Vermont Legislature SmartTranscripts:

[Sen. Ann Cummings (Chair)]: So we are live, and it is well, we have thirty seconds. We're early. I might actually get you out here at a decent hour considering this has been another week of 05:30 and 06:00 meetings. Just stay tuned, we're again, next week, I'm trying to schedule the education bill, our sections, but again, getting stat is challenging sometimes, so we're working around that so it won't be a straight section one, two, three, and four. I can't get Beth St. James until I think Thursday just to do a walk through of what is in the education sections, and we got to walk through with Rick Palmer yesterday. But I think we should just get a little bit greater, more than And okay. John is here.

[John Gray (Legislative Counsel)]: Hello. You want me to get this chair?

[Sen. Ann Cummings (Chair)]: Yeah. You can. I don't know. Scott is also here. Would it help to have Scott go first and we could

[John Gray (Legislative Counsel)]: We could even go together. He can go first if he would like to.

[Sen. Ann Cummings (Chair)]: Could go together.

[Scott Moore (Joint Fiscal Office)]: For the record, Scott Moore joined fiscal Madam Chair, it's a pleasure being Senate Finance for the first time ever. Yes. There is a couple of bits of the language of the capital bill that John will go through that would affect retention of my winners in state of Vermont. It might make sense for John to go another Okay. About them when we get there.

[Sen. Ann Cummings (Chair)]: Yeah. We don't usually hedge the capital bill. Yeah. So That's good news. John does everything Wow, John.

[John Gray (Legislative Counsel)]: He is all over the place.

[Sen. Ann Cummings (Chair)]: Coming back to new school construction with his I got it. Anything fun is me. I'm John Gray

[Scott Moore (Joint Fiscal Office)]: with

[John Gray (Legislative Counsel)]: the. Okay. I will jump into Zoom just a sec. You guys are so timely to that one. Feel delinquent.

[Sen. Ruth Hardy]: Oh, rare for us.

[John Gray (Legislative Counsel)]: I think I'm not used to being the first thing in the time slot.

[Sen. Ann Cummings (Chair)]: Are worse things. The last one in the time slot could be here until dark.

[John Gray (Legislative Counsel)]: I know. I know. I'm more of that.

[Sen. Ann Cummings (Chair)]: Better to go first.

[John Gray (Legislative Counsel)]: We are talking about the Campbellville today, H 952. If you would like, I just don't know how detailed you guys are gonna wanna get, really.

[Sen. Ann Cummings (Chair)]: I don't think we need to know that we're doing $2,000 for new shingles on this.

[John Gray (Legislative Counsel)]: Great. So the Senate institutions amendment is a sequence of instances of amendments, but it's not the whole of the bill. If you would like, I can show you the underlying, but if you're not interested in the underlying that's came from the House, I can just show you the changes. However, I think some of the language that creates the potential condition for this arriving here is in the underlying.

[Sen. Ann Cummings (Chair)]: I think that's what we need to look at. Okay. Why is it why

[John Gray (Legislative Counsel)]: is it And I will just Yeah. You're fine.

[Scott Moore (Joint Fiscal Office)]: Yeah.

[Sen. Ruth Hardy]: It's $9.52. Is that Yes.

[John Gray (Legislative Counsel)]: Page nine fifty two. I will pull up the house. Here

[Sen. Thomas Chittenden (Vice Chair)]: we go.

[John Gray (Legislative Counsel)]: So as passed by the house, just framing for the capital bill, much like the the budget, this is an adjustment act. You'll know that the capital bill itself is a two year. Exactly. So in the second year of the biennium, it is made up primarily of amendments to the prior year's capital bill, and that's where you're gonna see this kind of presentation where section one is amending last year's section one light. At some point, the numbers will unsync, which is unfortunate, but it's just light. So this section just sets out your total bonding authorization for the full two years, that's the $122,000,000 and then sections two through 16, I'm not gonna go into great detail. Two through 16 set out your bond and appropriations, and you're gonna see this, under this reader assistance heading, the houses proposed updates to the prior capital year bonded projects. I'm just gonna put

[Sen. Ann Cummings (Chair)]: And are these all within the, what are we, the debt advisory committee?

[John Gray (Legislative Counsel)]: Yes, this all fits within the Capital Debt Portability Advisory Committee, CDAP recommendations. This biennium's recommendations was 50,000,000 annually for 100,000,000 total. And just to scroll back up because you see, and this will be relevant to the Senate's proposed amendment, you see this figure is greater than 100,000,000. You've got 22,000,000 here. There's a couple of different places, and I know Scott is likely to speak to some of those where those extra 20 mil plus come from. One of the places is a process called reallocation where the committee goes in and investigates old projects, unused funds, and reclaims them and applies them to the bottom line to fund new projects here. But Scott, I think, will speak more to this piece. These are the sets of updates to last year's. I'm not gonna really hit them unless you have particular interest, and even then, I'm probably just gonna tell you you would need to talk to the House members. You can see underlying language here, which reflects a new addition rather than just a dollar update, And so this is a new line item that the House had proposed for state house entryway upgrades. Most funds, as you'll see, are appropriated to BGS, but then they're used for, in certain instances, other departments or agencies. But much of the funding is, of course, routed through BGS.

[Sen. Ann Cummings (Chair)]: Still working on the income taxes.

[John Gray (Legislative Counsel)]: Yeah, a lot of And sometimes you'll see measures like this, which looked like a $10,000,000 corporation in last year's capital bill, but in effect that $10,000,000 was a placeholder, and what you see in this year's updated adjustment act is breaking out that $10,000,000 into each of these items. So if you tallied up all of these, you would get that $10,000,000 figure. You can see some judiciary projects, including for the Newport Courthouse project. That was a new house addition that was not in last year's capital bill, a little over 1,700,000. Reallocations, this is the process I was just describing, part of how you increase that total figure at the start of the bill, and you can see a technical change here. As you may know, the capital bill at one point was exclusively bonding, but in recent memory the cash fund was created, which created this Exactly. Trade up

[Sen. Ruth Hardy]: Newport Courthouse? Yes. I believe we passed language last year about courthouse and county building like the the This is ringing

[Scott Moore (Joint Fiscal Office)]: a bell.

[Sen. Ruth Hardy]: Local, the county had to Oh. Well, it was about them actually putting money into it too and that they couldn't just, you know, not. There's a there there's a requirement that they put away a certain amount of money. And then use it for capital upgrades or improvements and so the county were not doing that and then asking for the full amount for this from the state and we put language in last year. It was an amendment.

[John Gray (Legislative Counsel)]: Yeah. This is all ringing a bell.

[Sen. Ruth Hardy]: Yeah. Because there we did a a courthouse upgrade for, I think, the Addison County Courthouse. County. Yeah. And they had not done the things they were supposed to do, so we put language in. So I don't know if we own the if the state owns the Newport Courthouse.

[Scott Moore (Joint Fiscal Office)]: Some of

[Sen. Ruth Hardy]: them are state owned and some of them are are county owned. I don't know about Newport, but if it's county owned, I wanna make sure they've done what we required them to do. Yeah.

[John Gray (Legislative Counsel)]: This definitely rings a bell. I would encourage, at least for this particular piece, talking to Alice Emmons because she would be the best to know, I think. Okay.

[Sen. Ruth Hardy]: Could could you find that statutory language at least and and and let me know what it I can't I don't remember exactly what it said, and I don't I'm not sure where to look for it even. So

[John Gray (Legislative Counsel)]: Yeah. I know. I I had paused screen share and was pulling up act 33 week last year to see, but I think it's actually elsewhere that we

[Sen. Ruth Hardy]: I did it. I think it was. I think it was in some miscellaneous bill that came over later. Miscellaneous judiciary bill, I think, is where it ended up being put in, but I don't know.

[Sen. Ann Cummings (Chair)]: I don't know what you're saying. It didn't ring a bell.

[Sen. Ruth Hardy]: Yeah. I mean, I brought it up in the context of the of the capital bill, but it didn't get added to the capital bill, but I think it later came in this to judiciary. Yeah, I'm Jefferson.

[Scott Moore (Joint Fiscal Office)]: I can tell you that that language is not in Act 33, which is last year's capital bill. And in this year's capital bill, the dollar amounts we see here are the money that was told to us by either VGS or the judiciary that they do need to finish. It doesn't count how much money they may have had through that Okay. The county, but we can look and see if we can find it.

[Sen. Ruth Hardy]: Okay. That would be helpful. And if

[Sen. Ann Cummings (Chair)]: we just did it last year, They were work in

[Sen. Ruth Hardy]: progress. Don't know anything about this one. I just know that it was the Essex County one that sort of prompted it because they hadn't they hadn't saved the money they were required already had been required by law to do and kind of put it all out of the state.

[Scott Moore (Joint Fiscal Office)]: I'm also happy to reach out to Territory Zones and ask the question if which one of these were county owned and how much money does the judiciary have, how much money came in from counties, etcetera, etcetera.

[Sen. Ruth Hardy]: Mean, sure. That would be helpful. I also just wanna know what yes. That would

[John Gray (Legislative Counsel)]: be helpful.

[Scott Moore (Joint Fiscal Office)]: I we're having a good share.

[Sen. Ruth Hardy]: And I wanna know what happened with the

[Sen. Ann Cummings (Chair)]: land flood last year and whether they they followed it.

[Sen. Ruth Hardy]: It's relevant to that. Yep.

[John Gray (Legislative Counsel)]: Thank you. Sure. I think that's that's 64 and 12. Okay. Okay. So continuing on, we were jumping next to the reallocation section. This is what I noted earlier to help inflate that dollar figure at the beginning. You're claiming old funds. There are statutory clawback mechanisms. There's a permissive after three years of the bond of dollars. There is a mandatory after five years. So this is one of the ways that funds come back and go to fund other projects in the current year's capital build. The technical change that you see here to include reversion is really a technical thing to align with, I think, finance and management language. Because in the past, all reallocation related to bonded dollars that hadn't been in the cash fund and you're now entering the time period where you're reclaiming cash dollars, given the freshness of the cash fund. The technical term used here is reversion for cash, so that's why that is used here. All the underlying, this reflects new reallocations done by the House this year. So this pretty dramatically increased the amount of funding. And

[Sen. Ann Cummings (Chair)]: this has been approved by the Senate?

[John Gray (Legislative Counsel)]: Yes, I will talk about the one change they made here, which is actually to claim additional funds. So none of these reallocations were rejected by institutions. This section, the cash funded project authorizations, unlike the first sections two through 16, which divide out bonded project authorizations by entity effectively, you know, section two is your classic VGS, section three is human services, All of your cash authorizations are just sitting in one section. This may at some point change in the future, I don't know, but this is just a long section that sets out all the cash authorizations. Just to note, you'll be familiar with this from the budget process, but the way the legislature has elected to deal with this is that the institutions committees themselves just use They don't use the word appropriate for cash projects. They use the word authorize, and so they authorize the projects here. They're memorialized in the capital bill, and then the language has to be duplicated in the budget for the actual appropriations that are set out. It does not have to be done this way. That's the choice that folks have enough to make.

[Sen. Ann Cummings (Chair)]: This bill hasn't come to us any faster. Yeah. But I remember it was a a big deal, and there was a lot of moving between funds.

