Vermont Legislature SmartTranscripts:

[Senator Anne Watson (Chair)]: Okay, good morning. This is Thursday, April 9, with the Senate Natural Resources and Energy. And we are starting the morning with discussing the latest iteration of vaudeville, H915. And we are going to start, we have a number of redemption centers with us today. Really looking forward to hearing from you all. So welcome Mr. Lennox. Yes. Hey, welcome.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Thank you.

[Senator Anne Watson (Chair)]: Maybe we should do some introductions. I have not been consistent with introductions, but we can do it today. Okay.

[Senator Ruth Hardy (Member)]: Hi, I'm Senator Ruth Hardy from Addison District.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Senator Barnes from the Rollins.

[Senator Anne Watson (Chair)]: Anne Watson from the Washington District and Senator Bongartz hopefully will join us a little bit later as will Senator Beck. They're in another meeting. Great.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: I'll just, my printer ran into ink, so I don't have paper copies of this, but I'll email them on it. That's what I need to shoot it. So Rutland, we just lost the redemption center, understand. So that's unfortunate.

[Senator Terry Williams (Vice Chair)]: But time includes a little slot. Susan.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Distinguished senators, thank you for having me here, giving me the opportunity to testify regarding hospital line fifteen. My name is John Ligus. I live in Norwich. I'm one of the owners of the Putney Road Redemption Center in Brattleboro. It's operated for over thirty years. Putney Road is the single largest independent redemption center in Vermont. We're responsible for about 6% of all the statewide redemption volume. I've testified before the Senate and House on previous versions of the federal bill model organization, both of which passed the legislature before being vetoed. I do appreciate the repeated efforts of the legislature to update this important law. We remain committed to supporting that effort and contributing to it in a positive manner. So I want to begin by restating a premise that I believe should guide this committee's work. The problem that the model bill addresses is one created by the manufacturing and distribution in Vermont of disposable beverage containers. Our world is drowning in plastic. Manufacturers have built multi billion dollar businesses on the conversion of natural resources into garbage. They have no functional plan to take responsibility for that garbage. The Bottle Bill is Vermont's most successful response to this problem. It produces the cleanest recycling stream in the state Since the widespread adoption of zero sort single stream recycling, more containers are placed in glue bins than ever before, but far fewer of those containers actually get recycled. Single stream has contaminated the recycling stream to the point where, as we saw at the Chittenden Solid Waste District a few years ago, recyclable glass was simply being dumped in landfills for years. Redemption centers are the antidote to that failure. We sort by material, by size, by color, our stream is clean and actual gets recycled. That is the success story this bill should be building. So as I previously testified, the bottle bill should be expanded to cover water, sports drinks and water. Understand and support the exclusion of milk and hard cider, but not these other significant waste streams. There's no rational reason why these containers should not carry their weight alongside carbonated beverages. If local Vermont breweries participate in this recycling program, we should expect the same with all beverage producers importing containers into Vermont. So, the handling fee. Treatment of the handling fee in the hospital line 15 is in its current form a non starter for any concession. We'll simply close many of these redemption centers to pass this strategy. And we'll explain why. Redemption centres are regulated businesses. We are told by law what container we must accept, how to serve them, and the fee we receive for doing so. We have no power over any of these key business considerations. Our revenues are set by law, but our costs are not. This BPERG testified yesterday since the handling chain was last adjusted, Vermont's minimum wage has increased by over 85%. Our payroll costs are risen accordingly, as they should. My partners and I are active supporters of

[Unidentified interjector(s)]: the living wage and commodity.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: We pay above the current minimum wage of Honey Grove. But every year the gap between what the law says we earned and what the market says we must pay our workers grows wider. We also have a massively distorted market for workers compensation insurance in Vermont, related to our dysfunctional market for health insurance. These costs make a redemption center much more expensive to run-in Vermont than it would be to pay some other states. Please do not make a false choice between what is good for Vermont workers and what

[Senator Terry Williams (Vice Chair)]: is good for our environment.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: House Bill nine fifteen proposes to take a regulated handling fee and hand its pricing power over to the producer responsibility organization, the very entity that is required to pay that fee. This is not a negotiation, this is a regulated entity setting the price at pace of businesses it depends on to satisfy those regulations. The PRO will go to every redemption center, starting with the smallest and most vulnerable, and set its terms. Redemption centers will have no negotiating levers. There's no concept of collective bargaining anywhere in this bill. The result is predictable. The PRO will use its monopolistic power to extract the lowest possible fees, driving small operators out of business and degrading the redemption infrastructure that this bill is supposed to strengthen fewer places to redeem containers, less service to the public. So here's our recommendation. The handling fee should be increased by 1¢ per container for both commingled and non commingled containers. The current bill under the facility fee for assorted for non commingled containers to 5¢ and leaves the commingled fee at 3.5¢. Once again, we start from the premise that this fee hasn't been updated in a generation. Simple inflation recorded at $07 A $0.01 cent increase across the board to $0.45 for non commingled and $05 for commingled reflects the minimum adjustment needed keep redemption standards viable given the labor cost increases we've absorbed over the last few minutes. Beyond that, the distinction between commingled and non commingled labor is not actually as large as a lot of people think. In either case, you still have to sort by material type, by color, if it's glass, by size, more than 15 categories of sorting. Brand level sorting is somewhat more labor intensive, sure, but the handling fee has been stagnant for so long that the real issue here is the overall level of the fee, not the differential between milk use sorts. Our people sort on average about 3,000 containers an hour. It's hard work. It's difficult to keep all of the sorts straight. They get about $16 for them, or like $10 after taxes. That's a recipe for a dysfunctional system. Striking in fact, to compare the treatment of the redemption centers and our costs in this bill to the treatment of ANR and their costs in this bill. There are three pages of text in this bill with a super vague recovery mechanism so that the Secretary of ANR is comfortable that they will get their cost back managing this new regime. No stat fee, no predictable amount for the beverage producers, just this vague sort of language about whatever it costs us to do this, you're gonna have to pay for that. I'd love to have that arrangement. That's okay. For us, we get 1p and one line out of tax, everything else is stat reduced. The updated fee should be our default. The updated statutory handling fee should remain in effect for each redemption centre until that centre has voluntarily reached an agreement with the PR. The most likely such arrangement will be the provision of sorting technology in exchange for lower end lifting. Great, that may be a great deal for some redemption centers, it may actually be a really good deal for ours in fact. Mechanized sorting, combined with the skilled customer service that a good redemption center provides, could reduce labor costs while maintaining the quality of the redemption experience. But that's a decision for a future redemption center to make for itself, based on its own assessment of whether this technology offer actually works as it's described, whether the maintenance of uptime terms are acceptable, and whether the overall economics makes sense. If the deal offered by the VRO is not good enough, the redemption centre should be able to continue operating under the statutory fee. This changes the balance of power in the negotiation to make it at least somewhat fair. Without this protection, the PRO has every incentive to offer inadequate technology on unfavourable terms, knowing that the redemption centre has no alternative. With it, the PRO must offer a deal that is genuinely better than the status quo, which is exactly the kind of market discipline that produces good outcomes. The redemption center should have the option but not the obligation to join together to collectively negotiate Yara. We have no power at all in this regime. The current bill leverages that lack of power against us in fact. To squeeze money out of us after already holding our handling costs down for a generation. A collective bargaining agreement would apply to all members of the negotiating group, although the terms need not be identical for each matter, There are legitimate differences in scale and circumstances between small operators and large ones. But without a collective bargaining option, the PRO will negotiate with each redemption center individually, exploiting the information on power asymmetry that exists between a well funded industry and small business. Collective bargaining would give Redemption Center a voice, since proportionatorable. We think that there should be an incentive for the PRO in this bill. All sick right now,

[Unidentified interjector(s)]: no care.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: The only care they have is if they extract value from us, right? Provide an incentive in the bill, or if they increase the amount of containers, making it into the redemption center, making it into that clean recycling stream, great, that should be what we're all actually working for here. We believe there should be redemption center representation on the board. So I testified before the House Committee on Environment during the last five minutes, advising the regulated parties in charge of managing the regulations invites regulatory capture from day one. PR award is describing the House bill is manufactured driven with oversight from Secretary Bennington and Clannan Brooks. It's an important check, but it's not the same as us having a seat at the table. We recommended that the PRO board include at least two redemption center representatives, one from a small operation and one from a larger one. These should be independent operators, not major retailers who operate redemption centers, because those retailers have strong commercial relationships with the distributors you fund the PRO. At risk conflict of interest, could compromise them, we think independence would be a better choice. Redemption centers are the ones who do this work every day under this regime. We understand what works and what does not and our perspective should be represented in the governance of the organization that will shape our industry's future. I'll close by saying that we appreciate that this bill represents a renewed effort to modernize the bottle builder. We recognize the difficulty in building legislative consensus. We are not here to oppose this bill. We're here to make it work for the environment, for consumers, for the people who run-in and work in Redemption Center, all across the country. Changes we've recommended here are not obstacles to compromise. They're conditions necessary for Redemption Centers to survive and thrive under whatever new system the legislature fails. Looking forward to continuing to work with the committee and with the legislature.

[Mr. Harrington (Beverage center owner, Rutland)]: Thank you very much.

[Senator Anne Watson (Chair)]: Thank you. Really appreciate that. Questions from Mr. Lucas? Yes.

[Senator Ruth Hardy (Member)]: Yeah, thank you. That was really helpful. And we have heard in all the testimony, I think, that we've gotten so far that handling the issues. So thank you for driving that home. I'm really fascinated by your full proposal about collective bargaining between the redemption centers and the PRO, and I think that's an upward thing to figure out. But my specific question is, you're also asking for seats on the board of the PRO. And generally in collective bargaining situations, you can't bargain with yourself. So having members on the board. So for example, the type of board I know the best is the school board and teachers can't be on the school board of the school where they work because they would then be bargaining with themselves. And so how do you reconcile that if you want the collective bargaining bank and this representation?

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: I would probably just, Doctor. I would say that you just, you're saying to the onboard when when it's approving the the the plan. Mhmm. If you're part of the collective bargaining group that's paying their plans being suspended to the board. You just keep saying, you know, I don't think that would be insurmountable. I mean, in our country, we do this with a different company in Europe and Germany.

[Senator Anne Watson (Chair)]: Yeah.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: And, like, unions sit on boards, on company boards. Mhmm. The on the companies that they would change. So I think that's odd.

[Senator Ruth Hardy (Member)]: And then how would you if do you have a specific proposal on how you would structure the sort of negotiation, collective bargaining between bureaus and the redemption centers?

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: I mean, since A and R is paid for all the work they do, they could sit in there as in between, as a mediator in a negotiation like that. But I don't know that that would be necessary. Think that if you give the redemption centers the power to come together to talk to each other about what do we think we really need, how are we different? Right? Because we all know sort of intuitively that

[Senator Terry Williams (Vice Chair)]: there are differences between big ones and small ones.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: But having that in a setting where we can get together and say, okay, what's something that you need that I might not be aware of because I'm in a different position, but having

[Ethan Mays (General Manager, Morrisville Beverage)]: that together, I think if we

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: have that framework where we can have that, I feel like that's a very different conversation about, a bank group would presumably pick one or two representatives that would then be the national negotiators to decide to the situation.

[Senator Anne Watson (Chair)]: Great. Other questions? I have a couple of questions. Yesterday, one of the ideas that came up was in any kind of negotiation situation between the, and I'm going get this wrong, but it's either the manufacturers or the distributors and the redemption centers. One suggestion was that there'd be a floor and it's sounding like one of the things that you are suggesting is that maybe there'd be a floor that you could go above, but you can't go below to ensure at least a little bit of protection for the redemption centers. Is that sort of, as you were suggesting, you should increase the container fee to buy 1¢ for co mingle and non co mingle. But anyway, how does that land on you?

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: How does

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: that suit you? Yeah, so I was aware of the conversations about the floor. And so, you know, so again, we sort of started two steps. So first, we think we need an increase in the hand. This is really like a long time, and there's been a lot of wage inflation, not to mention other costs in the last five years. So it's funny. But then beyond that, so I didn't think a floor really was as smart a policy, and I'm sympathetic to the PRO and manufacturers and the triche back. Like, if they can come up with solutions that we might not be fully aware of, then if the costs actually come down, great, that's better for everybody, right? But the way to police that is giving us a voice in that, giving us a vote on whether we want to accept what they're offering. And so I'd rather see that as And so instead of a floor, I built that as that, you know, pressure valve. So yeah, if you don't offer me a good enough deal, I just want the regular,

[Senator Terry Williams (Vice Chair)]: I just want one way on that, I'll

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: go all my way. If can offer me something that's attractive, it does make my life easier, it does reduce my liver cost, Great. It's something about off the value of that.

[Senator Anne Watson (Chair)]: Interesting. Okay. So you're thinking that, and I'm saying this back to you to make sure that I'm understanding what you're saying. So correct me if I don't have this right. So the idea, the construct, as you're suggesting would be that the PRO, like the default would be the current status quo, so for the increase, and then the PRO could say, look, we'd like to offer you this deal, and we're going to give you this technology maybe. And it could also, and we're to lower your handling fee because you've got this new technology, but it's still going work out to be a better deal for you. And then you could take it or leave it, and yeah, stay with the status quo if you want it.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Yeah. And importantly, you could try. Right. So I, it gives me the, the comfort to be able to say, okay, I'll give it a shot. You bring me your machine, let's run it for, you know, it'll take a while for my folks to get used to it.

