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LCC Advocacy Update: Week 8, 2021

Lake Champlain Chamber News and Press Advocacy Update LCC Advocacy Update: Week 8, 2021

Thank you to this week’s sponsor of our Advocacy Update:

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February 26, 2021

In news that should come as no surprise to anyone, the legislature will not be returning to in-person operation after their town meeting day recess next week. Legislative leadership has said that the legislature will meet until mid-May and adjourn, despite the likelihood that many will want to stay longer to take their time in appropriating Vermont’s share of the roughly $2 trillion relief package Congress is expected to pass shortly. When the legislature returns from town meeting break, they’ll be on a tight deadline to meet the crossover deadline of March 12th; after that, the work will need to begin to turnaround legislation to use the $1.5 billion in funding the state is expected to receive (much of this pre-allocated). 

For the reasons stated above, we have a great deal to update you on. In this week’s update: 

Federal Relief Update 

The de facto deadline of March 15th is quickly approaching and we will see the House vote on the next round of federal relief today (Friday) via the budget reconciliation process with the procedures to pass the legislation starting in the Senate on Tuesday with 20-hours of debate and an impending vote-a-rama. The full reconciliation bill looks similar to that proposed in President Biden’s proposed relief package, however, the price tag has pushed slightly closer to $2 trillion. 

Vermont will likely receive $960 million from the legislation, with two-thirds of that required to go to municipalities. An overview of small business relief can be found here and the full text of the bill can be found here. 

The big news this morning was that the Senate Parliamentarian (a Vermont Law School graduate, by the way) ruled that the $15 minimum wage increase would not fit within the budget reconciliation rules. Despite this, the minimum wage increase will be in the version passed by the House. So, what’s next? Well, they could fire the parliamentarian (happened in cases like this before), overrule the parliamentarian (happened in 2017), replace the minimum wage increase with a backdoor “luxury tax” on employers who don’t pay the proposed wage which would possibly fit within the Byrd Rule, or just drop it from the budget reconciliation effort to go for a stand-alone bill. 

Everyone, from congressional leadership to the White House, has been signaling this might happen. A number of Senate Republicans have come forward with a minimum wage bill that would come in at $10 an hour, index the minimum wage to inflation, and use E-verify to prevent the hiring of undocumented workers. The proposal isn’t sitting well with progressives, who feel the legislation is anti-immigrant, however, if the minimum wage is indexed for inflation it would be a very long-lasting victory for the Democrats. 

Join LCC and Congressman Welch Thursday, March 4th 

Join LCC’s Advocacy team and Congressman Peter Welch to discuss the news and economic relief coming out of Congress. This event is free to LCC members, with the option to contribute to the LCC “Pay It Forward” program that helps support LCC membership for those businesses harmed by COVID-19. Register here:

Register Here

Use Town Meeting Week to Engage with Your Legislators

We recommend that you take a moment over the next week to reach out to your legislators and let them know how the pandemic and resulting recession has affected your organization, whether good, bad, or a mix. It is helpful for legislators to hear these first-hand accounts, especially as they head in to the end of the legislative session. Need help connecting to your legislators? Let us know.

Vaccine Update; Good News to Share 

New guidance for vaccinated people  

Governor Phil Scott announced this week an update to the state’s policy on gatherings, as the new travel quarantine policy (announced on February 19th) went into effect. Effective Tuesday, people who are fully vaccinated may travel to Vermont and return from out-of-state travel without quarantine restrictions, once 14 days have passed from when they received their final dose. Additionally, people who meet these vaccination criteria may now gather with one other household at a time. Our marketing team is already adjusting messaging to targeted vaccinated people who are potential visitors in our drive market. 

Extending eligibility 

The Agency of Human Services and the Department of Health today announced that the portal for people 65 years and older to schedule an appointment to be vaccinated will open on Monday, March 1st at 8:15 a.m. Visit the Department of Health website or call (855) 722-7878 for full details. There are approximately 42,000 Vermonters in this category.

The Administration also announced that there will be more information available next week for phase-5, Vermonters between the ages of 16 and 64 in the “high-risk category” of which there are about 75,000 Vermonters. The State plans to open registration for this phase in a few weeks.

Johnson and Johnson on its way soon

The J&J vaccine has some benefits that have previously not been seen in the Pfizer and Moderna vaccines. It can last up to three months in refrigeration and only requires one dose while the other two vaccines need to be frozen at extremely cold temperatures and require two doses. Governor Scott said at his Tuesday press conference after joining late as he got off a call with the White House to discuss vaccinations, that Johnson & Johnson is expecting to distribute two million doses in the first week it is approved, of which Vermont is expected to receive 2,000. J&J told Congress this week that it expected to provide 20 million doses by the end of March and 100 million by summer.

