Vermont Legislative Update Week 15 | Downs Rachlin Martin PLLC


[co-author: Jessica Griswold]

The Senate adopts the budget

On Friday, the Senate approved the $ 7.17 billion budget for fiscal year 2022, H.439. Senate Appropriations Chairperson Jane Kitchel D-Caledonia called it “the most complicated budget I ever had to prepare while in the Senate” due to the flood of federal aid in Vermont for coronavirus relief and an unexpected amount of $ 211 million. excess income.

The bill spends $ 478.5 million in federal American Rescue Plan Act funds, while incorporating only part of Governor Scott’s ARPA spending proposal. Kitchel said the governor’s plan did not focus enough on the legislature’s funding priorities, including the service delivery structure, court reopening and higher education needs. Scott had asked the legislature to put all ARPA spending in a separate bill. Kitchel rejected this request, instead placing all ARPA spending in a designated section of the budget bill.

Highlights of the budget include:

ARPA expenses:

• $ 20,000,000 to the Agency for Trade and Community Development
• for economic stimulus grants;
• $ 11,000,000 to the Trade and Community Development Agency for the remediation of brownfields;
• $ 11,000,000 to the Ministry of Economic Development to fund priority capital projects statewide, as identified by regional development corporations or land use planning commissions, or both;
• $ 1.5 million for EMBRACE grants;
• $ 101.8 million for broadband;
• $ 500,000 to the Education Agency for local grants
• education agencies for the purchase of locally produced food;
• $ 2,000,000 in fiscal year 2022 to the Ministry of Labor to
• apprenticeship programs; and
• $ 5,000,000 for free last dollar tuition for one year
undergraduate studies for critical professional careers.

General fund expenses:

• Reserve from the General Fund of $ 150 million for the underfunding of pensions and $ 200,000 for a working group on pensions created to make recommendations for the next legislative session;
• $ 2.7 million to increase the Reach Up benefit to the 2021 requirement standard, an increase of $ 132 per month;
• Core funding to address the backlog of court caseloads due to the pandemic;
• Single credits from the General Fund to consolidate several special funds, including forests and parks and Law 250; and
• $ 9.5 million for the Environmental Contingency Fund, of which $ 4.5 million is allocated for PCB testing in schools, in addition to the $ 500,000 from the General Fund dedicated to the Ministry of Health of Vermont for PCB testing in schools.

House Commerce plans to amend Unemployment Insurance Bill

The controversial unemployment insurance bill, S.10, left the Senate with a new dependent benefit of $ 50 per month for UI recipients, but no adjustment to the UI trust fund formula. Companies have requested the adjustment to account for the pandemic, which has created an anomaly that will increase taxes on employers’ unemployment insurance.

House trade committee plans to strike all amendment that would take 2020 out of the formula. The rate schedule would probably move to schedule 3 next year, schedule 4 for the next two years, and then start to decline. While companies would pay a little more in the short term than they would under a Schedule 1 rate freeze, they believe it is preferable to the wording adopted by the Senate.

This committee was also the subject of an in-depth review of the newly passed child care benefits in the American Rescue Plan Act of the Joint Fiscal Office. The Senate Economic Development Committee added dependent support of $ 50 before these new benefits were made clear to lawmakers. In light of this development, the House Commerce Committee proposed to remove the benefit.

Senate committee cuts money for economic development

H.159 became the session economic development bill for targeted project expenses. As passed by the House, the bill contained one-time appropriations of ARPA funds for tourism and marketing, UVM’s engagement office, federal assistance in drafting grants for industries technology, a BIPOC business development project and money for downtown revitalization projects.

Responding to instructions to limit the budget from the Senate Appropriations Committee, the Senate Committee on Economic Development, Housing and General Affairs took a scalpel at the House’s version of the bill, slashing spending significantly. Reduced credit sections:

• Tourism and Marketing – Reduction from $ 2.5 million to $ 2 million.
o $ 1.25 million for out-of-state direct marketing.
o $ 750,000 to local chambers to design consumer incentive programs.

• Technology-based economic development – reduced from $ 3 million to $ 1.8 million.
o $ 200,000 for federal grant writing assistance.
o $ 400,000 in matching grants for businesses that receive federal grants.
o $ 200,000 for a research partnership program with industry.
o $ 1 million to UVM to complete the start-up of the Office of Engagement.

