Meadow Hill View
2023 Session Summary
Below is a summary of legislation of interest to Meadow Hill managed non-profit trade associations.
The Office of Legislative Counsel has prepared a summary of all legislation passed in 2023 here.
Lawmakers returned to Montpelier on June 20 for a special veto session and adjourned less than eight hours later. A two-thirds majority in the House and state Senate voted quickly to enact five bills vetoed by Governor Phil Scott, including the 2024 budget, an $8.5 billion spending plan. Governor Scott’s veto of a 0.44% payroll tax to fund a $120 million in child care program was also overridden. The tax increase takes effect next year, on July 1, 2024. Employers are required to cover at least 75% of the new tax. The Vermont Chamber has created a "Payroll Tax Calculator" so working Vermonters can better understand how this new payroll tax will impact your bottom line.
The state Senate failed to override the Governor’s veto of another key priority of Democratic leadership: a pay raise for lawmakers. The legislation (S.39) would have boosted their weekly pay to $1000 in 2025, $1100 in 2026, and $1210 in 2027. It also included rooms and meals compensation, professional development reimbursement, adjournment pay, and state employee-level health care benefits. The pay and benefits package added up to about $50,000 per legislator, per year. But it will not become law as supporters were one vote short.
The legislature overrode Governor Scott’s veto of the "Affordable Heat Act” in May. Sometimes called a Clean Heat Standard (and now officially known as Act 18 of 2023) the law is an attempt to get Vermonters to use less fossil fuel for heat, hot water and cooking. The Clean Heat Standard (also called the Affordable Heat Act) requires heating fuel sellers to sell less heating fuel or else pay someone else to get Vermonters to use less. The Vermont Public Utility Commission is tasked with registering every fuel dealer, collecting data on every gallon that is sold and creating a “clean heat credit marketplace.” A "clean heat credit" is earned when something is done to reduce greenhouse gas emissions in the thermal sector. Nearly ever fuel dealer in Vermont will need them, but it isn’t known how many they'll need and how much they’ll cost. While the work designing this policy is now underway, no payment is required by fuel dealers until the Vermont Legislature gives final approval in 2025. Oilheat and propane dealers can avoid making any payments if they buy, barter or earn credits for helping Vermonters reduce greenhouse gas emissions. Heating fuel and service companies can already collect credits. It is not clear what they're worth or how many will be needed until the CHS is fully designed, but they can be claimed now. The law allows them to be earned retro-actively as of January 1, 2023. These credits could include sales of renewable liquid and solid fuels, weatherization, more efficient heating equipment, wood stoves and the installation of electric heat pumps.. Click here to watch a one hour seminar from the 2023 Vermont Energy Conference called "Vermont's Affordable Heat Act...Explained."
The Governor did sign Vermont’s biggest transportation budget ever. The legislation (H 79) spends $851 million over the next twelve months. Much of the money comes from the federal government. Over $140 million for paving projects, covering more than 450 miles of improvements. It includes $18.2 million for bicycle, pedestrian, and transportation alternatives program funding, going to 55 construction projects and the design of 37 additional projects across 77 Vermont communities. There is also $48.8 million for public transit and $43 million in rail projects. Nearly $28 million will be spent to reduce carbon emissions from the transportation sector, including expanding EV charging. The law also includes a study of a "Mileage Based User Fee.” It also requires “work towards collecting a fee” on electricity dispensed though public electric vehicle chargers. None of the new fees will take effect until 2025 and only after a study is done on how to collect the money. As proposed it could add about $150 to register an electric vehicle. However, doing nothing will result in Vermont losing nearly a million dollars per year in gas tax revenue as the number of electric vehicles purchased increases while sales of gasoline continue to decline.
The Governor signed legislation that aims to prevent the theft of catalytic converters. It strengthens existing law (9 V.S.A. § 3022) by limiting the number of catalytic converters that can be sold for scrap and requires those selling them to prove ownership. A catalytic converter can fetch about $850 at the scrap yard for the few grams of platinum, palladium and rhodium inside these exhaust systems, making them literally more valuable than gold. Thefts have increased by more than 1,215% since 2019, according to the National Insurance Crime Bureau.
The Department of Financial Regulation (DFR) will now investigate how insurance companies compensate the automotive repair industry. Lawmakers are requiring the study by DFR which could result in a minimum reimbursement rate for auto repairs on insurance claims. The report will also include a review of best practices in the insurance industry when it comes to how repairs are directed and disclosed, including the use of aftermarket parts.