[John Gray (Legislative Counsel)]: Yes. And it and it can make for some synchronizing problems effective. Like this year on the House side, because of delay in the process there, they didn't have the cash when it was ready when the budget was being voted, so they had to do a third reading amendment on the floor to add their pieces. Wow. Okay. But it's all here now. That's the happiness. Okay. And it is reflected in the budget. There is some cleanup that's actually gonna happen in the budget because one of the line items was duplicated, but nothing huge. So to jump to, these are all your money pieces which form the first portion of the bill, but there's also sets of policy provisions in the capital bill depending on the year. The first piece that you see here, jumping into the policy sections, this was language that came from the Department of Environmental Conservation. To describe simply, there are terms for providing more affordable loans to upgrade water systems to certain kinds of communities. What you're seeing here is expanding these loans to this kind of system, an eligible mobile home park water system. Put simply, this is saying that certain kinds of mobile home parks, that is nonprofit or resident home parks that are registered with DHCDs, so meeting those two conditions, if you have this kind of water system serving that kind of mobile home park, you would now be eligible to receive these advantaged loan terms. The terms themselves have things like a longer term, so you're going to see something even longer than this in just a second, but generally this section, existing law, this is nothing new, right? This is just expanding an existing program, provides for longer term loans, so not to exceed thirty years. And additionally, they provide lower rates. The rate of interest shall be set by the treasurer taking into consideration prevailing borrowing rates available to similarly situated applicants. VITA shall the Vermont Economic Development Authority shall periodically recommend interest rates to to be set by the treasurer that are the lowest practicable rates consistent with maintaining the long term integrity of the fund. These may be available, may be less than the prevailing borrowing rates, but not less than 0%. It's kind of your standard terms under this program. Well, ready because that does come.

[Sen. Ann Cummings (Chair)]: Okay. We have less than zero.

[John Gray (Legislative Counsel)]: Yes. It's the kind of interest rate I'm looking for on my

[Sen. Ann Cummings (Chair)]: student loans. Yes. Me too.

[John Gray (Legislative Counsel)]: That's nice. Oh, well, not nice, you still have student loans. This section, Subdivision five, purpose ID is even more advantageous to applicant systems. It says a privately owned non profit community type system may qualify for a forty year loan term, so longer than the thirty, at an interest rate plus administrative fee to be established by Secretary of Natural Resources that shall not be more than 3% freight or less than minus 3%.

[Sen. Ann Cummings (Chair)]: How do

[John Gray (Legislative Counsel)]: you think So effectively a grant,

[Sen. Ann Cummings (Chair)]: it's a grant. I was gonna say

[Scott Moore (Joint Fiscal Office)]: It's a loan forgiveness matter, yeah.

[Sen. Ann Cummings (Chair)]: Okay.

[John Gray (Legislative Counsel)]: Provided that the conditions for receiving these even more advantaged terms, and again, is existing laws. The condition is that the applicant system meets income level and annual household user cost requirements of disadvantaged municipality, plus at least 80% of the residential units served by the water system, continually occupied by local residents, and at least 80% of the water produced is for residential use. You have all these conditions that have to be met to avail yourself of these terms. The expansion that you see here is to include these eligible mobile home park water systems. So this is taking an existing DEC programs and expanding it to this set of folks. I don't know how many of the equivalent parks exist. Like I said, it's a particular kind of park, nonprofit or resident owned, additionally, it's certain kinds of water systems serving those parks. So I don't know how much this would affect. And there's yet one more piece of this, which Yeah. Okay. So if the Secretary determines that this kind of system qualifies for a loan, the Secretary shall certify that long term and interest rate to Beta. I'm gonna skip over the new language and just explain what it is today. So reading this structure, in no instance shall the annual interest rate plus administrative fee be less than is necessary to achieve this kind of annual household user cost equal to 1% of the median household income of that applicant water system. So while you have the more advantage terms in five above that forty years, no lower than 3%, this provision actually imposes a floor. It it might stop you from hitting that negative three. You have to do this calculation that I don't know anything about for annual household user cost, and you can't go below 1%. So this is effectively a floor on the advantage terms. The new language basically says, for this expansion to eligible home park water systems, they're not subject to this provision. The program is being expanded to contemplate these kinds of mobile home park water systems and they get kind of the most advantaged term possible, this requirement doesn't apply to them except as applied to an eligible mobile home park water system, the Secretary shall not certify an annual interest rate plus B is less than necessary to achieve annual household use cost, so they can get the lowest possible. That's the consequence of these changes.

[Sen. Ruth Hardy]: Who else gets these besides the mobile home births that are being added?

[John Gray (Legislative Counsel)]: It is privately owned, non profit community type systems, and I will say on this front, this is a frustrating thing, it is not a defined term. It consists of different defined terms that have sort of been mashed together, and when I raised this on the House side, basically the response I got, this is not an area that I operate in, just happened to be included in the capital bill, the response I got is that this is a long standing DEC program, and everyone within this space knows what a privately owned nonprofit community type system is, so that any change would potentially disrupt the functioning of

[Scott Moore (Joint Fiscal Office)]: the program.

[John Gray (Legislative Counsel)]: I can pull up

[Sen. Ann Cummings (Chair)]: Your butt

[John Gray (Legislative Counsel)]: out. I can Wow. I don't think you guys are gonna spend a lot of time on the capital bill. It is the sort of thing where if you hear from DEC, obviously they can do a better job of explaining what is intended to be encompassed here. That's just why this was not touched. The way that mind drafting approached this is minimal touch is necessary to get the DEC goal, but not otherwise changing the way this I'll also just note that this is an impossible to read sentence, which is another thing that I flagged, but for the same reasons was not updated.

[Sen. Ann Cummings (Chair)]: It was probably 90s, early 2000s, were a lot of privately owned mobile home parks that were closing or the rents were escalating, I think we still get notices every time they receive all the whole home farm increase. I guess I haven't had that much in locally because it's been a while. I used to get them regularly, but one of the reasons they were closing was water and septic, and they didn't meet the new codes or the old ones were dead. And the cost of doing that, and there was the community action agencies were very involved in trying to help the residents be able to purchase or nonprofits, to purchase these what were for profit, sometimes mom and pop parks, but you had to have a way to get the water and the septic systems fixed, and I think

[John Gray (Legislative Counsel)]: that's And where this came to offer a sympathetic read on why you wouldn't touch the language that I wanted to change just because I think it's unclear. This does use defined terms. It just kind of groups them together. Community type systems define term. There's privately owned water systems define terms. And there was a specific choice at the time that this was implemented not to use the defined parks because they would have captured, I think, fire districts or some kind of municipality that folks did not want captured. So that's how you arrived at this specific language. It was an intentional choice. Maybe it could have been done more cleanly, but it was not a mistaken lack of thinking about the system. It just arrived at a funny term that I can't tell you what it means.

[Sen. Ruth Hardy]: Okay. That's very generous of

[Sen. Ann Cummings (Chair)]: the job. And and we don't need to be able to do that. Yep. The committee next door. But is this here because

[Sen. Ruth Hardy]: of the interest rate thing? Is that why we're getting the bill?

[Scott Moore (Joint Fiscal Office)]: Madam Chair, if I may, if you do look at this particular part of the section of the bill, does have the word fee in it? Because you're talking about the administrative fee. This is the same loan program. It's just expanding it to include the mobile home park system so it doesn't really change the income necessarily. But there is another lease section that John will give you. So Those are the two things I want to talk about, one of which is this, which is basically saying we're increasing the loan program to include another subset. Otherwise, everything stays the same. But when we get to the next I'm sure it's the

[John Gray (Legislative Counsel)]: next one. It's pretty soon.

[Scott Moore (Joint Fiscal Office)]: It's pretty soon. That's really how we go live with those.

[Sen. Ann Cummings (Chair)]: Okay.

[John Gray (Legislative Counsel)]: The other thing I would never I did not realize this, but when I was in Wise and Means, because this bill also traveled through Wise and Means on the outside, Chair Kornheiser said technically they have jurisdiction of bonding, which to me would mean that every year we'd receive the Caledonia. So I don't know what the thinking is, but here

[Sen. Christopher Mattos (Clerk)]: we are.

[Sen. Ann Cummings (Chair)]: Kornheiser's district has a very large.

[John Gray (Legislative Counsel)]: Yeah, Triademote. Yep.

[Sen. Ann Cummings (Chair)]: I think the largest in the state. So,

[John Gray (Legislative Counsel)]: Tri Park? Yeah. Okay, not this section for Scott's piece, the next section. Page 17, this is Division for Historic Preservation. There is currently an existing law authority for the State Historic Preservation Officer to accept grants, gifts, donations, loans, other things of value for specific purposes. Those purposes are establishing and maintaining displays and exhibits at a historic site and the Vermont Parateology Heritage Center or storing any historic site under section seven twenty three of this chapter. The new language that you have here extends the authority additionally to solicit grants, gifts, donations to the states or a preservation officer. You're going to see this notwithstanding language. Maybe I'll come back to this and explain first.

[Sen. Ann Cummings (Chair)]: So what say you couldn't solicit in the past?

[John Gray (Legislative Counsel)]: Ethics code prohibits solicitation by state officers, there's a specific term, but the state preservation officer would be one of these officers. So unless you want this solicitation to constitute an ethical violation, you need to not withstand this. So that's why you have an outstanding language here. The way the process would work is that the state historic preservation officer would have to get the approval of the Secretary of Administration to do this, and there would be this specific condition. In any request for approval or solicitation, the State Historic Preservation Officer shall specify the project and fundraising goal for which the officer is undertaking fundraising. The little pieces that I would note here because you may feel uncomfortable with notwithstanding an EPIC I spoke with folks in my office, and while obviously this isn't something you see all the time, the ability per se to solicit gifts, this would not be the first instance of this happening. So just noting that the housing that he did deliberate over this one, and I think that they're to try to state what their thinking was on this front, They felt comfortable with the State Historic Preservation Officer having this authority based on what they knew at the office, but had a broader concern about a kind of slippery slope type argument that other state agents might request this kind of authority. Ultimately, they landed at the position of setting this, but requiring that, you know, in receiving that approval you have to be specific in what you're doing.

[Sen. Ruth Hardy]: And the twelve oh three gs is just the part of the ethics code about accepting gifts, it's not like they're worth notwithstanding the entire ethics code.

[John Gray (Legislative Counsel)]: Correct, it a specific section that prohibits solicitation. It sets up other things for accepting gifts, like above certain monetary thresholds, but this is not a whole of what the ethics code.

[Sen. Ann Cummings (Chair)]: Okay, but this is not an individual soliciting gifts to themselves.

[Damien Leonard (Legislative Counsel)]: No,

[Sen. Ann Cummings (Chair)]: no. This is historic preservation, historic things are generally owned by someone else. I know we have we had to authorize money to buy it's the homestead down in Bethel Mhmm. Some of the original China was going up for auction somewhere. We had to come up with capital money to buy the China, but I assume we might also

[John Gray (Legislative Counsel)]: Makes sense.

[Sen. Ann Cummings (Chair)]: Have been able to ask the owners Exactly. If they would be willing to donate it Yep. To go into the historic preservation site.

[John Gray (Legislative Counsel)]: And and that's a really good point that this isn't authorizing the historic preservation officer to do any kind of solicitation individually. This is for specific purposes and it is routed through a process of approval by the Secretary of Administration. Okay. So there are some safeguards in place, and it's not a broad grant for all entities, it's in this particular instance. The next piece, this is what Scott was foreshadowing. This is authority for entering into a particular lease, the Little River State Park lease. So we have provisions in title 29 relating to leases or selling selling of property. So it's saying in FY '27, the commissioner of Forest Parks and Rec is authorized to enter into a long term lease with the Hunts Association for the use of a structure at this park and the land on which the structure is located, and it sets out different conditions that would need to be met to exercise that authority. The two things I would note is time limited. The authority only exists in FY27, right? It's gone after that. You would have to meet all these conditions before you could do so. Certain term conditions, identifying fee or fee formula, conditions on the use of the structure, insurance, provisions for termination, what should be done with operation and maintenance, including responsibility

[Scott Moore (Joint Fiscal Office)]: for the

[John Gray (Legislative Counsel)]: This is from the house. It's from the house.

[Sen. Ann Cummings (Chair)]: From the house.

[John Gray (Legislative Counsel)]: Okay. How to resolve conflicts, and then following, as you would expect, administrative bulletin 3.5, which is standard for state contracting. So this is extension of authority to enter into this lease. Section 14, this is transferring property. So Commissioner BGS has authorized to transfer to Springfield a portion of the Southern State Correctional Facility property, this particular acreage, and it's for these purposes, municipal purposes, including economic development as an industrial parcel. Much like the above, there are contingencies that have to be met for this authority to be exercised. The commissioner may transfer only if the state obtains zoning or subdivision approvals, state and town negotiate updates to this existing agreement to establish responsibility for maintenance and upkeep access roads, water, and sewer service lines, and mitigate impacts to the Springfield community. Lastly, the transfer of property can't include any brownfields. So for the commissioner to transfer this authority, zoning subdivision approvals, updates to the '99 agreement to establish responsibility and mitigate impacts, and exclusion of any brownfields. There's also a bit of a check back. If the town has not begun developing the transferred property, this would mean that the authority has been exercised, right? So if the town has received the transferred property, but hadn't begun developing it for the intended purpose, economic development, by the March, the town will consult with VGS to examine alternative uses for the property.

[Sen. Ruth Hardy]: What is economic development? Is that a find?

[John Gray (Legislative Counsel)]: No, super broad. Super broad. The limited quality you have here as an industrial parcel, but note that this is just an including, right? It's to be used for municipal purposes. So quite expansive is what it could be used for. The real additions that you're gonna see on that transfer, and in fact, there's no limitation really of what can be used for effectively, because if you think about what it's saying is you need these conditions for the transfer, but the town just needs to check back with VGS to discuss alternative uses if they haven't done it for purposes of economic development. I think the background to this is presumably the town is only interested in developing it for this purpose, and so the reason you have this provision is because they would sort of need help in identifying what else could be done with this. But yes, and there's one last piece to talk about that's not in this section. There's a set of repeals, and maybe this will quiet any fears that are around this, but note that this authority already exists for a different purpose. 2024 capital bill contained authority for something quite similar, transfer of 10 acres, nine twenty two, from this property to the town of Springfield. That's being repealed and essentially replaced with this alternative authority for a broader piece of the same parcel. The piece I really wanted to hit here though is the above section is repealed, I'm sorry, on 07/01/2013, so if the authority to transfer, if those contingencies weren't met, that authority goes away at that time.

[Sen. Ann Cummings (Chair)]: Okay.

[John Gray (Legislative Counsel)]: Last piece, I'll, I think this is the last piece, I'm not gonna belabor this one. This section is in the budget. This is exactly what's already in the budget. This is not new. This is the required check back on AHS operating budget for the '41 bed high end system of care, saying it's literally verbatim, the budget language, and this was Corrections and Solutions Committee wanted to have like a seat

[Sen. Ann Cummings (Chair)]: and I didn't think so. We've been trying to cite one.

[John Gray (Legislative Counsel)]: Exactly. That's

[Sen. Ann Cummings (Chair)]: we call the Woodside.

[John Gray (Legislative Counsel)]: So, and what it does, as you know, in the budget, is it prohibits expenditure in FY '27 for any further development until that operating budget arrives. Section seventeen, one of the cash appropriations is $3,000,000 on the house side to have BGS to work with or it's DOC to work with ADS to install Wi Fi in correctional facilities, $3,000,000. And this is requiring a report monthly report during off session, so that the joint legislative justice oversight, including the chairs of the corrections committees, institutions committees, can check-in on that progress, basically. Effective home passage. So that is the House bill. I think that's mainly what you need to see, but I could give you like three minutes on the, I assume you need to see the Seventh Amendment. I don't know if Scott wanted to ask While you on this particular

[Scott Moore (Joint Fiscal Office)]: you're sharing, if you don't mind Madam Chair, I'll take it again into John's sharing, go back to section 13. The one thing I wanted to bring up about in this section is it does allow negotiations to start about a future lease, about futureness of a lease that could happen on negotiation to happen in the future, but now we're not. So as such, although we don't know what number could happen for income coming into the state of Vermont due to this lease, because there's a lease terms in here. It is probably most likely why this bill is here in this committee. Once the bill passes, I did talk to Commissioner Pitsko and she said they really haven't had a lot of conversations yet about this lease. This lease would allow FPR to work with the HUD sink fix an older house, the Little River State Park. They also have a HUD grant for this. The HUD grant expires in 2031, so there's plenty of time. But part of that would be they would fix up the sold properties. State of Mark would lease them. They would give back some money for that lease. In the past, they have had other lease negotiations like this that sometimes bring in 25,030 thousand How much that would come to Vermont? We don't know. So at this point in time is to really get a feel for what that might be. Quite frankly, because they're going to be entering into negotiations. A, I don't want to influence negotiations one way or the other to see how much money could happen. And B, we don't know that it will happen, might not happen. So at this point in time, don't have a fiscal note or anything for you all. I apologize for that. But I have no way to estimate what income could happen but this section is one of those bills here in my opinion.

[Sen. Ruth Hardy]: And it's just for this one state park and one potential building.

[Scott Moore (Joint Fiscal Office)]: This is future negotiations about something that probably could maybe happen. Yes. In fact, there's a benefit. Okay.

[John Gray (Legislative Counsel)]: I'm going to jump to the institutions amendment here, like I called out as instances of amendment. The first is updating the aggregate figure here. The reason this needs to be done is they, it's the reallocation section, pulled back about $870,000 added to the bottom line for extra project coverage here, so they increased the total bonding amount in the bill. The second instance reduces the, you guys might be interested in this, it reduces one of the

[Sen. Ruth Hardy]: line items. See, my maintenance.

[John Gray (Legislative Counsel)]: And it slightly expands the purpose of one of the line items to include 2nd Floor

[Sen. Ann Cummings (Chair)]: Oh, fire escape designs, yes. High heels go through those metal grates coming out the window. I remember watching people get stuck out there.

[John Gray (Legislative Counsel)]: Poles, zip lines.

[Scott Moore (Joint Fiscal Office)]: Perkins. Yeah.

[John Gray (Legislative Counsel)]: Trampolines. Like the trampolines. I'm pro defenestration, which is a word I love to use. Wait, what? What word? Defenestration, which is to throw someone out a window. Joy is good. Okay, so I don't know how interested you guys are going be, but I'm just going call up that sometimes the decisions you'll see from Senate institutions in this case don't actually well, this looks like a reduction. What they actually did is they shifted this 500,000 from bonding to cash. So we did not change the actual amount. There is something I wanted to call out here. This one is just a little bit uncharacteristic. It is not novel. Generally, the appropriations are going right to state facilities. Is not, right? Recovery HealthSync is a, I think they're a nonprofit, but this is for renovations at a residential treatment center. So I just wanna call out that as a characteristic, is slightly different from what you typically see in the capital bill.

[Sen. Ruth Hardy]: Where is that? Which one is that?

[John Gray (Legislative Counsel)]: Vital so Recovery House Inc. Is a group that owns both. They own Serenity House, for instance, And I think it was the 2018 capital bill had a similar line item or specifically Serenity House. But this is just to the group, so it could be, I think, either of the pieces that they have.

[Scott Moore (Joint Fiscal Office)]: And if we look at this particular section with last year's capitol, you may remember there was money in for a fishing derby because it's cash. It does have that. This run in this case, the recovery house does have roof repairs among other capital expenditures that would be built in.

[John Gray (Legislative Counsel)]: And then continued efforts to keep addressing the incarcerated women's population, including specifically the Chittenden Regional Correctional Facility. There's additionally cash for this piece. Typically, lenders in the capital bill has about been just about replacement, trying to general it's a huge project, so trying to build up a lot of This is more expansive. This is saying there are urgent needs, basically, at existing facility, do something now instead of just storing money for replacement. So that's and that's, I think, part of what generated the reallocation. The committee was looking for extra dollars because they wanted to support this project among other things, and so they clawed that that almost 870 and applied almost 600 of it to this purpose. Slide changes to the grant programs. These are standard annual amounts that go out for historic preservation grants programs, historic farms preservation grant programs. There's like seven different grant programs that are typically funded at $2.50 or 300. This is increasing those 400.

[Scott Moore (Joint Fiscal Office)]: This

[John Gray (Legislative Counsel)]: is tied to a later policy section that was added in senate institutions. There's some language addressing stormwater utilities, and this is providing a 100 k to support municipalities in designing and implementing those through ANR. The one reallocation I did wanna call out, scroll to it, it is here we go. Taking 868,850 from the 2021 capital bill, you're gonna see that this is the women's correctional facilities replacement call out. So lest you think that this is reducing the funds for that purpose, part of the statutory clawback factors, unless you refresh them essentially, that money would be part of the governor's recommended capital budget next year to be reclaimed, and it might not be applied to the same purposes. In taking this reallocation and applying it to the purposes that they did, they kind of preserve the funds. There would still be more to be reallocated, but they preserved the extent that they did for the loans corrections. That's how they get the extra dollars that you saw in section one. I'm gonna jump past these pieces, This is exactly as the House recommended, there's nothing else here from Senate institutions. This is updating cash appropriations. Some institutions did change a couple of things here. I can try to call out. They added this 1,000,000 for statewide 300 for personal stormwater compliance. I think that's in alignment with the gov rec. The house had essentially struck much of those dollars, both bonding and cash that would have gone to stormwater flights, cubic or parcels or water flights. So the senate kind of added that back in. They increased the door control upgrades pretty dramatically, I think, up to 2,700,000.

[Scott Moore (Joint Fiscal Office)]: Back to what the governor had up and up.

[John Gray (Legislative Counsel)]: This had been reduced pretty dramatically. On the health side, They, in addition to the bonded dollars you saw above, although I skipped past it really quickly, have tried to fully fund the boiler replacement figure that I think is happening quite quickly in alignment with the gov rec. And then they changed this particular call out. This is the what would have been previously the replacement with its facilities. Again, they're trying to do kind of urgent fixes of the idea, and they changed the dollar figure they earned. See. Okay. This is one of the bigger ones. On the house side, this was 3,000,000 for WiFi installation at DSC. In part, you could think of that as almost a statement figure for years. Folks have been trying to get this to happen. They wanted to take a firm position on it. Senate has cut 2,750,000,000 of that. And sorry, it's I keep saying Senate. Senate institutions report has cut that by 2,750,000 down to 250 k.

[Sen. Ruth Hardy]: Is that enough to

[John Gray (Legislative Counsel)]: The limited thing that I can say on this front is, I think there was testimony to suggest that the 250 it's hard for me to express this. Folks were trying to figure out dollars for another project, maybe the boiler replacement. I can't remember.

[Sen. Ann Cummings (Chair)]: We were robbing Peter to pay.

[John Gray (Legislative Counsel)]: The administration came and said, You could reduce this and just apply $2.50 k to the WiFi, and that would be sufficient. That's basically what I recall happening.

[Scott Moore (Joint Fiscal Office)]: John, I'm happy to jump in by Department the way, if you don't of Corrections, the deputy commissioner had come in and said, we don't have a plan in place yet with use of all this money, so it's great you want to give it to us. However, it's too early in the stages. They're also looking for some other sources of funding, including the Feds and the Gold Board, the Lifetime Board, another board that The

[Sen. Ruth Hardy]: Community Bank.

[Scott Moore (Joint Fiscal Office)]: Thank you. So they already had some plans in place to get some funding for this. The House did feel that this has been a program they've been trying to do for a couple of years, so they wanted to make sure something did happen. In the House, the administration did say we don't have use for this 3,000,000,000. Please take this and fund our priorities. They said, looked at that and said, we will fund some of those priorities again as you saw written back up to become correct. But at that point in time, Department of Corrections came in and said, This $2.50 could be used to help create this plan that they need for the future. That is part of that discussion.

[John Gray (Legislative Counsel)]: There's a history here. That's part of it. It's not exactly analogous to the budget language related to the Highland System Facility and Care Act, but if you check on House Corrections page, you'll see a letter from PDS that this has been a repeated request that hasn't happened. So I don't want to delve too much of it, just to say that this is unlike many other line items, bit more of a touchy subject where, again, I think the house was trying to take a position with the 3,000,000 and saying, we want this done. But as of yet, no plan.

[Scott Moore (Joint Fiscal Office)]: The other thing, and I don't want to go into too many weeds about how the capital bill works, but as part of the cash fund, the capital development, up to 4% of the previous year's general appropriations can be put into cash in the capital bill. Year, minus the debt services, this year that was a $17,000,000 number which is in part why the total money available in the cash fund or the capital bill is 160,000,000 and 100,000,000. And I think in some ways the government could use that cash the way the government wanted. And the house felt that the 17,000,000 of money above last year's funding and as such they chose to, like John said, make a statement of almost 3,000,000 here. That remained necessarily in that part of the programs other than taking money away from some of the recommendations. So the Senate for the most part had brought the governor recommendations back up to where the governor rec was. A lot of that came from his wife.

[John Gray (Legislative Counsel)]: You you'll recall we talked about the Little Little River State Park lease that was authorizing, Forest Park and the rights to enter into a lease. This replaces enter into with negotiate. So the intention from the institutions committee is to remove the The background to this is wanna see the lease before the project is done. That's basically the one I

[Sen. Ruth Hardy]: heard from Robert.

[John Gray (Legislative Counsel)]: I will just say that you don't need a session to authorize this. Folks can talk

[Sen. Ann Cummings (Chair)]: and bring And it's still a free contribution.

[John Gray (Legislative Counsel)]: Yes. So technically this is now a somewhat superfluous section, but politically the thing this does is preserves this section for conference committee, and I think the intent from the institutions committee is maybe just spend some more time thinking about what additional conditions they might want to include in the So hopefully they would have time to figure that out, but this preserves it for conference committee. The ninth and since years ago, there was authority for BGS to sell 110 stakes trade. I don't actually know who is in that or anyone who's It's one who? I mean, it's just outside. It's, you know, not far away. Yeah. Is this the

[Scott Moore (Joint Fiscal Office)]: post office?

[Sen. Christopher Mattos (Clerk)]: I know. No. I don't think it's Warner.

[Sen. Ruth Hardy]: It's it's the really beautiful building on the corner,

[John Gray (Legislative Counsel)]: I think. Yeah. I just looked it up or it's

[Sen. Ruth Hardy]: really scary. Okay.

[Sen. Ann Cummings (Chair)]: Google tells me it's turning. Sitting down. Right? Right on. Just on the.

[John Gray (Legislative Counsel)]: Here it is. Look at this.

[Scott Moore (Joint Fiscal Office)]: Yeah, here

[Sen. Ruth Hardy]: it is. It's really beautiful.

[John Gray (Legislative Counsel)]: It's our building. Yeah. I've never gotten to do this. Very cool. More jewelry sales. The last piece is, I prefaced this earlier, institutions added some language related to storm water utilities. I will say that I am not best positioned to describe this, I didn't draft these provisions, but I will explain my simple understanding of these. This is trying to ensure, so let me just read it. Any municipality may adopt bylaws to implement stormwater management and control consistent with the program developed by the Secretary of Natural Resources. The creation of a regional stormwater utility under statute of rules of AR, shout out for venom unity regulating stormwater under the subdivision, including adoption by the municipality of a bylaw establishing a municipal stormwater utility. Don't charge these fees. I think this is trying to get in front of the future, an uncertain future in which there are fears that maybe regional stormwater utilities would somehow displace authority or communities to act on their own. This is language intended to ensure that the municipalities are not deprived of the authority that they do have. So the creation of a regional stormwater utility shall not prevent municipality from regulating stormwater under the subdivision, including by by law.

[Sen. Ann Cummings (Chair)]: And the

[Sen. Ruth Hardy]: chair loves municipal regional stormwater utilities. So That's how we got this. Yeah. That is how we got this.

[John Gray (Legislative Counsel)]: Section 19 is essentially the same thing. Creation of a regional stormwater utility under statute or rules of the ANR shall not prevent a municipality from regulating stormwater, including adoption by the meaning of it by law, authorizing the operation of a municipal stormwater utility that establishes those peace of mind. So I think this is trying to get in front of a potential concern. Same effective dated passage, and that is the capital book.

[Scott Moore (Joint Fiscal Office)]: Madam chair, I'm happy to go through all the nitty gritty of everything if you'd like. I brought a copy of the spreadsheet. It's really colorful. I'm really proud of it.

[Sen. Ruth Hardy]: But if

[Scott Moore (Joint Fiscal Office)]: you're not into it, we can pass.

[Sen. Ann Cummings (Chair)]: I guess the reason we have this is there's some leases in there

[John Gray (Legislative Counsel)]: that could Which we discussed.

[Sen. Ann Cummings (Chair)]: Yes. Lead to some increase in revenue or not. Is that it? Pretty much. Pretty much. So it's the Little River State Park, which is where is the State Park? Waterbury. That's what I thought. Where is the? Out of Waterbury Center, right? Is that on your axis and on Route 2 heading towards Richmond? Okay. That one and there is a whole the remains of a WPA work camp up there that has returned into a local park. At one point, I thought 4050, they went back to the nineteen twenties, issues of Waterbury Record. It was fascinating. And there's a lot about that park in the WPA, and they were run by generals that came up and said, well, and the governor regularly called the legislature back into session in the summer. But, yeah, I thought that was Little River Up there. Okay. So that could could be a nice area. Do you want a promotion?

[Sen. Ruth Hardy]: I I ask because I have to leave, so if you

[Sen. Ann Cummings (Chair)]: want me here, I'll vote. Yes. That would be good. Okay.

[Sen. Ruth Hardy]: I it's Are you ready for that? Are we ready? I'm ready. I move that we find favorable the h nine fifty two, the capital bill as amended by the senate committee on institutions.

[Sen. Ann Cummings (Chair)]: Okay. Senator Hardy has moved that we approve we revise favorably. Nine fifty two is is sent to us by the Senate Committee on Institutions. Further discussion, any amendments? If not, we'll call the roll.

[Sen. Christopher Mattos (Clerk)]: Senator Chittenden? Yep. Senator Beck? Yes. Senator Hardy?

[Sen. Ruth Hardy]: Yes. Senator Brock? Yes. Senator Gulick? Senator Mattos?

[Sen. Christopher Mattos (Clerk)]: Yes. Senator Cummings? Yes. Six zero one.

[Sen. Ann Cummings (Chair)]: Who would like to report that? Do you wanna do the

[Sen. Ruth Hardy]: Or Are you looking at me or Chris? Chris? You've reported one for a while.

[John Gray (Legislative Counsel)]: I mean, sure.

[Sen. Ann Cummings (Chair)]: All you gotta do is say we approved it.

[Sen. Christopher Mattos (Clerk)]: Sure. I'm

[Sen. Ruth Hardy]: there. Maybe, at least maybe.

[Sen. Christopher Mattos (Clerk)]: The word fee showed up in this bill 14 times.

[John Gray (Legislative Counsel)]: Six times. Thank you so much.

[Sen. Ann Cummings (Chair)]: Job. We got one more and it is miscellaneous tax. There, went over it yesterday. We had wording. This is the date chain

[John Gray (Legislative Counsel)]: The yield bill.

[Sen. Ann Cummings (Chair)]: The yield bill.

[John Gray (Legislative Counsel)]: Yep, I can do this one real quick.

[Sen. Ann Cummings (Chair)]: Yeah, this is the date change which makes it possible for tax

[John Gray (Legislative Counsel)]: to It's clarifying language, actually. So just to orient before I show you the amendment, this is what the committee passed out. This is your amendments to yield bill. You'll recall that the ending sections are the expansion of the credit for one year. So what I'm gonna show you is the effective dates in that as pass out of here. They just get the big broad bucket call out, and they say that the renter credit expansion takes effect 07/01/2026, and the narrowing, the return to current law takes effect 07/01/2027. This amendment, I have in your name, although we can change it to be whatever you guys would like, if I can find it, it's fine.

[Sen. Ann Cummings (Chair)]: So this is the renter credit. The other one is the coupling, decoupling

[Damien Leonard (Legislative Counsel)]: That's the other bill.

[Sen. Ann Cummings (Chair)]: Which we need to do to miscellaneous, right? That one in here.

[John Gray (Legislative Counsel)]: So that's not in this. This is just the

[Sen. Ann Cummings (Chair)]: yield bill update. This is the renter credit that we did.

[John Gray (Legislative Counsel)]: This doesn't change anything about the effective dates. It's the same effective dates, it just adds this language. Apply to claim year 2027 for those that become immediately effective. Claim year 2027 is taxable year 2026, so this is applying that one year expansion. And then it makes clear that the return to current law applies to claim years 2028 and thereafter. This is what would have happened even if you don't do this, but it's nice to call out what claim you were It advised does not change the dates that these go effective, it is just clarifying.

[Sen. Ann Cummings (Chair)]: Okay, this is clarifying.

[Sen. Ruth Hardy]: It's not

[John Gray (Legislative Counsel)]: a summary of any

[Sen. Ann Cummings (Chair)]: further discussion? We don't

[John Gray (Legislative Counsel)]: I think this is a straw hole one just in case

[Scott Moore (Joint Fiscal Office)]: straw hole. Yeah. We don't I mean, something to notice the

[John Gray (Legislative Counsel)]: calendar in. Yeah. Yeah. This is because this is in your name.

[Sen. Ann Cummings (Chair)]: Yes. Well, I'm doing the yield bill, so I'll just say it. Well, I tried anyone disapproved the other day. Is everyone okay with this clarifying amendment? Yes. Yes. Okay. I'm not hearing any no's. So

[John Gray (Legislative Counsel)]: He has a thumbs up. Senator Chittenden had

[Sen. Ann Cummings (Chair)]: a thumbs up. Yeah. Okay. You got thumbs up. Alright. That was easy. So Patrick is on Zoom, and he's already there. Okay.

[Sen. Ruth Hardy]: As as possible. Thank you, John.

[Sen. Ann Cummings (Chair)]: Thank you. Scott. This is again, they would like transportation out of the air base. So far, we have I remember we're striking all the funding language in here for removing the money from the Ed Fund or the transfer from the general fund because we did that at miscellaneous tax. Remember we adjusted Right

[Scott Moore (Joint Fiscal Office)]: by '27, yep.

[Sen. Ann Cummings (Chair)]: Yeah, '27. So until we change it again, and as long as the tax revenue's old, they get 10,000,000 plus or minus, They get that piece ongoing, so we need to strike that section. And there's one other Jet fuel. Fuel. Yeah. Not sure it's the tax on yesterday. Got to hear it from the Burlington Airport. So we're striking those two sections. The one that we still seem undecided on is MBUF. Is it MBUF?

[Damien Leonard (Legislative Counsel)]: It is MBUF.

