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Legislative Update – Week 7

This week’s Legislative Update is sponsored by:

February 21, 2020

Town meeting week is in sight. The first week in March, during which the legislature takes recess serves as a safe refuge for all fatigued by the 8-weeks of the legislative session before. This year, that break might be needed more than most as members nurse the wounds still sore from a failed veto override and try to recover from the frantic pace the building has adopted as large pieces of legislation loom near. This week was an oddly quiet week as committees plugged away at long-held priorities and House leadership tried to corral the votes needed to override the Governor’s minimum wage veto. However, the calm can’t last long, as next week committee chairs will push to wrap up longstanding projects before the town meeting week recess.

Much of this week’s newsletter is dedicated to Act 250 given the momentous changes proposed and the program’s impact on the state. Also in this week’s update;

Act 250 Reform Takes its First Steps Outside of Natural Resources Committee  

On Thursday last week, the House Committee on Natural Resources, Fish, and Wildlife passed their signature Act 250 reform bill which has been long-awaited. It ended not with a bang, but more of a whimper; the bill was voted out 6-3-2 and it is very likely the two members absent would have voted against the proposal. 

The work on this bill is far from over, as the bill was worked on this week by the House Committees on Ways and Means to discuss the fees and cost. This is no small issue, as the bill dramatically increases fees and offers broad bill-back authority to charge developers for staff time and experts. LCRCC testified in this committee that there is a disconnect throughout the discussion between all the applied costs to development and the eventual cost of renting a space created through Act 250.  

The House committees on Judiciary, Appropriations, and potentially Commerce and Economic Development will need to review the proposed changes before the bill could make it to the floor. If it survives a full vote from the House, it might not have the warmest welcome in the Senate which will be left with little time to review and make substantive changes. 

A high-level overview can be read below and the full bill can be read here.

Act 250 Overview: 

  • The bill centralizes more authority in a more professionalized, full-time three-person Natural Resource Board that handles major cases which make up about 20% of all cases that go through the program. The Board is accompanied by two members of the district commission from which the major case is located, who will have full voting authority, to ensure a level of local input.
    • Appeals to the Board’s decisions would no longer go to the Environmental Court and rather go straight to the Supreme Court. The Environmental Division of the Superior Court would continue to hear other permit appeals and enforcement.
    • The new board will cost somewhere between $500,000-$750,000 to operate, which is why fees have been increased (more below).
  • The nine District Commissions would still retain authority over minor cases, which are about 80% of the case of the program, and the per diem of District Commissioners are increased from $50 to $100. 
  • Language was added revising the statutory authority on the use of other permits to demonstrate compliance with Act 250 criteria, however, the bar was also lowered to rebut those presumptions.
  • Fees increase under this proposal from $6.65 to $9.65 for each $1,000 of the first $15,000,000 of construction costs and the NRB and other agencies can bill applicants for staff time and for outside experts hired during Act 250 permit process.
  • The bill attempts to make it less difficult to develop in Designated Downtown and Neighborhood Development Areas by removing them from Act 250 jurisdiction, however, it does also provide an avenue to appeal designation decisions.
  • Restrictions are increased in a variety of ways;
    • Elevation thresholds are lowered from 2,500 to 2,000-feet – this adds an estimated 400,000 acres into Act 250 jurisdiction – see map here.
    • A new trigger for commercial or industrial construction or improvements within a 2,000-foot radius of a highway interchange was created.
    • Amendments made to protect forest blocks such as a 2,000-foot road rule were also added to the program.
  • New criteria were added relating to;
    • Environmental justice – requiring that in addition to other criteria, “no group of people or municipality will bear a disproportionate share of the negative environmental consequences of the development or subdivision.”
    • Climate adaptation – in addition to other criteria, a project needs to meet and “building orientation, site and landscape design, and building design that are sufficient to enable the improvements” to adapt to climate change.
  • Many criteria were amended including transportation, energy conservation, and public investment.
  • Capability and Development Plan Findings will be adapted to include ecosystem protection and GHG emissions. There is also a study in the bill to better understand how the CDP and maps can be better used.
  • The bill requires that, to be used in Act 250, local and regional plans must be approved as consistent with the statutory planning goals and clarifying that local and regional plan provisions apply to a project if they meet the same standard of specificity applicable to statutes. The bill establishes a pre-application process to allow municipal and regional planning commissions to weigh in on a project before the Act 250 permit application is filed.
  • A new process is created that would allow properties to be released from Act 250 jurisdiction; meaning a permit can be extinguished for change of use or zoning changes.
  • Air and water pollution criteria were split into three criteria. Air was expanded to include air pollution, such as air contaminants, greenhouse gas emissions, and noise. Water was split into water and water systems.
  • Clarifying the definition of “commercial purpose” so that it is not necessary to determine whether monies received are essential to sustain a project. This was previously defined by rule and case law.
  • The bill stops short of including river corridors in criteria and instead changes the scope of ANR’s Rivers program and requires ANR to create a permit for Highest Priority Rivers.

Internet Service Tax Language Changed 

The House Committee on Ways and Means created new, draft language to apply to Software as a Service which potentially expands what might be covered. The new language is aimed at “vendor-hosted prewritten computer software” which it defines as “prewritten computer software that is accessed through the internet or a vendor-hosted server regardless of whether the access is permanent or temporary and regardless of whether any downloading occurs.” If this concerns you, we’d suggest contacting your legislators. 

Bill Seeks to Increase Utility’s Renewable Energy Purchases 

The Senate Committee on Finance considered this week a bill aimed at increasing the Renewable Energy Standard, or RES, that the state imposes on utilities. Currently, under the RES adopted in 2015 utilities are expected to procure 75% of their energy from renewable energy by 2032. An additional Tier II requirement currently requires that 10% of that energy comes from small-scale, in-state renewable energy projects. Under the language in S.267, the overall RES would increase to 100% and the Tier II requirement would be doubled to 20%. Green Mountain Power told the committee that they can handle an increase in the RES to 100%, however, an increase in Tier II would be prohibitively expensive, costing ratepayers an additional $15-25 million per year. 

VEGI Comes Under Continued Attack 

Over the years the Vermont Economic Growth Incentive program has been an easy target for politicians whose rhetoric is borrowed from other states and the national scene, though not tailored for Vermont. The program provides incentives to larger employers who grow their payroll in the state. The House Committee on Ways and Means has been discussing H.640 which would require the Vermont Economic Progress Council to disclose confidential information about businesses that receive grants through the Vermont Economic Growth Incentive program.

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 Laundry List

  • The State House was a-buzz this week with speculation and rumors of when the Speaker would bring a veto override of the minimum wage bill to a vote and pressure on House members to fall into party lines. The bill was procedurally fine for a vote on Wednesday, however, it was delayed and indicators point to a potential vote when the House reconvenes Tuesday. 
  • The House voted 105-37 last night to pass the Global Warming Solutions Act, well above the 100 votes needed to override a veto, though there was no indication one might come. 
  • LCRCC testified in House Ways and Means in support of Federal Changes made to 529 plans which would help Vermonters with substantial student loan debt pay it back. LCRCC presented our case that the issue of student debt is a sleeper issue with a significant impact on the state’s financial health, workforce, and housing market in the next 15-years. 
  • Tri-partisan support exists for a bill that would meet unwanted robocalls with criminal penalties.

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: