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Legislative Update – Week 5

This week’s Legislative Update is sponsored by:

February 7, 2020

It was a turbulent week as the Governor and Legislature clashed over how best to implement a paid family and medical leave program. It was a busy week too with LCRCC’s advocacy team testifying in three separate committees. 

In this week’s update: 

Legislative Breakfast Series

Our Legislative Breakfast Series is designed to provide direct access to legislators and decision-makers in Montpelier to ensure that our business community’s voice is heard. Join us for the opportunity to connect and enjoy a hot breakfast on a cold morning.
We’ll be sure to see you at the next breakfast on March 16th at Costco!
Thank you to New England Federal Credit Union for sponsoring our Legislative Breakfast Series.

The Economist Attempts to Understand Vermont

It’s not typical we’d include an article as a line item in our newsletter, however, it is not every day that The Economist takes aim at our state, asking the question “what has Vermont got wrong that much of the rest of America has got right?” The article highlighted a recent Bank of England study that showed that red tape and regulation has made it just as hard to build a home in Burlington as it is in San Francisco. Our takeaway? Vermont has many positive attributes that aren’t considered when we only look at wage growth and those achievements shouldn’t be ignored. But, if we want a robust economy that rewards people of all skill levels, we need to create a climate where companies can start here, grow here, succeed here and be celebrated for it.

Paid Family and Medical Leave Fails in Veto Override Vote 

Last Friday, the Governor vetoed the Legislature’s Paid Family and Medical Leave Bill citing the opposition to a mandatory payroll tax on working Vermonters and a desire to build a voluntary version of the program. House Democratic leadership wasted no time and vowed to vote to overturn the veto as early as possible. 

It was a dramatic day at the Vermont State House Wednesday as the Democratic Party looked to flex its supermajority and override the Governor’s veto of H.107. After a tense few minutes of a roll call vote, the tally stood at 99-51 with the override failing by one vote. The House leadership seems to be caught flat-footed and spent some of Thursday attempting to push members of their caucus to reconsider their vote within the 24-hour grace period rules allow. 

Meanwhile, Governor Scott’s own voluntary paid family and medical leave program is on a path to implementation. The Governor needed an initial group of people to start the program, or as they call it in the insurance industry an initial risk pool, which he achieved by negotiating with the Vermont State Employees Association (VSEA) to join during their contract negotiation last year. 

The Governor’s office sent out RFPs for an insurance carrier to run the program in mid-January and expects them back soon. It’s unclear what the plan of the Democratic party is now that they failed to override a veto of their own plan. What is left is to stop the Governor’s plan would be to turn against the VSEA and poison their pay act, an unlikely move. The Administration could possibly have a contract to start a program by March.

Non-Compete Agreement Bill Passes Committee

After a long, drawn-out debate which is now in its second year, the House Committee on Commerce and Economic Development passed H.1 on Thursday by a vote of 9-1-1. The bill is greatly scaled back from its original version which would have banned the agreements entirely. The new bill restricts the agreements to key employees who make over 1.5 times the Average Annual Wage as defined by the Bureau of Labor Statists. You can read the final version here. LCRCC‘s Advocacy team worked diligently to retain the strategic use of these agreements for our members.

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LCRCC Testifies on Global Warming Solutions Act

On Thursday LCRCC testified on H.688, the Global Warming Solutions Act. The bill would create the ability for a citizen to file suit against the Vermont Agency of Natural Resources under an amended Rule 75 if they feel the Agency did not adopt rules to address climate change quickly enough or if the State misses greenhouse gas emission goals at years 2025, 2030, and 2050. LCRCC made the case that the bill should weigh different factors to define success instead of defining targets strictly on emissions mitigation targets. We also stressed the importance of making legislative intent very clear, given that the legislation is designed to potentially trigger a court decision.

LCRCC Testifies on Homeless Bill of Rights 

The House Committee on General, Housing, and Military Affairs is considering H.492, a bill creating a homeless bill of rights that would add “housing status” as a protected class under Vermont law. LCRCC engaged in conversation with the Committee Thursday to better understand the legislative intent and hear what the bill is aimed at doing. The committee offered that the bill is an attempt to destigmatize a demographic of Vermonters and would not affect businesses’ ability to deal with bad behavior at their establishments.

Commercial Cannabis Bill Moving 

On Wednesday, the House Ways and Means Committee added their contributions to a bill that would create a commercial cannabis market in the state. The committee settled on a tax rate of 20% for cannabis products; a 14% excise tax and a 6% sales tax. The final tax regime is a departure from conversations up to this point which would have included a local option tax for municipalities who host cannabis businesses; the latest version does not. The revenues from the regulated market are expected to be about $13 million over the first 4-years of a legalized market; about $8.9 million of that would go to the state’s general fund and about $3.8 million to the education fund.

Senate Considers Banning Plastic Toiletries in Hotels 

The Senate Committee on Natural Resources and Energy is considering S.227 which would prohibit  stocking single-use bottles of toiletries in lodging establishments in the state. LCRCC testified before the committee that many in this sector who have reached out to our team are already working towards phasing out these products, however, much more time is needed. We also brought to their attention that there are health and safety concerns that need to be considered.

The Laundry List

  • The House Ways and Means Committee continued their discussion of tinkering with the corporate tax system in Vermont and this week considered doing away with the bank franchise tax in favor of including banks in the corporate income tax. Since the state switched to Market Based Sourcing last year, they hope that banks paying the corporate income tax would capture money from out of state banks.
  • The Senate President Tim Ashe told reporters this week he hopes to “announce what its path is, either a vote on an override or a replacement bill” for S.37, the medical monitoring bill. 
  • The Senate Committee on Health and Welfare is considering S.181, an act relating to access to employee restrooms for individuals living with an inflammatory bowel disease. 
  • The Senate Committee on Education heard from Joint Fiscal last Friday that S.271, a bill that would provide free tuition for qualifying students at Vermont community colleges would cost $5.9 million in its first year and $6.8 million in subsequent years, not accounting for inflation. 
  • The House Committee on Government Operations took initial testimony on S.47, which would ban businesses from donating to Vermont political campaigns or parties. VPIRG, which just started it’s own PAC and the Vermont Progressive Party testified that they largely supported the bill. 
  • A Transportation Climate Initiative public information session scheduled for Thursday night in Burlington was postponed. We will have more information in a future update. 

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

We look forward to working with you this session.
The Lake Champlain Regional Chamber of Commerce Advocacy Team

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Tom Torti, President
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Cathy Davis, Executive Vice President
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Austin Davis, Government Affairs Manager
Thank you to this week’s sponsor of the Legislative Update: