Vermont Legislature SmartTranscripts:

[Sen. Richard Westman (Chair)]: Your line. We are with Senate Transportation. It is Wednesday February, and first on our agenda is Disability Advocates Day, and we are slightly late because the weather outside is frightful. And if you could introduce yourself, tell us a little bit about it, and we'll we'll welcome you. Sure.

[Peter John He]: Thank you for having me this morning. I'm Peter John He. I'm the deputy director for the Vermont System for Independent Living, and we're happy to be here helping you incorporate the Vermont Coalition for Disability Rights into this day. VCVR is a member organization, of which VCIO is a member. And we worked as a coalition to advancing human rights, civil rights for individuals with disabilities to ensure their full and equal participation in all aspects of community life and political process. Our theme this year is to write disability rights into every piece of legislation. The hope is that the legislation will consider people with disabilities when they're putting together the bills to ask people with disabilities directly how this will impact them. Myself, I'm a carless traveler. I advocate for public transit for people with disabilities. And I was late because my driver was late. And so when we say to write disability rights into every bill, we're meaning to make accessibility and nondiscrimination explicit in operable parts, policy, design, and implementation, not just as an implied afterthought. In transportation, typically that would mean accessible infrastructure by default, sidewalks, crosswalks, bus stops, shelters, I'll get the bus stops later, and deep doors, your construction, procedural rights and accountability and meaningful engagement, notice of meetings, appropriate data, clear place to elevate problems, and a decision you have to convey about reducing access. Specific language would be examples, and they can be tailored if needed. But having a disability rights impact statement, such as the Vermont Agency of Transportation, VTrans, shall, prior to implementation, evaluate whether this act will increase, decrease, or have no impact on access or for monitoring for disabilities, including access to employment, healthcare, and essential shopping and community life, and shall commit with disability stakeholders to identify risks of reduced service, and qualify meaningful notice for stakeholders in this whole process when access is reduced. Protect access to work and community integration for transportation outcomes. Federal policy for the older adults and persons with disabilities, transportation program recognizes vocational and social personal trips as eligible purposes. However, local proposals have eliminated recurring trips for riders and proposed caps have been used for to cut off vocational access. So it's been a real big problem. I'll talk a little bit about that more. And then program administration too should include explicit consideration of access to employment, community participation, providers with disabilities, setting trip priorities, and constraints. When what's missing from typical legislative council language in our experience is they it assumes compliance with the Americans with Disabilities Act, but does not operationalize it. There's no required review. We need measurable outcomes. They'll process when access is reduced. And if peace services reductions are purely administrative, and they have direct impact on people with disabilities. And so it functions like a rights restriction. And then you get short term notices or there's problems with the local providers that can't connect with different local partners. And there's no consistency in terms of protecting access for work and eligible trips purposes, which includes location and social and personal trips. So any statewide or regional change that restricts trip purposes, trip frequency, eligibility, all the stuff within publicly funded mobility programs shall include advanced notice to riders and partner agencies, a documented rationale and a process to ensure the smallest possible negative impact on riders who rely on health service for essential life activities. And this is especially relevant because this committee and the House committee have heard that a transportation program for older adults and persons with disabilities is quite unpredictable. The program routinely has to be adjusted when new dialysis riders or new cancer patients, so they have to adjust things. And so people who need that service can always know that it's gonna be needed. And this recently has been a big issue with transportation and cleanup. In the Green Mountain Transit service area, only medical trips are being provided under the OND program. And VCL has received many calls because our peers could not get to work. We explored some alternatives. One individual was trying to figure out ride shares and different alternatives, but they were only 10 to three schedule. And so it just it didn't fit into commuting hours, so they they were really stuck. And there were nine people specifically in the town of Colchester that were impacted by not being able to get rides to work, one of them being my colleague who worked in our Burlington office. Unfortunately, the town of Colchester did come through with some additional funding, so at least those people have those employment trips restored, but how many others don't? And it's different across the state. I got a call the other day about, somebody says, Oh, OMB is running out of money, and they called the local provider, and local provider said, No, everything's fine. But they aren't asking the deeper questions. What restrictions have you been putting on the program that it may not be from? We've also had complaints about reductions in social trips. We know everybody knows and has heard about the importance of social interactions and health. It's so important that I wanna share my personal situation. My wife has moderate dementia. Fortunately, she's able to stay at home alone when I'm at work. I do help her with medication and meals, but she's alone. She's at home all day, and therefore, I really make an effort when we go to appointments to make sure they are either before or after the lunch hour so we can go to restaurant to eat, our favorite place is wayside. So that's usually where we go, But it's so critical that she had an opportunity to get out of the house. And then if you don't have that life experience tonic about accessibility, it can be easily forgotten or an afterthought. And so another way of right disability rights into legislation is when you define things in the definition section or the purpose of the bill. There is one bill I just happen to pick out, s one forty six, and that's relating to transportation demand management services. I know the page number and the line number. And so it just says transportation demands, services, and it defines what transportation it means. Oh, it's left out the left in the other line numbers, that, you know, they have to they have these plans to reduce vehicle mileage, and it can be it can telecommuting and a variety of different things, walking, bicycling, and riding public transit. So I would love to see that language changed to just accessible transportation, demand management or TDM, and then the rest of it is saying, because I have personally found and we've found as a disability community within VCPR, if you don't say it out loud, it gets forgotten. So it it really is crucial to do that. So before we go on, any any questions about go ahead.

[Sen. Rebecca “Becca” White (Vice Chair)]: Thank you, chair Westman. Well, you identified my bill. So I was like, wait a minute. I know this language. So if I understand correctly because this is kind of a new I I think you may have presented a DevOps at one point in the past kind of on this concept. If I don't know if you provided examples then, so it didn't click, I guess. But you're basically saying that instead of having the list that's in that list sound like carpool, walk, bicycle, ride, public transit, you would start

[Peter John He]: Start with the word accessible. Okay. Because that way, it's up front. People understand it. They know what's needed. I recognize, I mean, even I, as a person who just feels like, I can't fully understand what somebody could use as a wheelchair goes. I don't have that lived experience. So I understand that it's hard to keep this thing around. I've been advocating for public transit for people with disabilities since I arrived in Vermont twenty five years ago. So So I've been doing that a lot.

[Sen. Rebecca “Becca” White (Vice Chair)]: Is there a reference you would say that would be a value like, because when I drafted the bill, you know, I worked with our lawyer. Mhmm. Is there a word in kind of the legal framework? I know Senator Bihovsky has talked about universal design. Like, what's a way for me to communicate to the lawyer how to get that type of thing? Just say go I would like the language to reflect like disability rights awareness. Like, is that a good way to put that?

[Peter John He]: Of course. That would be one way. I almost included in here the accessibleuniversal transportation. But I was concerned that universal isn't quite people aren't as familiar with that word when they hear it as they are with accessibility. Mhmm. So that that was kinda why I decided that that's I mean, ideally, we would move to have everything under universal design, then it would automatically include accessibility. So that's that's

[Sen. Rebecca “Becca” White (Vice Chair)]: that's helpful.

[Sen. Richard Westman (Chair)]: So just a couple.

[Sen. Wendy Harrison (Clerk)]: So I am so glad you are here. Thank thank you very much for being here. And I believe that we shouldn't have to, legislators shouldn't have to get definitions of things. The VTrans and our system should include this because it is part of federal law. So our systems should include this and there should be things embedded in VTrans. It's going

[Chris (Joint Fiscal Office)]: to take a

[Sen. Wendy Harrison (Clerk)]: little while to get there I think. We haven't talked to VTrans.

[Sen. Rebecca “Becca” White (Vice Chair)]: Well I like that suggestion of putting in the

[Sen. Wendy Harrison (Clerk)]: T- But like we shouldn't have that. I mean yes we should know them if we can, but that can't be our responsibility because it's it's just not fair. We change, you know? And this is something that needs to continue.

[Peter John He]: For transportation, you have you you make a point. But there are a lot of other laws that are not tied in the federal stuff. Yes. Yes. That that would would that I mean, not in Vermont, unfortunately, but I'm very much aware in other states where they do use federal money for Medicaid transportation, but they also have some I think they're called COMs, CMOs or Peer Management Organization. So they basically contracted out with somebody else. But in that process, unless an advocate comes up and says, Hey, wait a minute. All those rules that went with that federal program get lost when it gets moved over. Oh, that's interesting. So that's a big concern. I know that was a big concern in Boston. Advocates got together with that. Yeah, so just really trying to elevate the whole issue around that people with disabilities have.

[Sen. Wendy Harrison (Clerk)]: Right. Just so thank you for being here. Things that help people with disabilities also help those who may also have disabilities, but that aren't apparent.

[Peter John He]: Yeah, we had a call the other day from somebody wanting to know, because a lot of people have invisible disabilities, and they were, how can I let somebody know that I can't? I'm not the same as everybody else. There are a few symbols out there, I don't think anything's caught on directly. One is a sunflower for an invisible disability, that's a whole other issue. Any other questions?

[Sen. Rebecca “Becca” White (Vice Chair)]: Well, do just I know that we're running up on time, but you also you called out another one of my bills in your testimony with s 75, which is the Kurtz bill. And so I was wondering just offline if perhaps you and I could work together to resolve some of the things raised in both of those bills. Gotcha. So I wanted to make sure that I would like to because I wanna make sure that they are actually reflective of

[Peter John He]: Yeah.

[Sen. Rebecca “Becca” White (Vice Chair)]: The bill is in honor of Kurt McCormick, representative Kurt McCormick, and he was a fierce advocate for fully accessible transportation corridors. So, you had a walker, wheelchair, stroller, or a bike. So, I wanna make sure, Correct. You can.

[Peter John He]: Yeah. I would love to. That'd great. So I also wanna just talk briefly about medical number 75. Yeah. I generally support this bill. I definitely applaud the additional funds for this fiscal year that are being put in here so that especially the O and D program within that score is not gonna completely lose cut services to people with disabilities. And I mean, I use the program a lot myself. I live in East Callis. There's no regular transit there, so that's why I use the OOD program. But even fortunately, my schedule is a little bit flexible. I ride share into my career. Sometimes I get dropped off at wayside and catch the bus into town. Sometimes I get dropped off near the co op, and I can walk to my office. It varies from day and time. And so I can do grocery shopping with Co op or shop, or I can go to the drugstore and then, you know, rideshare by phone. But even if something is getting to Walmart, that's a whole another process. So I do a lot of ordering online. And it's, you know so it's it's vital that we have all of these, the O and D can support all these things with healthcare and social engagement, making those essential services. And I'm glad that, I mean, I've been sitting through years and years of study of how to help fund public transit. So I'm glad that we at least have one proposal in legislation, and generally support this, but I you know, and it's because of how it's spelled out with package delivery. It's public transit supports everybody, so it's kind of spread across the board with everybody, but it seemed to be equitable. But I'm a little concerned about it may un disproportionately affect people with disabilities because we buy more things online, because of the lack of transportation, and it's something I actually send out a survey every year to our peers, and I may see about getting that in the next next survey, ask them a question. But I I did have some things. I mean, based on what my ordering was, it cost me about a dollar 50 a month. Certainly something I can afford, but for people on a fixed income, even that small amount may may be difficult. But then I was also I didn't see anything in the legislation specifically. So if I I live too far out to use DoorDash or, if I hadn't DoorDash delivery, well, groceries aren't counted, so that's not it's not like but what happens if I was a roll of toilet paper in my order? And what am I? I'm paying 30 to 30 something, a roll of toilet paper. So there's some squeeze that it's they need to be done for that to to smooth it out a little bit. Mhmm. But but I am I am pleased with it, and I I I do support it. And I'm gonna take just a minute because I wanna really quickly talk about infrastructure and sidewalks. And I do a lot of ADA work as well on Edvard Community Access Program, and I'm always telling towns, sidewalks are programmed. If they fall under the ADA or local and state governments, that they need to be accessible. They need to and understood is maintenance issues in the wintertime, but there's lots of problems in the summertime too with broken sidewalks and trees going up through things. I can go on and off. But in the wintertime for me, with my vision, low vision, and I have only vision in one eye, my depth perception's really cool. So it's really hard for me to see, to know how high a snowbank is or when I'm getting on or off the bus or standing at the shelter in a pile there and, oh, I'm gonna have to step over that. So I I figured out a way to solve that problem for me anyway. I have this in my backpack. I can do this. Oh,

[Sen. Richard Westman (Chair)]: well. Mhmm.

[Peter John He]: So now I can just get that snow out of the way and just move it so I don't have to worry about it. I mean, I have fallen numerous times, and I said, I'm tired of this. So I'm gonna just do something that's gonna work for me. So that's one of the things I carry with me. Another reason why my backpack is heavy all the time, but I'm like, okay. I'm happy to do that. So any other questions people have? I'm happy to answer those.

[Sen. Richard Westman (Chair)]: Well, we thank you very much for coming today, and and and we will try to keep the issue of the disability community on our mind as we put together our budgets. We do believe sidewalks are important and and good for us. And and, again, thank you for coming.

[Peter John He]: Thank you.

[Sen. Wendy Harrison (Clerk)]: I'll definitely Yeah.

[Peter John He]: Was calling

[Sen. Rebecca “Becca” White (Vice Chair)]: on my bills. I gotta fix something.

[Sen. Richard Westman (Chair)]: Anytime. Alright. And you know the drill. Name ring the scissors for.