[Senator Terry Williams (Vice Chair)]: So three to six months.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: But then if it's not working like you said it was, like, no. Thanks. You can take

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: your machine back. I'm gonna

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: go back to regular running. Right? So so so our shop has, like, five or six people in any room. We're big. A good shop. So we've got a couple of folks that have been with us forever. They will sit. And so But the young folks are it's the beginning of a career ladder. Right? This is a entry level job. It's super hard to stay staff. And so but if if I could keep my bugs forever, and I've been eliminated pre conditions that are super hard to stay built and they're, you're right, it's kind of constant training and stuff like that. Great, that's definitely worth the trade for. I'm very interested in talking about that. If I'm a smaller deficit center with one person, you're not gonna replace that person. Right? You're you're still gonna have to have someone there that if there's jam in the machine, unjams it, you're gonna have to be I mean, some of them there just, you know, all of a sudden, gonna be down, you're gonna still answer it. Didn't talk about that, but there really should also be a thing that if my machine's down for any sort of material of time, like more than a couple hours, I'm gonna be hand sorting. And so I should get the statutory fee if I'm having to hand sort it because that labor is still that late. So there's stuff to work out and so, you know, I think that everybody's open to trying to work that up, trying to think of a way to, you know, get this system to work better. You gotta you gotta have us in that conversation. You gotta have us, you know, working with you to try that out, to try different ideas. Mhmm.

[Senator Anne Watson (Chair)]: Great, thank you so much, really appreciate it.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Thank you all, Patty.

[Senator Anne Watson (Chair)]: Yeah, for sure. Okay, so we're going to move now to Mr. Switzer from Linda Phil Renerson. My welcome.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Thank you, thank you for having me. I'm not really as out on the speaker as mister Lang is here, but public speaking is not my thing,

[Senator Anne Watson (Chair)]: but It's all good. In the

[Senator Terry Williams (Vice Chair)]: middle of I appreciate

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: you having me, taking the time in the committee to talk about this important bill. My name is Shane Switzer. I own Lindenburg Redemption in Lindenburg. We are considered one of the top 20 redemption centers in the state that this bill outlines here. And so I've been involved in this conversation for not several sessions like some of these gentlemen here, but but in the in the short term here, and I've I've learned a lot about the redemption system and I try to look at the system from a like, so if we're gonna have a bottle bill, we've talked about it for year after year. From all perspectives, how do we make this thing something that we can go forward with it? All stakeholders are somewhat happy with. And what I understand, we're close. We're not real far away. And so we'd love to make something happen if possible. We just to start, we support modernization, we support efficiencies, we support upgrading the system, and so we want to try to get it right if we're going do that. And you're gonna hear a lot today. We heard a lot about it yesterday about the handling fee. At the end of the day, the way this bill is set out as we speak just really is it's kinda, you know, it's the Wild West that we heard yesterday. There's not a lot of language that says that protects us as redemption centers. And so we wanna we wanna get that right. We are gonna submit some language, know, suggestions that we have, and and there's some things that with the handling fee, I mean, I'm just gonna say because I I think it's important to but,

[Senator Terry Williams (Vice Chair)]: it's the most important piece

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: of this bill. The way that it's set out now, it just leaves it it leaves it so there's an organization. The PRO has doesn't have a lot of incentive to do anything other than drive the handling fee down. And I can tell you right now that if the handling fee goes down, we're probably not gonna take bottles back anymore. I mean, it's just the reality of the situation. In preparation for this testimony, I I looked at my numbers, and in December we lost money taking bottles and in January we made a couple thousand dollars and so for let's say $250 a week, is it worth me redeeming bottles? It's probably not. And so at the end of the day, we do it. We have we own a large beverage center. We do it as a you know, it's a community service, really. There's there's not there's a few in the town back door but but there's a really big area out and and then obviously, you know, that involves us. So, we we have a space for it. We have a the facility and all that and we want to continue doing it but at the end of the day it needs to make financial sense and in order to to make financial sense of it we really need an inflationary adjustment here like we we we've heard over and over about how we haven't gone up in years near to near and we really need to make that as part of this bill. When I'm looking at like how does this look going forward and can we be sustainable going into the future. We really need to get an adjustment in the you know for inflation and the I'll tell you a couple of couple of stories that a friend of mine owns some beverage centers in Massachusetts, and not too long ago, I said to him, I said, how does redemption work here? And he said, well, we have these reverse vending machines. I have three or four stores whatever he has and they did a modernization effort in mass in 2020 if I understand it right. And in 2020 the recyclers came in and said we have this reverse vending machine, you can buy it for $20,000 or you can lease it for a penny a can and pay nothing upfront and and the handling fee and mass is 2.25¢ if I understand it correctly. And so I said to him, how do they work with redemption centers? What do they and I did in my research find that redemption centers get paid a little bit more in Massachusetts, but I said, how do they work with redemption centers? He said, there's no reduction centers around here. Went out of business. They can't afford to operate at these think redemption centers get in MassDome, what we do is about $3.01 $2.05 cents or somewhere in there. And so and so they went out of business. So what you have in Mass is you have a redemption rate that's really low and I I don't have the number off the top of my head but it's it's a lot lower than ours more than half and it's because they just use the reverse vending machines in most places. As soon as you assign labor to redemption in Massachusetts, it's a it doesn't answer, but it doesn't make sense at all. And so so that's essentially like we want to avoid that here. I believe we don't want to look at it to drive the cost down so everybody goes out of business and the only option is I don't know if you've ever used a reverse vending machine at Shaw's or at Fry's dropper. If you have more than 10 cans, you wanna you wanna do it. You just you'll put them in the long you put them in the movement, or they take take too long. You know, as you mentioned yesterday, you know, there's the the the stores that those are at who don't really have a huge incentive to fix it fast or they as soon as they assign labor to those it's a bit it's it's not worth it. I just want to avoid what happened in Mass where it seems that we're talking about other states and how they do redemption. I want to bring up that Maine just raised their rate in 2023, they're handling fee I should say to 6¢. Maine also expanded over the last several years and I'm in the process of talking with an operator there because I wanna really understand how they do it. I haven't had time in the last couple of days to pull that together, but but I'm I'm interested to see how they do it there. It's a neighbor state that's you know, we all we just like Maine, but it's it's relevant. I think this is I This is already sold. So they raised their hand on being a success.

[Unidentified Senator (possibly Senator Seth Bongartz)]: At the end of the

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: day we have there's two primary stakeholders here. There's the distributors and the redemption centers, the points of redemption. And what we run into is nobody wants to give up anything, nobody wants it to cost them any more money, or nobody, know, and so we've it seems like we go around and around about about the the money here if we go back and say we need you know we put this floor back into this bill and then we have you know the the at the end of the day the distributors don't want to take any more money out of their pocket if you will and ultimately it's not them taking money out of their pocket it's passed down to consumers. There's a per case cost that gets transferred over to retail that the distributors have in this thing. If 8.5 per can that the distributors have to pay now, that's 8.5¢ a can that they're adding to the end of the final product. And you know in my case, can't speak for everyone here, but we're competing with New Hampshire and and, you know, I hate to bring that up, but it's a real thing and it's and that they don't have they don't have redemption there. So, like, it's it's automatically an asset per can less and and such. So so I think that the cost gets passed down in the system. And think when we the distributor don't want take any money out of their pocket, we want more money. One of my proposals here is there's money in the system. Like, this system, the life cycle of this system generates the the unclaimed deposits are

[Senator Terry Williams (Vice Chair)]: are

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: part of this system now. And we won't talk too much about where they go, but because that's a goal definitely a good place and a good cause. But what about if we take some of the money that in the oh, let me just let me back a little bit. In most states, the unclean deposits go back into the system and that helps make the system viable. It doesn't take there's no way to cover all of the cost of it, but but it it it takes the burden off of everybody. So we have distributors that don't wanna give up the money. We want people we have us that want more money. There's money in the system. I know that it it gets a little messy, but is there a way that we can that we can reframe some of that money to to make this thing viable long term for all the stakeholders? And the producers definitely have a responsibility to take care of these containers and all of that, I certainly have a chance of that. Instead of like quoting Terry for it, let's get a little bit of money back into the system.

[Senator Scott Beck (Clerk)]: When I

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: talk to distributors their main concern is how much is this payroll going to cost us? Like what's it going to cost? It's their responsibility so they're going to have some costs involved in it for sure no matter what but at the end of the day is there something they can do? The money's there.

[Senator Anne Watson (Chair)]: So We do have a question right here. Yeah, I have couple questions.

[Senator Ruth Hardy (Member)]: I think the bill does transfer some of that money starting in 2030.

[Unidentified interjector(s)]: Oh,

[Senator Ruth Hardy (Member)]: does? Yeah, from the Clean Water Fund where the sheet money goes now through the solid waste fund, the solid waste management assistance of Caledonia. It doesn't do it permanently, but I don't know why it doesn't start earlier. I'm not sure I understand the timeline enough yet. So that I think is partly to the bill. I had a question about the handling fee again, cause I'm still trying to understand. We have heard loud and clear about the handling fee problem, but it seems like there are a couple of handling fees. And we just talked about the difference between the sorted and unsorted or commingled and non commingled, but there's also the handling fee for liquor bottles. And the bill sets that one at 3 and a half cents per container. What do you get now for liquor bottles?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: So right now we get the same 3 and a half cents for liquor. Okay. In this bill it's my understanding that liquor is not part of the PRO and so they're talking about that separately with a handling team because it's not part of the PRO.

[Senator Anne Watson (Chair)]: So Okay. So 3 and a half

[Senator Ruth Hardy (Member)]: cents is what you already get. Yes. So that's not increasing it or decreasing it. It's I'm going to ask a question that I'm assuming you're going to say you think 3 and a half is not enough for the liquor bottles either, or is that sufficient?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Yeah. Mean, it's the same as the rest of the-

[Senator Ruth Hardy (Member)]: So overall, that one should be, you would like that one to be raised as well? Yeah. Okay, so you've not had head's not been tied to it as well. Okay, because I just realized there are two different places in the bill where this comes up and so I wanted to make sure I was actually not.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Going back to your original question about the money that comes out. So it's my understanding that that the money that's set out in the bill now is 3 and a half million dollar 2,000,000 or $1,000,000 for two years and 750,000 for two years. Yes. And what that's for is really deeply justified in in the house environment that it's going to cost 3,500,000.0 to $4,000,000 to put machines in the top form reduction centers as grants. Like this money this money specifically, to my understanding, will be used for that.

[Senator Anne Watson (Chair)]: Got it.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: And so so it doesn't fund it otherwise. Yeah. That's a one time, I remember four years, it's a one time thing for the grants.

[Senator Ruth Hardy (Member)]: I'm wondering if we could do some of it earlier, the help of the transition costs. Yeah.

[Senator Anne Watson (Chair)]: But okay, that's helpful, thank you.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: And my thought there on the, on the, that unclean money is is not that you know you heard yesterday from Paul that that we you know that there's some huge windfall for this unplanned deposits, I have no idea if they're in or not, but we're not we're not saying we're looking for anybody to make all kinds of money on this here. We're just saying what I'm saying is there's money in the system let's let's see if can take part of it out to help the entire system be sustained still longer.

[Senator Anne Watson (Chair)]: Well, multiple other questions. I saw senator Williams first and then senator Beck.

[Senator Terry Williams (Vice Chair)]: So for you, is this something when you're on a, you know, fiscal momentum as far as the You gotta get huge money

[Senator Anne Watson (Chair)]: here. Yes. We should we should look at the fiscal note. I'm sure there is one that exact run that easy. Oh, yeah. So

[Senator Terry Williams (Vice Chair)]: You can do it. Yeah.

[Senator Anne Watson (Chair)]: Yeah. And they would be able to speak to the state's money involved in this, perhaps more so than, you know, making projections about, you know, system beyond the state's funding. Thank you for that. Anything else, Senator Williams? Okay, so

[Senator Scott Beck (Clerk)]: seems like if we could squeeze a penny out for our redemption centers,

[Unidentified Senator (possibly Senator Seth Bongartz)]: that would make all the difference in the world.

[Senator Scott Beck (Clerk)]: Question, in St. Johnsbury, and I don't know how, widely this is practiced across the rest of the state of it's in Limonville. There have historically been two redemption centers, and they pay 6¢ a can. Yeah.

[Unidentified Senator (possibly Senator Seth Bongartz)]: And I'm just They do a lot.

[Senator Scott Beck (Clerk)]: The redemption center Really? Eats a heavy. Right?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Right. Exactly.

[Senator Scott Beck (Clerk)]: It comes out of

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: your hand. They get paid the same.

[Senator Scott Beck (Clerk)]: Okay. So what if we just passed a law that said, you cannot pay more than the deposit value for the can. It just said a nickel. That's you can't charge 6¢. You can't charge 7¢ for a system where the person paid a nickel for that beverage. And and so, you know, my thought there is, you know,

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: we we're getting the this competitive market and some things like that. The reason why people do it is is

[Senator Scott Beck (Clerk)]: This is not really I mean, it just seems like for wherever that's a way to get a penny to a lot of redemption centers. I mean, I get your market thing. I'm a free market guy too, but this is kind of a weird little covered pit.

[Senator Terry Williams (Vice Chair)]: Does that

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: penny go somewhere else?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Well, it doesn't necessarily.

[Senator Scott Beck (Clerk)]: Yeah. I think it comes out, it must come out eventually comes out of the it's

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: no, it's just giving it up. They're just giving up that penny saying we want to be competitive in the market.

[Mr. Harrington (Beverage center owner, Rutland)]: That doesn't help anybody, it doesn't give the extra penny with 99% of the redemption setups in its state.

[Senator Scott Beck (Clerk)]: No. It doesn't it doesn't solve if you for the redemption centers that are charging a nickel right now, it doesn't mean anything to them.