[Sen. Ann Cummings (Chair)]: MBUF, alright. New language. And we again, there was just a lot of verbiage in there, and I think we're still seeking it out. I think there still need some clarity to how it will work. It didn't seem once we understand how it will work, didn't seem to be a lot of concern about sending that to EVs and perhaps at some point, you know, duals, but the combustion engines seem to be causing some consternation even though I feel better about that, the more I learn. So, hopefully, we could put Patrick up and send her Chittenden, you have your hand up. You don't have I

[Sen. Thomas Chittenden (Vice Chair)]: just wanna say that, yeah, I do have reservations about the m buff, but I don't need to overstep on the policy front for the Senate Transportation Committee. I hope they'll reconsider some of these concerns on the out years, but I don't need to hold this bill up if it needs to get out today, and I think we should move it along, but that's just where I am.

[Sen. Ann Cummings (Chair)]: So I haven't got that on for today, right? No. They haven't told me it has to come out yet, and I think we're pretty full next week with the budget miscellaneous and yield, so they probably if we vote this out Tuesday or even Wednesday, they won't get to it. So, Patrick, you are with us. I hope we're not taking you away from something more enjoyable than talking to us about MBOB. I like the Montpelier seeing behind you. Yeah.

[Sen. Ruth Hardy]: But

[Sen. Ann Cummings (Chair)]: it might be helpful if you just first walk us through what this would do to EVs. I think we understand that, but just walk us through, then take us to the next step, and then finally to the third step, which is combustion.

[Patrick Murphy (AOT State Policy Director)]: Sure. Thank you, Madam Chair. For the record, Patrick Murphy, State Policy Director for the Agency of Transportation, and happy to be here. Apologies for not being able to be in person. I think it would be good to, excuse me, start with sort of the context for all this for the funding picture that we have, and that might provide some insight into, what your colleagues in the Senate Transportation Committee had been thinking about, and then get into, some of the more of the detailed questions that you may all have about how we expect this to work in practice. So I do have some slides to to provide that, context, if I can share those in a second here.

[Sen. Ann Cummings (Chair)]: Sure.

[Patrick Murphy (AOT State Policy Director)]: Can you see this okay?

[Sen. Ann Cummings (Chair)]: We can there we go. That's perfect.

[Patrick Murphy (AOT State Policy Director)]: Okay. Thank you. So as a Vermonter John Dewey has said, a problem well defined is is a a problem half solved. So we wanna be able to sort of give you a clear sense of of where the funding problems are, at least within the arena, fuel taxes not getting into purchase and use here.

[Sen. Ann Cummings (Chair)]: Okay.

[Patrick Murphy (AOT State Policy Director)]: So the gas tax was originally intended as a road usage charge. And as you've heard in testimony, this has become more problematic as we've had a diversification of vehicles over the past several decades. And and then with the introduction of electrification. So there are three main problem problems that come out of the fuel taxes here in Vermont. First is electrification. So it's money that we're not collecting because EVs don't consume gas. The legislature addressed this in part with a flat fee of $89 for an infrastructure fee, but that doesn't cover the full cost of the impacts that electric vehicles have on our road network. Fuel efficiency is another big area for revenue losses. So over the past several years, greater fuel economy means the vehicles, each vehicle is consuming less gas and therefore paying less in in fuel tax. And then inflation is actually the biggest variable of all of this. So because there's no inflationary factor that's applied to the fuel taxes, purchasing power has been diminishing over time. So those are the three main issues that we see with fuel taxes. On the national level, we see this. This is looking at in terms of if you hold held the fleet in 2023 at constant, where would the biggest percentages of losses be? And so on an annual basis, you'd see a 3% loss due to electric vehicles, a much higher loss due to improved vehicle efficiency. And then when you then factor in inflation, that becomes more significant. At the Vermont level, now, because there is an infrastructure fee in place, we're losing about a million dollars a year or so, given that we have 13,000 fully electric vehicles. And if you apply the same methodology, if you freeze the the fleet makeup of of where the fuel economy was in 2013, we are probably losing somewhere around $16,000,000 over those gains that we've seen in the past decade plus. So we are at about 13,000 vehicles, and that means that with those only paying roughly just over half their fair share, the average gas vehicle is paying, means that we're losing about a million dollars a year, but that is expected to grow, and so that's one of the big things that I know the question came up about is this really worth it because we're not going to see necessarily big gains in the in the first couple of years in terms of revenue. And what we're doing is laying a found foundation for being able to capture that revenue that we know will increase over time as more and more vehicles become electric. This give you a this slide is intended to give you a sense of how things have changed since the gas tax was last raised in 2013. Ford 150 is probably one of the more popular vehicles in the state. Back in 2013, the average Ford 150 was paying about $270 per year. That's based just on 11,000 miles a year. So on a per mile basis, it was paying about 2.5¢ per mile. That same vehicle in the latest model year is now paying almost a $100 less, 1.7¢ per mile, because of just the increased fuel economy of the fleet, but in in this vehicle in particular. And now there's also a hybrid version, which consumes even less gas and therefore pays more than a $100 less per year. And then there's a Ford Lightning, of course. And up until 2025 was paying no gas tax at all. And then now with the $89 fee is paying roughly 0.8¢ per mile. So there's been a huge variation over the past decade, but then even within vehicles right now, there's a high degree of variation. This is the same vehicle more or less. In fact, battery electric vehicles generally weigh a bit more. It has the same impacts on the road network, and yet all of these vehicles are paying different amounts. And so what we're trying to do is get to a system where each vehicle is paying roughly the same on a per mile basis. This is, those figures adjusted for inflation. So you can see once you build an inflation factor into this, you see even a larger drop in in revenue. We see this at the federal level as well, where the gas tax is about 18.4¢ per gallon has not been changed since 1993. Here again in Vermont, the last time the gas tax was changed in 2013, the average fuel tax being paid on a per mile basis was about 1.7¢ per mile. That's now changed to about 1.4¢ per mile, which is what we're recommending for the mileage based user fee. But in twenty thirteen dollars, that's only about a cent per mile. Wanna run through this was a a presentation, that the UVM Transportation Research Center had given to your colleagues in Senate Transportation, looking at revenue projections and the sort of degree to which inflation in particular plays into this. So this is looking if we just did nothing, where would we be in about twenty, twenty five years? With no policy changes, we see a significant drop in fuel tax revenue, which is to be expected. And that's because of these three different variables. First, electrification, which is expected to grow. Second, fuel economy standards, are all are also expected to grow, and then inflation. The assumptions used were fairly conservative, so instead of relying on what we had previously, You know, the climate action plan and comprehensive energy plan targets are are quite aggressive and optimistic at this point. So if we use data that goes back to a time before there were any advanced clean cars, two rules in place, which is the regulatory mechanism for delivering more vehicles up to a 100% in 2035. So the state has put a pause on that. We didn't factor that in. If we We took a more conservative outlook, knowing that federal policy has changed significantly in the past year and a half or so. So this gives you a comparison of what we had expected under the climate action plan when we had all kinds of other investments and incentives in place, and then what we now are projecting for these potential revenues in the future. So if we put up in place a mileage fee for battery electric vehicles, we see this, you know, it's a a few million in the first few years, and then it grows over time based on the assumed EV adoption rate. If you then move towards more fuel efficient vehicles, you can expect to see, you know, slightly higher increases in the beginning, but then, you know, also continuing into the out years. If you had a mileage fee that's indexed to inflation based on the National Highway Construction Cost Index, which is something that's used by FHWA, the Federal Highway Administration, and that's based on real data from what state DOTs are paying out to contractors on their Federal Highway Aid projects. You see inflation here has a big impact when you have some sort of adjustment in place. To narrow that down, this sort of yellow dotted area in the middle is to give a sense of if you just index it indexed for inflation for just a battery electric vehicle mileage fee, where would you end up? And then the the higher red out outlined areas are if you move to to all vehicles. These are the cost inflation cost indices that the committee looked at. The agency had recommended National Highway Construction Cost Index because that's really the what our budget is driven by by construction projects. And so it relates most closely to what our budget is, but there are other indices to go by that other states use, and I think it's a topic for discussion later, what the best index might be, and then also whether to put a cap in place, so there's not huge jumps that we've seen in some recent years. So a number of states do have inflation indexes for their indices, their motor vehicle, for their gas taxes, fuel taxes, four of those base it on construction. One other thing that I wanted to flag, talked about this the last time you all met with me, but there is a flat fee in place of a $178 in the in the current language. And how that might make sense for transition, for people to be onboarded and get used to the system, and to address some of the shortcomings of the system in our initial inability to distinguish between in state and out of state miles, longer term, keeping a cap in place will impact the amount of revenue you're able to generate. So this gives you a sense that, you know, if you had a $140 cap, you're losing probably somewhere in the range of three quarters of the revenue that you might otherwise gain. And because folks that drive more than that amount per year are going to opt for a flat fee over over the mileage that they're actually driving. And so it gets away from what we're trying to move towards, which is to have people pay for the actual mileage that they're driving in a way that reflects the impacts on our infrastructure. So a $178 fee, it's not in this slide here because that was not a number that was talked about at the time this was generated, but you can see that it would be somewhere over 50% of the revenue that might be lost by keeping that in place. How do we address these three different problems? The first is

[John Gray (Legislative Counsel)]: If you Sorry

[Sen. Christopher Mattos (Clerk)]: to just a question about that that flat B in the T Bill, it's a $178. Right?

[Patrick Murphy (AOT State Policy Director)]: Yes.

[Sen. Christopher Mattos (Clerk)]: Does that go away after a certain period after it's kinda onboarded? I forget from what they need.

[Damien Leonard (Legislative Counsel)]: Not not in the current draft.

[Patrick Murphy (AOT State Policy Director)]: Right right now, the language does not sunset that.

[Scott Moore (Joint Fiscal Office)]: Alright. Thanks.