[Ted Barnett (Joint Fiscal Office)]: Sometimes sometimes I forget. Ted Barnett, joint fiscal office. I'm here to talk to you all about local option taxes. This should be a general overview and primer of local option taxes. The pilot special fund, which is where 25% of local option revenue flows. We're also gonna look at New York and Massachusetts as they have a different structure of they give municipalities different abilities to levy local option taxes on, in the case of New York, sales taxes and Massachusetts occupancy taxes, and then talk through some considerations because, you know, as we're the revenue folks, we when discussing taxes, we like to put forth considerations and kinda core principles when thinking about the some of the tax types.

[Sen. Richard Westman (Chair)]: And I might say to you that the senator from Washington and myself were in had a legislative breakfast together, and there are communities in Stowe is was the community we were in that are looking for local option tax increase above the 1% going to 2% and then trying to include it in their charter. So our so if we can make sure that we cover what's permissive here under the statute now, and I think the reason they're looking at the charter is because they're looking to move around the base law.

[Ted Barnett (Joint Fiscal Office)]: Exactly. So I will kind of briefly touch on that in context. I understand you're gonna have Tucker in Yep. Tomorrow, and he will be able to go more in-depth about the abilities you grant that you require municipalities to do through Tucker,

[Sen. Richard Westman (Chair)]: I what they're able to may say I have one community in my district in Morristown that is voting on a charter change in March. And specifically, what they're talking about is earmarking $800,000 their initial 1% for their roads. And they have and I might ask them to come in. They had they paid for an outside study to look at the assessment of their roads. And for them to get to a place where 60% of their roads are in glyph condition, it's going to take them 800,000 a year for the next five years. And their their property taxes are under such pressure that they don't feel that they can raise anything. So they presented a budget that is flat, but if the local option taxes, the first 800,000 per year will go into their local roads. So there's a whole bunch of nexus here that we thought I thought and I brought it up to the committee, and I think we all are on the same opinion that we need to get up to speed on what's going on.

[Ted Barnett (Joint Fiscal Office)]: Absolutely. Yes. And when, although municipalities are not required to do so when they implement a local option pact, many do put on their ballot that a certain percentage or amount of the local option pact will go to roads or capital projects or etcetera. Absolutely. Very high level. The authority for local option taxes is found in a specific corner statute as 24 DSA one thirty eight. And in that, you know, statute, it allows towns to put a 1% local option on any combination of sales, meals and alcoholic beverages or rooms. A lot of times, folks are doing all of the meals and rooms taxes or the sales tax or kind of the full full slate of things, but someone could do meals and alcoholic beverages only or just the ribs if they wanted to. This was originally created all the way back in around it was it predates act 60, but it was it was allowed to sunset and then reinstated in act 60, and it was envisioned as a transition mechanism to help municipalities make it to the new statewide education property tax. There was you know, I heard it very a little bit when I first started, but this concept of gold towns, they were specifically called out in creating local outcome taxes. It was municipalities that met certain criteria, on their grant list or grant list growth. And so they were allowed to create local option taxes, without a municipal charter change. However, outside of those gold towns, most municipalities required a charter change to implement a local option tax all the way up until act one forty four of 2024. Now under this new regime, it just requires a the municipal the select board recommends that through a majority vote that the the article will go on a town meeting day or a duly warned kind of vote in the municipality. And once voted by a majority of voters in the town, the lot can go live with the caveat that the commissioner of taxes can limit it to five per year. Local option tax administration is a bit of a lift for the Department of Taxes. We'll go into that later in the slides. And so if there were a whole raft of municipalities doing local acting taxes, it would probably be unduly burdensome for tasks to administer. So they limit it to five to year per year currently. We're seeing about that many come online since the chain was adopted.

[Sen. Wendy Harrison (Clerk)]: Okay. Thanks. Quick question. Thank you. Does the education expenditure limit, does that still exist? The revenues cannot be used for education expenditure? I'm not suggesting that they should. I just wanna know if that's still

[Ted Barnett (Joint Fiscal Office)]: That is still in statute. Yep.

[Sen. Wendy Harrison (Clerk)]: Thank you.

[Ted Barnett (Joint Fiscal Office)]: A key point about local option taxes is they are administered by the Department of Taxes. The Department of Tax folks, businesses, towns, right, are sending their sales or meals and rooms tax returns to the Department of Taxes, and then the Department of Taxes is figuring out how much revenue needs to go to each specific municipality according to the 75, 25 split, 75% to the town, 25% to the pilot special fund minus a small return fee that is subtracted in the same proportions. So these return fees are in place to help tax administer local option taxes and also support the appraisal and litigation program. I get some questions about this, so I called this out specifically. A return fee is attached to each individual return submitted by a business, and they some businesses pay their taxes monthly, some pay it quarterly. And so when you see later the amount of money collected by tax, I've had some people be like, that's a lot of money. What do we mean by return? So wanted to flag that here. And, also, our current 75, 25% split was changed from seventy thirty. So towns were given a little more a larger percentage of local option tax revenues last year. In act 57, it went into effect 10/01/2025.

[Peter John He]: So the five ninety six is taken out from the top, and then you do the seventy five twenty five? Yep. Mhmm. Go ahead. Is that something that

[Ted Barnett (Joint Fiscal Office)]: No. The return fee has been around I don't it's been around for at least a decade. It was a little higher. Yes. Those have around for a while.

[Peter John He]: I I asked because I don't ever remember paying it paying it. So

[Ted Barnett (Joint Fiscal Office)]: it's likely that when you're sending your return into the Department of Taxes, you're not seeing a specific line for the 5 Okay. 96. The tax is kind of scooping that off from the back end. So I'm good. I I would chat with the Department of Tax

[Sen. Richard Westman (Chair)]: on that one.

[Ted Barnett (Joint Fiscal Office)]: Okay. I don't wanna give you the clear preemptively.

[Peter John He]: So business just sent all the money they collected, and then that $5.06

[Ted Barnett (Joint Fiscal Office)]: I'm in the allocation. I I think we just

[Sen. Richard Westman (Chair)]: raised a flag. He might be audited.

[Ted Barnett (Joint Fiscal Office)]: This all comes this was ex accepting. So they're in towns that have a local option sales tax, and, also, airport sells aviation fuels in that municipality. There is a local option sales tax on those fuels. On although the 75, 25% what happened last year, there's a specific they did not make that change. Y'all did not make that change for aviation fuels. They also do not incur return fees. Per federal law. The amount of the 30% that goes to the state that must be used for aviation related purposes, so it goes with t fund, unlike for other local option taxes, which goes to the pilot special fund. So that really applies to municipalities, South Burlington for BTV, Lahey, International Airport, and then in Berlin. Berlin implemented their local option tax 01/01/2025, and so there's a new municipality paying local local option or there's a new local option sales tax on jet fuel in fiscal year twenty five that generated approximately $86,000. It's not a huge piece of revenue, but it is there and it operates differently than other types of local option taxes.

