Vermont Legislature SmartTranscripts:

[Committee staff/IT (unidentified)]: You're live.

[Sen. Richard Westman (Chair)]: And this is Senate Transportation, and we're resuming our testimony with, ledge counsel and Damian Leonard, and we are back on mileage based user fees.

[Damian Leonard (Office of Legislative Counsel)]: So for the record, I'm Damian Leonard from the office of legislative council. The chair asked me to prepare the draft that you see in front of you, which is a rough initial draft of what it would look like to transition all motor vehicles that are registered for highway use in Vermont to the mileage based user fee six years after the mileage based user fee takes effect. So that would be 01/01/2033 or upon the occurrence of contingency. And I'll get to those in a moment. The

[Sen. Richard Westman (Chair)]: I really don't wanna cover the contingency piece.

[Damian Leonard (Office of Legislative Counsel)]: Okay.

[Sen. Richard Westman (Chair)]: But this and here's where where the I thought that we would put the we did the calculation and we had joint fiscal come in and talk about if we got the 50,000,000 back for purchase service Yep. In that piece, when would we be when would that money run out? And I think from joint fiscal, what we heard from Logan was that given inflation, given the drop off in fuel taxes and where that, we would in six years, six to seven years, that's when we would begin to fall off, and that wouldn't be enough to cover it. So the initial thing is to just to start the conversation around this table. When would that that would be the break.

[Damian Leonard (Office of Legislative Counsel)]: So the language in front of you, the the key changes to most of this, and I wanna preface this by saying, so this is off of the I've made amendments to the initial draft of the mileage based user fee, which, as you know, the house is working on amending. And based on the discussion today, there's already a few changes that are coming, likely more before that bill moves. So the first key change, though, is just in the purpose statement, just replacing language related to battery electric vehicles with all motor vehicles. That in itself is a a policy choice for the committee. You could potentially structure this so it applies to a subset or to some motor vehicles but not others. The current draft would phrase it as motor vehicles registered for highway use. Throughout the rest of the draft, what you'll see is BEV or battery electric vehicle has been replaced with motor vehicle. The definition of BEV is deleted because it's no longer necessary. And, otherwise, the changes are there are no other major changes in the the overall draft language itself, and it really gets down to a discussion for the committee about an appropriate effective date and whether or not you wanna have a revenue or funding based trigger that could trigger an earlier effective date. The way there are two examples in here that have possible triggers. They're potential triggers that I came up with with JFO. The chair hasn't had a chance to review them yet. So they are really just for thinking on and and discussing. But what they would say is that they're at the very end. They're they're listed as contingent effective date option one or contingent effective date option two. Again, these are just Mhmm.

[Sen. Richard Westman (Chair)]: I see.

[Damian Leonard (Office of Legislative Counsel)]: Discussion points, but they would basically say that the effective date for these changes would either be 01/01/2033 or the January 1 following the occurrence of some sort of revenue factor.

[Sen. Richard Westman (Chair)]: But it's up to you to discuss whether that makes sense. So the agency has not had a chance to review this. They will have comments. The discussion that I think needs to happen with the agency will be what are the things that need to happen to move in total to this. But if we're looking at realistically, you couldn't do anything even if we went breakneck speed for three years to move it out to the whole world. If we're out of of going to what the best case scenario, we've only got enough money to go out six years, what do we need to do to get ourselves in a position where we can even consider moving to everybody for mileage based fees. And I think what we've seen, we're facing right now with going live with mileage based fees, We, this year, have to set the rate if There's that's gonna there's steps that are gonna need to be taken. This is just the first salvo in what would we need to do if we were gonna move to a place where I think, you know, from my view, if we're gonna treat everybody the same, a mileage based user fee for everybody is the only way we're ever going to treat everybody the same. So this is just the first step in starting a conversation. Okay. Go ahead.

[Sen. Rebecca "Becca" White (Vice Chair)]: Okay, so looking at the language and just as I think I'm following, we may never see this because we are going to expect something from the house so we're kind of waiting for them. This could be

[Sen. Richard Westman (Chair)]: Or we may

[Sen. Rebecca "Becca" White (Vice Chair)]: add on. Or oh, totally. Exactly. I don't know. Maybe they say they don't wanna do it at all, for example. So under the first contingent effective date option one, I guess I just so the e board, I guess I know are you saying you don't want to explain this right now or you want us to review it or can we answer that? I I

[Sen. Richard Westman (Chair)]: the agency hasn't got a chance to review it, so I think what we'll wanna do is we'll wait for the agency to come come. Because we're gonna have to hear from them what are the different steps in this process.

[Sen. Rebecca "Becca" White (Vice Chair)]: But the trigger is to do what? It's triggering what happening?

[Damian Leonard (Office of Legislative Counsel)]: And not going into place.

[Sen. Rebecca "Becca" White (Vice Chair)]: Per who? Every single type of vehicle? Yep. Okay.

[Sen. Andrew Perchlik (Member)]: So you're I mean, this is hypothetical, but you're pushing off the EV part of the AMBA until 2033. No. No. No.

[Damian Leonard (Office of Legislative Counsel)]: Yeah. So the EV part of the AMBA, this is just what we see in front of you is Mhmm. Would be additional sections beyond the AMBA proposal that would be coming from our personal house. Added on to So yeah. So the EV portion of the AMBA would would happen in 2027, assuming that's the date that comes out of the house. That's the current proposed date is to begin that transition in 2027. And then the this is proposing transitioning to other vehicles in 2033. I should have been clear about that when I walked through. I left off the rest of the EV portion just because I didn't want this to be a 22 page document.

[Sen. Rebecca "Becca" White (Vice Chair)]: Okay. That makes more sense. Okay.

[Damian Leonard (Office of Legislative Counsel)]: It's That's

[Sen. Andrew Perchlik (Member)]: not a rewrite issue. No.

[Sen. Richard Westman (Chair)]: This is add on to everything after that.

[Sen. Rebecca "Becca" White (Vice Chair)]: I now understand your concept. I like this direction more than what we had originally seen as the proposal because it does help alleviate some of the fear that I had that we're just gonna put EVs on the tax runway of an indexed fund without the gas tax also being looked at. So does this have anything are there any changes to the indexing of the gas tax in

[Sen. Richard Westman (Chair)]: the Nothing at this period of time. Nothing this is just my view is whatever we do, we took a step. What we're doing right now is not compatible to everybody across the board. Took a step when as a state when we did the registration and added to the registration, but it was a step. It didn't go all the way to make that fair. What's being proposed is is be another step. What are the steps that we have to do and what do we have to instruct the agency to do to get us ready? I just picked the date because of what Logan said was a period of time, and the only proposal that would get us out there, if that is six years, what would it take for us to be ready to go in six years? Because if we don't start planning now, we're never gonna get there.

[Sen. Rebecca "Becca" White (Vice Chair)]: Do you and can I just ask, like, the thought process behind the two different options? Is idea that we would only expand it to all vehicles when we experience a revenue decrease. Maybe I'm going into deep, know you want to wait for the agency, but it seems like, if I'm understanding,

[Sen. Richard Westman (Chair)]: at least the second option Second option? I'd like to hold

[Sen. Rebecca "Becca" White (Vice Chair)]: up Oh, mind then. Well then I have no questions then. I really just have no questions about those things.

[Sen. Richard Westman (Chair)]: Thank you.

[Sen. Rebecca "Becca" White (Vice Chair)]: Yes. Because I feel like

[Sen. Richard Westman (Chair)]: we hit it already.

[Sen. Rebecca "Becca" White (Vice Chair)]: I guess that's what I'm saying. No.

[Sen. Richard Westman (Chair)]: Just I'm on the second option. Yeah. Okay. I guess I I didn't we don't know exactly what the house committee is gonna do in in that piece, but I wanna get it out there and say to you, if we and, you know, I clearly don't think the house is gonna move on purchase and use, but they may move a little. What I've heard but if they did and the proposal that the governor I think we've had the testimony we've had, as I've said to you, is we run out of money in six years. Yeah. So what's the long term solution and what does this committee think the long term solution is? If, let's say, you were someone on the committee who

[Sen. Rebecca "Becca" White (Vice Chair)]: had other areas of amendment to the M. B. Flight.

[Sen. Richard Westman (Chair)]: You're gonna get a total chance to move to the law. There's no we're we're we're just trying to set a path in your mind where you can and there'll be options and, you know, this is nothing's in stone. Okay.

[Damian Leonard (Office of Legislative Counsel)]: Great.

[Sen. Richard Westman (Chair)]: K? Yeah. Alright.

[Sen. Andrew Perchlik (Member)]: Are we well, that's it. We can discuss that with. Are we confident that we have six years? I mean, with the inflationary cost of materials, we figured that out.

[Sen. Richard Westman (Chair)]: I think we're gonna have to talk about all of that.

[Damian Leonard (Office of Legislative Counsel)]: Yeah.

[Sen. Richard Westman (Chair)]: This this was just based on the what the testimony we've had so far. Okay. K? Disappoint can you Slide.