[Mr. Harrington (Beverage center owner, Rutland)]: Which is almost a 100%.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Yeah. Okay.

[Senator Scott Beck (Clerk)]: But for the ones that are or I mean, it just seems like that

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: would be something that could provide some help in certain places you're unsafe.

[Senator Anne Watson (Chair)]: Well, just as a question, your redemption center does not do that.

[Senator Scott Beck (Clerk)]: We do not.

[Senator Anne Watson (Chair)]: We do not. And yours does not. For the folks who come up afterwards, would be helpful to know if you are paying back any more than the the principal. So

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: I I understand what you're saying as far as if it's if you if we've got something that says that we you can't do that, it's it's in statute so that way they can't give any more than that legally and blah blah blah. But I I don't think that I don't that doesn't do 99% of us any

[Senator Scott Beck (Clerk)]: No. And I'm not saying that's a substitute for increasing the handling fee, but it just seems like something that's it's a practice that is working against some redemption set around the city.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Pretty much, yes, the guy is paying it though. Like, I'm really surprised that. Yeah. They think so. Yeah. Clearly, they think they need to pay an extra penny to get the volume in.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: That's right.

[Senator Scott Beck (Clerk)]: And they're looking they're

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: But, you know, that's sort of, you know I'm losing money on every hand, but I'm making it up in volume. Right?

[Senator Anne Watson (Chair)]: Well that was tough call. If you have I I don't wanna interrupt you if you have more that you would like to

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: I just in clothing. Yeah. So my ask here is that we increased common goal and non common goal a penny and we take a look at the the existing, you know, system of funds, what we call it, the unclaimed deposits and maybe there's something that can be done there that's a compromise for everybody. It gives some money to where it's going now, it gives some money to the system so it would be able to be sustainable and and there you know I agree with with John on the collective bargaining. I like that idea. I right now in the building, not a lot of you heard yesterday that, like, know, bring us up again. That's it's like a wild west as far as, like, the language and and the protections there. And I think if we're gonna do something here with with the the handling fee, we need to make sure that it's spelled out pretty clearly. We could possibly get on board with with what Ron said about how maybe there's not a floor, but as long as that language is really tight and protects other redemption centers, you know, we could we could possibly get on board with something like that. But as where we sit right now, like, we we need a floor of some sort, but but let's continue the conversation. And there's two primary stakeholders, redemptions and distributors, and that we we let's make this work if we can and and make the system long term sustainable. Thank

[Senator Anne Watson (Chair)]: you so much. Any other questions, Mr. Smith?

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: You're welcome. Okay,

[Senator Anne Watson (Chair)]: thank you. Appreciate it. Okay, so we'll move now to Mr. Harrington. Welcome. Thank you. Thanks for having me. Yes. From the beverage fair.

[Mr. Harrington (Beverage center owner, Rutland)]: Yes. Yes. I'm gonna be to the flight in Brutland. I've been here for this same routine at least twelve years now. Been promised that 1¢ every single year and it gets right to the finish line and doesn't make it. We try to add in, water bottles, this and that. In my mind, to add that in right now is a waste of everybody's time here because that's not going to pass. That's not going to pass the governor. That's just my own feeling, obviously.

[Senator Anne Watson (Chair)]: To clarify, you're talking about the including more kinds Yes, of

[Mr. Harrington (Beverage center owner, Rutland)]: yes, expansion. I would like to see it in the future, but I think it's twelve years ago I said, we're trying to move too fast. We need to do this in steps. In every single, every two years, stuff just gets thrown in, it gets convoluted. I've always asked just for that 1¢ and try to get that passed, tack it on to something else that's going to pass. We're treading water here, we need to get this done. I'm the only, my father started the business over thirty years ago, I'm the only one left in Central Vermont. Everybody else has been shut down. There's nobody in Montpelier. And there's a reason there's not new redemption centers opening up. I mean, I think everybody here can agree what the issue is there. Now, I wanted to expand my business and take care of my customers. So I looked at putting in one of these machines, and that's a real big red flag I see in this bill. It's a plumbing for these machines. It's got this. I have right here, this is from Palmer's, to handle the business that we do right now. The machine itself, just the equipment, dollars 270,000. There's a special compressor that's required, dollars 5,000. Extra monthly BIM usage fee, 500 per month. And then the first year of service is free, but the mandatory service contract is, oh my reading glasses, $8,366 a year. I believe you would put a number together on the first year. That covers like, if you're talking about the construction, that covers two machines. That's not remotely close. Even if you cut that in half, you still don't have the money. And I believe that by not having the floor, that just covers some of his butt. When that cost overruns too much, you're just going to start chiseling that out of us. What you're going to end up with is large places, businesses like mine are just going to meet your requirements. The same requirements are going to throw those crappy machines up in front, and then all these u bottle drives and all that stuff. They're all gonna go away because nobody wants to put this up. I will like I said, I wanted to invest, but this was too much money for me to absorb, and then every two years not knowing what we're doing. But I want to help the community out. I want to make it better for everybody to return to recycle. With that being said, in the bill, it talks about opening a lot of new centers. And I'm not sure financially that's feasible because as you can see this money right here, that's a lot of money. To do that all over the place, I think that if you invested this money in centralized locations, to me that would make more sense. But touching on when we talk about putting money back in the system, when I look at the bottle bill, I look at it as that that is clean enough for a moment. Right? So to to go unfunded or low funding on it doesn't make a lot of sense to me. I know that there's extra money in this and that, but it's a program that needs that money because without it, you have crafting roadsides and all that stuff. Just like if you don't put money into a clean water fund, you have dirty water. So this to me, this is worth funding. This is, you know, and I've gone back and forth. I've been like, you know, we're competing with enhancers. So, you know, you get rid of the redemption, this and that, but I really think that our roadsides would not look very nice at all. That's that's my thing.

[Senator Anne Watson (Chair)]: Without

[Mr. Harrington (Beverage center owner, Rutland)]: without a floor engineer, that would be like if I went up to 08/2002 Toyota, and they wanna sell me a car. And I was like yeah I'm interested in that car okay well if you want it well how much is it well we'll negotiate that later just take the car and then we'll tell you what you have to pay and nobody's going to see that I just see the writing on the wall. Like I said, I've been through this, I've seen the bills. My father actually was instrumental on the coal mangle bill. He was on that committee and started that. I'm kind of proud of the business we have. I'd like to see us do a better job. At what we're getting paid right now, you just can't you can't do it. It's not you know, there's only so many lost liters. You know? You you try to do your best, but that's what we have. Just briefly on the liquor bottles. We get paid handling fee on all the liquor like it's commingled. It's not really. It's a separate source. So I mean, that's just kind of nitpicking, but it's not commingle, and we get paid for comming. The 3.5¢. Right. Yeah. Right. So I mean, would the amount of like, what we do is that a huge deal? No, but you

[Ethan Mays (General Manager, Morrisville Beverage)]: would think

[Mr. Harrington (Beverage center owner, Rutland)]: that the state would pay us what? Money.

[Senator Anne Watson (Chair)]: Oh, sorry. Was thinking about consumer,

[Unidentified Senator (possibly Senator Seth Bongartz)]: I can remember it about ten years ago. Everybody had a redemption. Yeah. And there was competition. They were like, oh, take it here and get 6¢ a bottle. Yeah. Well, this one's up to 7¢. And I think a lot of. Right. So so what they would do, they they brought up bag full of cans and bottles. We got $5. If they had a deli, probably go in there and spend the $5. So what was the reason what do you think was the reason that there were actually some competition between the.

[Mr. Harrington (Beverage center owner, Rutland)]: Because there was profit in. There's no profit in it now that's why you haven't seen one open out. Right and what I see for customers too is we used to get people coming in with $10 worth of bottles and then they'd excuse me go and and spend the money. Now we have people, those people are putting it in the zero store, and you have we have somebody from Watesville that comes in three times a week with truckloads because they go up to the resorts, they take all the cans out of the recycle, and they're not spending a dime to the store. They're taking all that money. That's what they're making. That's their job. So So the industry's savior, I'd like to get, I'd like to take care of the people with a fast machine like this, come in and bring you $10 worth and hopefully you spend some of it in the store, you have a good experience, You're not in line forever wondering why you you did the bottles, and, you know, better for everybody in in my opinion.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Still, like, a proportion of that unclaimed money was going back into the system, it would probably mean that the state wasn't getting that part of it because they're getting they're getting a chunk of it to clean water from them. Right.

[Mr. Harrington (Beverage center owner, Rutland)]: I I I'm just looking at that.

[Unidentified Senator (possibly Senator Seth Bongartz)]: So wind and growing from spades are gonna get more wild ravine. Yeah.

[Mr. Harrington (Beverage center owner, Rutland)]: And whether it's a clean water fund or it's cleaning roadsides or it's a superfund site, you're you're doing something for the environment. It's not, you know, you're not burning Boston patrol, which leads me to another point right now. So we have three tractor trailer trucks a week to come pick up our empties. Big diesel trucks up and down the interstate. All they're doing is hauling air. I mean, you've got those big bags. There's no weight for that stuff at all. The glass has a little bit of weight, but with these machines, you would reduce, I could do like maybe one to two pickups a week, you know, on an average, probably one and a half over a year. And when they left, they would have weight to them. It would be, because everything is crushed, the glass is broken, you know, it's much more streamlined thing. But the cost, I mean, are hard numbers. Went about this and the problem is, like, when I talked to Tom about this, I was like, that, you know, that service contract, that's I mean, that's crazy. That's too much. And then why do I have to pay for bin usage when I don't pay for it now? Because I have no negotiation. I I can't negotiate with them. So if this bill goes through, it's gonna get worse because I really have I have nothing. Here I can say, no, I'm not buying the machine. But I know what it's like not to have negotiation power because I was complaining about the bins. I mean, again, why would I pay $500 a month for extra bins when I'm not paying that now? It's just a hidden fee that they're putting in. I shouldn't have to deal with. But if I don't have any power to negotiate with, then that's where we're

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: kind

[Mr. Harrington (Beverage center owner, Rutland)]: of gonna be.

[Senator Anne Watson (Chair)]: I think have another question here. Yeah, thank you. This is helpful. I'm sensing a theme, which is great.

[Senator Ruth Hardy (Member)]: Wondering, I'm looking through the stewardship plan part of the bill, which is what the plan that the PRO has to create in order to set itself up. And there is this consultation with stakeholders, which I'm assuming you guys are the stakeholders they're supposed But to consult it does seem pretty light.

[Mr. Harrington (Beverage center owner, Rutland)]: Yeah, we couldn't concentrate, Yeah, back in And

[Senator Ruth Hardy (Member)]: then there's this provision that says that they can just not do what you guys want them to do and just write out why they, so I'm wondering if any of you have some suggestions for how to strengthen that part, because that seems like it's the key, the plan they come up with, is the plan that you all would have to live with. And your voice is pretty minimal in the plan.

[Mr. Harrington (Beverage center owner, Rutland)]: That's correct, and our voice gets smaller and smaller as each of the other stores close, because to be honest, those stores don't want to take bottles. If I went to Carmelo and Farm store, I went out with two big bottles, bags of bottles, legally by statute, they have to take those bottles. They wouldn't know, they don't even get picked up for empties. So they don't know. They want a lot of the, they don't care as long as they don't have to take the bottles back. So our voice gets smaller and smaller and smaller, but if we just all of a sudden decide we're just going to put up those vending machines, know, the single things, that's going to create a pretty big problem. People aren't going to return I think that's Bottlesack, no. Yeah, that's what we all want. We want proper recycling, you know? Yeah, I our voice is small, but it really should be strong.

[Senator Anne Watson (Chair)]: Exactly, well

[Senator Ruth Hardy (Member)]: that was my point.

[Mr. Harrington (Beverage center owner, Rutland)]: We hold a lot of cards and about a year and a half ago, and we're one of the top five, I don't know exactly where we're at, we're one of the top five in the state, I actually pulled my certification, so by statute, I only have to pay back what I sell in my store. Have I gone there yet? No, I haven't. I still take everybody's back, but I wanted that control because I'm at best I'm breaking even on my bid, you know? And like I said, I don't, I want to provide another service for the customer, and I can't do that with the rates right now.

[Senator Ruth Hardy (Member)]: Well, I guess if you guys have suggestions for specific ways to get your voice more heard in the process of coming up with a plan. Once the plan is made, then you all have to live with it. So the plan seems like a pretty important place for you to have upfront input.

[Mr. Harrington (Beverage center owner, Rutland)]: I would put a ton of thought into that part of it, because off the top of my head, I would say that obviously we need to have a floor and the 1¢ more than what we have right now would be a minimal. And then it should be like every two or three years, we need to revisit that. Maybe there's some verbiage in there about inflation from the Joint Fiscal Committee or something. I'm not, that's not my forfeit. It's the portion of it, but that seems like it would be good, like two or three years, and with, you know, the rate of inflation that must be set right by the Joint Fiscal Committee, would assume. There's a couple of years. Yeah. Right, so we could, if that bill could reference that and it would track evenly with that, whatever we cash out now, that it would continue.

[Senator Anne Watson (Chair)]: Do you have a question, Senator Brown?

[Senator Scott Beck (Clerk)]: No, this is Vicky. So you're suggesting 4.5% for return had an S4, and then inflation factor built in.

[Mr. Harrington (Beverage center owner, Rutland)]: Yeah,

[Senator Ruth Hardy (Member)]: yeah. Well, point five for some of them, co and five for the non

[Mr. Harrington (Beverage center owner, Rutland)]: felt bill.

[Senator Ruth Hardy (Member)]: The bill does go up to five for the co

[Senator Scott Beck (Clerk)]: mangled. Okay.

[Mr. Harrington (Beverage center owner, Rutland)]: But the bill also talks about that after how many years everything will be co mangled, Seth?

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: It Go ahead. I

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: believe it's my understanding that the bill says that if we get a raise for a short time until the PRO is activated and then everything's commingled with the PRO. Right. And that's where our statutory amount draws out.

[Mr. Harrington (Beverage center owner, Rutland)]: Right, that's that's the version that I read. I haven't read the latest version, but at some point that was in there And the way I interpreted that was once this is all in place, that the commingle would go away. The

[Senator Ruth Hardy (Member)]: handling fee goes away. I mean, seems like, it says the handling fee shall not apply to beverages that are covered by a stewardship plan. Correct. So there's no handling fee after a stewardship according to this Right,

[Mr. Harrington (Beverage center owner, Rutland)]: so I'm saying there has to be, if was commingled, then if if we put in the commingled was four and a half percent, non commingled was fine. I guess if you just leave it in there like that, so if there was still non cold mango, you would get that

[Unidentified interjector(s)]: extra. Yes.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Not to.

[Mr. Harrington (Beverage center owner, Rutland)]: Let's see. You know, and again, I mentioned that I've been here going on twelve years just trying to get that little more money. I just hate to see another year go by, nothing gets addressed. And I, I hate the word sudden. It seems like every time it's, let's just do another study, we'll study it, study it. Then it, you know, it's like almost like just start off with this. Don't do a study.

[Senator Anne Watson (Chair)]: So I do recognize we have a couple more folks to hear from, I think we might have a question from Senator Williams and I think we have one from Senator Beck.

[Unidentified Senator (possibly Senator Seth Bongartz)]: So I went up in New York State Board and they I used them to a local selector. And we started taking back vows at the transfer station. And then each organization that came in fast for money, they got a donation, but they were taking water bottles that were evidently in New York State. They put a red if they had red ink on the label, they were evidently, New York State had a extra deposit on that. And I was I I had to go to the grocery store in New York State when they take back bottles and then sign this. You know if you're if you're redeeming water bottles and you didn't purchase them in New York state you're gonna get fined. You know you guys have anything like that? Did they see anything like that? Well

[Mr. Harrington (Beverage center owner, Rutland)]: the problem is you can go over there and get a soda can that's March for

[Senator Scott Beck (Clerk)]: a mall

[Mr. Harrington (Beverage center owner, Rutland)]: redemption. There definitely is is cross border returns but there's also people that do the zero sort so in my head right or wrong I think that that kind of outweighs a little bit so you do have some cross border but you also have some going into zero returns so it's you know it's not the system's still somewhat balanced.

[Unidentified Senator (possibly Senator Seth Bongartz)]: I would think that would be a problem because of because those wallets are problems they don't even want them to waste. Yeah. You know because they're sold what they're not they're not the right number around or something. Yeah. Printer plastic. Yeah. I I They order the things you see on the side of

[Mr. Harrington (Beverage center owner, Rutland)]: the bill. Right. But if we got rid of the bill, if we got rid of that altogether, you'd see glass, especially glass because I've, you know, that's even worse, but cans, glass, you know, everything else, because So you really don't see the question. When you do go in other states, I tend to really notice that there is a lot of know cans and bottles it seems like people just like throw them out.

[Unidentified Senator (possibly Senator Seth Bongartz)]: It's good question it's maybe going

[Senator Terry Williams (Vice Chair)]: to seem like a one on

[Senator Scott Beck (Clerk)]: one type of question but when you get when you receive your check at the end of the month for cannabis fees that comes from the state of Vermont or does that come

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: from Colorado?

[Mr. Harrington (Beverage center owner, Rutland)]: It comes from Tomra and it's a breakdown and my manager spends two hours a week breaking all that down and making sure that we're getting paid properly because if you don't, then there's a mistake because they go on average, we send 120 bags back of 12 ounce cold mango canes, supposed to be two forty in a bag. By the statute, they'd have to audit 10% of those and they pay us on the 10%. So if one of those bags breaks open and 30 cans fall out and they audit it and now your average is low,

[Unidentified interjector(s)]: you can lose money. The 10% is not representative of

[Mr. Harrington (Beverage center owner, Rutland)]: that we have to watch that like the hog all the time or if they tag the wrong bag and all of a sudden they have a 120 count and a two forty so it's not cut and dry where I think that these reverse vending machines would be much more accurate and that's one of the reasons I'm pushing.

[Senator Scott Beck (Clerk)]: So just a follow-up, if Tom was paying that

[Unidentified Senator (possibly Senator Seth Bongartz)]: bill and let's say we

[Senator Scott Beck (Clerk)]: do say hey you guys get another get another penny okay is Tom were going to say I guess we could have men are they going to say that the commodities market doesn't support that?

[Mr. Harrington (Beverage center owner, Rutland)]: Well they really need commodities market because it would just be the distributor putting that extra penny on what they're charging when it comes through

[Senator Terry Williams (Vice Chair)]: but at some point somebody's got

[Senator Scott Beck (Clerk)]: to pay for that penny on the

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: road distributor pays the handling fee now right Right. And so so it would just be another penny on their handling fee that they would have to pay.

[Senator Scott Beck (Clerk)]: But where do they get that penny from?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Their bottom line. Their Yeah. But the commodity market

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: But Tom didn't hear. Just, it's like, you know, the distributor is just going to pay me whatever you tell.

[Senator Scott Beck (Clerk)]: But who's going care?

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Like cost that.

[Senator Ruth Hardy (Member)]: But the beverage industry, like the producers, so, you know, there are three levels. They're the people who make the drinks, the distributors, and that are four levels, the people who sell them, retailers, and then these guys. Yeah. And the the beverage companies are making a killing right now.

[Senator Scott Beck (Clerk)]: So, you know, they're or or they go up in their price. Yeah.

[Senator Anne Watson (Chair)]: Yeah. Okay.

[Unidentified interjector(s)]: They're gonna make sure

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: that they under stock in their price. Yeah.

[Mr. Harrington (Beverage center owner, Rutland)]: They I'm I'm sure they'll try

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: to pass it on. Somewhere somehow.

[Mr. Harrington (Beverage center owner, Rutland)]: But it it would not come out of on them.

[Senator Scott Beck (Clerk)]: Okay. Senate Bongartz. No. I just remember his testimony from two years ago. Mhmm. And the thinking was that the problem wouldn't especially because they're not set on the national struggle and it's not Yeah. It's not gonna going be national pricing. Whether that's not a problem, I don't know that is.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Yeah. We don't wait anytime that Well,

[Senator Anne Watson (Chair)]: heard from another EPRs that trying to adjust the price, especially for these national or international companies can be actually more expensive to try to change the price than to raise it. So thank you so much. All right, thank you for your time. I appreciate it. Okay, so we're going move on to Mr. Hayes. Welcome. Thank you. Yes.

[Ethan Mays (General Manager, Morrisville Beverage)]: Morning, thank you for having me on such short notice. I'm Ethan Mays, I'm the general manager of Morrisville Beverage in Morrisville. We're a pretty large redemption center up there. And the one thing that differentiates us from everybody else is we have the RVM technology that you guys have heard so much about. So one of my main goals today is not to rehash everything that's been said. We certainly support raising the handling fee, but to answer your questions about how RVM has worked for us, what's been good, what's been bad, and any other questions that you might have about that. A couple quick facts real quick, redemption has not been very good to us in the last year, although already been dropped significantly, and labor costs have not as you've heard about. So the bottle redemption used to be one of our most profitable parts in our entire store. We're a liquor store, we're

[Unidentified interjector(s)]: a beer beverage store, have

[Ethan Mays (General Manager, Morrisville Beverage)]: a separate restaurant. Bottle redemption was one of the most profitable parts of that to our bottom line. Last year it was the worst significantly and that's because our volumes were out. We don't have an exact reason for that. Volume in the whole store has dropped a bit too, but our labor costs certainly have not, and it's only within the last month that we have really taken some serious action on that labor cost in order to make bottle redemption profitable for us again. Because without either an increase in volume, a reduction in labor, or an increase in the handling fee, the future from our bottle redemption is in question. It really is. We don't want that to speak. We are happy with the changes we've made. We are happy with the technology that we've implemented, but it's not going

[Senator Terry Williams (Vice Chair)]: be profitable for our whole business or it just doesn't work.

[Ethan Mays (General Manager, Morrisville Beverage)]: So again, I'm happy to answer any questions that you may have.

[Senator Anne Watson (Chair)]: And so the technology that you have is the large volume, like you can handle like a whole, like dumping of a whole bag.

[Ethan Mays (General Manager, Morrisville Beverage)]: That's correct.

[Senator Anne Watson (Chair)]: At a time, not just like the one can at a time kind of situation. And so, I mean, do you find that customers are pretty satisfied with that? Like they're not having to, it goes relatively quickly and that's the case for sure.

[Ethan Mays (General Manager, Morrisville Beverage)]: So in 2021, we decided to go all in on a bulk feed reverse vending machine, and as far as know, we're still

[Senator Terry Williams (Vice Chair)]: the only ones in the state that

[Ethan Mays (General Manager, Morrisville Beverage)]: have done that, although others have looked at it. So we're just about five years into that now. In the beginning, it's obviously a big change for the consumer. It's different from anything that they've ever experienced, and it's very different from the simple feed machines that they're used to at the purging for. It's very fast, it's very efficient, it does its job, customers do not have to wait a long time. There is some training, training your customers to do things differently when they come in because the ball p machine does not accept glass, so that still has to be sorted out. And that takes some touches. Most of our regular customers have gotten used to that and done that. And in fact, very, very recently we have a very competent manager out there who has been very successful about training our customers to do that, to make sure when they come in their glasses already out, so it can be proficient. Ten, fifteen, twenty minutes most of it, people have to wait when there's a bunch of people on the long line of people. And for bigger loads, we have

[Senator Terry Williams (Vice Chair)]: a trailer that we set up

[Ethan Mays (General Manager, Morrisville Beverage)]: for bottle drives. We will bring those commodities into the bag and then our people will put that volume through the machine and not hand count it so we're utilizing that machine for everything.

[Senator Anne Watson (Chair)]: I've also heard that if somebody dumps something in that is not actually redeemable bottle, that it kicks them back somehow. So they do still have to, these machines do still need to be staffed, is that correct?

[Unidentified interjector(s)]: That's correct.

[Ethan Mays (General Manager, Morrisville Beverage)]: It's not fully automated at all. We had grand ideas when we put the machine in that we would be able to utilize the labor elsewhere in the store. We never intended to replace any jobs or replacing the labor in our store. We just needed that labor in the front of the building and in the store. We've actually never had a hard time being able to staff our bottle reduction. We've never had more than two people out there, even though we're a large volume facility, even while we're handcuffed, we've only ever had two. Now we're at one right now because we need that labor in the front of the building. And that was our goal from the beginning to get that labor into the front of the house working out there. It didn't work that way until just recent. There were for various reasons, we needed two people out there still all the time. So we never saw the labor savings that we expected to from putting in the RVM. And in fact, because the rate that we've had to increase our wages that has gone up dramatically and our labor rate has doubled. Our average rate was two people out there at $19.50 an hour. And so we don't pay small wages for those folks to be out there. We depend on them to be out there to show up, do a good job and to take care of the machines. Now we're doing it with one person which again is a very recent change but we're still paying that person a very high wage to make sure that everything gets taken care of.

[Senator Anne Watson (Chair)]: Great distance. What happens when

[Senator Scott Beck (Clerk)]: the machine goes down? How do you adjust or are

[Senator Terry Williams (Vice Chair)]: you able to adjust back to

[Ethan Mays (General Manager, Morrisville Beverage)]: the old system? Very quickly it becomes the old system. Yes, it goes back to the county. We found that

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: a lot the machine goes down

[Ethan Mays (General Manager, Morrisville Beverage)]: a lot less now. Mean we're five years into this. In the beginning there were some quirks to work out and in the middle there were some issues with maintenance but we got that worked out and it also depends on who you have out there maintaining the machine as well. So we have very confident people in person out there now who are able to keep that machine running at top so the rate that it goes down is very very minimal now. But yes when

[Senator Terry Williams (Vice Chair)]: it goes down you still got handcaps. Do

[Unidentified Senator (possibly Senator Seth Bongartz)]: you own the machine? We do own So the you don't have to worry about voiding warranty or anything like that being fixed?

[Ethan Mays (General Manager, Morrisville Beverage)]: Well, so the way we decided we could have reached the machine, we decided to purchase the machine. That was a several $100,000 expense plus over $50,000 in renovations that we did to our center to modernize it and make it look better. It was a big expense that it took on. We anticipated at that time, and I've been here testifying before about expansion of the bill, that that would happen. It obviously didn't, but that was our goal to be able to be ready for that. So we purchased a machine on a five year payment plan, this year it'll be paid off. There is the maintenance plan that took effect in year two, so Tomer does take a cut out of some of those cans that are redeemed to make sure that the machine is maintained and it's within warranty for the first year so they'll come and take care of everything and then after year two there is that maintenance plan. It gets them to show up.

[Unidentified Senator (possibly Senator Seth Bongartz)]: So if it goes down you don't have your mobile redeeming machine mechanic out there you have to you have to go to the tower to get somebody to come fix it?

[Senator Terry Williams (Vice Chair)]: Yes yes

[Ethan Mays (General Manager, Morrisville Beverage)]: absolutely. Well that's the thing we can fix on-site. Mean if it goes down and it just needs to be cleaned the sensor needs to be cleaned the belt needs to be wiped out fine, but if not, then we gotta pull a a call to John Remnant and get somebody out there.

[Unidentified Senator (possibly Senator Seth Bongartz)]: What happens if you put a bottle in?

[Unidentified interjector(s)]: Just throw it out? When it's not working.

[Senator Terry Williams (Vice Chair)]: Does it does it jam the machine? If the machine's down,

[Ethan Mays (General Manager, Morrisville Beverage)]: it won't accept it. It just won't.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Oh, I mean, if it's working right and put a bottle or

[Senator Scott Beck (Clerk)]: you get Glass bottle. A glass bottle? Yep. That's a problem.

[Ethan Mays (General Manager, Morrisville Beverage)]: That's okay. Definitely a problem. And that was a big problem in the beginning where we got

[Unidentified interjector(s)]: some issues with the machine.

[Senator Terry Williams (Vice Chair)]: So it

[Senator Scott Beck (Clerk)]: doesn't make the last part?

[Ethan Mays (General Manager, Morrisville Beverage)]: Not the the bulk. Oh, okay. We have a separate

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: single feature. We must have

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: customers screw that up all the time.

[Ethan Mays (General Manager, Morrisville Beverage)]: We used to,

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: not as much. And then they show them the training, but we've got them pretty good. They get

[Ethan Mays (General Manager, Morrisville Beverage)]: on there pretty quick and we get a glass bottle or go through. And 99.9% of the time it's a mistake. It's like, oops, okay, I won't wear a medication.

[Senator Anne Watson (Chair)]: So when the machine does go down and you have to call Tamara for a repair, how long does that usually take?

[Mr. Harrington (Beverage center owner, Rutland)]: Usually twenty four to forty

[Ethan Mays (General Manager, Morrisville Beverage)]: eight hours, they're there. Many times they can walk and put the thing on the phone and get it back up and running so that we're not really in the hands down notice. Again, they have gotten a lot better in this service. It all depends on who they have working in their service department and they struggle, they reach everybody else. So right now they're very good and they're very responsive and will come out even on the weekends and get bed safe and care.

[Senator Anne Watson (Chair)]: Great. You all are open on weekends?

[Ethan Mays (General Manager, Morrisville Beverage)]: We are open Tuesday through Saturday. Great. Yep.

[Senator Ruth Hardy (Member)]: That's good. Do you have the technology that has the app that people can use to drop a bag and get it put on their account?

[Ethan Mays (General Manager, Morrisville Beverage)]: No, we talked about that, but that was proprietary technology

[Senator Terry Williams (Vice Chair)]: to Tom Ra at the time when

[Ethan Mays (General Manager, Morrisville Beverage)]: we started this and they had not released that for use in reduction centers, at least not in Vermont. Okay, we don't have that.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: We would love to have that. Okay.

[Senator Ruth Hardy (Member)]: Do you have any suggestions for the bill, given your singular experience? Nobody else has done what you've done so.

[Ethan Mays (General Manager, Morrisville Beverage)]: Sure, I mean, certainly the handling fee needs to go up. Yeah. No matter what, because even with the technology that's in place that we have, that we've invested in, our profitability is down. If that handling fee does not go up specifically after the year that we had last year and if that was attempted to be negotiated lower, we're out of the redemption. It doesn't make sense anymore to do that if that goes down, it's just not, does not go up. So there certainly needs to be a floor on that and that floor needs to be higher than where it is today. Because again, that as you've heard many times that it's not kept up. We to have significant seat at the table when it comes to the stakeholder, when it comes to the PRO, whether that means being on the board or just, or somehow making that happen, there needs to be significant participation. Especially these other businesses that have not put in the technology, they need to know what's coming down the pipeline and they need to able to make a decision to establish their business without being forced on their growth.

[Senator Anne Watson (Chair)]: Yeah, okay. Thank you. Yes, thank you very much. You're welcome. Appreciate you coming to share your experience again, especially on late notice. Yeah, absolutely. Great, yeah.

[Senator Scott Beck (Clerk)]: I ask one question before you Oh yes, go sure. If you hadn't had to purchase a machine, was absorbed by the PRO, so that's the way it's going

[Senator Terry Williams (Vice Chair)]: to work, right? You could put them in?

[Senator Anne Watson (Chair)]: Well, think there's That's a possibility. A possibility, but I think it's the grants or Nope.

[Senator Scott Beck (Clerk)]: Okay. So if they owned it and it was in your store, your expenses would go down because part of what you're doing with the fee right now is paying off the machines. That's correct.

[Unidentified interjector(s)]: Yes.

[Ethan Mays (General Manager, Morrisville Beverage)]: But the labor rate still doesn't go down. And we haven't had any savings.

[Mr. Harrington (Beverage center owner, Rutland)]: Okay. So you haven't had

[Senator Scott Beck (Clerk)]: any savings. Have okay. No labors. Right. It should be able to deploy it more efficiently. That's correct. Okay. Great,

[Senator Anne Watson (Chair)]: thank you. And so sorry about that.

[Senator Ruth Hardy (Member)]: Yeah, no, so Adam, I invited him yesterday. He's one of my constituents now. He's a Bristol veteran. He wasn't sure if he

[Senator Anne Watson (Chair)]: would I be able to sent him a lady. Yeah, he was

[Senator Ruth Hardy (Member)]: getting a delivery this morning, he probably is not gonna be able to come. I gotta tell you that conversation I had with him yesterday was very similar to what we've heard. Was stressing the handling fee as So,

[Senator Anne Watson (Chair)]: okay. Yeah. That's helpful. A good It is a common thing. Would you like to add something?

[Mr. Harrington (Beverage center owner, Rutland)]: Just very, very quick. The machine that I talked about here differs a little bit from his because the bottles and cans all do go together.

[Senator Ruth Hardy (Member)]: Oh, glass glass.

[Mr. Harrington (Beverage center owner, Rutland)]: But I was saying at the time that I got the call, the only thing it didn't do was select the bottles. Those are tough.

[Senator Anne Watson (Chair)]: Well, that's interesting. Thank you. That's helpful. That's good to know. Thank you. Actually, I do have also one more question for Mr. Hayes, if you're I have one more question for you. He's fluent in the night. Oh! So, one of the things my goodness, yes, Mr. Handy had mentioned was this ongoing $500 been the, do you have something like that that you have to pay on a monthly basis?

[Ethan Mays (General Manager, Morrisville Beverage)]: We do not.

[Senator Anne Watson (Chair)]: We do not.

[Ethan Mays (General Manager, Morrisville Beverage)]: I mean, Tom would negotiate contracts independently, I can't speak to Watson kids. Okay. That's accurate. I can tell you

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: we don't pay $500 a month. Okay.

[Unidentified interjector(s)]: It's just good

[Senator Anne Watson (Chair)]: to know what the breadth of possible.

[Ethan Mays (General Manager, Morrisville Beverage)]: Absolutely.

[Senator Anne Watson (Chair)]: Have a

[Senator Ruth Hardy (Member)]: power of negotiation.

[Senator Anne Watson (Chair)]: Exactly. Thank you very much. Okay, so with that, I think we don't have any other testimony from redemption centers on this. We do have a little time before our next topic starts, which is at 10:40. Before we move on, thoughts or comments from the committee about anything that we've heard so far? Seems

[Senator Ruth Hardy (Member)]: like a common theme of fee that you need to address. And I also think that getting them more into the process of the plan and giving them more

[Senator Anne Watson (Chair)]: negotiation power is important. You know, I'm intrigued by this idea of collective bargaining. I'm not, I don't even, I'm going to hold that with an open hand. Think that's an interesting idea, this idea of the floor is interesting. I'm also interested in this idea of, could the old system persist if wasn't appealing to a redemption center? All of these things are, I think, of an interest in my So, any other thoughts?

[Senator Scott Beck (Clerk)]: No, these things make it work. People, we need more redemption centers, not fewer. Yeah.

[Senator Anne Watson (Chair)]: Yeah. Anything to add, Senator Beck

[Senator Scott Beck (Clerk)]: or Senator Williams? No, can move Okay.

[Senator Anne Watson (Chair)]: Yeah, definitely interested in making the industry work and the possibility of redemption centers closing as a result of this bill is exactly the opposite of what I think we would want. So I'm very interested in making it work. So I'll just say that for now. Okay, with that, let's take a break until 10:40.

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: Thank you all.

[Senator Anne Watson (Chair)]: There you go. Hey, good morning again. This is Center of Natural Resources and

[Senator Ruth Hardy (Member)]: Energy coming back with a break.

[Senator Anne Watson (Chair)]: We are switching topics to move on to H740, which is about greenhouse gas inventory registry. We're joined by Secretary Moore, welcome.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: Thank you. Good morning, it's a pleasure to be here and I'm joined by two staff from our Climate Action Office, Jane Mozartz, who heads the office, and then Lauren Ashbrook, who is our Mitigation Chief.

[Senator Scott Beck (Clerk)]: I am here in just a minute. I'm going to share my screen because we do have some slides this morning.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: It's doing a lot of things, but not going to do full screening. There goes a slide. So I thought I'd start with just a little bit of context around the climate action plan and what led us to producing the memo that then H740 is in response to. So as I'm sure many of you recall, the Global Warming Solutions Act was passed in 2020, which established the climate council. The climate council then did yeoman's work to develop an initial climate action plan, which was adopted about thirteen months after the first meeting of the climate council. After that sprint, we move into sort of a more regular cadence for producing revisions to the climate action plan. The first of which occurred in July year. And so we're now operating under that updated climate action plan. So the climate action plan has a very extensive list of recommendations, a couple of 100 in total, but in response to feedback, frankly, we received from the public, we did identify sort of a top 10 list of activities. And implementation of these activities, Some of them involve legislative action and some of them involve action by the administration. One thing to point out is while the Global Warming Solutions Act does require ANR to adopt any rules that are identified in the climate action plan, we don't view that the current cap directs any of that activity. So we don't anticipate rulemaking on or before July 1. In addition, the climate plan sort of lays out what the council will do over this next four year period. And that includes work continuing to monitor and track progress in reducing greenhouse gas emissions, looking at what additional resources are needed to fully support implementation, continuing to work with the administration and also the legislature to drive forward some of those priorities. We do anticipate going to a quarterly council meeting cadence, which is a great downshift compared to what we were doing this time last year, where we were meeting in some instances multiple times a month. And then we do have a set of subcommittees that support the work of the council and really sort of working to keep those members informed because subcommittee membership is more extensive than council membership, but also recognizing that there isn't a ton for subcommittees to do in the interim. One of the things that was included in the updates to the climate action plan was the following request to ANR, and that language in the green box is the language from the Climate Pint, but asking us to develop a framework for the reporting of greenhouse gas emissions and to make a recommendation about how we would propose that this be done by December 15. We were pretty close. I think we were the following week in delivering that memo. I believe it came to your committee, Chair Watson, along with House Energy and Digital Infrastructure. And really the recommendations we made sort of build on work that was done by the treasurer as part of the cap and invest report that he submitted last year to the general assembly, where he noted or recommended further evaluations of the benefits and impacts of joining a program, including whether to establish a greenhouse gas reporting program. So this is sort of this arc of the importance of good data to work in the climate space. So in developing our memo, we looked at two different reporting frameworks. The first is harmonization because we know that this information with greater and lesser degrees of detail is being, some of it is being already collected by the Department of Motor Vehicles and the Tax Department. And then we also looked at a standalone reporting rule where entities would report directly to ANR. And our recommendation in that memo is for a standalone reporting goal. And there's several reasons for that. One is it allows us to sort of identify the level of detail we would need in the data to answer questions. And really the uses of this data may not be predetermined, but I would say generally our program design. And that includes how we might modify existing incentive based programs the state is already administering to have greater impact or better support low to moderate income households, as well as potential new program designs. This is the kind of information that would inform any of those measures. It also sort of puts the control of what that data request looks like with the agency. So if needs change, we can rescope the program as opposed to right now where we're really somewhat limited in terms of what tax and DMV need for their own purposes and therefore are willing to support for our purposes. And then the last piece here, and this is one that's become more evident as the current federal administration rolls on, is this would decrease our reliance on federal data sets. Some of those reporting requirements have been, are in the process or rumored to be about to be rolled back. And so this ensures that we have good information and it is continuous. We're a rule to move forward just based on the experience of other states. It's also really, there's legal value in having the general assembly specifically authorize us to create this reporting program. Was a legal challenge in at least one other state that created a reporting program that was resolved by making explicit the legislature's intention to authorize us to do that sort

[Senator Scott Beck (Clerk)]: of work. Who was that? Washington State. Washington.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: Then the last piece is just the resources needed to have this be successful. And I'll talk about that a little bit more on a slide here too. So as noted, a high quality dataset is really important to our ability to fully understand and evaluate the benefits of different emissions reductions efforts, inform future policy, but also help ensure that designs of current programs really meet the needs of low and middle income Vermonters. In order to do that, it is important to have resources both to create the program, but then also to ensure compliance. It was striking as we were working on this to learn from the PUC that they estimated only about 55% of entities reported in response to the obligations created under the clean meat standard. And that is a reflection of inadequate funding for compliance related work at the PUC. And so just, if this is the basis, it's one thing if this is the basis for designing incentive programs, it's another thing entirely. And this is intended to be the basis of a regulatory program. And it's really important to make

[Senator Ruth Hardy (Member)]: sure we have complete information.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: So when we put together the initial proposal in the memo we had submitted back in December, we identified some staff needs, some one time costs and some ongoing needs. I've attempted to gray out the one time costs because as we testified in the House Energy Committee, just given the fact that the staff wouldn't start on July 1, and then the ongoing costs for maintenance and third party verification are in all likelihood at least a year out. We believe that with a $500,000 base of probation, we could meet the needs, the one time needs and then the ongoing needs without having a separate ask for one time money. There's open questions around program scope. The H740 as it came out of the house is narrow and focused on the transportation and building heat sectors, the RCI sector. This is 70% of the statewide greenhouse gas emissions, so it's a pretty good fight. But there remain questions about whether to incorporate non energy industry sources or other sectors. I know house energy had talked about some of the wood fired or biomass fired plants, as well as, I think had looked at levels that might even bring in some of the schools that rely on wood fired boilers. So in the end, none of that is in H740 as it arrived with you all, but those conversations have been added. The approach in H740 is to amend section five eighty two. And again, this is providing that clear authorization for our program. And just another recognition that we really, we can't do this without additional resources. This is beyond what we currently have capacity for. And then I believe in what was forwarded to the committee this morning are several pieces of supplemental information that may be of interest to the committee as you review the bill, including a summary of state greenhouse gas reporting programs,

[Senator Anne Watson (Chair)]: a

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: little bit more information on emissions by sector here in Vermont, as well as some of those existing reporting requirements. And then I think the part B of this is the data collection strategies from other states. So just a wrap of information to inform your deliberations.

