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DRM Advocacy Update – Week 10 – 2023

This Update is Created by the Lake Champlain Chamber for Distribution by

March 17, 2023

Legislators were back in Montpelier this week after their weeklong recess for Town Meeting. It’s crossover week, meaning legislation needs to be out of the committee of jurisdiction by the end of today, or the legislation is done for the session… at least, that’s how it is supposed to be. Crossover has never been a hard and fast deadline, despite whatever leadership says. There are some ways around it; a committee can seek a waiver from the rules committee, legislators or a committee can add a piece of legislation that didn’t make crossover as an amendment to a piece of legislation that did make the deadline, and more.

That said, crossover allows a brief relief for those working on legislation, as it narrows the scope. The downside of crossover is that legislation that has not received enough testimony, scrutiny, or attention might move because it is a political priority despite it not being ready for primetime. 

In this week’s update; 

Childcare Bill Voted Out; Ponders Parental Leave

The Senate Committee on Health and Welfare concluded their work on S.56, the childcare bill. The fiscal picture and footprint of the bill are still unclear at this time, however, that discussion will now gain momentum in the Senate Committee on Finance. It is expected that the Committee will seek a payroll tax for about $100 million in spending under the bill for this year and then about $200 in the next fiscal year. The Committee backed away from a previous proposal to push four-year-olds into the public school system, deciding instead to study the issue due to the effects that it would have on the private market.  

The bill provides full reimbursement for those making up to 185% of the federal poverty level (FPL) compared to the current 150% of FPL and then reimburses on a sliding scale up to 600% FPL or about $180,000 for a family of four. The bill also includes $7.3 million in grants distributed by the Department of Children and Families to retain childcare workers. 

In a rather large addition, Senator Jane Kitchel brought to the Senate Committee on Health and Welfare, as well as the Senate Committee on Economic Development, Housing, and General Affairs, a proposal to include parental leave only in the childcare bill. The proposal would cost about $15 million and would provide 12 weeks of leave to one parent. The plan would fully replace wages up to 200% of federal poverty guidelines, with a decrease in benefits up to a cap of 600% FPL. 

We’ll have a deeper dive into the final version in next week’s update.  

Paid Family Leave Passes Out of the House Committee on Ways and Means 

The House Committee on Ways and Means passed H.66, advancing what will likely be the most generous paid family and medical leave program in the country. The Committee received JFO analysis that the program altogether would cost $117 million per year instead of the lower numbers previously cited. 

The Committee elected to restore a provision that reimburses those making less than $25,000 a year their payroll taxes at the cost of about $10.2 million. You can read an overview of the bill with the exception of these changes here.

The bill now goes to the House Committee on Appropriations before going before the whole House to be voted on. The bill has 103 sponsors, setting up the House and the Senate for a rough battle as the Senate has already made movements to preempt the bill by adding parental leave only to their priority, the childcare bill. 

Housing Bill Gets Watered Down; Fragile Balance Undone 

The Senate Committee on Natural Resources and Energy proceeded with an amendment that watered down, S.100, also known as the HOME Act, removing essential components of the bill for broad support. 

Most substantially, the amendment waters down the changes to the 10/5/5 rule that were made by the Senate Committee on Economic Development, Housing, and General Affairs. Quick background on this rule: it means that if a developer builds ten units of housing within five miles of each other within five years, they trigger Act 250. Senate Economic moved that threshold to 25 units. To counter this, Senate Natural agreed to the 25 unit increase only within areas of enhanced designation which comprise about 0.03% of the state’s land. 

The Committee also carved out an LCC proposal that would have allowed any property covered by Act 250 that would be converted to housing to not require a permit amendment so long as the development was under 25 units. 

The Senate Economic Committee has agreed to the amendment by the Senate Natural Committee, however, this has disrupted the fragile balance created in the original version of the bill as the Vermont League of Cities and Towns was immediately vocal about their discontent with a bill that only takes away municipal power and does nothing to remedy duplicative state regulation or more archaic state-level regulation which is subject to ubiquitous frustration. 

The Senate Natural Resources Amendment does the following; 

  • Raised the required density in areas zoned for residential and served by sewer and water infrastructure from at least four units per acre to five units per acre. 
  • The Senate Economic version would have removed the ability under the current law of any combination of 10 voters and property owners to appeal. The Senate Natural amendment restores that language though restricts it to a “common injury to a particularized interest” that those individuals have.  
  • As we discussed above, the Senate Economic version raised the jurisdictional trigger from 10 units to 25.  This version struck that language and left the rule at 10 units, 5 years, and 5 miles. The Senate Natural Committee allowed this jurisdictional trigger to be lifted to 25 units in a downtown, neighborhood development area, or growth center. However, this provision which is about a five-year time period, is only temporary and would sunset in three years. 
  • They also removed the cap on the number of priority housing units that are exempt if located in a downtown, growth center, or neighborhood development area. This also is a temporary provision that sunsets on July 1, 2026. 
  • Senate Natural deleted the sections that would have eliminated duplicative local/ANR wastewater permit connection sections that they had previously passed. 

What was added is not the controversial part, with most advocates disappointed with what was removed. Here’s what was added; 

  • The Committee added the concept of Master Plan Districts in designated areas so that a town could pre-approve an Act 250 permit for a development area. Then, each new project in that area would be a permit amendment rather than a full permit. 
  • They added an enhanced village center designation. A town can receive the enhanced designation for a village center if they have permanent zoning and subdivision bylaws, municipal sewer and water infrastructure, and adequate staff. Priority housing projects located in Enhanced village centers require 50 or more units to trigger Act 250. This is a temporary provision that sunsets on July 1, 2026. 

Join us for Tourism Day 

LCC is working with a large coalition of business advocacy groups to pull together a full day highlighting the importance of the visitor economy in the Vermont State House. You’re invited to join tourism and hospitality industry leaders at the State House to engage with legislators and raise awareness of the collective contributions of these industries to the Vermont economy. If you’d like to join, please email [email protected] or sign up here! 

Problematic Labor Bills Advance Out of Committee 

The Senate Committee on Economic Development, Housing, and General Affairs passed S.102 and S.103 this week. As VTDigger notes in the coverage of the bills, they were introduced late and moved very quickly. The bills have numerous issues and will result in unintended consequences if they proceed to final passage. 

S.102 has been scaled back with the removal of the language that would have ended at-will employment in the state, created new severance pay requirements, restricted electronic monitoring, and much more. The bill now does the following;

  • “Captive Audience” provision – prevents an employer from penalizing an employee who does not participate in discussion on issues perceived as political. The provision is aimed at preventing employers from discussing the impacts of unionization with employees, however, it can have far-reaching consequences as well. 
  • Card Check Provisions – means that only 51% of employers would need to indicate interest in unionizing to move forward without an official election. 

S.103 has lost the language on noncompete agreements following testimony that those provisions are the subject of current FTC regulatory efforts. The bill now contains the following. 

  • Confusing discrimination language will only create more business for attorneys – Broadly, the changes to existing language around discrimination in this bill are problematic because it redefines harassment as one event rather than what exists under case law now; one severe event OR a series of pervasive events. The bill would now say that it need not be severe or pervasive, which has multiple negative impacts. This bill could effectively make the courts and the Attorney General’s Office a central human resources department because a single incident will trigger litigation when it should trigger HR intervention, while the language around the petty slight and trivial inconvenience is too vague and would trigger a great deal of litigation that would be very difficult. This proposal also puts employers at risk because they are responsible for an employee’s single incident – under severe or pervasive, there is the ability for the employer to intervene. 
  • Banning no-rehire provisions in settlement of litigation hurts everyone – Legislators in the House have previously heard from attorneys representing employees and employers that provisions designed to prevent the rehiring of an employee after the settlement of a lawsuit should not be banned as they serve an important purpose for each side. The genesis of this proposal is an underlying assumption of advocates for this bill that there is a coercive nature of these agreements when in reality, it is part of a negotiation between two parties represented by legal counsel and crafting an agreement that best serves their needs. Additionally, often if the original issue has proceeded to this point, the relationship is completely unsalvageable.

We encourage you to reach out to your legislators and vocalize your concerns on these bills. 

Liquor Legislation Check-in 

The House Committee on Government Operation and Military Affairs passed the miscellaneous alcohol bill, which does the following; 

  • Increases the annual limit on fourth-class licenses allowing the Board of Liquor and Lottery to grant up to a combined total of 20, instead of the current 10, to a manufacturer or rectifier.  
  • Repeals the sunset on the sale of alcoholic beverages for off-premises consumption or, as it’s commonly called, alcohol to-go. 
  • Replaces the term “cider” with “hard cider” in the Vermont statute when referring to alcoholic beverages.  

The House Committee on Judiciary continued their discussion around dram shop legislation this week and passed legislation that seeks to assist in the high cost of liquor liability insurance. The legislation also requires all proprietors of businesses with a liquor license to acquire liquor liability insurance. The bill passed out of Committee unanimously and represented changes beneficial to Vermont businesses. It is estimated that this could lower VT’s ISO rating from it’s current 10 (the highest it can be) to something closer to a 6. 

The Laundry List 

There are many moving pieces, and we do our best to add the ones that don’t get a section in the newsletter yet should be on your radar here. On any given day in the State House, there are about 175 hours of committee time outside of floor time, and then the hallway, cafeteria, or other time spent legislating. 

  • Read past updates here – week 1, week 2, week 3, week 4, week 5, week 6, week 7, week 8, week 9, and the last session’s wrap-up
  • A great deal of local legislating was done last week as well as many elections. Read summary coverage from Town Meeting Day here via VTDigger
  • A bill recently introduced, S.123, takes aim at resort fees which have become a topic of conversation at the federal level under the colloquial title “junk fees.” President Biden took aim at these fees along with airline fees in his most recent State of the Union. LCC has been following this conversation at the federal level and will advise legislators to let the federal efforts lead. 
  • After 10 weeks of back and forth on H.10, the House Committee on Commerce and Economic Development passed a version of the bill that made minor changes to the Vermont Employment Growth Incentive program and created a study committee to research how the state should best proceed with providing economic incentives.
  • The House Committee on Ways and Means advanced H.165, which would make universal school meals permanent in Vermont schools at the cost of about $29 million. The bill draws that cost from the education fund; however, it is likely that subsequent conversations on the bill will look to add that amount of funding to the education fund. Concerns about new taxes to fund the program are still warranted. 
  • The House Committee on Commerce and Economic Development will not be pursuing legislation, H.87, on earned wage access this session after additional testimony this week.
  • You likely have some level of first-hand knowledge of catalytic converter theft over the past few years. S.48 takes aim at the expensive and inconvenient occurrence by limiting the number of these parts made of precious metal that a scrap yard can accept per day and restricting the transportation of these parts by anyone other than a licensed recycler.