Brighter forecast 

The vaccine this past week has been shown to be 89.5% effective at stopping transmission in a recent study. This week’s forecasting from the Department of Financial Regulation shows cases trending downward continuing into the summer, similar to the experience of Israel described last week. Still many are concerned about a fourth wave from virus variants. 

State COVID Bill Moves Past House 

A bill of many names; The Fast Track bill, CRF bill, Covid Relief Bill, and Expedited Budget with the bill number H.315, passed the House today and is on its way to the Senate where it is already under consideration. The bill contains $62 million in spending and a reallocation of $17 million in previously allocated CRF money, bringing the total package to $79 million. In an attempt to prevent further decay in the state’s bond rating, the bill reserves $20 million in general fund dollars for future use in pre-funding other post-employment benefits (OPEB) associated with the state’s pension system unfunded liability about to grow by about $600 million. The hope is that this will be an adequate demonstration to creditors that the legislature is dealing with the state’s debt burden.  

The Senate will not move the bill until after town meeting week. The Senate appropriations committee is still unsure about using $10 million in general fund money for Gap Economic Recovery Grants, however, seems to also concede that it might be the only option, as it would not be an allowable use for CRF dollars. The Senate Economic Committee is considering the GAP program (at one point more public than anticipated) as well as looking at advanced funding for the mortgage assistance program. We covered some of these provisions in more detail in last week’s update. The ACCD produced this flowchart this week to help those who might apply the GAP grants understand the system. 

A summary of the bill as passed by the House Appropriations Committee can be found here.

H.315 relief and recovery bill. Highlight sheet and spreadsheet 

Unemployment Insurance Update 

The conversation in Senate Economic Development, Housing, and General Affairs got a new degree of urgency that led the Commissioner of the Vermont Department of Labor to seem to suggest that ongoing discussions on the Unemployment Insurance (UI) system, which we previously updated on, be bifurcated. This might involve, the language in S.10 which deals with employer experience ratings, and that the larger conversation dealing with the UI Trust Fund rate schedules, as well as a possible 20% increase in UI benefits be dealt with in another bill. 

In two weeks, many people will have their benefit year wage base recalculated due to federal law if the Vermont Legislature does not take action. The Consolidated Appropriations Act, passed in December, allows the DOL to recalculate a claimant’s benefit year, shifting out their new benefit year and eligibility if it drops by more than $25 to keep them on the federal PEUC. The Vermont Legislature will need to move legislation enabling this federal change at the state level in the next two weeks and S.10 could be a vehicle for this.  

LCC Testifies on Economic Development Proposals in the House 

The Lake Champlain Chamber’s Government Affairs Manager sat down with the House Commerce and Economic Development Committee Thursday to discuss a draft economic development bill as well as numerous other proposals before the committee. Testimony can be watched here and read here. The bill holds a wide array of proposals we’ve discussed in previous newsletters including “mini-TIFs,” Vermont Seed Fund recapitalization, changes to the Relocated Worker Program, creation of a Tourism Marketing and Promotion Fund, Downtown Village Tax Credits, and creation of the Better Places Program. 

Given all of the strong downtown components, LCC suggested the Committee consider adding a provision to remove areas of enhanced designation from Act 250’s jurisdiction. Such a change would help communities capitalize on all of these proposals as they quickly move to revitalize and recover from the pandemic by building affordable housing and dense, walkable downtowns. This narrow change to Act 250 is pretty ubiquitously agreed upon; however, it keeps getting hung up in the larger Act 250 debate. We asserted that this narrow change brings with it positive environmental benefits by driving development into downtowns with plenty of reviews making it less suited to a conversation in the natural resources committees and better suited to economic development and housing committees. 

PPP Update; Changes Likely to Benefit Vermont  

This week, the Biden Administration released an Executive Memorandum making significant changes to the Paycheck Protection Program that will increase eligibility and push to the front of the queue many Vermont businesses. We recommend all Vermont businesses explore PPP if they have not. The memorandum:

  • Established a 14-day PPP loan application period (started Wednesday) exclusive for businesses and nonprofits with fewer than 20 employees (not 20, less than 20 employees as characterized by headcount; full-time, part-time, and seasonal employees). 
  • Allows sole proprietors, independent contractors, and self-employed individuals to receive more financial support by revising the PPP’s funding formula for these categories of applicants to accommodate gross revenue rather than net revenue. We expect further detail on this change to be available Monday. 
  • Eliminates three barriers to access; 
    • Eliminates an exclusionary restriction on PPP access for small business owners with prior non-fraud felony convictions. 
    • Eliminates PPP access restrictions on small business owners who have struggled to make federal student loan payments by eliminating federal student loan debt delinquency and default as disqualifiers to participating in the PPP.
    • Ensures access for non-citizen small business owners who are lawful U.S. residents. 

