April 13, 2012 – Week 14

The end of this year’s legislative session is in sight. While Speaker Shap Smith’s target adjournment date of April 27th may end up being just that, a target, it’s likely that legislators will wrap up their work in the next two to three weeks. The end of the session always brings with it some creativity as bills get tacked onto other bills that are seemingly unrelated, new issues crop up and others fizzle.

Shareholders Personally Liable?
The Senate Economic Development Committee held an initial hearing on H.78, a bill that relates to employees’ unpaid wages. The final section of the bill would make boards of directors and shareholders personally liable for employees’ unpaid wages. The Chamber has expressed significant concerns with the effect this provision would have on investment in Vermont companies. Shareholders would likely reconsider investing in Vermont companies if this provision were passed and directors would likely resign if there were signs a company was in trouble rather than working to guide the company through the rough patch. In the Committee’s consideration of the bill, Senator Galbraith (D-Windham Co.) expressed serious concerns about the provision indicating that if the bill passed, he would immediately resign from his positions on boards. He also explained that we need risk takers in order to grow our economy and that this provision would inhibit risk takers. Senator Ashe (D/P-Chittenden Co.) asked if the impact the bill might have on startup companies was considered. Finally, Senator Illuzzi (R-Essex/Orleans Co.) indicated that it was unlikely the shareholder liability section would remain in the bill given the concerns he, and others on his Committee, have with the provision. A new draft of the bill, which is scheduled to be taken up this morning, did not include the shareholder liability section.

Renewable Energy Bill Delayed
The Senate Natural Resources Committees continues to work on H. 468. The bill would create a Renewable Portfolio Standard in Vermont and expand Vermont’s standard offer/ feed-in tariff program. While the Committee had scheduled to vote on the bill each day this week, as of Thursday, a number of issues remained unresolved and the bill had not yet made it out of Committee. The Chamber and GBIC feel the bill would unnecessarily increase electric rates in Vermont for the foreseeable future.

Permit Appeals Bill Passes Senate
S.28, a bill that requires the Act 250 permit appeals process to be on the record for controversial cases and some refinements to party status has been approved by the Senate. (See Week 13 for a summary of the bill.) Senator Ginny Lyons (D-Chittenden Co.) steered the bill through the Senate despite the concerns of interest groups. The House will work on refining the language and the House Natural Resources Committee has already begun taking testimony. Our organizations support on the record review for controversial cases, but we do not support the changes to the party status provisions. We will work to ensure that the bill does not result in expansions to party status that may result in frivolous interventions to delay proceedings. Environmental Court judges, Natural Resources Board staff and District Commissioners all testified that the bar is already low for people to participate in the process and prehearings at the District Commission level allow everyone to participate. We recommend using existing standards in federal and state law to determine party status.

Public Service Board Authority
The House Natural Resources and Commerce Committees held a joint hearing to talk about the Green Mountain Power and Central Vermont Public Service merger. Specifically, the Committees heard testimony about whether the Legislature should intervene in the Public Service Board’s open docket. Several legislators are attempting to pass legislation that would require $21 million be paid out to CVPS ratepayers. Mary Powell, of Green Mountain Power Corporation talked about the cost and service benefits that can be achieved by bringing GMP and CVPS together. Janet Doyle of IBM, also testified at the hearing. IBM is a party in the merger docket. Doyle indicated that IBM Vermont believes that GMP is uniquely able to deliver savings to their customers, including IBM. They were pleased with the memorandum of understanding entered into by the Department of Public Service and Green Mountain Power which will front load savings to ratepayers for the first six years after the merger is finalized. For IBM, this will mean close to $2 million in savings in the first six years. Jim Pratt of Cabot Cheese, talked about the need for predictability in order for a business like Cabot to grow and succeed. Referencing the Legislature’s potential involvement in an open Public Service Board docket, Pratt states that when changes happen in an unpredictable manner, it makes it difficult to operate a business in Vermont saying “we wonder if next time, it’ll be us.”  Frank Cioffi, President of the Greater Burlington Industrial Corporation, echoed the need for the business community to be able to count on predictable proceedings in order to move forward with plans. Also, that the Public Service Board is well-respected in Vermont and any change to an open proceeding creates uncertainty for businesses.

Clean Energy Summit
U.S. Senator Bernie Sanders, Governor Peter Shumlin and the Vermont Department of Public Service co-hosted a Clean Energy Investment Summit this week. The purpose of the summit was to bring together people from the energy, finance, government, environmental and business sectors to talk about opportunities to grow Vermont’s economy and increase our use of clean energy. In his opening remarks at the summit, Senator Sanders talked about Vermont’s culture of frugality saying that “we don’t like to waste and that’s exactly what we’re doing if we don’t invest in energy efficiency.”

Cloud Computing Debated Again
The Cloud Computing bill (H.757), was the source of additional debate on the House floor this week. Representative Heidi Scheuermann (R-Stowe) requested that she be allowed to withdraw her bill which originally called for a refund of the sales tax for companies that access software remotely and that such services not be subject to tax going forward. She believes the original intent of the bill should have been respected and that the bill has “morphed” into something she can no longer support. H.757 now institutes the sales tax beginning July of 2012. House Majority Leader, Lucy Leriche, explained that the bill remains in its original condition unless it is acted upon by the House and no action on the bill had been taken to date. Other members argued that when a member introduces a bill, they take a chance in terms of what the process will bring at the end. In a partisan vote, the House did not support the motion to allow Representative Scheuermann to withdraw the bill and House Republicans expressed frustration that such a move would discourage minority members from proposing legislation. Meanwhile, S.173, the bill supported by our organizations has yet to be taken up in Senate Finance.

Quick Hits

The House Appropriations Committee passed out H.762, the omnibus labor bill. The bill includes a new process for sole contractors to register as such. The bill is on deck for consideration by the full House this morning and is likely to pass. If approved by the House, the bill would move to the Senate for consideration.

The House Agriculture Committee held a public hearing on H. 722, the GMO (Genetically Modified Organism) labeling bill, this week. Since the bill is still in the House, with the crossover deadline several weeks ago, it is unlikely that it will move forward this year.

H.752, relating to permitting of stormwater discharges in impaired watersheds has passed both the House and Senate.

H.761, relating to executive branch fees, including motor vehicle fees, has passed both bodies.