentary while I inform this. So

[Mike Kelly (President, Core-Mark New England)]: I went

[Patrick (Joint Fiscal Office analyst)]: to the bill, as you know, the bill's not actually appropriating any dollars, but it seems to be signaling your intent for, like, what you would like

[Sen. Alison Clarkson (Chair)]: to ask appropriation. We're appropriations to Right. Consider the importance of these sectors and our business community.

[Patrick (Joint Fiscal Office analyst)]: And as we go through it, I just want to make sure that it does, in all cases, reflect your investment, because there were a few instances where it appeared that the dollar figure that was in the bill was inclusive. Oh, I see. And there's some other areas where I took it to be in addition to what's in the government. So that's why in that one column, you'll see government plus what's in this bill. Right.

[Sen. Alison Clarkson (Chair)]: I see it particularly, for example, with the micro business. What we're wanting to is the difference between $4.93. So you're you've got it. You've got the 100,000.

[Patrick (Joint Fiscal Office analyst)]: Yeah. And then another one was about a rank, which you had, which says 200,000 in the bill itself. There's another 500,000, which is in the But

[Sen. Alison Clarkson (Chair)]: which is not for this Right.

[Patrick (Joint Fiscal Office analyst)]: So in total, OREC, exclusive of that, without a figure, would be 700,000. Right. Right. Thank you. The the one column which we dropped from the last matrix was what

[Sen. David Weeks (Clerk)]: was in last year's budget.

[Sen. Alison Clarkson (Chair)]: That That we did not have, George. So I'm sorry. That wasn't conveyed or communicated to Patrick. But we can maybe have that in the next I

[Patrick (Joint Fiscal Office analyst)]: send it to you in the

[Patrick (Joint Fiscal Office analyst)]: very lunchtime so you can have that. What?

[Patrick (Joint Fiscal Office analyst)]: With just the table and everything.

[Patrick (Joint Fiscal Office analyst)]: I don't I understand.

[Sen. Alison Clarkson (Chair)]: So you've got it up here.

[Patrick (Joint Fiscal Office analyst)]: Let me see. Let me see. In Excel just in case you did have anything. So maybe didn't quite mention it. Right. You fixed that.

[Sen. Alison Clarkson (Chair)]: So we have we have twenty minutes to we can chat about this and where people are with these amounts. I again, we are it's our job to advocate for what we know is needed or feel is needed with a different and it is appropriations job to say, well, thanks, but no thanks. Oh, yeah. This is we feel this as well. It's an appropriation's job to make the final decision, but it's our decision to recommend what we feel is needed. So I would urge us to focus on what what we wanna advocate for. And and I as we go through that, that that sort of the lens that I think we need to be looking at. Do you have any other frame ups for us to look at?

[Patrick (Joint Fiscal Office analyst)]: Just one thing that you won't see in the table here is do you have the additional meetings for the convention task force? Yes. That's the minimum tab. Yeah. Yeah. So there there there is technically a estimated per diem cost for that. However, I understand that they had the same authority last year and did not end up actually aesthetic. Right? So It's it's and it's fairly de minimis. I think it was about 7,500.

[Sen. Alison Clarkson (Chair)]: Yeah. That's anything under 10,000. Oh, you have a lot of

[Patrick (Joint Fiscal Office analyst)]: study groups that

[Patrick (Joint Fiscal Office analyst)]: you can

[Sen. Alison Clarkson (Chair)]: start to add up. Yeah. No. No. I appreciate that. So let's shall we start with that? Patient?

[Sen. Kesha Ram Hinsdale (Member)]: Oh, okay. If you wanna

[Sen. Alison Clarkson (Chair)]: go in Let's let's just go in.

[Sen. Kesha Ram Hinsdale (Member)]: Let let's just I was thinking more like we could start shaving things off and then see what we're left with where we might agree with the policy, but we don't know what universe we're trying to live in. And I would just say, like, I I think we'd have to prioritize it in the in the universe of the governor's recommend. Like, that financial amount, we'd have to say, these are our top priorities in that amount.

[Sen. Alison Clarkson (Chair)]: And I I I would say the governor's recommend is the governor's recommend. We are a separate branch of government. We hear directly from our constituents and from the Yeah. The business community that is providing and needing these resources. I don't feel compelled. I absolutely I'm happy to Then I'll just

[Sen. Kesha Ram Hinsdale (Member)]: say $5,000,000. I mean, I just say if we said, like, these are this is our box of $5,000,000, and here's the other things we care about.

[Sen. Alison Clarkson (Chair)]: K. So I would just say the chair of appropriations has not asked us has not given us a sandbox of $5,000,000.

[Sen. Kesha Ram Hinsdale (Member)]: The chair of appropriations has said in various public settings, there is no additional money. So my next to follow on suggestions are things that one of them is something where I would take it out of this bill and move it to somewhere that there is an existing appropriation.

[Sen. Alison Clarkson (Chair)]: So that, again, is not our job, but we I I mean, I hear what you're saying. So you're saying let's live in a universe of $5,000,000.

[Sen. Kesha Ram Hinsdale (Member)]: I think it is our job to say these are the things we care the most about if there is no additional money. Or we get to also see where there are other funds where this would make more sense. So for example, because this is all general fund money, the Vermont Law School Small Business Law Center, I would take that out of here. They did just get money from Senator Sanders, but also I think the best way to give them more money would be to earmark money from the cannabis excise tax that goes towards small business development. You heard the small business development guys say it's kind of winding down.

[Sen. Alison Clarkson (Chair)]: They can't actually advise cannabis businesses.

[Sen. Kesha Ram Hinsdale (Member)]: They can with state dollars. They can't with federal dollars. That's I talked to them about this. That's right. They they Bernie Sanders just got them more money, but they could they would not be able to use it for cannabis. If we get them state dollars, they would be able to do that for cannabis. Right idea. So I would I would take that out of here, out of the just a general fund appropriation. So it's not We could

[Sen. Alison Clarkson (Chair)]: put in this bill, we can say where it would come and

[Sen. Kesha Ram Hinsdale (Member)]: help I guess it's already I think it's in the it's in the cannabis bill, which would also have an appropriation. So

[Sen. Alison Clarkson (Chair)]: The Vermont law of small business

[Sen. Kesha Ram Hinsdale (Member)]: No. But the appropriation is Right. For small business.

[Sen. Alison Clarkson (Chair)]: We can, in this bill, direct that money to come out of that. I yes. Or I would just take

[Sen. Kesha Ram Hinsdale (Member)]: it out of this bill and put it in the cannabis bill.

[Sen. Alison Clarkson (Chair)]: Well, that's a that's a choice. So but would you keep it at 300,000?

[Sen. Kesha Ram Hinsdale (Member)]: I'd say $2.50, honestly, just because I think that's, like, with the amount that small business gets, I think that's an appropriate amount to set aside specifically for legal assistance.

[Sen. Alison Clarkson (Chair)]: Okay. That's how do you gentlemen feel about that? Make sure I understand what we're talking about here. Kesha is proposing that law schools. Kesha is proposing that the that that because Bernie Sanders has fully funded the law, the small business law center,

[Sen. Kesha Ram Hinsdale (Member)]: that- But none of that money could

[Sen. Alison Clarkson (Chair)]: be used for- But none of the money federally could be used for cannabis That $250,000 be pulled from the cannabis from the cannabis revenue to pay for to contribute to the small business law centers were with cannabis businesses. Is that is that also your additional recommend that they would it would be for

[Sen. Kesha Ram Hinsdale (Member)]: the people? Go ahead and say, like, I I really wanna delete stuff from this list to have a serious bill.

[Sen. Alison Clarkson (Chair)]: Like, I can't vote. It's a you know what? I take offense at that. This is a serious bill. We have listened for now two years to the resources that we think are valuable. We have not included all the resources we did last year. We have pared it down. I think I think all of these resources are important to our permanent businesses. I don't I I don't think it's I think

[Sen. Kesha Ram Hinsdale (Member)]: I agree with you. Okay. You can

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: take offense, but I have

[Sen. Kesha Ram Hinsdale (Member)]: a hard time if unless we delete some things, voting for a bill that spends money that we know doesn't make the

[Sen. David Weeks (Clerk)]: Can I take a slightly different one?

[Patrick (Joint Fiscal Office analyst)]: Yeah. Sure. I think

[Sen. David Weeks (Clerk)]: we all need to prioritize. Yes. Absolutely. Totally. The one to do around this matter.

[Sen. Kesha Ram Hinsdale (Member)]: Right. I I'm gonna propose that we delete the 300,000 from this list.

[Sen. Alison Clarkson (Chair)]: Right. I I have that. Okay. I have that recommendation. Okay.

[Sen. Kesha Ram Hinsdale (Member)]: So and then I would propose we delete the 75,000 to the International Trade Division. We have given them money recently. They said they don't want it or whatever the case may be. I don't think we can afford to just give an entity $75,000 they say they don't want or need right now. Tim Tierney does a fine job with Taiwan.

[Sen. Alison Clarkson (Chair)]: Tim Tierney is the one who asked for this. So it is Why did his counterpart come in? Well, who knows? That's a good question. That none of them ever wanna ask for much, even though we know. I'm, like, a postal feedback. But that would be you're right. That is a new program. It would be a new Yeah. Piece, and I think that that would be an appropriate thing Important for us to pull

[Patrick (Joint Fiscal Office analyst)]: Taiwan is, and we know what the Taiwanese government is doing to promote trade, and we know that we've been very high on our list of people with whom we cooperate Right. And depend on, except.

[Sen. Kesha Ram Hinsdale (Member)]: But until we have a New England agreement or some real plan, we can't afford to just give $75,000 to people.

[Sen. Alison Clarkson (Chair)]: I'm sure. You know, say they need it. David, do you have any feelings about that? Yeah.

[Sen. David Weeks (Clerk)]: So, actually, I'm supportive of opportunities that I want and and I I this sounds one of my my problems. Different perspective. Sure.

[Sen. Kesha Ram Hinsdale (Member)]: We just we didn't hear from we heard from them that they have folded that into their existing work, and they will not do anything differently even if given the money.

[Patrick (Joint Fiscal Office analyst)]: So that's your suggestion. What are your other suggestions? We're just gonna

[Sen. Kesha Ram Hinsdale (Member)]: go back. Those are my two to delete, and I would I would

[Sen. Alison Clarkson (Chair)]: take What's your what's your other deletion, I just

[Sen. Kesha Ram Hinsdale (Member)]: Oh, the business small business law center portion.

[Sen. Alison Clarkson (Chair)]: But that you're not deleting it. No.

[Sen. Kesha Ram Hinsdale (Member)]: I would delete it from this list and put it in the cannabis bill.

[Sen. Alison Clarkson (Chair)]: Right. You're suggesting that we actually

[Sen. Kesha Ram Hinsdale (Member)]: This is a general fund list.

[Sen. Alison Clarkson (Chair)]: Right. No.

[Patrick (Joint Fiscal Office analyst)]: Mean, I let me finish my sentence. These are all written in the language as, yeah, general fund.

[Sen. Kesha Ram Hinsdale (Member)]: Right. So I would just delete

[Sen. Alison Clarkson (Chair)]: it from this bill. I wouldn't delete it from the bill. I would just direct it to come from the cannabis revenue because we're still wanting to support this as a resource I for cannabis

[Sen. Kesha Ram Hinsdale (Member)]: would give appropriations a list of things we believe should come from the general fund. And because we have a cannabis bill, I would put that in the cannabis bill because I I have other suggestions to bring this number down to what we think is actually reasonable right now, including the Downtown Village Center tax credit being 4,000,000 instead of 5,000,000, and the Brownfields being cut down in half to 1 and a half million. So that and to me, that's a serious Yep. Proposal. I don't think we can go to them and say, no. We need 5,000,000 and here's why. We need to try and live somewhere in a universe of scarcity of budget dollars.

[Sen. Alison Clarkson (Chair)]: I hear you. So those are good suggestions, and thank you for for those. And that that is true. Let's weigh in everybody on the downtown and village tax credits because Kesha is proposing that we consider four for that and What's the demand? The demand that exceeds the amount we have always. So Wait a second.

[Patrick (Joint Fiscal Office analyst)]: But do you have any idea of what's they Yes.

[Sen. Alison Clarkson (Chair)]: They gave to us. Yes. In your in your materials, and I can pull it up in one side of things. Hi, Rick. I didn't realize we're there. The demand is hot.

[Patrick (Joint Fiscal Office analyst)]: I don't know. I it's

[Sen. Alison Clarkson (Chair)]: Yeah. Yeah. It's it's super out of shape. It's super high. It's super high. People love this program. Anyway, so other people on downtown, because we have a proposal on the table at four.

[Patrick (Joint Fiscal Office analyst)]: Give me one for your list if you get And then get

[Sen. Alison Clarkson (Chair)]: you one. You know, your return on investment, this is one of the most Yeah. The biggest returns on investment that we have. Yeah. Why I'm just trying.

[Patrick (Joint Fiscal Office analyst)]: I can see. I can certainly go along with this. Point. I can go

[Patrick (Joint Fiscal Office analyst)]: because thanks often. I wanna see anybody.

[Sen. David Weeks (Clerk)]: David? Yes. I'm a supporter of the downtown village tax credits. But being a revolving fund with eleven years of history, I maintain a deep end of the current funding amount of it.

[Sen. Alison Clarkson (Chair)]: It's not a revolving fund. It's a tax credit.

[Sen. David Weeks (Clerk)]: Well, revolving tax credit. Every year we build it pays back into itself. Mhmm. Correct. Which by theory expands the tax credit each year. We have these questions.

[Patrick (Joint Fiscal Office analyst)]: Yeah, know we did. I to thank you, Sam. Has it been underfunded all along because the demand is continuing to rise.

[Sen. Alison Clarkson (Chair)]: So the demand the the I'm not reading the script.

[Sen. David Weeks (Clerk)]: She already I already go for it. Anyway

[Sen. Alison Clarkson (Chair)]: the demand and it's it's not clear here to me how many how many projects they yeah. That they don't that they can't fund. But I I know it's substantial. I get it. Yeah. And I apologize if this doesn't have that or at

[Patrick (Joint Fiscal Office analyst)]: least not at But we'll see about that put in. It's now. It's the same thing that we deal with we deal with housing. The situation is running ahead by far of anything we do. And so I would not be surprised if we don't get it back and put in ten years later. We might get it back in terms of dollars, but it's not a requirement.

[Sen. David Weeks (Clerk)]: Was infusing it with a housing bill element. High priority, at the very least, maintaining its current. Right.

[Sen. Alison Clarkson (Chair)]: Thomas? I

[Sen. Thomas Chittenden (Member)]: think they're all meritorious. I do agree that we need to prioritize. I sadly don't have any strong opinions over another on any of these. The money's not there. The money's not there. And so let's give downtown village tax credit 10,000,000, but it's it's not gonna be there. That's

[Sen. Alison Clarkson (Chair)]: Right. But it again, it's not our job to figure out what's there. It's our job to be realistic. I agree with Kesha that it's it's important to be realistic, but I also think it's our job to advocate for our jurisdiction. So, David, you were at a minimum keeping governor's recommendations.

[Sen. Thomas Chittenden (Member)]: I don't

[Sen. Alison Clarkson (Chair)]: know. And what would you what would be your priority for that?

[Sen. David Weeks (Clerk)]: Well, it's a number of course.

[Sen. Kesha Ram Hinsdale (Member)]: But at 3,000,000?

[Sen. David Weeks (Clerk)]: At 3,000,000 per story. Come on

[Patrick (Joint Fiscal Office analyst)]: and see where the focus is on. Okay. You'd be willing to go higher if the numbers worked out. That's good. Sorry.

[Sen. Alison Clarkson (Chair)]: Can I just ask what section you're about right now? Downtown village tax credits.

[Sen. David Weeks (Clerk)]: Say 3,000,000,000. Some. Don't know. Yeah. But, yeah, I'm a little hamstrung, but we don't know last year, so we don't know what the growth is. Okay. I can tell

[Sen. Alison Clarkson (Chair)]: you that the growth downtown village tax rate, I think it was last year was

[Patrick (Joint Fiscal Office analyst)]: So I guess the the real history on that is, so in statute, the the department's able to award up to $3,000,000 in credits in that given year, and that's been consistent for, I think the last time it made a change was in, like, point two.

[Sen. Alison Clarkson (Chair)]: Bet you know that. Yeah. We've been after poll, we tried to The problem is not

[Sen. David Weeks (Clerk)]: a matrix, not about the individual It would be helpful to understand where we're coming from.

[Patrick (Joint Fiscal Office analyst)]: It's just a bit of data there. We're all aligned. Rebuilding. I think we were

[Sen. David Weeks (Clerk)]: talking about line two and three and four and five and six and seven. What was last year's?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: Oh, that's different for each. Why?

[Sen. David Weeks (Clerk)]: It's really a time. Sitting in without that, I

[Sen. Alison Clarkson (Chair)]: mean, it's hard to it's hard to. We asked, okay. So, there's a difference between what we asked for and what we got. We got we got micro we got we did not get many of our requests because last year's budget was also very tight. Down I and and, Patrick, you should just come back to us with these numbers because I believe micro business did get an additional amount. Professions of color did get what it got, and it was in base, I believe. But you could come back

[Patrick (Joint Fiscal Office analyst)]: to First thing I'll do when I leave today is add last year's funding levels to disable, and maybe I'll have that on

[Sen. Alison Clarkson (Chair)]: the table. Ask add last year's ask because we also asked for a significant investment, and we didn't we didn't get it, which is fun. That's what the appropriations were. That's hard

[Sen. Kesha Ram Hinsdale (Member)]: to do because do you mean our ask or the organizations ask or the RHRF?

[Sen. Alison Clarkson (Chair)]: What this committee voted out?

[Patrick (Joint Fiscal Office analyst)]: That was s one twenty two. Right?

[Sen. Alison Clarkson (Chair)]: Yes. What this committee voted out is what I'd like to know. And then what was funded? Sure. And then this year, what the governor's recommended is what is proposed. So I guess given that we have we're gonna be turning to Sophie to do two thirty in a second. What I would ask for us is to do the if we have patient's priorities, and I'd love to declare on everybody else's priorities if we could, but by you know, before we leave tomorrow. Patrick,

[Patrick (Joint Fiscal Office analyst)]: if

[Sen. Alison Clarkson (Chair)]: you could get us that additional those additional pieces today, is that possible? So we'd have some more hospital. That'd be great. And then maybe hear from everybody by the end of the week if we could maybe spend a little bit of time before we adjourn to. But I get I get Yeah. Yeah. I'm getting to hear her. So we just because we have to make these decisions. Thank you. Thank you for leading it off. Kesha Ram Hinsdale. So Patrick, thank you. Anything else?

[Patrick (Joint Fiscal Office analyst)]: I don't think so. I think I have some directive from you all. Thank you.

[Sen. Alison Clarkson (Chair)]: I appreciate it. That information. Right. And with that, we're gonna turn to Sophie.

[Maggie Lenz (Vermont Retail Grocers Association)]: Can you just

[Sen. Alison Clarkson (Chair)]: Yes. You could just stay there. Yeah. So we're looking at draft 3.1 of s two thirty.

[Sophie (Legislative Counsel)]: Do you want me to put it by one swing or the? I know. I think

[Sen. Alison Clarkson (Chair)]: we have it all right here. And what we're looking at really particularly is the agreed upon language on page three. Have you been able to put this up on the screen? Oh, oh, do you not? No. It just that it's online. Online. People can see. Okay. Sophie, share with us what you have changed. We can see it, but you made choices because it's slightly different language. But the I declare part is the same.

[Sophie (Legislative Counsel)]: It's the same language. Yeah. Alright. Good good morning. Sophie for the office of legislative council. And you have in front of you draft 3.1 of s two thirty. And on page three in the middle of page, lines 10 to 14 is the additional language. And so this now provides that, again, we're talking about adding victims of sexual assault, stalking, and domestic violence to the definition of crime victim under the Fair Employment Practices Act. And right now, the current language is that if you are a person that falls into that category, there are a number of ways you can provide supporting documentation to your employer. And under Romanette four ninety seven on page three, there's a self attestation by the person describing the circumstances supporting the person's status as a survivor of domestic violence, sexual assault and stalking, for which no further corroboration should be required unless otherwise mandated by law. And then this adds in, self attestation shall include the following language above the person's signature and date. Quote, I declare that the above statement is true and accurate to the best of my knowledge or belief. I understand that if the above statement is false, I will be subject to the penalty of perjury or other sanctions in the discretion of the court.

[Sen. Alison Clarkson (Chair)]: Thank you. Thoughts you got Randy and and good thank you getting a yes here Charlie would you like to weigh

[Sen. Kesha Ram Hinsdale (Member)]: in are you still in the room yeah Okay. Hello.

[Mike Kelly (President, Core-Mark New England)]: Charlie is

[Sen. Kesha Ram Hinsdale (Member)]: up through my end, policy director with the Vermont Network Anti Domestic and Sexual Violence. This is language we feel comfortable with and I appreciate the committee's work on this issue.

[Sen. Alison Clarkson (Chair)]: I appreciate our work on this and thank you, Thomas, thank you, Dave? Before we, as we near a post.

[Sen. David Weeks (Clerk)]: Yeah. I'm just wondering if on

[Patrick (Joint Fiscal Office analyst)]: page one line three, are we still calling this a flex day working arrangement? No. We I think we title it at the end. Yeah. Think it was So

[Brandon King (Deputy Chief of Enforcement, Dept. of Liquor & Lottery)]: retitle it.

[Sophie (Legislative Counsel)]: Yes. On page four, lines nine eight nine, council. And it says after passage, the title of the bill is amended to read an aggravating to fair employment grounds. Awesome.

[Sen. David Weeks (Clerk)]: For a motion, madam chair.

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

[Sen. Thomas Chittenden (Member)]: would move that we approve favorably with amended draft number three. One of S two thirty dated February 6 point twenty six nine fifty three AM. Did you get all that?

[Sen. Alison Clarkson (Chair)]: It should've been The clerk fell hold

[Sen. David Weeks (Clerk)]: up. Thank you. Senator Barr? Yes. Senator Chittenden? Yes. Senator Barr? Yes. Senator

[Sen. Alison Clarkson (Chair)]: Thank you. Who has interest in reporting this bill? David kindly has taken on one seventy three. It's actually a decision. Randy did a great job yesterday on our SR note, JR resolution. What was it? 42. Thomas, either of you would be willing to take this on.

[Sen. Thomas Chittenden (Member)]: Always happy to do. You want me to?

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I'll provide backup if he needs it.

[Sen. Alison Clarkson (Chair)]: We're sit next to each other. Exactly.

[Sen. Kesha Ram Hinsdale (Member)]: But it is after the break, and I do a lot of promise every.

[Sen. Randy Brock (Vice Chair)]: Have a good day.

[Sen. Alison Clarkson (Chair)]: It's great. Chittenden kindly is going to take on reporting this bill with backup from his district. That as it has no appropriations, it may actually be on yes. So it will go on notice tomorrow. Are you

[Rose Kennedy (Assistant Attorney General, Tobacco Enforcement)]: there's no underlying

[Sen. Alison Clarkson (Chair)]: No. I will be curious to see where it gets up, but I think it could probably get some straight to the floor.

[Sen. Thomas Chittenden (Member)]: The underlying bill had an impact on labor negotiations. I would be shocked if it goes to appropriations. I think it's done nothing more.

[Sen. Alison Clarkson (Chair)]: Yeah. I'm never shocked at something. Okay. So we shall see. And David, I've already spoken to the chair about, 173 having really super de minimis, appropriations.

[Sen. David Weeks (Clerk)]: I noticed it didn't pop that I got from. So

[Sen. Alison Clarkson (Chair)]: Yeah. Thank you. So, Thomas, if you could kind of pick that up to the secretary.

[Sophie (Legislative Counsel)]: I didn't send you one without, but I'd like to go.

[Sen. Alison Clarkson (Chair)]: Oh, sorry. Sorry to take that. Here, take that one back. Here's your first one.

[Sen. Thomas Chittenden (Member)]: They're too finicky up there at the secretary's office.

[Sen. Alison Clarkson (Chair)]: Hi, are they? Okay. Thank you, committee. That was good work today. I appreciate our getting to yes together. It's not always easy. And thank you. Thank you, Charlie. Thank you, Sophie. And the cons we have made our work on the consumer protection piece of the cigarettes. We're oh, You know, I think a lot I've we've narrowed it considerably, which is I think that puts stuff in the right direction. And I would just it's a area of I would encourage us all to look at that over the break because we're gonna have to make decisions about it fairly quickly when we return. What do we have tomorrow? Tomorrow with Canvas, and we're gonna be beginning to make so on the Canvas bill so tomorrow, we have a couple of things. Tomorrow, we begin with the housing bill looking at the home ownership associations. We're having two lawyers who specialize in the home ownership, and we have a fiscal note on the housing bill. Are we starting at 08:30? We're starting at 08:30. Then we end at 11:30, 11:25, and we go through till 10:15 where Tucker's gonna pick us up on cannabis. And what I would really like us to be able to do with cannabis is be honest with each other about what sections really are sections that are challenging for you. Because I know there are some of you that have really some areas, and it's a big bill, and I acknowledge it's a big bill. Well And you've got an adult that we don't have for. We had terrific testimony. We have got lots of stuff to refer to.

[Sen. Kesha Ram Hinsdale (Member)]: Well, actually okay. So a lot of people's questions were related to how this harmonizes with other states or doesn't. And so I asked for there was, you know, there were groups saying, well, the state does this and the state does that. And then they got us three experts from other states. And then the directive was, you don't have time for those. So that does concern me because That's super valuable information to knowing if this is, like, how to- It's okay. Contact.

[Sen. David Weeks (Clerk)]: We've got a matrix in one state versus another. At least

[Sen. Thomas Chittenden (Member)]: we know that. Through it, but it's in our documents.

[Sen. Kesha Ram Hinsdale (Member)]: Okay. I mean, people are still asking a lot of questions that can be answered well in other states. And and some of it was yes in our matrix. Some of it wasn't.

[Mike Kelly (President, Core-Mark New England)]: Yeah, I don't know

[Sen. Randy Brock (Vice Chair)]: the matrix. For example, one of things that struck me from a lot of the medical stuff that I got in writing was that we don't have the maximum amounts, right, to be over prescribed, etcetera, or allowed. Right. And that this is very, very harmful to what we don't. I got several lists.

[Sen. Kesha Ram Hinsdale (Member)]: Oh, well, so those amounts all do harmonize with certain other states and we could, then we could ask other Right. States how is that Or like California allows delivery in counties where there's not an existing cannabis retailer, so there's nuance to what's been I think it would be really valuable to have experts in other states.

[Sen. Alison Clarkson (Chair)]: Well, not three other states.

[Patrick (Joint Fiscal Office analyst)]: Yeah, was. Again, you know,

[Sen. Randy Brock (Vice Chair)]: as I said, with a lot of the input that we've gotten, have to protect the testimony, the stuff that I would love to have heard testimony about, we did it at halftime, etcetera, etcetera. Our time has been Sure.

[Sen. Alison Clarkson (Chair)]: So, tomorrow we're gonna really go through this and see where you guys are. We've now heard quite a bit of testimony. We now have a lot on our website under this subject. Encourage us to review it, right? Are are

[Sen. Randy Brock (Vice Chair)]: for the time, but It's just a practical matter is it's easy for us to move quickly to vote on something where there's consensus. But where there's, you know, significant consensus,

[Sen. Alison Clarkson (Chair)]: we have to do more homework. Right. Absolutely. We do need to do our homework. I also think I also it's a legislative life. This this bill is gonna go to hopefully, we will be able to pass out some of this. This will go to the house. This will get a lot of time in the house. Right. It's a priority of the chair of house government operations.

[Sen. Kesha Ram Hinsdale (Member)]: But I just want us to understand what's happening in other states because I got we are surrounded by other states that have an impact on our sales.

[Sen. Alison Clarkson (Chair)]: Right. And I think after we go on break, let's just review those three and let's see what we can get in next week. So

[Sen. Kesha Ram Hinsdale (Member)]: Next week or Friday? So I mean, I'm

[Sen. Alison Clarkson (Chair)]: gonna Let me just let let's just pop that out because if there are areas that this committee is isn't gonna end up growing out, I don't want Tucker having to rewrite both sections of it that are not gonna be supported. So I do think it would be great for us to just review the sections with Tucker and see where people are in terms of support and that's what

[Sen. Kesha Ram Hinsdale (Member)]: I wanna ask Tucker to to represent which states have what.

[Sen. Alison Clarkson (Chair)]: And we could also, in between, if they were available at the top of that testimony, we could have the three if we could get them in tomorrow morning. We could maybe have the three states away in before we have that conversation too. I do. But I think we need to have a con I don't I've really given crossover. Yes, ma'am. I would really like us to be recognized or honor Tucker's time and have him really only redraft and re rework things that have a chance of passing out

[Sen. Kesha Ram Hinsdale (Member)]: of this committee. I just wanna recognize that until testimony, we didn't know that New York could advertise in Vermont.

[Sen. Alison Clarkson (Chair)]: Yes. That was true.

[Sen. Kesha Ram Hinsdale (Member)]: That was shocking. We just, like, we really we are the economic development committee, and we need to recognize when there's a completely unfair situation for our state's businesses from the surrounding states. So,

[Sen. Alison Clarkson (Chair)]: let's take a review of the cannabis bills.

[Wendy Knight (Commissioner, Department of Liquor and Lottery)]: I again,

[Sen. Alison Clarkson (Chair)]: we're gonna be doing those pieces of the of the housing bill, and, hopefully, we're getting to a pretty good license on those two bills, housing and the counterintelligence. I think we're making good progress, and we will work on those right now. So thank you all. We're gonna go offline,

[Mike Kelly (President, Core-Mark New England)]: we will