[Patrick Murphy (AOT State Policy Director)]: Sure. So the first part of this is addressing electrification, and it's what our grant application to FHWA was focused on. So it's what we have federal funding to be able to support implementation by January 2027. We have contracts in place to be able to do that. But it's also to be able to, as I said before, build the capacity to address these other issues. So we're the immediate phase is really tackling electric vehicles because that is on a per vehicle basis where we're losing them the most amount of revenue. It's a narrow group of vehicles at the moment that we know will know and expect will grow over time. So it makes the most sense to be able to to in this first instance of a mileage based user v to to figure things out with a smaller group of vehicles in a way that that gets us to make some progress towards what we know will will be needed in the future. So fuel efficiency in the Senate version of the transportation bill was expected to be kind of included into this by 2029. That wasn't the administration's proposal. It came out of the Senate Transportation Committee, but that's to give you an idea of how they were thinking about this, that that things needed to be phased in and they would like to see some definitive move towards including fuel efficient vehicles because they know that that's where there's there are some significant revenue losses. And then what was proposed by the Senate in their, excuse me, by the Senate Transportation Committee in their version of of the transportation bill was to have the inflation adjustment put in place once all vehicles were in the program. So it would be done on on a fare basis, and there wouldn't be sort of diverging lines of where people where different vehicle classes or vehicle types were. So what we've proposed, you've seen this slide before, is to really build on our existing systems to fit within our climate action targets, and to be able to use cost effectively what we already have in place, which is an annual vehicle safety inspection process that is currently collecting odometer readings and avoiding those issues with privacy that other states have had had some concerns about, and then being able to build off of the existing infrastructure that we have so that more methods of reporting might be incorporated into this in the future allow for flexible payment options so it more closely approximates what people pay for the gas tax and then to be able to use these federal funds for implementation. We have $3,000,000. We have committed to being able to build this out. It is something that the Federal Highway Administration is looking closely at to be able to address their own issues with the Federal Highway Trust Fund. And to be to really start small and to strategically think through all these different steps so that we we are able to expand and evolve over time and become fairer still. We understand that this is not a system that's going to be perfect from the start, but it is our intent to design a fairer system because what we have right now is inherently unfair when you have different vehicles paying different amounts despite having the same impacts on the infrastructure. So the way it would work is that people continue to pay an $889 road usage charge until there's sufficient mileage data within the system to be able to apply a mileage fee. Once that's in the system, then those whatever those prior fees had been paid into the system, they would be credited against that first mileage fee, and and then the balances for those mileage fees would be reconciled at the point of registration renewal. As I said before, the the mileage fee is effectively capped at a $178, which is roughly 12,700 miles, so that anybody who drives less than that amount would pay less than that fee. And anybody that drive drove more than the 12,700 miles would pay only the $178. And as you heard Chair Westman speak to, earlier in the week, that was also to kind of address some of the concerns around, driving out of state and, and, some of the issues that can't just be dealt with in this first phase. Users would be able to have a lot of choice. They're still able to pay in the same ways that they do now at the DMV in person using cash, credit, checks, but they'd they'd also be able to to to pay upfront. They'd be able to just wait and pay a registration renewal, or they would be able to decide that, well, I'm I'm not comfortable with this, you know, high amount either upfront or at the end, and I'd rather be able to space these payments out on whether it be on a monthly or quarterly basis. So it to the user themselves, it it is intended to be as simple as possible and to as be as accommodating as possible so that we we have people onboarded into a system that that doesn't seem too complex to navigate. The second piece of this that the committee, the Senate Transportation Committee had talked through is is language that would bring in more fuel efficient vehicles, conventional hybrids, plug in electric hybrids. Throughout the session, they've gathered testimony from not just the Agency of Transportation here in Vermont, but other agencies who have run pilot programs or who in the case of Hawaii, are actually have implemented a program to be able to understand what is the landscape for all of this. And they had folks from Virginia come in to speak to their committee, so there does seem to be some support for this notion of mileage fee that is not quite not quite a pure mileage based user fee, but looks at what is the increment that we are losing on each vehicle and being able to kind of come up with a way to to recapture that. So when you look at this chart, vehicles that are getting 23 miles to the gallon or lower is on this left hand side, they're already paying more than 1.4 on a per mile basis. In some cases, as you get, you know, further and further to the left, as you go lower in fuel efficiency, you have a number of vehicles that are paying much higher than 1.4¢ on a per mile basis. And this does have equity implications because at least here in Vermont, those driving less fuel efficient vehicles tend to have lower incomes and be located in more rural areas. So then as you move, you know, 23 miles to the gallon is about the average fuel economy here in the state of Vermont for a vehicle, for a light duty vehicle. And so as you go beyond the 23 miles a gallon, you can see in this orange increment that we are sort of beginning to to to bring in less than 1.4¢ per mile for each of these vehicles down to, you know, 60 miles to the gallon. There there aren't a lot of vehicles down at that, you know, high a a mileage rating, but but you do have Prius's that are, you know, between forty five and and fifty two miles to the gallon. There's a number of vehicles, over 20,000 hybrids that that are getting some very good fuel efficiency, and so we're not seeing the same amounts being paid on per mile basis. And so this is just to give you a sense of what the committee has talked about, looking forward to the next phase of implementation. I wanna reiterate that we have a federal grant for $3,000,000 to do this work. We have committed some of that already to an IT contract to be able to do this work that was asked of us by the legislature in 2023, and then again in 2025 with some refinements to how the legislature wanted to see the program designed. So this is, you know, very good opportunity. It's at 80% of the total cost of the project, is higher iterations of this grant program for a fifty fifty split. So this is very favorable to the state of Vermont to be able to take this money and implement the program before EV adoption grows as a funding problem. So, you know, in in some cases, it is, as you all know, important to spend money to be able to to make money. And in this case, it's, you know, not not a bad situation to be able to spend somebody else's money, to make money. So we have, this federal grant and tasks that have been laid out. And I wanted to share this because I know there have been a number of questions. It's not a not an easy thing for for people to, you know, hear in just one sitting and and wrap their heads around. There is a lot of work within this that the agency will have to do to be able to reach out to the public, reach out to the specific users who will be impacted in this first phase, not only incorporate their feedback into the design of the system, but to share what it is we're working on and why and and understanding how the program will work. So there's a substantial amount within this grant budget on public outreach and education. Even in the system implementation task, there is a lot of work to be able to to survey folks, to be able to incorporate some of their concerns into the design of the program, and then afterwards to help evaluate the program. So it's there's quite a bit that that will help to interact with the public and build awareness of of what we're trying to do. And then this is I think maybe the last slide that I have, which is to just address what's in the bill right now. There are a number of check back points. Again, the agency, the administration has not supported making these latter phases required. We wanna be able to learn from from the first phase of in working with electric vehicles, but but there are a number of check backs that have been built into this bill so that you all will have more information to be able to think about how the next phases would roll out. And later in this year, we'd submit a communication strategy. It will have already begun in the summer, but you'll have a communication strategy that will walk through what we intend to do, not just leading up to implementation in January 2027, but all throughout '27 leading up into '28. So we really have eighteen months of to work with and being able to to reach out to the public and the impacted parties, because people are gonna gradually be introduced to this program. We'll have general outreach to all electric vehicle owners, but then each person is going to come into contact with the system through the registration process, and everybody's on a different schedule, and we'll be on board and there'll be enough opportunity to first lay out what's going on, understand what their past mileage has been and and what they might expect for future bills, but they won't see their first actual mileage based user fee until the second registration or in some cases even a third. The other piece is there's a lot of reports, so asking the agency or requiring the agency to submit an initial transition plan by next January, so you have that information to consider with your next transportation bill. Looking at additional mileage reporting options to distinguish between the in and out of state miles, This was set up to use our existing system because that was the most cost effective way to do it. But we know that we can make the system even fairer still if people have the option to be able to distinguish between in and out of state miles. It's not expected to be a concern in the at the outset because a number of states, most states do not have a per kilowatt hour tax or anything that they're capturing on out of state vehicles. The closest state to us is Pennsylvania that has something like that, and Georgia. So there's there's a very small risk of double taxation on all of this. The other piece you began to discuss the other day was a system of fuel tax credits and how that would work in relation to the mileage ratings for different vehicles, in order to make sure that no vehicles registered in the state of Vermont are paying more than that rate of 1.4¢ that has been proposed, but still to be able to capture that out of state revenue. So a system of fuel tax credits would potentially act as people are paying the fuel tax as they go throughout the year, and that's almost in advance on their mileage based user fee payment that's credited within their account. And so at the end of the year, people would end up paying only that increment that you saw in the in the orange in the in this a couple of slides ago. We've been asked to look at a proposed schedule for other vehicle classes and fuel types. So not just hybrids, conventional hybrids in in 2029, but all the all light duty vehicles in 2031, but then to look at medium and heavy duty electric vehicles, does it make sense to have a weight based factor there because of the increased impacts on the infrastructure? And then looking at a recommendation for a flat fee cap, default flat fee, which is something that's in the current language now, it's again a $178. If somebody doesn't go and get their vehicle inspected, they would there's no data on which to apply a fee, and so they would just be charged a $178. If they then went and got their vehicle inspected within ninety days, whatever difference they might have overpaid in that initial instance, it would have allowed them to move forward with the registration process, and that difference would be credited towards their next mileage fee. And then we're asked again for recommendations on a capped inflation adjustment factor, once all vehicles are enrolled, and then to have some ongoing reporting on the program results in the first several years of the program. And then lastly, the language requires that we submit a draft final report, which is a part of our grant agreement by 07/15/2028. The gist of what I wanted to get across today, but I know you all have questions.

[Sen. Ann Cummings (Chair)]: I think it's becoming clearer. I do have one question. I guess I've heard you say that the agency and the administration doesn't support going all the way to combustion vehicles or the weight fees or whatever at this time. But does the bill assume that we are doing that, or is the it sounds like the bill is set out in stage steps, and is that something the agency can accept? If we vote the bill as is? We've taken jet fuel and the funding out of it, but

[Patrick Murphy (AOT State Policy Director)]: Sure. So I think as the secretary explained the other day, it's as I understand it, the agency and administration isn't opposed to that. We're just not there yet, and that what we wanted to be able to do is to learn from this first phase of implementation and then to understand how things would work in a in a second phase of rolling it out to make what we're talking about is many more vehicles that come with even more complexity because you have to design a system of fuel tax credits to be for it to really make sense. And so I I understand what the Senate Committee on Transportation was trying to do, basically set a marker in place in statute that would create the need to come back with all of these different reports and additional information to inform how that next phase would roll out. And but I but I do think that there are things that would need to be put into place for it to to roll out successfully. And that means that you would need to have language in there that that does actually lay out a system of fuel tax credits. Because as it's written right now, it's you have both a mileage based user fee, but no, like, repeal of the fuel tax is so you have two systems working in concert.

[Sen. Ann Cummings (Chair)]: Okay. Yeah. I mean, I think before it is set out in steps, I mean, first we do this, and then we do that, and then we do that, and I assume that you you would remove the gas tax?

[Patrick Murphy (AOT State Policy Director)]: Well, I I think I think that's an open question, obviously, for for you all to decide. What the committee had had talked about is this system of fuel tax credits, which would act as sort of an advanced payment on a mileage based user fee.

[Sen. Ann Cummings (Chair)]: Oh, okay. So that's refundable. If I go through a $178 worth of gas tax, which I get credit, so I won't be double paying.

[Scott Moore (Joint Fiscal Office)]: That's right.

[Sen. Ann Cummings (Chair)]: And that answers the concern I had about the little old lady that only drives five miles to church and five miles to the grocery store every week.

[Sen. Ruth Hardy]: Okay.

[Patrick Murphy (AOT State Policy Director)]: And so in in in the agency's proposal, that young woman would would only be paying up to the amount that she's actually driven and not up to that $178 So I Damien can speak maybe to to some of the language that may or may not need to be adjusted for that. But in the agency's proposal, we would like to see those that are driving less than that 12,714 miles that they're only paying exactly the amount that they've driven. If people, you know, drive 13,000, fourteen, fifteen thousand, that they would then be they would be paying just that flat $178. And then ideally ideally, that cap is lifted as you have more vehicles come in because you do have more complications when people are paying both fuel tax and a mileage based user fee because as you saw, I think from some of the slides, you can have a gas vehicle that's paying 200 some odd dollars, and then we and we have a difficult situation created by having just a $178 cap.

[Sen. Ann Cummings (Chair)]: I guess what I'm trying to figure out is if this committee is comfortable with going with a step fee that you have laid out, what needs to change in the bill, if anything, to make the agency, I. E. The administration, comfortable. And then so then we know what we're working with there and then we could talk about what would make the committee comfortable and Senator Hardy has a question.

[Sen. Ruth Hardy]: Thank you, Madam Chair. Patrick, think this is helpful to understand this a little bit better. I mean, I have this similar concern that the chair has about the person who's driving only a few miles. I heard you talking about wanting to make sure that this is fair. And I and I think there are multiple sort of angles on fairness and one is, you know, double taxation. And then the other is if this whole concept is built on the premise that we're charging people for the number of miles they drive because that's how much their usage of their vehicle is impacting our infrastructure, our roads, and we want to charge them based on how much they're driving. That it does seem like the out of state miles are relevant even if there's not passed in another state because they are being driven in New York or Ohio or whatever. They might not be taxed because they're an electric vehicle, but they're not impacting Vermont's roads because they're impacting New York's roads.

[Scott Moore (Joint Fiscal Office)]: But they're not paying a fee to New York.