Vermont’s “Lemon Law" has been updated to provide consumers one year following the expiration of the express warranty for new motor vehicle arbitration if proceedings are terminated because manufacturer performs corrective work satisfactory to consumer prior to scheduled hearing. The measure also eliminates the annual (or biennial) validation sticker on license plates, allows motor vehicles that are more than 15 years old (as of January 1, 2024) from needing to have a certificate of title, and authorizes the Commissioner of Motor Vehicles to issue a certificate of title for a motor vehicle without regard to the age of the motor vehicle.
One of the most successful programs to incentivize economic development in Vermont barely survived. While some lawmakers were willing to let the Vermont Employment Growth Incentive (VEGI) program sunset at the end of 2023, a coalition of advocates urged lawmakers to simplify and expand this important program. After much consideration, lawmakers extended the program for another year and agreed to discuss further in 2024.
Efforts to keep more money in Vermont by sending less to Washington, D.C. was stopped by the Democrats in the House. The legislation would have helped Vermont businesses reduce their federal tax obligation through the State and Local Taxes (SALT) deduction. Vermonters pay nearly 14% of their income in state and local taxes, which is higher than any other state except New York, Connecticut, and Hawaii. The move, which would save Vermonters $20 million in federal taxes and add nearly $2 million to the general fund was rejected by the House Democratic leaders who stated that they do not believe businesses should pay less in taxes, even when it benefits Vermont.
The legislature set aside $30 million to fund free school meals for all students in the state, regardless of income status. It will be paid by an increase in property taxes.
Vermonters will be auto-enrolled in a Roth IRA starting in 2025 if their employers do not offer a retirement plan.
A “safe collection” program for “household hazardous waste” is now law. The original version would have created a costly and duplicative recycling program for propane tanks. Propane energy advocates successfully removed re-fillable propane tanks from the regulation.
If you install, fix or fill fuel oil tanks, there are several proposed updates to Vermont's Aboveground Storage Tank Regulations. Among the changes under consideration is a requirement that existing tanks meet new tank installation standards by 2030. The proposal would also create a “yellow tag” that would allow a fuel dealer to fill a non-compliant tank under certain conditions until the end of the heating season. Click here to review a slide deck of the proposed changes from the Vermont Department of Environmental Conservation.
A significant change to the Vermont Petroleum Cleanup Fund is coming under legislation approved this year. The new policy increases the maximum reimbursement for underground storage tanks by $10k, from $990,000 to $1 million. The same $1 million threshold would apply to aboveground bulk storage facilities. The maximum reimbursement for cleaning up spills from aboveground storage tanks that are less than 1100 gallons will double if the bill becomes law, from $25k to $50k. While opposed by the Petroleum Cleanup Fund Advisory Committee, funds dedicated for cleaning up fuel spills could be spent on electric and wood heating appliances. However, according to this memo, none of the money can be spent on electric and wood heating until the fuel oil tank is removed or repaired.
The Agency of Commerce and Community Development (ACCD) approved five brownfield cleanup awards, totaling $3.97 million, to remediate contaminated sites across Vermont. Since the Brownfields Revitalization Fund opened in October 2021, nearly $11 million in cleanup funding has been awarded to 25 projects in eight counties, which are anticipated to clean up more than 42 contaminated acres and create 554 jobs and 425 units of housing.
Vermont’s decade long energy policy to increase the amount of electricity used for heating and transportation is getting another cash infusion. A pilot program that allows Efficiency Vermont spend $6 million of electric ratepayers money to incentivize electric vehicles and cold climate heat pumps has been extended another next three years
The sales tax exemption on certain wood burning heating equipment has also been extended— for one more year. Under the law, only furnaces or boilers that are used as a primary central heating system can qualify.
Legislation to address the state’s affordable housing crisis passed with little enthusiasm after the most effective measures were removed. Housing advocates had high hopes back in January that lawmakers would agree to remove some of the regulatory hurdles that add time, cost and complexity to building in Vermont. After months of debate, all that is left to the legislation known as S.100 are limited and temporary changes to Vermont’s 50 year old land use law, as well as few minor amendments to municipal zoning regulations. Instead of increasing the threshold for Act 250 review from ten housing units to 25, the legislation calls for a “study.” The law authorizes even more studies to improve coordination, reduce redundancies in state permitting and releases funds for municipal planning. But none of these things accomplish what is most needed: the removal of regulatory hurdles that make construction so expensive. Language passed by the Senate to limit the ability of towns to ban affordable fossil fuel used for heat, hot water and cooking was also removed in the final version passed by the House. Instead lawmakers added yet another study to figure out how to enforce a statewide Residential Building Energy Standard. There are a few small changes that will have a positive but limited impact on Vermont’s housing crisis. In municipalities with zoning and subdivision, the construction of four or fewer units in an existing structure located entirely within a designated center would count as one unit toward the total number of units. Additionally, developers can build up to 24 units of housing in designated areas, including a village with zoning and subdivision regulations without going through Act 250. However, this exemption is temporary. It expires on June 30, 2026. And it only pertains to a tiny fraction of Vermont’s developable land — just 31 square miles.
The legislature agreed to temporarily lift regulations on electric utilities and “related facilities” (cable, telephone and internet providers). None will be obligated to obtain an Act 250 permit until 2026 if they are rebuilding of existing distribution lines and improving reliability and service to existing customers through overhead or underground lines in an existing corridor, road, or State or town road right-of-way. There will also be a study to figure out whether this exemption helps make our wired world more resilient.
The sunset to 30 V.S.A. § 248a has been extended another three years. Under the 248a process, any businesses building a telecommunications facility can apply directly to the Public Utility Commission (PUC) rather than going through town zoning. The legislature also ordered a study to be completed by January 15, 2024 to figure out how to make the process easier for municipalities and individuals to participate in the regulatory process.
On the Wall Legislation of interest that did not pass in 2023, but could in 2024.
H 53 proposes to establish as a matter of law that a retail sales transaction of a motor vehicle is final after three days, and to prohibit a motor vehicle dealer from selling a vehicle that was traded in as part of the sales transaction until after the transaction is final.
H.9 would exempt motor vehicles, except for buses, from the safety inspection for the first 40 months after manufacture in the case of plug-in hybrid electric vehicles; from all inspections for the first 40 months after manufacture in the case of zero-emission vehicles; and from the safety inspection for the first 30 months after manufacture in the case of other motor vehicles.
H 12 proposes to make the annual motor vehicle safety and emissions inspections biennial and form a study committee to investigate the effect that motor vehicle inspections have on Vermonters with low income, Vermonters who live in rural parts of the State, and Vermonters who are elders.
S.113 would require gas stations and convenience stores that accept credit or debit card payments for the retail sale of gasoline to provide notice to the customer if they, or a third party, will place a hold on a credit or debit card payment that is for an amount larger than the actual retail gasoline purchase.
H 419 would add consumer protection measures for broadband service. The legislation attempts to promote a thriving broadband market in Vermont free of anticompetitive, unfair, deceptive, or misleading practices in order to protect the public and to encourage fair and honest competition.
H 36 This bill proposes to give municipalities the authority to use home energy rating systems for compliance with the residential building energy standards. It would also allow the Department of Taxes to share data on the fuel tax with municipalities. It would also direct the Department of Motor Vehicles to share data with municipalities related to the tax on transportation fuels. The bill would also prohibit a renewable energy project from being denied a certificate of public good solely for aesthetic concerns.
H.119 proposes to, with limited exceptions, prohibit the operation of a motor vehicle equipped with an inadequate or modified muffler or exhaust system or with an amplification device.
S.102 would expand employment protections and collective bargaining rights, ending “at will” employment. It would require severance pay for employees at a rate of one hour of pay for every 12 and one-half hours worked during the employee’s first year of employment and an additional one hour for every 50 hours worked in subsequent years. It would also prevent “electronic monitoring” of employees, something routinely done to prevent crime.
S.9 would give the state auditor permission to open the books on any private business that has a contract with the state, including those selling fuel, equipment or vehicles. This includes the examination of records and accounts.
H.101 attempts to create a Regional Transportation Climate Initiative to increase the cost of gasoline and diesel fuel. It would also add a new fees on cars and trucks with combustion engines if they don’t meet the minimum MPG standards. The bill would also take $20 million from the fund that repairs Vermont's roads and bridges (the Transportation Fund) to spend on marketing EV’s to Vermonters. The legislation would also make bus service free.
H.56 gives the Vermont Public Utility Commission (PUC) jurisdiction over the construction and operation of utility model thermal energy networks. It would prohibit the PUC from approving permits to expand natural gas service territory.
S.59 bans oil and gas heat, hot water and and gas cooking appliances from being installed in any buildings owned or controlled by the state.
S.24 requires the Commissioner of Environmental Conservation to adopt rules to implement a Low Carbon Fuel Standard for motor fuels.