[Sen. Wendy Harrison (Clerk)]: Just a quick question. Thank you. Does do the towns have to use the funding for airport related?

[Ted Barnett (Joint Fiscal Office)]: See Kristen nodding in the background. Related.

[Chris (Joint Fiscal Office)]: The first from Joint Festival, yeah, that that FAA regulation applies to the town share as well. And, you know, I'm not an expert on the city of South Burlington's budget, but my understanding is they've used some of their share of this for like noise mitigation activity and things

[Sen. Richard Westman (Chair)]: like that.

[Chris (Joint Fiscal Office)]: Activities directly related to BTB being bad.

[Sen. Wendy Harrison (Clerk)]: Okay. We could probably use it for transit to the airport. I don't

[Peter John He]: know that for a fact.

[Ted Barnett (Joint Fiscal Office)]: Yeah. I I would suggest Speculating.

[Chris (Joint Fiscal Office)]: I think the city of South Burlington should do their due diligence with their attorneys so they don't get in trouble with the FAA.

[Sen. Richard Westman (Chair)]: Oh, yeah. Yeah.

[Sen. Wendy Harrison (Clerk)]: I'm just speculating. Okay. Thank you.

[Ted Barnett (Joint Fiscal Office)]: There are two municipalities that, have a different version, of local option taxes in their channel charters. So they went before the general assembly. They got their version of a local option tax approved. These are Burlington and Rutland City. These taxes are con elected at the municipal level, and so they retain a 100% of the revenues generated. They're not subject to the 75, 25% split. In Burlington, it's called the gross receipts tax. For admission, alcoholic beverages, amusements, and meals, that rate is two and a half percent. Hotel motels is 4%, and short term rentals is 9%. In Rockland City, it's the room meals and entertainment tax. It's similarly a gross receipts tax, but it's 1% on the businesses that, you know, provide lodging, meals, or entertainment.

[Peter John He]: So go ahead. Is the short term rentals, are they required to pay the lodging tax, the rooms and rooms rooms tax?

[Ted Barnett (Joint Fiscal Office)]: That would be on top of the, like, state. Yep. Meals and rooms tax. So when thinking about I as I understand, Burlington very sharply regulates their short term rentals, and so this differential rate might be part of that effort. You may not see a lot of revenues given that the pool of short term rentals might be small in Burlington. But, yes, when thinking about competitiveness, this absolutely stacks on top of state rates.

[Sen. Wendy Harrison (Clerk)]: And and can other towns do that if they change their charters?

[Peter John He]: If they

[Sen. Rebecca “Becca” White (Vice Chair)]: yes. On a term change and you can call it

[Sen. Richard Westman (Chair)]: for a good bit. Therein that was part of my therein, it it looks to me like it would be very hard for us to say no to a a charter change from a community like us. No. We've already set the precedent.

[Sen. Rebecca “Becca” White (Vice Chair)]: Okay. Good to know. Thank you.

[Ted Barnett (Joint Fiscal Office)]: Taking a look at revenues generated by local option taxes, this is from the Department of Taxes. They have a local option tax disbursement report. Within so two things. First of all, we will talk in the next slide about the general what caused some of the reasons behind the change in trend for local auction tax revenues. You'll see from twenties fiscal year twenty seventeen to 2021, there was a slight increase, but it was relatively modest. And then starting with fiscal year twenty twenty two, revenues really took off.

[Sen. Richard Westman (Chair)]: The

[Ted Barnett (Joint Fiscal Office)]: in addition to those trends, the when looking at these bars and overall revenue, should note that the vast majority of this revenue is sales tax revenues. Oh. About 75% of this total of 56,000,000 was generated by local options. That's Texas. And since all of these revenues were collected before the switch and allocation percentage is reflective of

[Peter John He]: the seventy thirty split. And the t fund has just been being from.

[Ted Barnett (Joint Fiscal Office)]: That is correct. And it is so small comparatively in revenue. We should have noticed this that you can't even see it on.

[Peter John He]: Right. Even on the chair.

[Ted Barnett (Joint Fiscal Office)]: Yeah. You can't even. Zero. So the reason revenue really started to take off in 2022, it's a combination of two sources. First of all, the post pandemic, we saw a relatively large increases in consumption taxes. First part of this was spending on goods as opposed to services. I'm sure you all have heard discussions post COVID. Folks couldn't go out to eat, couldn't go to the movies. I mean, there's a whole kind of set of things that so folks were in their house. They were looking at their couch or their dining room table and decided to buy a new one because it was annoying them. So, yes, there are also folks who were receiving stimulus checks. Right? And so we're putting at least a portion of that money we're spending on goods. So we saw a shift in the economy. And the growth you'll see in 2021 so this is a snippet from the consensus revenue forecast. Between 2020 and 2021 fiscal years, sales and use taxes increased by overall at the state level by 17.4% and then 7.4% between '21 and '22. Right now, you'll see the actuals to '24. It's really slowed down quite a bit, but we're really the consensus revenue forecast looks at that growth happening more in line with inflation to a change percent year over year. So that's those numbers are quite large, comparatively. A similar but slightly different story occurred for meals and rooms. Meals and rooms really took a hit in the pandemic. Those folks weren't going out to eat. They weren't going on vacation. But once the economy opened back up, meals and rooms taxes responded quite strongly. You could see the difference between '21 and '22. They increased by 50%. From what I understand also that when as the economy was opening up, Vermont was a relatively safe place. It was also it was a relatively attractive domestic location for tourism. So very strong bills and rooms, tax receipts after the pandemic. And since local option taxes are levied on consumption taxes, it makes sense that we see a spike in revenues for local option taxes. The second piece is in addition to strong consumption tax revenues. The number of municipalities with a local option tax really started to increase after the pandemic. You see in twenty twenty one twenty twenty, there were twenty twenty one municipalities with a meals and rooms tax. That increased to 32 by 20.5. Similar story for sales tax increased from 16 to 25 by 2025.

[Peter John He]: What was the other place that started selling jet fuel in 2025?

[Ted Barnett (Joint Fiscal Office)]: Berlin. Nat. As far as I understand, Nat sells

[Sen. Richard Westman (Chair)]: JEDI.

[Ted Barnett (Joint Fiscal Office)]: So that's broad level overview of local option taxes. We're gonna spend a little time with the pilot special fund since they receive 25 of local option tax revenues. Broadly speaking, the general pilot program compensates municipalities for the assessed value of state owned buildings, prisons, BBM buildings, For UVM, the amount that towns can receive through the pilot program is capped at $750,000. I pulled some examples of state owned buildings for y'all and tweak them. I've done this in other committees, but tweaked them for y'all in the last two. The first one is the the state house. But, yes, also where towns are receiving payments for AOT district offices, garages, the Albert Well Welcome Center. So if it's stay at home building, it's within their jurisdiction. They're receiving a payment based on the insurance replacement value, and that's what's shown here, of that infrastructure.

[Peter John He]: How often is that updated?

[Ted Barnett (Joint Fiscal Office)]: It is so AOA, the administer agency of administration has a contractor. They updated it between 2025 and 2026. They will update it if there are changes. I don't know how often they're increasing the base values in going out and kind of relooking that. But I can

[Peter John He]: I can go with that? Rebuild the state house to 30. It's not

[Ted Barnett (Joint Fiscal Office)]: I yeah. I'm the AOA contractor, I'm gonna chat with them. I yeah. I don't know their methodology, but that seems right. There's a lot of marble.

[Peter John He]: Yeah. Yeah.

[Sen. Richard Westman (Chair)]: Well, actually, you know, I'm gonna say something that you can't mean. Sometimes people devalue what we do here at.

[Peter John He]: Yes. The

[Ted Barnett (Joint Fiscal Office)]: in fiscal year 2026, the general pilot payments, so this is base payments for state owned buildings. This is including kind of additional appropriations that were that are paid for from the pilot special fund. These totaled 11,390,000.00. These are actual payments in the budget. This appropriation was 12,200,000.0. There's also a $40,000 appropriation for correctional facilities, which is included in here. It does not include in the budget. There's a supplementary payment for Newport and Springfield. The actuals are slightly different than what's in the budget, and we won't see those until the end of the year.

[Sen. Richard Westman (Chair)]: Yeah. We cut deals. We fall through those communities to take the Christmas.

[Ted Barnett (Joint Fiscal Office)]: Payments through the general pilot program for as long throughout their history since the start of the program, which started along with local option taxes, which kinda came out of the general era of act sixty nineteen '97. As far as I understand, payments have been prorated since the beginning of the program up until fiscal year twenty twenty four when the pilot program was fully funded able to be fully funded, right, as we talked about, much more revenue generated through local option taxes. So they

[Peter John He]: didn't pay the full full value? They did not. On the replacement value.

[Ted Barnett (Joint Fiscal Office)]: And I later on have the information on how much the prorations were for their fully funded.

[Peter John He]: Okay. Thank you. Still on the building values, which is the replacement value. Are they changing that? So I said I think I've heard other comments about the pilot's around 12,000,000, and it will take 12,000,000. Wouldn't it go up if it's something that's gonna reflect the replacement value?

[Ted Barnett (Joint Fiscal Office)]: That's a good question, and I'm gonna move to this next slide. What is placing a lot of downward pressure on pilot payment right now is the CLA. So you'll see the first step in the pilot payment calculation is that the total assessed value of state owned buildings is multiplied by the CLA. And since we're seeing CLAs decrease, in other words, property values increasing in towns, that serves as kind of a a way to even if values through insurance replacement value are increasing, decreases in the CLA are gonna mean that

[Peter John He]: It erases them. Yeah. But is the but is the value of billing automatic? Like, is that automatically figured into the I mean, we guys still appropriated it, if there's not money in the fund, we probably wouldn't, but is the value automatically just that when those values get updated it automatically goes into the formula, so the final payment would be more unless we'd set no.

[Ted Barnett (Joint Fiscal Office)]: So right. So what tax is doing is they they receive this the full state building inventory from the agency of administration, and that includes for that year, that fiscal year, what the insurance replacement value is. And so they add that up for the town. And so they're refiguring that calculation every year.

[Peter John He]: Okay. So

[Sen. Richard Westman (Chair)]: for example, in the town of Johnson, campus for, the colleges on top of the hill, and they, is it the CLA? Why they have, over the last two years, seen significant decreases in their panels?

[Ted Barnett (Joint Fiscal Office)]: Yes. And over this time, there has been a slight increase in Johnson's kind of the total value of state owned buildings within Johnson, but the CLA hasn't decreased so much that their pilot payment has gone down over the past couple years. Yep. Thanks.

[Sen. Wendy Harrison (Clerk)]: Just a quick clarification. I just wanna make sure when you say total assessed value, that's the grand list value?

[Ted Barnett (Joint Fiscal Office)]: That is the insurance replacement value.

[Sen. Wendy Harrison (Clerk)]: So why would we not use the grand list value?

[Ted Barnett (Joint Fiscal Office)]: There I regret taking the slide out. It's in another presentation. There are some advantages of using insurance replacement value in my mind. This is I don't know if this is why it was originally placed in the statute. This is, to be clear, Ted, a JFO kind of musing on the issue, is that one advantage is these values already exist. Right? The agency of administration is maintaining their insurance replacement values for liability purposes. Second, it provides consistent valuation across the state. You're not relying on local listeners to go out and for example, in Montpelier, value the steakhouse. And so state owned property is wide and complex. The state actually owns ski lifts. There's the example I use quite frequently is there's frequently is there's something in Randolph called a biodigester. And so there's a lot of technical property that's out there. And so having values that already exist that are consistent across the state and done by a third party makes sense within this calculation framework. But it is a it would be a policy choice to change it to assess value. And there are, when this comes up, questions about why it isn't why is insurance replacement value versus assessed value. Absolutely.

[Sen. Wendy Harrison (Clerk)]: Yeah. And that's that's interesting. It just seems the CLA is really that's supposed to equalize between towns. It seems like I don't know why you would use CLA when you're using insurance, but that's a longer question.

[Ted Barnett (Joint Fiscal Office)]: Part of the logic is that the CLA in the education property tax is designed to bring locally assessed values to a common statewide level. And since here, you're you have a common statewide level to make the value of these buildings reflect local listed values, you would multiply it by the CLA. I also think that this potentially was a policy quiz to limit the cost of the pilot when it was first implemented. That's also a possible explanation, but it is it is a part of the calculation, and there are estimates of you know, if the legislature were to pursue, we wouldn't give them the calculations. But Go ahead.

[Peter John He]: Yes. And what's the bar between the one?