[Sen. Ruth Hardy]: But they're not paying a fee to New York. But but if the concept here is the the more you use our roads, the more you should pay for them, then that's not completely consistent. And so, you know, I mean, there's inconsistencies across lots of things we do, but I just, you know, don't quite understand that inconsistency. But also, I think incentivizing in some ways, driving less is is a good thing if that can be done. Some people can't avoid driving a lot but some people can and driving less is, you know, has less impact on our roads. And I was interested to make you mentioned in your final slide, I think, about the the weight of a vehicle because that has a huge impact, you know, a a very, very light vehicle driving on our roads first versus a very, very heavy vehicle driving on our roads has a different impact. So is that currently do do we charge more right now for registration fees or something for heavier vehicles? 10,000

[John Gray (Legislative Counsel)]: pounds.

[Sen. Ruth Hardy]: Over 10,000 pounds, okay, but that

[Sen. Ann Cummings (Chair)]: would be something you would

[Sen. Ruth Hardy]: put into this later perhaps?

[Patrick Murphy (AOT State Policy Director)]: Yeah, so the research shows that light duty vehicles between basically 10,000 pounds or below, there's very little difference in the actual impacts that those vehicles have on our infrastructure, so pounding the pavement. They're 10,000 above. There does, there is research that shows that has a significantly higher impact. So obviously when you're talking about tens of thousands of pounds on the roads, that has a much higher impact. So it's not been it's not been considered for light duty vehicles.

[Scott Moore (Joint Fiscal Office)]: Okay.

[Patrick Murphy (AOT State Policy Director)]: But it would be something that we would definitely look at and that the legislation directs us to look at if we were to move towards medium and heavy duty vehicles. The first the first instance of that would would definitely be electric vehicles. So there are higher registration fees for and it's tiered based on weight. Okay. And so but I think you'd have to look at that comprehensively to understand the impacts and then come come up with a fair sort of calculation for that kind of rate. I wanna go back to your your comments about the in state and out of state and just reemphasize that we understand it's not a perfect system. If we were to implement something right off the bat that uses technology heavy solutions, so a plug in device or vehicle telematics to be able to determine in and out of state miles, the the administration costs would be astronomical.

[Sen. Ruth Hardy]: Got it.

[Patrick Murphy (AOT State Policy Director)]: So the other states that have done that have seen, in some cases, still are not producing net revenue. So that's why we think that it's better to start with this simplified option where we already have an existing process, we're passively obtaining that data and then being able to apply a fee. I understand there are everybody's gonna have the one case that I've driven down to Georgia or wherever, and aren't I being double taxed, but the amounts that we're really talking about quite small when you consider that no vehicle is going to be asked to pay more than 14 some odd dollars per month, less than $15 per month.

[Sen. Ruth Hardy]: I I appreciate that. I I totally appreciate that, and I'm I'm happy to hear about the heavier vehicles. The I do think it's important that we all eventually get onto the same system and that I do appreciate what the Senate Transportation Committee is doing in terms of phasing in so that regardless we're all sort of Regardless of what we drive, we're all being, you know, passed equivalent to our usage. I think that that seems fair. And, you know, I don't like the sort of split that we have right now where people are pointing fingers at different types of vehicles or different types of people. So, think bathing into where we're all in the same playing field I think is helpful. But my question, and I think you had a slide on it just to make sure that the revenue actually is a positive to the T fund as you move into this new is that is that true? I think there was a slide that showed that, but I wanna just double check. Oh, you're you're muted.

[Patrick Murphy (AOT State Policy Director)]: Sorry there. So in the first in the first, you know, couple of years, it will it's uncertain, and I think you've heard this from the JFO as well, from Logan, that it's sort of impossible to predict how people will choose to pay the mileage based user fee. So right now, we have a system where it's $89 and you're paying prospectively for the next year. So that's easy to estimate. You just, you know, take the number of vehicles and it's an annual fee and you multiply it by that fee. How people end up choosing, you know, whether they wait until the end or, you know, that it it there's going to be a little bit of a messy period in between. But how we've proposed to phase it in is that you get to until you have that first mileage reporting in the books, which is the first inspection after 2027 and then the second inspection after 2027. Until you get to that second point, you will continue to pay $89. So there shouldn't be any or much change to how revenues come in in the first year, where it will start to get a little messier is if what you know, that second and third year as the transition works.

[Sen. Ann Cummings (Chair)]: Mhmm.

[Patrick Murphy (AOT State Policy Director)]: At the same time, though, you have more electric vehicles coming on board, and so there's that other factor of uncertainty in terms of how many vehicles will be subject to that. Overall, NET, this puts in place a system that not only allows you to sort of eventually you catch up, and not only allows you to bring in what's now probably about a million dollar loss for battery electric vehicles, but it puts in place the system that will provide that opportunity to include more vehicles. Mhmm. So that so what we're developing here, what might now be, like, not economic to be able to, you you know, distinguish between in state and out of state miles because of the high administrative costs, will be easier when we have a higher volume of vehicles in place. And so the infrastructure, the IT infrastructure that's being developed will be able to sign a fee in the same way, identify the vehicle subject to that fee, the whole, you know, all of that process will be worked out in a way that allows you to then just introduce other reporting options, whether it be a plug in device, more likely, know, telematics as that becomes more widespread so that you have somebody opting into a system that others might have privacy concerns about, you have people that can opt into a system because they know they travel more out of state miles and then be able to have their fee based just on those miles within the state of Vermont. So that's so even though it's been framed in some quarters as, like, just targeting battery electric vehicles, the system we're actually building will allow for us to be able to broaden the number of vehicles subject to it, if that's the direction the legislature chooses.

[Sen. Ann Cummings (Chair)]: Okay. Patrick, I want to take us back a step, because I think we are getting into the weeds. Sure. This we have a bill in front of us, and this committee has already made changes. We've determined that we are going to support an increase in the jet fuel, and we have determined in the miscellaneous tax that we're changing the source to get $10,000,000 additional a year to the transportation fund. But if we pass this bill as is, which as I understand it, says the first step is we're going to EVs. Alright? And we're gonna tax them per mile, and it's as far as we can humanly get it, it's going to be based on how much it costs per mile. Alright. And then it envisions going forward with a lot of other detailed questions that will have to be worked out. I've heard it said by more than just you that the administration doesn't supports going to the EV techs and supports maybe sometime in the future going to, you know, hybrids and maybe hybrids are okay, but when you take it into combustion engines. This I'm not clear If we pass this bill as is, does it doesn't enact anything other than the EV tax fee day one. That's why it's sitting in this committee. Can the agency live with this bill? And if you can't, what do you need us to change? And I just I don't you know, and I don't know that you can tell us that, but if you could bring us some amendments on Tuesday.

[Sen. Ruth Hardy]: Why are we asking them that?

[Sen. Ann Cummings (Chair)]: I mean, I why aren't we supposed to figure out what we need to to figure it out. Well, there is some uneasiness with the bill talking about where we intend to go with it, but it does nothing at this point, my understanding, with impacting anything on combustion engines. So I'm looking at for general information, I wanna know where the agency of transportation is comfortable. If you're comfortable with this bill and if you aren't, what would need to change for you to be comfortable? We will make the decision about whether or not we're gonna go there and we will make a decision about our comfort level and hopefully they'll all arrive at the same place.

[Patrick Murphy (AOT State Policy Director)]: Thank you, Madam Chair. So, bill language as it is written will impact gas powered vehicles in 2029 hybrids, fuel efficient vehicles above 25 miles to the gallon, then in 2031 would bring in the rest of the fleet, the light duty fleet here in the state. There are two ways to approach it. The way that the agency has recommended is that we do this in the first phase. We have lots of requirements to come back to the legislature to propose how the next phase might be rolled out based on what we learn in the first phase, to be able to figure out a lot of these issues that that you and your colleagues are are raising.

[Sen. Ann Cummings (Chair)]: So is

[Patrick Murphy (AOT State Policy Director)]: that That can that can be done by taking out the last, you know, two sections or whatever it is that doesn't put this in statute, but continues to require the agency to come back and report on these specific items. The other approach that the Senate Transportation Committee has chosen in this current language is to put it into statute and then force future legislatures to grapple with this based on the recommendations that come back from the agency on our research, on our learnings from the first phase for battery electric vehicles. So obviously, that is, you know, the your committee's prerogative to determine which approach fits best. But I think the agency's recommendation would be that we essentially remove the last two sections that bake these latter two phases into statute without really having figured out how you'll make them work in practice.

[Sen. Ann Cummings (Chair)]: Okay. But no matter I mean, with the bill, it lets the public know so we can get public feedback where we are planning to go. Mhmm. It doesn't enact or does it? It it does enact.

[Damien Leonard (Legislative Counsel)]: Section 21 expands the bill to hybrids and internal combustion vehicles that get 2031. In twenty twenty nine Twenty twenty. Hybrids and internal combustion vehicles that get at least 25 miles a gallon. And then in 2031, all other internal combustion vehicles under 10,000 pounds gross vehicle weight rating, which is like their loaded weight rating.

[Sen. Ann Cummings (Chair)]: Okay. The way Sandra Mattos.

[Sen. Christopher Mattos (Clerk)]: Yeah. Through conversations with AOT and members of the Transportation Committee to learn more about what this grant was, and considering the legislature ourselves told them to do this anyway, so not backtracking on that, but the EV part, I'm uncomfortable with getting that into a system in place where we can recover that road usage fee, as we're calling it, road usage charge instead of an EV infrastructure flat rate. I'm fine with that part, moving with the EVs, it's the last few sections of the bill when it gets into the combustion section that I'm not comfortable with, and I would rather have transportation take a look at that than us and finance, based on conversations that They I

[Sen. Ann Cummings (Chair)]: have, they send it

[Sen. Christopher Mattos (Clerk)]: to us. Yeah, but that's been since they did that, and I think I'd rather have transportation look at that and make those changes themselves. Getting rid of the question.

[Scott Moore (Joint Fiscal Office)]: I'm ready to make a note, but I, yeah, I feel we're having a lot of conversations over the summer and I just think this has become so complicated and it doesn't mean to be.

[Sen. Ruth Hardy]: What what so wait what

[Sen. Ann Cummings (Chair)]: do you where do you stand? I

[Scott Moore (Joint Fiscal Office)]: I think we should move the bill but I just this has become so complicated and it does not mean to be complicated on this worthless transportation.

[Sen. Christopher Mattos (Clerk)]: Well, I'll say if somebody drives a vehicle over 10,000, and if there is a cap in place, and I spend more in gas tax, I'm gonna be a little ripped because I don't have a it's not a big truck, by any means.

[Scott Moore (Joint Fiscal Office)]: And the canvas is one of the issues I have.

[Sen. Christopher Mattos (Clerk)]: Right. Yeah. So that's why I wouldn't want the combustion parts to come in then

[Sen. Ann Cummings (Chair)]: Wouldn't your truck

[Sen. Christopher Mattos (Clerk)]: It would be excluded, but if Yeah. If I'm paying an increased registration fee, I'm paying more in gas tax and everybody else pays less, like, yes, I'm paying more in a registration fee because my truck was more already, and then I also don't get the benefit of a road user, or the mileage based user fee having a cab,

[Scott Moore (Joint Fiscal Office)]: I'm

[John Gray (Legislative Counsel)]: gonna

[Sen. Christopher Mattos (Clerk)]: be a little upset that I'm paying more to be on the road, and then paying more to actually

[John Gray (Legislative Counsel)]: drive down.

[Sen. Christopher Mattos (Clerk)]: So that's just where my I'm gonna give

[Sen. Ann Cummings (Chair)]: a rebate to cover the cost of your gas over

[Patrick Murphy (AOT State Policy Director)]: Yeah.