Read the full memo for a full list of crucial changes to this program. Attend this SBA webinar Wednesday to learn more about the coming rules. 

Cloud Tax Back, Again 

The House Committee on Ways and Means began the discussion around H.261, a bill that would tax pre-written software accessed remotely. The Committee heard from the Tax Department that they do not support this proposal due to the complexity associated with differentiating between software as a service (referred to as “cloud” or in the language of the bill “pre-written software accessed remotely”), platform as a service, and infrastructure as a service. The Commissioner also noted that these tools are more essential and relied on now more than ever as we ask people to stay home, stay safe, and use SaaS to carry out their daily life. The Committee heard from a member of the Tax Structure Commission, which was widely supportive of broadening the tax base to cover services, that if they were to go forward with such a proposal, that they should exempt business-to-business transactions. 

The Lake Champlain Chamber will continue to engage on this issue. Expanding the sales tax base was a suggestion of the Tax Structure Commission, which LCC pushed back on in comments on the draft report. Read LCC’s comments on the Tax Structure Commission draft report here. 

Laundry List 

  • Governor Phil Scott appointed his Director of Affordability and Economic Initiatives, Tayt Brooks, as Deputy Secretary of the Agency of Commerce and Community Development following the announced departure of current Deputy Secretary Ted Brady, last week. He’ll be moving on to take the helm at the Vermont League of Cities and Towns. 
  • Tired of robocalls? The Senate passed S.11 this week to criminalize certain robocalls, however, it is unclear how effective the legislation could be given the calls often originate from outside the state or country.
  • Senate Finance passed S.53 this week, removing the sales tax on feminine hygiene products, often referred to as a “pink tax.”  
  • The House Ways and Means Committee began the discussion on H.185 which would make military pensions exempt from income tax in an attempt to attract those leaving the military with skill sets Vermont employers are looking for and many years left in their career. The Governor has repeatedly put forward the proposal in budgets with no success despite Vermont being one of only a handful of states that doesn’t provide such consideration. The Equity Caucus this year endorsed this proposal. 
  • H.171, the affordable childcare bill, hit rough waters this week as it approached a deadline to be moved out of the House Human Services Committee. Unfortunately, a scheduling conflict prevented LCC from testifying in-person given the little time the committee has with this bill, however, we submitted written testimony which may be read here. The Committee is expected to finalize the bill today.
  • A conversation around a state-wide rental registry is continuing simultaneously in the House and the Senate in the form of H.256 and S.79. The House Committee on General, Housing, and Military Affairs is letting the Senate lead and will take up the bill when it is sent over. As it stands now, the bill would require rental units, including short-term rentals, to register with a new entity at the state contained within the Department of Public Safety’s Fire Safety Division which will potentially have five new employees to carry out inspection and enforcement.  
  • Some limited guidance from the ACCD last Friday explained that events can count on guidance for the coming spring and summer being no more restrictive than guidance available last year. The Agency has promised that more guidance will be forthcoming in April. 
  • H.89, an act relating to limiting civil liability for agritourism activities passed on risks inherent to the activity, passed the House almost unanimously this week and has since been referred to the Senate Committee on Judiciary. 
  • Want to get your staff more involved in the top issues facing our state? Applications for Leadership Champlain are being accepted now through April 19, 2021.

Join Us for Our (Virtual) Legislative Breakfast Series 

We’ve had a fantastic legislative breakfast series so far featuring Governor Scott, and over 20 elected policymakers, and staff of the Congressional Delegation. Our Legislative Breakfast Series is a staple of each legislative session, providing access and perspective into the inner workings of Montpelier. During these uncertain times, the format has changed; however, our team’s dedication to bringing you this access has stayed the same. We invite you to join us on the following dates:

  • Monday, March 15, 2021 – 7:30 a.m. to 9:00 a.m. – Special Guests: Lieutenant Governor Molly Gray and Senate President Pro Tempore Becca Balint, Speaker of the House Jill Krowinski 
Register

Special thanks to the sponsor of our Legislative Breakfast Series:

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Concerned or need to learn more about anything in this newsletter? Email our team at [email protected].

We look forward to working with you.
Sincerely, 
The Lake Champlain Chamber Advocacy Team

Category: Advocacy Update