[Senator Scott Beck (Clerk)]: Think with that, happy to answer questions. Super.

[Senator Anne Watson (Chair)]: Gosh, was very thorough. I don't have any questions. Thank you. Any other questions from the committee? Yes, go ahead.

[Senator Scott Beck (Clerk)]: So is this consistent with what's in the Locust Point? I

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: believe, just to be clear, I believe House Appropriations stripped the appropriation out of the bill. They advanced the policy bill to you all so that you have the opportunity as you're considering your own appropriation priorities to pull this back in, which is part of why I probably said resources 18

[Senator Ruth Hardy (Member)]: tests. Yeah, and as a result, the language in H740 went from having a strict deadline date to contingent resources.

[Senator Scott Beck (Clerk)]: Does your agency support seven forty?

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: I think there is value, real value in having better data. I think one of the challenges we've seen in conversations around things like the clean meat standard is you end up with dueling experts and opinions about the cost, and it is challenging to answer those questions without a robust data set to underpin it. I also think this kind of data where we're getting information, not just on statewide fuel sales, but on types of fuels in geographic areas could help us look at some of the existing incentive programs the state runs and better tailor those to meet the needs of Vermonters in a way we can now. When we adopted the initial climate action plan, the tax department just collected state level information on gallons of fuel sold, not even about fuel type. We worked with them to modify their form, so now we get a breakdown of fuel oil number two versus propane versus kerosene that has been helpful, but we still don't know. We know those fuels aren't equally distributed geographically, but we don't know more than that right now. So this more granular data, I think allows for better programs.

[Senator Anne Watson (Chair)]: Just- Sure, even if you could introduce yourself.

[Jane Lazorchak (Director, Vermont Climate Action Office, ANR)]: Oh, thank you. Jane Zareczak, Climate Action Office. There's also a real gap in the data around biofuels, which is a significant component when you're using the data to quantify emissions. So I do just wanna flag that. That's actually not in the data.

[Senator Anne Watson (Chair)]: Percentages. Thank you.

[Senator Scott Beck (Clerk)]: Some of the deadlines or the timeframe that came out of the house, the committee is applicable with these numbers.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: Yeah, I mean, we would correct in terms of standing up the program and having it, yes.

[Senator Scott Beck (Clerk)]: Any other questions at this point? Okay,

[Senator Anne Watson (Chair)]: well thank you very much. You're welcome. You said

[Senator Ruth Hardy (Member)]: that something was forwarded to

[Senator Anne Watson (Chair)]: the committee. That's what I

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: was looking for. Was it the memo from Yes. Okay. And then it has appendices behind it. Okay.

[Senator Anne Watson (Chair)]: Super. Thank you so much. And I guess we will shift to this merchant. Welcome. No, I'm just here. I'm just here. Thank you.

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: Good morning. So thank you to Chair Watson and members of the committee. For the record, my name is Jerry Duvall. I join you today as a member of the Vermont Climate Council and I want to be fair upfront that my testimony is solely in my capacity as an appointed member of the council and does not represent a position of the organization that I work for because as I shared with this committee previously, PAN does not take positions on bills before the legislature. For some background, I have served on the climate council since October 2020 when I was first appointed by the Senate Committee on Committees to serve as the member from a Vermont based organization with expertise in energy and data analysis. I was then reappointed by the Senate Committee on Committees in 2023. On the council, I chaired a science and data subcommittee and also serve on the cross sector mitigation subcommittee and the council's steering committee.

[Senator Scott Beck (Clerk)]: What organization is center? Energy Action Network.

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: Energy Action Network. Yeah. It's the organization that I work. So in my council capacities, I was a co author of both the initial climate action plan in 2021 and the updated kind of action plan that was adopted by the council on July 1. So I just wanted to share a couple of few reflections about H740. First is that the reporting requirement envisioned in this bill as secretary Morris said was a top priority recommendation of the council. Specifically the first priority recommendation listed in our top 10 that was made in the 2025 climate action plan is to develop a framework for the reporting of greenhouse gas emissions data from fuel suppliers and other significant emitters of climate pollution. To me this recommendation is about basic data gathering. Members of this committee may support or they may oppose various policies to reduce climate pollution. In my view this bill is not about that, it is simply about knowing how much pollution different fossil fuel suppliers and large emitters are responsible for. Right now, Vermont has very good estimates of the aggregate amount of statewide climate pollution emitted in Vermont by virtue of the Vermont greenhouse gas inventory that is produced by the agency of natural resources. What we do not currently know is which fossil fuel companies are responsible for what share of those emissions and where as the previous testimony spoke to as well. For instance, how many gallons of fossil fuels are imported into and sold within Vermont by whom? That's information you don't have right now. This lack of information limits the state's ability to have those fossil fuel companies help reduce pollution over time, and as the saying goes, if you don't measure it you can't improve it. So in summary, I as a member of the council and chair of the science and data subcommittee support H740 for the following reasons. First and foremost, basic data collection and reporting as proposed with the Greenhouse Gas Reporting Registry is a necessary precursor for any meaningful pollution reduction policy or programs or even well designed incentive programs as secretary Moore said. We've already seen this that this is true of the electricity sector with the regional greenhouse gas initiative which Vermont participates in, requirements of facility level emissions reporting for electric generation facilities. It's been true in the transportation sector while we have not required fuel supplier level reporting in Vermont, states that have advanced transportation sector policies to help reduce emissions and costs have set up these type of requirements including Washington, Oregon, and California. And it's also been true of multi sector pollution reduction programs that have been developed in Washington, Oregon, California, Oregon. I'm going go back to the greenhouse gas initiative. So as participant in RGGI, Vermont is already among the states that require reporting of emissions from any fossil fuel fired power plant above 25 megawatts. However, beyond the utility sector and in contrast Vermont does not currently require supplier level reporting of emissions from what are by far the largest sources of climate pollution in Vermont that combine hundreds of millions of gallons of gasoline, diesel, fuel oil, propane, and other fossil fuels that are imported into Vermont by fossil fuel corporations for use in transportation and thermal sectors. For context, the transportation of thermal sectors combined for approximately 72% of Vermont's climate pollution far surpassing our electricity sector at 3%. And so in my view, we are going to rightly require supplier level emissions reporting of our least polluting sector, the electricity sector, we should also require supplier level fuel sales reporting of our most polluting energy sectors. Also as spoken to in Secretary Moore's testimony, I'll just say this for myself, don't know if I would phrase it in this exact same way or she would say it in the same way that I did, but as the federal government becomes a less reliable source of energy emissions data collection and reporting, as we are already seeing from the EPA. I think that it is very important we have a state level reporting required to ensure Vermont can track and understand key data necessary to inform broad and specific efforts to protect human and environmental health. And then lastly for some context, I have to confess that as I've heard conversations about this bill, I've found it a little bit of kind of questioning how the title is being talked about because it is certainly about the greenhouse gas inventory and greenhouse gas emissions reporting, but it is not asking fuel suppliers to report emissions, it is asking them to report fuel sold, the content of that fuel and the location of it. So in some ways it's more accurate I think to think of this as a fuel suppliers and large emitters reporting requirement because the fuel suppliers themselves would not be reporting emissions. Again, they'd be reporting gallons and content in those calculations to determine the emissions would be done by ANR. So lastly, in climate council meetings, the lone vote against recommending a reporting requirement

[Mr. Harrington (Beverage center owner, Rutland)]: came from

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: the councilor appointed to represent the fossil fuel industry who argued that fuel suppliers do not have the time or expertise to calculate emissions. Again, to be clear, a reporting requirement would not require that the corporations that import fossil fuels into Vermont calculate emissions rather in proposed in H740 and as done in other states, fossil fuel suppliers will merely have to report data that they already have specifically the types and volume of fuel sold and the location. Again, the calculation of the emissions associated with the combustion of those fuels would be preceded by Anne Arnaud and fossil fuel companies.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Don't we already report that to the tax department? I mean, we asking them to do double duty here?

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: Much of this information is already reported to the tax department. I would defer to secretary Moore and Jane about challenges in terms of data sharing. I would also note that there's key information that's necessary to do emissions calculations that's not reported to the tax department, specifically the content of fuels, including as Ms. Zortzak spoke to, the biofuel content of different fuels. Because if you're selling, if you do a delivery of fuel oil that has a B20 blend, it has a different emissions profile than 100% number two fuel oil.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Is there any way we could get with tax and come up with one report that both agencies could?

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: We've had some of those conversations. Tax obviously has some real privacy concerns that extend well beyond fuel reporting and sort of principles that they don't want to cut against regardless of sort of the need. One of the things we did look into was whether reverse harmonization is possible. Could we collect data that could then be passed to them so that they wouldn't also have to collect it? I would say the jury's still out on that one. It's not as easy as sounds, that is an area we can convince. Should seven forty move forward, that's an area we can continue to dialogue with them.

[Senator Ruth Hardy (Member)]: There are, in Beyond Tax and DMV, who collect those fuels explicitly for tax purposes. In the memo, I might draw you to all the other statutory requirements on the books for fuel reporting, some of which are not acted on, but could be in large part, and many of those stick with the public service department, and those there would be easier perhaps reverse harmonization considerations in that we could clean up statutes on books so that double dipping or double reporting couldn't become erroneous down the road. And that is something we've talked quite a bit with public service department about on top of just like the obvious tax and DMV. And the last thing with taxes, I think that we perhaps could continue to work with them closely to ask them to collect additional data, but the two concerns we've heard is one, Mission Creek, they're very clear about when they collect data for purposes around tax, they don't like to add on additional requirements, so that's the problem with the biofuels. And then if there is this forward thinking, if there was to ever be a regulation or a component that we use this data for, if we were getting that data from tax, that we would still never know the regulated, the potentially, I should

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: say, regulated entity of the organization,

[Senator Ruth Hardy (Member)]: which is not something we would humor us.

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: If I may, oh, sorry.

[Mr. Harrington (Beverage center owner, Rutland)]: Go

[Senator Ruth Hardy (Member)]: ahead. I just had a question actually now for the agency. Two things you mentioned, sorry, this is the awkward button.

[Mr. Harrington (Beverage center owner, Rutland)]: You wanna come back?

[Senator Ruth Hardy (Member)]: It's fine. The statutory cleanup, is that something that we should be doing in

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: this bill to make it clear? It could be. Okay. It wasn't anything that was discussed in the house, but certainly it is something that I think would have utility.

[Senator Anne Watson (Chair)]: Okay, because I was just skimming through your memo.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: Do you have specific? Yeah, there's specific questions. I

[Senator Ruth Hardy (Member)]: don't rate this time, but we would be happy to collaborate with the public service department on that, because it would be statutes on their books and we would have talked about it with them explicitly, but we would want to ensure that they were 100% supportive. Okay, maybe we should have

[Senator Anne Watson (Chair)]: them in to talk about it,

[Senator Ruth Hardy (Member)]: because if that can help ease some conservative people, it might force it. And then just specific to your budget, I'm not sure I understand, you said you grayed out some of the one time things. Does that mean you

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: don't need that? Not sure how I understand. So you're doing $300,000 to create a system. I'm saying is if there was a $500,000 base appropriation in year one, we would use some of that base appropriation for the IT being. I see. And then in year two, you would move in for maintenance of the system and the compliance activities that aren't necessary as you build again.

[Senator Ruth Hardy (Member)]: Okay. So 300,000 would help build the system, 500,000 would build the system and staff the system.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: So $500,000 is sort of an ongoing cost, right? We need staff, we need maintenance and we need some amount of compliance and verification to ensure we're getting everybody reporting in. But in year one, we don't need maintenance or compliance and verification. So we would just instead use some of that base appropriation for the IT.

[Senator Ruth Hardy (Member)]: Okay. So I guess you probably can understand where I'm going is like, what do you need in year one? Do you need the full 500,000 in year one? That is our best projection because that would allow

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: us to hire both positions at some point in the next fiscal year, as well as have this IT contract. Okay. Okay. Alright. Thanks. Yep.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Yes, go ahead. So I figured all while here in the past, this is a, you know, like the affordable heat act. It's just a, it's a, it's a tax. Is this gonna create any additional tax on dual dealers than they're already paying? Know? So

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: my in in my view and understanding, this is in no way shape or form a policy that leads to any costs in terms of those sectors. This is just about data collection and reporting. So I think that it's down To me, this is just about gathering data to understand how energy pollution is produced by different fossil fuel suppliers in different parts of the Pearson, Vermont. And what is then done with that data is a whole different set of conversations that future dates.

[Senator Anne Watson (Chair)]: So to build on that, as a result of this data, you're not also charging the fossil fuel industry anything additionally, there's no costs that are incurred directly to them for this.