[Sen. Ann Cummings (Chair)]: Your gas tax over that. We aren't. Senator Hardy.

[Sen. Ruth Hardy]: Well, I I was pointing to Senator Chittenden.

[Sen. Thomas Chittenden (Vice Chair)]: I agree with all the comments that were just made, and I would just add one more thing. I really agree with the administration's point of view on this in softening or stripping the in statute pieces of Section 21. Fine to continue to study this and come back and talk about how this could be in place. But I I'm I'm not comfortable with the m b a for the same reason senator Beck and senator Mattos just said. I also respect the Transportation Committee and their hard work on this. So I'm fine with moving this bill forward, but I just I don't support the trajectory of this, and I would hope that they would reconsider it and maybe align with the administration a little bit more on what they're looking for.

[Sen. Ann Cummings (Chair)]: Okay. What I'm trying to figure out is, are this committee want an amendment that would strike out, I think it's the last two sections, which

[Damien Leonard (Legislative Counsel)]: Would be 21, 22, and 23. So 23, it essentially it is contingent on it expanding to all internal combustion vehicles. But if you're not expanding to internal combustion vehicles, it probably doesn't make sense in there, and it could lead to confusion because the effective date is 2031 or when all internal combustion vehicles are subject to this. It it could be something that comes back as part of the reports, and the reports are in the sections preceding that. They're already reporting back on expansion and the flat fee, to keep that, whether to adjust it, credits, if they expand to internal combustion, etcetera.

[Sen. Ann Cummings (Chair)]: So Okay. So if we strike those sections, I think I'll get you sent back. Okay. Think it would it's helpful if we could say the agency shall evaluate that information and then bring back a plan to expand because this is this is not going to solve the funding problem from what I've seen at all. It helps. And it will help. Yeah. But it's not making up for my vehicle when I was driving a Mercury station wagon, I think I got 10 miles to the gallon. It's going uphill. I'm now getting 35 and I regularly get 50 on the highway. I am definitely not buying as much gas as I used to, but I am driving as much as I did when I had the big Mercury station wagon. So and I complain about the potholes as much as anybody else. So I think that's the question, what this bill is envisioning is moving to a system where everybody pays based on how much wear and tear they put them out. I understand that there is an obvious inequity right now because some of us are paying that fee through the gas tax. The easiest thing to get combustion vehicles would be to raise the gas tax, but raising a tax has been ruled unacceptable at this point. So I'm I'm I'm getting some committee members, think I'm close to the majority, we've got one missing. Senator Hardy,

[Sen. Ruth Hardy]: I'm Yeah, I mean it does, I mean I asked directly the question of whether it would raise more revenue and based on what I heard and what I see on the chart, it does raise more revenue. So, it is trying to address both issues. That is what it's. Especially over, you know, a number of years. And like I said earlier, I think it's helpful and fair and starts to help calm down the, like, division, divisiveness if we're all on the same system. And I appreciate that they tried to move us all to the same system. And, you know, I I just it it shouldn't be an us versus them thing. And there are obviously things that need to be worked out with the the cap and the the out of state and the technology and everything, but this lays out, the bill lays out a stepped plan and a stepped trajectory while holding them accountable for moving forward with it. And so I would not be supportive of getting those out of balance section without it. I am supportive of the getting rid of the jet fuel tax thing. So if we do an amendment, I would like either two amendments or a single amendment.

[Sen. Ann Cummings (Chair)]: Right now we've got two. We've got to strike the section that takes money eventually out of the ed fund because we did that in the miscellaneous tax. Okay. We adjusted the purchase and use, so they're getting 10,000,000 for now on a regular basis, and we need to take out the jet fuel. The question I think, and I'm trying to think of what we may need the drafters to do, I'm gonna wait until the whole committee is here, but it sounds like I've got at least half the committee. Well, I thought that senator Beck said that he's

[Sen. Ruth Hardy]: okay with moving this forward.

[Sen. Ann Cummings (Chair)]: Oh, okay. You're okay with moving it forward. Okay. Senator Brock, where

[Scott Moore (Joint Fiscal Office)]: are you? In the thought process.

[Sen. Ann Cummings (Chair)]: You're in the thought process?

[Scott Moore (Joint Fiscal Office)]: I'm disinclined to go all the way to the end and try and find a midpoint or a place where something sunsets, or

[Sen. Ann Cummings (Chair)]: a place where something is clearly passed on to a future legislature to consider. Okay. So you're more in the don't bite the whole apple today. Alright. So maybe Damian, we got this on for Tuesday. I don't have it anywhere yet. We don't have it anywhere yet. We may have some we're gonna have some long four times next week, and we will be starting at one at least because morning committees are for the on the floor at eleven every day now. Just Wednesday, Thursday. Wednesday, Thursday. Yeah. Because Friday, we're on 11:30. Tuesday, 11:30. Anyway, if by the time we get to this again, if you could draft something that would essentially take out those three sections and say the agency shall evaluate information they get from the EV whatever and come back with a proposal. There's already a thing in

[Scott Moore (Joint Fiscal Office)]: the bill.

[Damien Leonard (Legislative Counsel)]: That is already in the bill.

[Sen. Ann Cummings (Chair)]: It's already in the bill. Already

[John Gray (Legislative Counsel)]: required for

[Sen. Ann Cummings (Chair)]: the vaccine. Doing transportation. Okay.

[Damien Leonard (Legislative Counsel)]: Yeah, they're already required for the vaccine plan in section

[Sen. Ann Cummings (Chair)]: We're not taking it out.

[Damien Leonard (Legislative Counsel)]: Yeah, you're not taking it out. It's in section 20. They're already required to develop a plan to expand mileage based user fee to hybrids and other fuel efficient vehicles by 01/01/2029, and to all light duty vehicles by 01/01/2031. Their plan has to include additional options for tracking mileage, tracking out of state mileage, and a sliding scale of fees or credits for vehicles that also purchase gasoline or diesel fuel. They're also required to do an outreach and education along with user experience feedback process during the first couple of years to help inform those reports. And the transition plan reports require three reports, one next January, one in July 2028, and one in September 2028. So you have comprehensive feedback and reporting already built in. What I'm hearing the committee say right now is that you want to consider striking sections 21, 22, and 23, and you're discussing that.

[Scott Moore (Joint Fiscal Office)]: Yeah.

[John Gray (Legislative Counsel)]: But

[Damien Leonard (Legislative Counsel)]: I think what I heard earlier is that you want to strike out the surcharge on jet fuel, which is sections forty four and forty five, and the changes to the purchase and use tax that you addressed in your miscellaneous tax bill. So that's sections eleven and twelve.

[Sen. Ann Cummings (Chair)]: I wanna make the sorrow sign because

[Damien Leonard (Legislative Counsel)]: Yes. So the Red. What I have drafted as you were talking here, not edited, not ready to go, but the rough draft has three instances of amendment. The first addresses purchase and use. The second, assuming you move forward with it, addresses the future implementation and expansion of the mBuff. And then the third addresses the surcharge on jet fuel. I have another version without the mBuff pieces in it if you decide not to move forward. So

[Sen. Ann Cummings (Chair)]: That is great.

[Damien Leonard (Legislative Counsel)]: So I have I have all that ready, and then

[John Gray (Legislative Counsel)]: if there are other changes There will be no other changes.

[Scott Moore (Joint Fiscal Office)]: Okay.

[Damien Leonard (Legislative Counsel)]: But I can get both of those edited Okay. And be ready to go for Tuesday.

[Sen. Ann Cummings (Chair)]: Yeah. Because we're we're getting

[John Gray (Legislative Counsel)]: I

[Scott Moore (Joint Fiscal Office)]: think it

[Sen. Ann Cummings (Chair)]: gray areas. I could probably justify this saying we're not gonna commit to future fees at this time, but I think that's as far as we're gonna go today. Hopefully, everyone will be here on Tuesday and well, whenever we get this in, I think we'll have a little We'll put it on the end of the day. Yeah. Yeah. We'll come back. Okay. What about 07:10? No. 07:10. Ah, yes. 07:10. This is I have been told that the senators from Bennington would find natural resources to actually take a look at and have possession of seven ten. Oh. That is the energy generating, that's the two driveways, two transmission lines, and we need first to amend that, and I don't have a draft here. Do we have that? There to is an agreement that got sent to us. This has the not requiring separate driveways and Yes. And it had a whole decommissioning. So when the life of the solar field goes away Uh-huh. And there was still an open question like who would pay for that, I was told and we got yeah, we got language sent to Ellen, Ellen, but we don't have Ellen. And so, well, we probably can't get Ellen at this point. So first thing on Tuesday, we will vote this out. What? But it doesn't have the

[Sen. Ruth Hardy]: language in it right now.

[Sen. Ann Cummings (Chair)]: It doesn't have the agreed upon language for the decommissioning. We could vote it out now. Who agreed on it? I don't know. There's no way to be talking about. Okay, there was a whole question and it was left open. Seven ten had two parts. One was if you put two solar arrays and this was for net metering only, it didn't do the Standard offer. Standard offer. Everybody was in agreement. The second part was Should we let Patrick go? Yes. We should let Patrick go. Thanks, Patrick. The second part

[Patrick Murphy (AOT State Policy Director)]: Thank was you.

[Sen. Ann Cummings (Chair)]: What happens when a solar field reaches its useful lifespan and needs to go away.

[Sen. Ruth Hardy]: That's not

[Sen. Ann Cummings (Chair)]: in the bill. It was in the bill or it was brought to us as being in the bill. I don't think so.

[Sen. Ruth Hardy]: I'm looking at the bill right now.

[Sen. Ann Cummings (Chair)]: There's one at the PUC that introduced that as the amendment. As the amendment. Maybe that if PUC wanted it, there's been agreed language between the industry and the PUC, and we're not gonna get to do this today,

[Sen. Ruth Hardy]: so we will do it on Tuesday. I don't remember this being an issue at all. Does this I

[John Gray (Legislative Counsel)]: say they start fresh Tuesday. There was

[Sen. Ann Cummings (Chair)]: a proposal that was put on the table. I remember.

[Scott Moore (Joint Fiscal Office)]: I remember the conversation.

[Sen. Ann Cummings (Chair)]: Yes. Yeah. And there was an open question on what happens if this company from China just walks away or somebody goes bankrupt and got the money, and there was a proposal for a reserve

[John Gray (Legislative Counsel)]: Now it's coming.

[Sen. Ann Cummings (Chair)]: Fund Yeah. To cover those instances. Yep. And that's the language that has been agreed upon, but we don't have it. So we will wait for Ellen, and we will do it on Tuesday, and but that's this is a simple little bill and I don't know why we have the concern that it would do something to the Bennington proposal that's it resulted in many lawsuits apparently, but that is a standard offer project, and this is only for net metering projects. It doesn't impact standard offer. And we were all set to go, and then the senator from Bennington asked if we would wait while natural resources looked at it. Why they need but he has said that he would prefer that they take possession. If we don't want them to take possession, we can vote it out. I was trying to be neighborly, but I don't see where this gets into natural resources. This is utility regulation, decommissioning funds,

[Sen. Ruth Hardy]: and I think it's about citing solar. So

[Sen. Ann Cummings (Chair)]: there's land Yes. Issue that but it okay. So we will get Ellen whatever we can, we will vote this out as soon as we can and we will get a clean copy for everything. To make sure we understand it. To make sure we know what we're doing. It's always good. And I will not have to remember to bring why they brought my script down here where I won't forget it. I don't know. But I won't bring that up, so because I won't do it on Tuesday. And maybe by Wednesday, we'll be ready to to do that. Okay. It's been a long week. I think we have another long week. I know we have long weeks.