[Ted Barnett (Joint Fiscal Office)]: That's to bring into grantless value similar to the edge case. Mhmm. I've included so the last slide, I'm not gonna run through the mechanics of doing the pilot payment calculation. I've included this here for your reference if you really wanna understand the mechanics of how this works, but I'm not gonna run through the specific numbers unless you really wanna be too. So this slide, I wanted to compare the places where there are local option taxes, which is the map of Vermont on the left, with the towns that or municipalities that receive pilot payments. Understandably, there's not a one to one correlation. Where you see local option taxes is frequently in areas around ski towns, ski areas, or areas, municipalities that have a large commercial base, whereas pilot payments are much more diffuse. General comment about magnitude of pilot payments is you'll see on this map, the darker colors, the darker blues rec reflect higher pilot payments, whereas you get to this kind of greenish, light greenish color, those are smaller pilot payments. A lot of municipalities are receiving relatively small pilot payments. Maybe they have some state park infrastructure. They have a couple of lean tos in their town borders. Maybe they have a single AOT garage. A lot of these payments are relatively small. Where you're seeing larger payments, understandably, mafia for the whole kind of state infrastructure and complex. Other so the state college system is where towns are receiving relatively large pilot payments. And yeah. So outside of those core pilot municipalities, a lot of places are receiving smaller payments. This

[Sen. Wendy Harrison (Clerk)]: is really helpful. Thank you for having this slide. Of course. So kind of shows so does the pilot fund have other sources of revenue other than the okay, so this means that some towns are kind of subsidizing the others in some ways because the state is compensating through the pilot for being not practicable, which is good. I think the state should pay its way, but it's getting funding from some towns and using that in other towns. I

[Ted Barnett (Joint Fiscal Office)]: will say there's a lot of different ways to look at what's equitable in this system. And so, yes, it is true that local option taxes in certain towns are funding pilot payments in other towns. I will note, and I have this on a slide, that I'm a Williamstown resident. And so I am going to Berlin and paying Berlin's local option tax. I'm going to Montpelier, and I see it on my receipt. I'm paying local option tax in Montpelier as well. So there's questions about shoes supporting commercial activities in lockdowns and then where payments are going to.

[Sen. Wendy Harrison (Clerk)]: Yes. Yes. And just to follow-up. So so there could be very good reasons for that and logical reasons and appropriate reasons, but it's just important to note it and to understand how that how that works. Mr.

[Ted Barnett (Joint Fiscal Office)]: Chair, I will note that Chris has his hand up behind you if you wanted to recognize him. Totally, yeah.

[Chris (Joint Fiscal Office)]: Chris, I would just, yeah, to your point, Senator Harrison, I would reiterate that, and I don't mean to split hairs with this comment, but I just wanna remind everybody that it's not the towns that pay local option tax to sort of subsidize everybody. It's the commercial activity that occurs within the town. So that doesn't mean it's

[Ted Barnett (Joint Fiscal Office)]: all to Ted's point, it doesn't

[Chris (Joint Fiscal Office)]: mean that town residents or the town itself is paying it. But I'd also just like to remind the committee that, yes, that's the case that the towns that generate the local option tax, that revenue then goes to other towns. But you could say that about everything state government does as well.

[Sen. Wendy Harrison (Clerk)]: Yeah. You could, but this is when someone yeah. This is a longer conversation.

[Ted Barnett (Joint Fiscal Office)]: Yeah. But every everything we do

[Chris (Joint Fiscal Office)]: when we collect revenue goes to us. There's not a direct connection between who's paying the taxes and who's receiving state funds.

[Sen. Wendy Harrison (Clerk)]: Right. But it's helpful to know the flow of And this one is pretty straightforward because there's no other funds that support Pilot and so that's notable. Okay, thank you.

[Sen. Richard Westman (Chair)]: I would say that the place that always comes to mind from me is Williston. And Williston particularly comes to mind because that's where all the box stores are. And everybody that travels to the box store goes mostly on the interstate or route to. And so everybody miles around is paying their local option tax. And I certainly would like to be fair to will estate, but. Yeah. So that's a good conversation to have. Yep, it's an extremely good conversation to have, and the balance that you keep in that between the host community and the rest of the state is something that I think is part of the point of why we're here to talk about this.

[Sen. Rebecca “Becca” White (Vice Chair)]: Do mind if we hear from the leak? I know that Well, we dropped the

[Sen. Richard Westman (Chair)]: we're doing a get Our ground under us for this. And Oh, we just had his

[Sen. Rebecca “Becca” White (Vice Chair)]: hand, so I didn't know if

[Ted Barnett (Joint Fiscal Office)]: he Just a point of is there a breakdown of online sales? Because the way fair decision sort of changed that dynamic that all sales online purchase.

[Sen. Richard Westman (Chair)]: You know? So I don't know if there's a breakdown. We're trying to yeah. We're trying we're we're trying to get our feet underneath her and and get you know, I specifically asked Josh to come to

[Peter John He]: Yeah.

[Sen. Rebecca “Becca” White (Vice Chair)]: That's why she's asking.

[Sen. Richard Westman (Chair)]: Yeah. And we And we're gonna we're just getting started here. Within

[Ted Barnett (Joint Fiscal Office)]: the pilot special fund, it will make sense that the general health of the pilot special fund is reflective of the story we were talking about with local option taxes earlier. The revenue and expenses in the pilot fund were closely matched between in this chart, kind of since the beginning of the pilot special fund. But in this chart from 2017 to 2021, revenue and expenses are pretty close. And you'll see on the table below, this is reflective of the proration. So there in other words, there wasn't enough revenue to pay for the full pilot payments in municipalities across the state. And so every year, as part of the budget process, appropriators were trying to figure out based on how much revenue we have available, how how much can we spend on the pilot program. But once post pandemic, consumption taxes really started to respond, once more towns with local option taxes, once they came online, revenues started to outpace expenditures. It took a few years to have enough revenue to be able to fully fund pilot payments, which started in 2024, but the ending balance in the pilot special fund increased from about $4,000,000 in 2021 to over 15,000,000. So almost right at 15,000,000 in fiscal year twenty five.

[Peter John He]: Go

[Sen. Wendy Harrison (Clerk)]: ahead. Thank you. So in the years so 1718, '19, they the state didn't fund the pilots completely. Mhmm. And I guess that was because of statute.

[Ted Barnett (Joint Fiscal Office)]: There was not enough revenue in the in the fund, and so the statute specifies that if there isn't enough money to make the pilot payments, payments shall be prorated by whatever percent.

[Sen. Wendy Harrison (Clerk)]: So so the ending balance, why didn't they use that funding to to make the pilot?

[Ted Barnett (Joint Fiscal Office)]: Part of it is, I think, fiscal conservatism. You don't wanna fully draw down the balance or mismatch, kinda overspend each year and pull the fund into deficit. I don't I don't know for sure, but that would be It just seems understanding. Yeah.

[Sen. Wendy Harrison (Clerk)]: Because the reason to have a balance is that well, it it it just seems strange that they wouldn't have used that money to pay the towns.

[Ted Barnett (Joint Fiscal Office)]: And part of it is, right, you're trying to before the revenues, they come in, you're trying to understand how much consumption tax activity is going to happen. You may not have a perfect window on that. You're going to conservatively budget your pilot payment, and maybe revenues come in a little higher so they built a balance. But you don't wanna then dive into the balance the next year and spend it down. If a recession happens or it could easily go the other way, right, where you budgeted a certain amount for how much revenue you think is gonna come in, the economy softens, you receive much less revenue. If you don't have a balance in the fund, then that all disappears, and then the fund is in.