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: All you're saying is it's the time to report, but this is information that they already collect and report. Yep. So they don't believe that that is meaningfully additional.

[Senator Anne Watson (Chair)]: Does that help?

[Jerry Duvall (Energy Action Network; Member, Vermont Climate Council)]: I could, I would be remiss if not mention something that I did not say specifically in my prepared testimony, which is when the agency of natural resources presented the recommendation that led to H740 in terms of a reporting requirement, there was deliberation by the council on that specific recommendation, not just whether we supported it as we did in the climate action plan, but whether we supported the resources necessary to establish the reporting requirements. And that was a near unanimous vote in support of ANR's proposal. And so I just want to say that my support here today as a member of the council isn't just for the idea of a reporting requirement, but very much strongly for an alignment with the agency in terms of the request for resources, because as was said earlier, actually doing this is and I quote the language that's in July now, contingent upon appropriation of funds in fiscal year 2027.

[Senator Anne Watson (Chair)]: I have a couple of other questions. So one, and this is sort of for anybody, and I think I know the answer to this question, but I just want to be really clear. So this, I mean, we've talked about it in terms of like, this is the transportation and heating sectors, but to the degree that heating or transportation is supplied by electricity, electricity is already sort of covered. We know that data that lives somewhere else. And so it is just fossil fuel based transportation

[Senator Ruth Hardy (Member)]: and heating. And those emissions don't show up in the inventory under transportation or heating, they show up in the electricity sector. So yeah, this is really about

[Senator Anne Watson (Chair)]: fossil fuel transportation. Gotcha, okay. And then the other question I have is, I'm just thinking about, you know, so this kind of, like, supposing we're able to find an amount of money to help support this. I guess I'm thinking about the usefulness of driving down people's costs for fossil fuels, which right now are just absolutely, you know, spiking. And it's very scary. And so just thinking about the, if you could speak to like the usefulness of this kind of data, in the light of, you know, in the context of spiking fossil fuel costs.

[Unidentified interjector(s)]: Yeah, absolutely. It's so timely, if I may, for a moment, take off my climate council hat and put on my EAN data tracking research and analysis hat, we just published an EAN analysis earlier this week that looked at what has the cumulative costs to Vermonters been the first month post the start of the war in Iran because of the price spikes we've seen in fossil fuels, specifically looking at gasoline, diesel and fuel oil. And what we found is an estimated at least $32,000,000 over $32,000,000 from the war that was paid for fossil fuels in Vermont in the month across the month of March beyond what would have been paid for those fuels if they

[Senator Terry Williams (Vice Chair)]: had remained at their February

[Unidentified interjector(s)]: levels before the war started. And specifically the largest price increase was for gasoline at over 15,000,000 in extra expenses for Vermonters just last month in March. And if folks are interested in digging into that analysis, we also provide consumer level information. What does that mean for an average Vermont driver? What does it mean in terms of 200 gallon fill up of a fuel oil tank? And what does it mean for average annual expenses for driving and for heating if those prices remain elevated for a long period of time. And so getting back to the question of data, I think that the signals we are seeing from the EPA and from the EIA raise really big concerns about the continued availability and the confidence in the quality of the data that's coming from the federal government. And so I think it's really important that Vermont collect as directly and comprehensively as possible the information that we need for our purposes. And I think that there are some potential consumer protection benefits to this data in terms of understanding the areas of the state that are most dependent on the, not just the most polluting, but also the highest cost ways to heat a home, which

[Senator Terry Williams (Vice Chair)]: those things are the same.

[Unidentified interjector(s)]: Fuel oil, ferrocene, propane are the highest polluting and the highest cost ways to heat. And so if we're gonna target programs or incentives to help people not just cut pollution but cut costs, it would be helpful to be able to target those incentives and resources to those areas where people face the highest cost.

[Unidentified Senator (possibly Senator Seth Bongartz)]: So that point you brought up about the increases of military action. You know, that's gonna go on a chart some points. So people still need to use the fuel to get the word. Absolutely. And, you know, if anything is gonna create cause a situation where people are gonna drive lost because it was not as cheap. But as far as fossil fuels for trailer, you know, they don't produce propane or or fuel oil. Mhmm. Until we fix that or get everybody an electric vehicle, We're stuck with what we got. So I guess the question is where where is this reporting that are gonna benefit that?

[Unidentified interjector(s)]: I mean, would go back to the basic idea of in order to improve something we have to measure it and know where we're starting from and how much of different fossil fuels are coming into, what their content is, where they're being sold so that we can help reduce people's exposure to independence on. I I think the challenge economically is that

[Senator Terry Williams (Vice Chair)]: fossil fuels are part of

[Unidentified interjector(s)]: a global commodity market where we have no level of control of the price volatility and spikes that we are seeing. In contrast, there are things that we can do locally that help reduce those costs and that involves spending money in Vermont with Vermont businesses rather than sending it out of state. Weatherization is probably the best example, but it also relates to more use of more locally available and sustainable energy sources including the appropriate use of stable wood heating, including electricity generation and electrifying those parts of transportation and heating that are both very polluting and incredibly expensive for homeowners.

[Senator Ruth Hardy (Member)]: Yes, Ben. You send us the report that

[Senator Anne Watson (Chair)]: you have just received?

[Senator Terry Williams (Vice Chair)]: Yes. Yeah,

[Senator Anne Watson (Chair)]: well, and my thought at this point is that vote to support this bill is at this point, vote just to support better date to, and agnostic as to what that, what that means moving forward, but being able to, but I'm appreciating this. Yeah, that's it. Because data is sort of, you can't improve something that you're not measuring. Appreciate it. Any other thoughts or questions?

[Senator Scott Beck (Clerk)]: Only that, you know, our code to build the bill, we should put the money back in and get the base into something to point over to. People are vicious to me. Don't vote money in. That's just a concept. It's all good. Mhmm.

[Senator Anne Watson (Chair)]: Because is the money in the house such as not? Bill Powell doesn't have the last part of

[Senator Scott Beck (Clerk)]: the the house kind of which included the date of the.

[Senator Terry Williams (Vice Chair)]: Was there any other government government?

[Senator Anne Watson (Chair)]: No, this came about as a result of a bill. As with most bills, it could not have been in the. Administration.

[Senator Scott Beck (Clerk)]: But they all view the right and the hood, right, and flourishing from the construction.

[Senator Anne Watson (Chair)]: Oh, from the climate council.

[Senator Scott Beck (Clerk)]: On climate council. The support of the committee.

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: It started with Chair James putting in a council.

[Senator Anne Watson (Chair)]: Okay. Great. Any other questions at this point? Okay. Super. Thank you so much. Okay. Any other thoughts folks would like to share at this point about 07:20? Great. Thank you. So are we anticipating, we've been anticipating Mr. Bongartz. Okay, great. So 11:30, we're gonna hear from the PUC. So we're gonna take a break until then. And then we'll have Okay. Alright. Is Senator National Resource Energy coming back from a break and we're joined by Mr. McNamara, Chair of the Public Utility Commission. Welcome. In the context here of we're preparing a budget letter and wanted to just hear from you about how things are going with the PUC budget.

[Ben McNamara (Chair, Vermont Public Utility Commission)]: Great, thanks. Glad to be here. So for the record, Ben McFamer, Chair of the PUC. So it was telling me that things going well.

[Senator Anne Watson (Chair)]: Yeah. Always. Yes.

[Ben McNamara (Chair, Vermont Public Utility Commission)]: I might remember how to put this to you. So I should have set this up earlier. Is that extra time? It is. Great. Alright. So I'm not gonna provide the overviews and sorry. Just for context, I sent you the slides that I've used for both house and accident appropriations. Recognize that you're not diving into the same level of detail, so I'm just going to do a very, very high level overview. Hopefully you know who we are, we've showed up a couple of times. FY '27 budget. So our proposed budget is roughly 5,300,000.0, so it's an increase of a little bit less than 3%, so 2.8% above FY '26. The pie chart on the side here is just appropriations, committees love this, we're special funded, no general funds. The only time we ever got any general funds is for the clean energy, or sorry, cleaning heat standard work that we did, that was one time appropriation, that money's gone. So FY '27, we're asking for $5,300,000 roughly of special funds. Most of our funding comes from gross receipts stats, that's about 90, slide, please. 97% of our funding application fees make up about 3%. There's a little bit on the build back for a corporate quarter time, a little bit of that. It's pretty negligible. Salaries and benefits make up about 87% of the commission budget. We do not have, you know, we don't own state parks, we don't own, you know, access points for fishing, any of that kind of stuff, so our budget is very straightforward. So one interesting bit is our projected revenues, and this is from gross receipts tax and application fees is 4,350,000

[Mr. Harrington (Beverage center owner, Rutland)]: a month.

[Ben McNamara (Chair, Vermont Public Utility Commission)]: So it's obviously a deficit, we're running a deficit. We do have reserves, because we're special funded we're allowed to have a certain amount of reserves, it's been built up over the years. Generally it has fluctuated, put in some money one year, take out some money in the other. Last couple of years with healthcare costs and retirement costs increasing, we're just only taking money out of reserves. There's no foreseeable paths at the moment for us putting money into the reserves, sort of going down reserves to meet our budget. We We expect to do that from those developers.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: Just looking ahead and

[Senator Scott Beck (Clerk)]: see, so that FY27 projected revenue, is that less than you receive in FY26 or more? How's it, what's the trend of that revenue stream?

[Ben McNamara (Chair, Vermont Public Utility Commission)]: Yeah. So gross receipts tax is essentially on the it's a tax on the utilities that we regularly. Okay. That can fluctuate considerably over the years. The vast majority of the money comes from electric utilities. When you've got a beautiful, absolutely beautiful weather, you know, not too cold in winter, not too hot in summer, utilities revenues are actually not that high. But when you've got a bitter cold wintertime or hot summer, then the revenues go up because they are selling a lot of electricity on higher costs and pretty much the exact same with Vermont Gas as well, which is another negative source. So generally fluctuating, getting to your specific question, we assumed about a, I think this was somewhere between 23% increase compared to FY '26, we're just trying to estimate and there's a general trend up, but the trend up is less than the trend in healthcare costs than retirement. Those are closer to inflation. Exactly. Alright. So the Commission's workload, this is just high level. So we get about just over 2,000 new cases filed with the Commission every year. It's a little confusing because reports are filed as cases. In terms of cases that we're actually doing, a large majority of those are net metering, some merchant generation, and we also have a lot of rate cases. This just provides we do a lot. So this just gives you some statistics on what they're doing. I do have a slide.

[Senator Scott Beck (Clerk)]: We charge fees for all those cases and

[Ben McNamara (Chair, Vermont Public Utility Commission)]: filings. Right? We charge application fees only for what we call merchant generation or merchant storage. Those are projects that are not directly funded by the electric utility. Because the electric utility is paying like gross receipts tax, we don't actually charge them anything. But when you've got Encore is one of the larger sort of from off base solar developers, when they propose a project, that's their own capital that they're raising. It's not associated directly with utility, so they've obtained applications for lease. And that application fee goes both to the Department of Public Service and to us. We get about 40% of the fee and departments get 60%.

[Senator Scott Beck (Clerk)]: So a net meter, five kilowatts on the roof. Do they pay you a fee?

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: They do. They pay them. Okay.

[Ben McNamara (Chair, Vermont Public Utility Commission)]: And, honestly, it's those are flat fees.

[Senator Scott Beck (Clerk)]: Okay. But they pay they pay. Okay. They yeah.

[Unidentified Senator (possibly Senator Seth Bongartz)]: They're a

[Ben McNamara (Chair, Vermont Public Utility Commission)]: one time fee? It's a one time fee for all of these. For the most part, it's the smaller projects just pay a flat fee. Once you get to significant sized projects that we expect to have a lot of litigation, then those pay a per kilowatt fee. And end up paying a fair amount. This is again just talk about workload a little bit. We do have certain time frames that we try to resolve cases. There's obviously outliers, and some of the outliers are not great, but generally we get cases and we try to resolve them as quickly as possible. The most significant impact or the most significant changes here for when we don't resolve cases are when you have interveners, the adjoining landowner for example, hates a project, and also depends on the developers. Some developers are very just automatically try to work with the adjoining landowners. Others take the view of this is a good project that we're proposing, we're just going to push forward. So some of the cases that are heavily litigated can be dragged on for quite a while, and that's because interveners should have all the appropriate rights to intervene to be able to say their piece. So we try not to shortcut the process and try to administer relatively efficient. This is a list of just major things that we're working on. I was just looking at my schedule. So just in June we have hearings on GMP's multi year rate plan. This is for they have a

[Mr. Harrington (Beverage center owner, Rutland)]: four year

[Ben McNamara (Chair, Vermont Public Utility Commission)]: plan where we estimate what their capital costs are and look at the potential fluctuations in their costs. That multi year rate plan is up for renewal. So we have hearings on that in addition to at the same time of having hearings on GMP is 7.5% rate increase for advice. So we've got those coming up in June. We've got a smart gas pipeline. This is not a new pipeline. This is the norm that's been litigated for years. We've got hearings in early July. And then every three years, the energy efficiency leads other leads to what's called a demand resource and resource plan proceeding. And that's where we set the budget and also authorize what they're going to be working. So that's those hearings are likely coming to summer as well. So three fairly significant projects. And then of course we have rate cases, we have Hyde Park happening,

[Mr. Harrington (Beverage center owner, Rutland)]: and

[Ben McNamara (Chair, Vermont Public Utility Commission)]: then, oh actually sorry, I was talking about the next slide. These are cases that we're currently working on. Last year, we actually had a lot of changes based a lot of studies based on things that The US does look at. For example, single plant that hasn't shown up here yet, it's blank. Energy savings account, customer credit, these are energy efficiency programs. And then some various reports, low and moderate income, great stabilization for electric utilities, thermal energy exchange networks, a variety of different things. I've already talked through, but this is really the mean of it, is FY '26 budget is 5,140,000.00. We're proposing 5,299,000.000. So 2.8% increase. We're trying to really minimize the increases here. We're not imposing any new initiatives or anything. We do have some vacancy turnover savings. We have a couple of positions that we're just not filling given that we're relying on reserves. And a lot of the savings that we actually have from FY '26 are because in FY twenty six we had three clean lead standard positions given that there was no apparent movement on that. And if we are going to do anything, we would need authorization or funding for positions for all that. So we just let those positions go. If they're not funded, we're not keeping them. So some of the savings actually are from vacancy savings that quite honestly, what's the way you need much. So, I've already talked a little bit about the cost that we're seeing, retirement is about 4.1% increase for us from FY26 to FY27, healthcare was about 10%, other fringe benefits 9.5%, and then internal service funds essentially what are we paying billable services, what are we paying agency and digital services, that was 5.6% increases from that policy and the funds from the services. So those are our factors, and again we're just drawing down our reserves. And we expect reserves to get us through for two, potentially three years, through maybe FY '29, at the most, '30, so we are going to be coming back next year with some ideas as to how to structurally address those potential changes funding, also potential changes to the work that we do.