• Better Places Program – reduced from $ 5 million to $ 1 million.
o Subsidies to municipalities for the creation of dynamic spaces.

• Microenterprise Development Program – reduced from $ 2.2 million to $ 1.5 million.
o Increase of $ 200,000 in base funding.
o $ 1.5 million to help new micro-businesses affected by Covid-19.

The bill retains the initial appropriations for a start-up capital fund for entrepreneurs, a study on the post-secondary career and the state technical education system, awareness-raising and technical assistance for companies belonging to BIPOC and an international business attraction and investment program.

The committee is still considering adding Bridge grants for economic recovery and Capital investment grants sections of the bill.

Transmission bytes

Economic stimulus grants – While the governor said there was $ 500 million in unmet business needs related to the pandemic, lawmakers put forward only $ 50 million proposed for a new round of grants. The Senate Economic Development Committee recommended using $ 20 million this year and $ 20 million next year. The Senate’s appropriation brought it down to just $ 20 million this year. The Senate Economic Development Committee heard from the Vermont Lodging Association, the Vermont Association of Wedding Professionals, the Lake Champlain Chamber and the Vermont State Chamber talk about the need for additional funding. They shared their suggested grant criteria that would include six months of fixed costs with a cap of $ 300 million. Senators will have more discussions in the coming days to determine how to allocate the funds.

Taxation of PPP grants – The House Ways and Means Committee continues to examine the issue of the taxation of federal payroll protection program grants 2021. If the legislature does not allow a state link to recent tax changes federal grants will be taxed. Additionally, low-income Vermonters will lose enhanced benefits under the Working Income Tax Credit and the Child and Dependent Care Credit.

Broadband – The Senate Finance Committee continues to reflect on the creation of an authority to guide the efforts of the State towards universal broadband coverage. As adopted by the House, H.360 would create the Vermont Community Broadband Authority, an independent body to coordinate the construction of the Vermont communications union districts. Community-led CUDs would be responsible for providing universal access to broadband broadband. To address concerns about expertise, timeliness and accountability, the Senate finance ministry is considering a different approach: creating an executive director or deputy commissioner position within the civil service ministry. Members of the Committee generally agree that while the provision of broadband access is a fundamental obligation of government, this responsibility should remain with public bodies.

Guidelines for Transition Grants for “Idle” Businessess – The legislature has allocated $ 10 million in American Rescue Plan Act funds to provide grants to businesses that have not received prior financial support from the state or federal government. The Trade and Community Development Agency published the bridging grant guidelines. Businesses that have received small amounts of federal assistance in the form of P3 grants may be eligible if the $ 10 million allocation is not exhausted.

Restart the courts – The Senate has proposed $ 16.4 million in ARPA one-time funds over two years for investments in the justice system that will allow the courts to begin operating in person. Courts have been closed since the start of the pandemic, with limited options at a distance, resulting in a significant backlog of civil and criminal cases, including child support and evictions. “When you don’t have a trial, you don’t have regulations,” one senator commented about the backlog. The bill also authorizes six-person juries in civil cases.

PCB testing in schools – The Senate has proposed $ 4.5 million for indoor air quality testing for PCBs (polychlorinated biphenyls) in public and independent schools. No funding has been set aside for remediation. The costly problem of PCBs in schools became well known when Burlington High School was forced to close its doors due to high levels of PCBs. The state then had to spend $ 3.5 million to renovate a closed Macy’s store in downtown Burlington to allow for in-person learning. Reclamation of the Burlington High School site could cost $ 7-12 million and still cannot reduce PCBs to approved levels. The authorities are now considering a complete dismantling of the building.

Amending Law 250: the next three weeks – This week, lawmakers continued to discuss and collect testimony on H. 120, a bill that would update Law 250. The bill attempts to tackle climate change with a revised capacity and development plan, a newly delegated oversight authority for district commissions, and proposed changes to district commissions. authorization criteria. Many of the changes to the bill’s criteria follow recommendations from the legislation the General Assembly worked on last year. The administration’s proposals to restructure the governance of the Natural Resources Council and grant exemptions to designated city centers, villages and neighborhood development areas have not yet been considered by the committee.

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