[Sen. Wendy Harrison (Clerk)]: Right. I I understand that with a regular fund where you you have operational responsibilities, but this is basically a a you're giving the money back to the towns or you're paying your taxes actually is what it is. That's the state paying its taxes to the towns. And so having a balance is just, it's just kind of strange. But I'll leave it at that.

[Ted Barnett (Joint Fiscal Office)]: More recently, there have been beyond the general and correctional facilities pilot payments that have been made long term. There have been other uses of of pilot special fund revenue in fiscal '26. So these these were uses in that are on the table. This was in act 27, the the big bill last year. There is a onetime appropriation for the municipal grand list stabilization program. This is compensating municipalities for properties that have been flooded. And then there was an item that was available to help towns cover kind of road improvements or that were not covered federally. And so that was $1,150,000 of an appropriation last year. As I understand, there was a lot of demand for for that appropriation. So, yes, there are additional last year, there were additional uses of pilot special fund revenue. In addition, the

[Peter John He]: BAA,

[Ted Barnett (Joint Fiscal Office)]: This is as path by the house, it should say, here at the bottom in this bullet. It included additional payments from or appropriations from the pilot special fund. One is a $500,000 appropriation to PVR, to inventory and create a a valuation model for communication property. I referenced that because part of that discussion intersected with transportation, Greg, trying to understand communication property. There's the whole discussion of right away leasing for communication property. And so there is that bill required communication property to be placed in the grand list and valued real estate, and so this appropriation would help the Department of Taxes build a model so that municipalities could understand how to value and what communication property is in their local jurisdictions. And then h the BAA that's passed by the house also includes $3,410,000 for reappraisal and listing payments. That payment did come from the general fund, but in the BAA, it would come from

[Sen. Richard Westman (Chair)]: the pilot special funds. And and the bottom line, and we're moving in the direction in the senate towards using the the funds from the pilot fund for those two. What is the bottom line of what's left for surplus within

[Peter John He]: the pilot fund?

[Ted Barnett (Joint Fiscal Office)]: It's a good question. I know Chris, when that bill was being considered in the house, put together a table that would show the overall kind of an estimate of where the fund would ended up would end up at the end of fiscal year twenty six if those changes were made. I will note that in this table, for example, the general pilot payment, it's appropriated for $12,200,000. The actual payment ended up up being $11,400,000. The grand list municipal grand list stabilization program, the actual spending in FY '26 is about $80,000. So this appropriation was intended as more buildings complete the pilot program. And Chris, I was Sure. Stalling a little bit. Yeah.

[Chris (Joint Fiscal Office)]: Sure. So, Chris from Joint School, those of you who are on the appropriations committee will remember that I shared this with you a couple days ago, but we worked with the tax department to sort of figure out what are they projecting the expenditures will be based on these appropriations activities. And based on their estimates, if all of these sort of changes and those shifting of those costs happened in '26 and in '27, the pilot fund would end FY '27 with a surplus of a little over 11,600,000.0. I would note that that is dipping in a little bit to the surplus, but in the future, tax and JFO both think that since the conservative budgeting that Ted mentioned on the pilot payment appropriation as well as the fact that more towns are likely to adopt local option taxes, some of the things Senator Westman has been mentioning, the revenue picture is likely going to increase too. So we're not particularly worried about the fund's ability to absorb these costs in the near term. We would caution the legislature to avoid adding additional recurring costs in the current revenue picture at this point in time, though.

[Sen. Richard Westman (Chair)]: I'm gonna speak just for myself. This really is though that first percent. This is not anything to do with if a community goes beyond the 1% and tries to move to 2%. This is really about the 1% and not the and what for me is concerning about the one percent is we have no consistent way of dealing with this now, and we're picking things one at a time out, and that's a little concerning. So if we're gonna be fair to everybody, shouldn't we think about what's a fair way to distribute across the board? And so that that's part of why we're dipping into figurines all about. And it is a good question that Josh from the league raised. It would be nice to get some figures about the online sales and how that fits into all of this. I'm not sure.

[Ted Barnett (Joint Fiscal Office)]: At least in the data I've seen that they were the Department of Texas is able to pull out online sales. I will send them an email just to to confirm. There is a line within the data that kinda has an other catchall category for folks who are submitting statewide returns that aren't apportioned to a town, and that includes as far as I understand, historically, it's included a lot of online sales, but I chat with the Department of Texas to see if they could get us a Yep.

[Peter John He]: Number of people would be paying.

[Ted Barnett (Joint Fiscal Office)]: And if that fails, there are ways to look just generally at the amount of consumer spending that's happening online and of course, you're back to Vermont. So if that fails, I can provide a general picture. Okay. So this is showing pilot provisions in the governor's recommended budget for FY '27. A lot of the line items will we've discussed in the previous slide. So the appropriation is carried forward from fiscal year twenty six. So is the so are the total payments to towns with state correctional facilities. The 3.1 or $3,410,000 in additional cost for reappraisal and maintenance of municipal grand lists is in the governor's recommended budget, and we'll note that we will have to see which municipalities adopt local option taxes Heard that, you know,

[Sen. Richard Westman (Chair)]: there are a number considering. Does anybody keep track of who's putting on the ballot this year either expansions or adding or off that activity, does the tax department track that? Yes. The okay.

[Sarah Merrill (Vermont Department of Taxes)]: Yes. Hi. Yeah. It's Sarah Merrill from the tax department. Yes.

[Sen. Richard Westman (Chair)]: We will be looking to get somebody from the tax department here to talk about that.

[Ted Barnett (Joint Fiscal Office)]: Great. Yes. My low tech method is I have a Google alert for, like, local option tax and robot, and it, like, kicks it in. So I know Milton and I think Warren are some of the ones considering local option taxes. But the tax department does a better job than I do, I'm sure. So transitioning, we're out of the pilot special fund. This is looking at other neighboring jurisdictions, other neighboring states that have different structures for taxes that local jurisdictions, the counties or municipalities are able to implement. The first one is Massachusetts, which gives local municipalities gives them two different mechanisms to raise local revenues. So these are layered on top of the state occupancy excise tax rate of 5.7%. Municipalities can add up to an additional 6% on rooms, and they can do a 3% short term rental impact fee. And in that impact fee, 35% of the revenue must be used for affordable housing. Of 352 municipalities in Massachusetts, two two hundred and thirty three of them have a local occupancy rooms tax, so a lot of municipalities have taken the state up on that provision. A smaller number, 42, have a short term rental impact fee. These revenues are this whole program is administered by the Department of Revenue, and so that's one example. The next one is New York State, and this is looking at their state Looking at their sales tax, the base state sales tax rate is 4%. Counties can add up to 4.875%. And then counties share a negotiated percentage of that local county revenue with cities and with cities within that county, and it varies quite a bit quite a bit. Some counties, their percentage share was about 40%, and others were sharing just 6%. So it really depends based on the county in New York, and this is collected by at the statewide level. And provided there's a publication that shows the differential rates by different counties, you'll see that a lot of them have taken the state 4%, added a county 4% for a total rate of 8%. And a number of them have also gone to the full 4.875%.

[Peter John He]: Yes.

[Ted Barnett (Joint Fiscal Office)]: Moving to some general considerations, I will I understand that I have four minutes, so I will cruise

[Sen. Richard Westman (Chair)]: right through these. The first is Well, you know, deeply kind of take to get through this. I'm not issuing the next it's gonna take a half an hour or so. Okay.

[Ted Barnett (Joint Fiscal Office)]: Great. Then we will spend more time considering. The so the first one is complexity. One of my favorite pieces of testimony, I do have favorites, was given by the Department of Taxes to Senate Finance all the way back in 2023, talking about local option tax administration and how they do it and how they figure out, especially for transactions that happen online, which transactions are happening within a specific town. And this is complicated because, as this map shows, this is what they've provided to the committee. And I don't wanna steal a 100% of their thunder because if they are coming in, I'm sure they will be able to give a more fulsome exposition on how challenging this is. But this map shows the different colors represent the USPS address. So when you write down your address to send a letter, a lot of folks in Middlesex, within Middlesex is town boundaries, their address says Montpelier. So if you're doing a transaction online and you're entering your address, that retailer has to have a way to figure out that that transaction is Middlesex. I don't think they have a local option to act if they had one, figure out how to apportion that revenue to Middlesex. And it's a whole challenging operation. To recreate the Montpelier. Correct. Yes. And so there are shape files that I understand that the tax department sends to retailers or, you know, like Square, Shopify retailers that are doing that work. But it doesn't sound easy, and I'm glad they're the ones doing it. So as you're thinking about the local option taxes, these challenges are here, and the Department of Taxes has to do a lot of work because of Vermont's kind of quirky and rural landscape. The next piece is a bit about equity. And so when we talk about equity within JFO, another way of thinking about that is is thinking about who pays the specific tax. We did have a discussion, so this is already covered, about the difference between local option taxes. Right? Like, who's raising that revenue? Local option taxes are raising revenue where commercial activity occurs, and often that is in municipalities that have a large tourism or retail presence. And there are a lot of municipalities in Vermont if they did a local option tax. The example I give is Marlborough just did a local option tax. The estimates were they would raise $1,520,000 dollars worth of revenue because they just don't have the same commercial base or mules and rooms tax base that Brattleboro has, for example. And so thinking through kind of that that challenge of yes. Where is that where is that revenue coming from? That is a challenge within state. It's also looking at who would bear the increase or change in local option taxes or, you know, when a town is implementing one. For the rooms tax, that revenue is largely being raised as being paid by out of state visitors who are coming to stay in hotels or motels or short term rentals. But for the sales, meals and alcohol taxes, that's borne by mix. Some of it's being paid by Vermonters. Some of it's being paid by out of state visitors. And so keeping that peace of mind, it's the impact is different depending on the tax type. Finally, this says sales tax in general consumption taxes are regressive, meaning that folks who have lower incomes are spending more of their incomes on goods. And so a change in any sort of change to consumption taxes are likely impacting lower income folks more than it's impacting higher income folks. And then finally, thinking about competitiveness. So a local option tax, you know, someone who's coming to Vermont or thinking about their spending, whether they're spending in Vermont or New Hampshire, they're not considering local option taxes differently than they are state taxes. And so looking at our total rates, including local option taxes compared to neighboring jurisdictions is important. Within the sales tax, most other New England states have a sales tax rate of between five and a half and 7%. So once right, towns with the local option tax are kind of at the upper end of that, towns with you know, who are increasing beyond that 7%, if you all gave them that authority, would be less competitive from a sales tax perspective. Meals, similarly, Vermont has the highest meals tax or is high among neighboring states. Within lodging, we'll just note that it's very hard to make comparisons because oftentimes local jurisdictions have the ability to raise different rates, and so it's hard to get an apples to apples comparison. So helpful to keep rates in mind. It's also helpful to look at it's a different competitiveness means something different for Hartford, right, which is right on the border versus Stowe, which, right, doesn't have the same kind of cross border consideration. Really, Hartford's looking at folks could easily go to New Hampshire and pay no sales tax.

[Sen. Wendy Harrison (Clerk)]: They still shop at Hartford and in Brussels. Mhmm.

[Ted Barnett (Joint Fiscal Office)]: Yes. Exactly. And so right. Like, we we bring up competitiveness, folks may have a like, folks are making their individual spending decisions and, yeah, they may decide that the differential in tax rates doesn't impact them. That's it. That's all I have for y'all.

[Peter John He]: Go ahead. Other than the issues around aviation fuel and transportation fuel, having to go for transportation, are there other restrictions? Like, they came up I can't remember when you were in corporations if you talked about this after you were there, like, part of your testimony about option tax and purchase and use. Are there things that would predict that other than the current statute that we need to change or other things you might want to tax, like the emusivity tax that other cities have done already?

[Ted Barnett (Joint Fiscal Office)]: Not that I

[Peter John He]: can by the creativity of the minds of local officials.

[Ted Barnett (Joint Fiscal Office)]: As far as I I will, like, double check with Kirby and legislative council just to make sure. I think the things that are preempted, the Internet, for example, it's just you can't text it in general. Cable or electricity.

[Peter John He]: Assuming there's some things that they couldn't do because of other state laws outside of the pilot law or federal law.

[Ted Barnett (Joint Fiscal Office)]: Yes. I'm not I'm not aware of any, but let me check with Kirby just to double check.

[Peter John He]: Do you see why a pound could do a purchase and use local purchase and use case? Not

[Ted Barnett (Joint Fiscal Office)]: that I know of. I can't think

[Peter John He]: of anything off top of my head.

[Sen. Wendy Harrison (Clerk)]: Bill enroll. Right?

[Ted Barnett (Joint Fiscal Office)]: I mean, they would have to do I don't know. Chris has some His new charter check. Yeah. They would have to do a charter check, but I don't know about the yeah.

[Peter John He]: They're in the same vendor.

[Sen. Rebecca “Becca” White (Vice Chair)]: Yeah. Right? We only gave an exemption to local option type, but that

[Chris (Joint Fiscal Office)]: was what I was saying. Might wanna hear from DMD on whether there's any limitations from their perspective. It's a different test. Yeah. They administer it with DMD for different purposes.

[Sen. Richard Westman (Chair)]: And I I might say to you the same, not in every case, but the same communities that have a local option to consider. For example, or St. Elvans Town are rare. Yeah. A lot of, and they're already the communities that have a good local option tax base. That was a pretty good Yeah. But anyone's saying. Thank you. This is not the last we're going hear from you. I'm thinking we'll take a five minute break, and then we'll see a little exact maybe back to