[Senator Anne Watson (Chair)]: That is the part that I wanted to make sure that the committee heard, you know, to say that the trajectory right now is one that can't sustain beyond '29, 2030, and we're going need to think about some some kind of change. And we

[Ben McNamara (Chair, Vermont Public Utility Commission)]: have some general thoughts, but we're still working through it. We haven't talked to administration, haven't talked to new folks. That'll be something that over the summer we'll start talking to folks as to different ideas. The main one or sort of the two main things that we're thinking internally. Right now we're funded by gross receipts stats. We're looking at potentially being funded by the direct assessment. The way that several states do this is we basically, if our ratio So right now our budget is informed by a large degree to the weather, as I talked about, or at least our revenues. What other states often do is they look at what is the budget based on what are you telling us to work on? What are the cases that we expect to see? And then we come back to the legislation and say, this is what we expect to need. So in other words, doing something very similar to the other agencies. And then, but some states will do this where they assess that fee on the utilities directly, others do it through general funds. There's different ways to do it, but part of it is changing the funding from what are you telling us to do, and then we'll fund based on that. So that's one large consideration. Another possibility is changing application fees. The application fees do not represent the works that we do on merchant generation. And then another possibility is Vermont is one of only four EUCs in the country that actually looks at or that is responsible for citing distributed generation. The others are West Virginia and Nebraska. One possibility would be look at Act two fifty and local zoning for citing merchant generation consistent with a larger portion of other states. I will also just caveat that a large portion of states have local zoning looking at the small scale generation. A few states will also do another statewide setting board, but not the PUC. So we're looking at possibilities and throwing those out as long as at least that I'm seeing is the most feasible at the moment. So because at least in my mind, just proposing, hey, just give us a lot more money is not ever a good solution. Instead, it should be looking structurally at what we do. Are there other better, more efficient ways to achieve it?

[Senator Anne Watson (Chair)]: So center party first and a

[Senator Ruth Hardy (Member)]: little bit of center one. Okay. So you're not asking for us, this is just a preview of what's coming and there's not an ask right now?

[Ben McNamara (Chair, Vermont Public Utility Commission)]: That's correct. This is simply a preview.

[Senator Ruth Hardy (Member)]: Okay. In my other committee, you're probably aware and find this, there's a conversation about the two forty eight A process and whether or not you're the

[Senator Anne Watson (Chair)]: right entity to pick up,

[Senator Ruth Hardy (Member)]: to do that work. So are you thinking about that as well?

[Ben McNamara (Chair, Vermont Public Utility Commission)]: We are looking at that. Interestingly, the telecommunications citing tends to actually, because their power will serve multiple patents potentially. My understanding is that most other states there is a statewide component. We would follow-up.

[Senator Ruth Hardy (Member)]: Yeah, yeah. I mean, think the conversation is PUC versus SAT two fifty, which

[Senator Anne Watson (Chair)]: is a statewide range. So I don't know if you

[Ben McNamara (Chair, Vermont Public Utility Commission)]: We've not got a lease up.

[Senator Scott Beck (Clerk)]: Okay. We should have the lease number.

[Ben McNamara (Chair, Vermont Public Utility Commission)]: I'll wait for some help. Just a curiosity question, We have same 26 positions where we currently are in the positions. And that includes the measures as well. Do you

[Unidentified Senator (possibly Senator Seth Bongartz)]: have enough other than the three and four, you have enough

[Senator Scott Beck (Clerk)]: to do what you need to do

[Ben McNamara (Chair, Vermont Public Utility Commission)]: with the instructor? I enough to do the work currently. I have been very clear to different committees that when they said, oh, the PUC should just do this study, I said, that's great, we're not, we don't have the resources to do, we can, we're treading water at the moment and it depends on what happens in end of the we have no control over, you know, it's not like we have an estimate of every month, this is how many cases tonight, As I mentioned before, have a couple major cases all coming to the same time, so it just means a lot of nights a week, a month of folks for the summer. We also, another answer to your question too is I'm sure there's plenty of folks who wish we could do things faster, and we're not doing the things faster. I don't see us moving projects faster than we currently are. There's a few outliers that I think we can improve on, but for the most part, if people want more efficient and quicker turnaround, then we need more resources. But People are content with how we could put cost to significantly improve it.

[Senator Scott Beck (Clerk)]: Any other questions at this point? How much time do you spend about, or I mean, it's like, whatever you want to, one of the smaller projects that you think you wouldn't be able to do somewhere else.

[Mr. Harrington (Beverage center owner, Rutland)]: Yeah, it's difficult to answer

[Senator Terry Williams (Vice Chair)]: that because it entirely depends. If somebody who's very good comes well prepared, does talk to all the neighbors, has everything resolved when it gets to us? It goes through very smoothly very quickly. When there is concerns, and I'm not saying it's fully up to the developers as to whether or not they've sort of worked well with the neighbors, the staff there, maybe it's the best. When it's a heavily litigated case, it can drag on for a year. With respect to the small, like rooftop solar, those are absent some objection, net metering under 15 so, 15 kilowatts or so, so you guys go to the rooftop. Those are deemed to shoot after fifteen days unless somebody objects. What we've run into though is amendments where some of the developers don't necessarily seem to understand the rules and we spend a lot of hours going back and forth of either can't do something or can't. So you occasionally have like one or two outliers that makes the statistics a little difficult. Most of the projects goes through fail.

[Senator Anne Watson (Chair)]: Great. Super. Any other questions at this point? Okay. Well, you so much. Really appreciate you taking time to update us. It's good to know the lay of the land and what's coming down the road. Thanks very much. Thank you. Okay. All right. So we do have a little bit of time to talk about our budget letter. I have not touched the cow. Okay. Trying to get to write document here. Okay. Just thinking about our plan for right now, thinking about today, talk about who's in, who's out, and then just prioritizing tomorrow. On the draft that you're looking at right now, do you, what some of the asks that came from, Mr. Carpenter included the DEC physicians for the Rivers program. They're engineers, if I'm not mistaken, their name.

[Senator Terry Williams (Vice Chair)]: Office of Water Programs, and those are in the House of Public Health.

[Senator Anne Watson (Chair)]: Okay. And then there was an ask around a third party consultant for CAFO inspections. That is not an inspection. We've also been asked about the slow camp program, which would be an extension of a pilot that funds acceptable management practices and logging to maintain clean water. I think those are the only new, potentially new things that you may not have on your list. Anything else that's in the broad scope?

[Senator Ruth Hardy (Member)]: I

[Senator Terry Williams (Vice Chair)]: don't have them on stuff today, and

[Mr. Harrington (Beverage center owner, Rutland)]: then we're

[Senator Terry Williams (Vice Chair)]: in the bible study.

[Senator Anne Watson (Chair)]: You know

[John Ligus (Co-owner, Putney Road Redemption Center, Brattleboro)]: what,

[Senator Anne Watson (Chair)]: I think I I could share with you all, including Jude, the version that I am working on?

[Senator Terry Williams (Vice Chair)]: I have a previous version. Let's get assessed at 100 and

[Senator Ruth Hardy (Member)]: And you're asking, are there things that are not already Right. Yep. And are we gonna sort of categorize things to If they're already in a house budget, I feel like that's a different category. We could say it's four feet, but that's not really our ask. It's already there.

[Senator Anne Watson (Chair)]: So, you're thinking if we could categorize them by It

[Senator Ruth Hardy (Member)]: feels like there are bills that we've already passed or planned to pass. And then there's the separate asks that are sort of outside of a bill. And then there are, these are already in the house budget and yes, we support them. It's closer to the possibility that we can say, no, don't. Or we support these and we support an additional bench or something like that. Just because it feels like there are three different, slightly different things. That makes sense to me. I

[Senator Anne Watson (Chair)]: did just forward to you the latest document that I have, which has a little bit updated information. I forwarded it to Jude as well. Oh, you know what's not included? Okay. I have not changed the density bill. Should say that that's H seven seventy eight and the greenhouse inventory bill is H seven forty. Say that. Those are the only two that have money in them. And

[Senator Ruth Hardy (Member)]: I would just say the Farm Security Fund is a bill that the Senate passed, and that should be

[Senator Anne Watson (Chair)]: a longer meals. Okay. Okay.

[Senator Ruth Hardy (Member)]: So that was split S60? S60.

[Senator Anne Watson (Chair)]: S60. Okay. Yep. That, yeah, makes sense to me.

[Senator Scott Beck (Clerk)]: So we're talking about that. I'm just gonna try to understand how you could be, okay, we're actually looking for 15,000,000 sites?

[Senator Ruth Hardy (Member)]: That was their original request based on the sort of need, but-

[Senator Scott Beck (Clerk)]: Then they get down to-

[Senator Ruth Hardy (Member)]: I think the Senate Ag Committee has 1,000,000 on their list as a, they need money to get it all started.

[Senator Anne Watson (Chair)]: I would advocate for the 1,000,000 as would I.

[Senator Ruth Hardy (Member)]: And let them be consistent across the two companies.

[Senator Anne Watson (Chair)]: It comes more tomorrow, so we can have everybody here. Yes, we are planning to do this more tomorrow. There's one other issue that I do want to flag.

[Senator Ruth Hardy (Member)]: And if we

[Senator Anne Watson (Chair)]: can get Jason Betchelber in tomorrow, we can try to do it tomorrow. Is it waiting? Okay. That's right. Because we were going to have him in earlier and then he could have One other issue that I want to flag is, I figured Paul, district model wanted to create a new kind of license for access to them. We made a license, it might not be enough for the right word, but fee for using access points. And I did check with legislative council to say, do they have the authority to create this fee? Because normally that's us. Legislative council confirmed that yes, they do. Currently they have this authority. That pitch did not go so well in the House. The House said, not only are we going to disagree with the creation of this fee, we're going to distribute the authority to create this, but they did backfill the budget. So there's money in the house budget now, it's like $50,000 that is intended to be a replacement for what they would have gotten if they had instituted some kind of a fee for access points if you're not using them for hunting or fishing. One possibility is that we agreed with that, and I wish we had Commissioner Bessel during conference. But one possibility is that we agree with the house that they do not have that authority, they shouldn't have that authority, and we can give them the money that they would have gotten. Because fair enough, they're in a tight budgetary situation. Another possibility is that we say, if it's just about these public access points that maybe that's okay.

[Senator Ruth Hardy (Member)]: That feels like kind of a bigger issue than just the last day of our budget.

[Senator Anne Watson (Chair)]: I agree. Agree. So, yep. Well, maybe that's something that we can build in for next week. I know maybe this, maybe I

[Julie Moore (Secretary, Vermont Agency of Natural Resources)]: think I

[Senator Anne Watson (Chair)]: guided him for next week. Okay. So maybe this could be separate from our budget letter, but something that we we may want to weigh in.

[Senator Ruth Hardy (Member)]: Yeah. So

[Unidentified Senator (possibly Senator Seth Bongartz)]: I'd like more information around.

[Senator Anne Watson (Chair)]: Yes.

[Unidentified Senator (possibly Senator Seth Bongartz)]: Should they strip that out, but not only did they do math, but I want

[Senator Terry Williams (Vice Chair)]: to know more about the law.

[Senator Anne Watson (Chair)]: What authority did they do? So they, according to our legislative council, they do have the, currently the authority to create such a fee. Yes. The house language removes that.

[Shane Switzer (Owner, Lyndonville Redemption, Lyndonville)]: But

[Senator Anne Watson (Chair)]: gives them money. Think it's, but gives them money. I believe it's, I'll double check that, but I believe it's in the budget.

[Senator Scott Beck (Clerk)]: Good on the fucking Yeah.

[Senator Anne Watson (Chair)]: You know, it's not about it. It's a good

[Senator Terry Williams (Vice Chair)]: It's $9.33, which finances

[Senator Scott Beck (Clerk)]: will go off through the center.

[Senator Anne Watson (Chair)]: Is that the yield bill? Oh, it's The yield bill. Oh.

[Senator Ruth Hardy (Member)]: It's a lot of weird stuff with the yield bill. Well,

[Senator Anne Watson (Chair)]: I'm going to put a pin in this one for more conversation. Okay. Thank you. So we'll discuss this more tomorrow. And so with that, we will adjourn. Thank you.