Issues

As has led the Vermont politic news over the past two months, the legislature and Governor Phil Scott are at an impasse with regard to the Fiscal Year 2019 State Budget and a potential 5.5 cent statewide property tax increase to pay for K-12 education.

To be clear, for the second year in a row, I voted for the FY 2019 State Budget as it passed out of the House of Representatives.  It is a responsible budget that increases slightly the spending over last year, while making some small investments where needed, and protecting the most vulnerable.  Additionally, for the second year in a row, it doesn't rely on any new or increased taxes and fees.

That said, a challenge has arisen with regard to the State Budget now, as it is now incorporated with a tax bill, which if approved now, would increase property taxes on all non-residential property by 5.5 cents.  This increase is unacceptable to Governor, so he has vetoed the budget ... twice.

Like many, I am disappointed that we remain at this impasse.  But this potential 5.5 cent increase on non-residential properties is not just a tax on second-homeowners and non-residents.  In fact, 57% of the non-residential property in this state is owned by Vermonters.  This kind of tax increase - at a time when we have revenues coming in well above target - is not something that should advance.

Now that we are near the end of the Fiscal Year, however, I am very hopeful that the legislative leadership will finally sit down and negotiate in order to come to a resolution that will ensure this tax increase doesn't go into effect.

All of this said, I will reiterated my oft-repeated concerns about education funding:  it is exceptionally disappointing that we are in this position year year in and year out.  For years, it has been clear that the education funding system is broken and beyond repair, unsustainable, and unfair.  Yet, throughout that time, legislature after legislature, and administration after administration have failed to advance any meaningful reform to the system.  In this regard, we have continued to fail the people of Vermont, and we end up in the situation in which we have founds ourselves now. 

You can be sure that I will continue my effort in this regard on behalf of the community of Stowe, and of all Vermont families and businesses.

With regard to budgets in general, we have begun these last two years to put into place sustainable and responsible state spending, and I have been pleased to have been able to vote in favor of the budgets.  With louder and louder calls for increased spending and new state programs, however, we must do all we can to ensure the trend we have begun continues.

Rest assured, I will also do all I can to ensure that happens.

I have spent much of my time over the past twelve years advocating for greater attention to, and investment in, our state’s economic growth.

And, while I'm proud of my achievements over that time, I have found that far too often, the health of our state's economy is on the back burner when it comes to legislative priorities.  This has begun to change with the leadership of Governor Phil Scott, there is still a great deal to do.  We must make economic growth a legislative priority each and every legislative session.

A Few of My Successes in the 2017-2018 Biennium

 Much-Needed, Overdue Changes to our Beer Franchise Laws

I happily led this effort to modify our beer franchise laws in order to provide to our small, craft breweries relief from some of the burdens of Vermont's franchise laws.  After all, craft brewing is a thriving sector of the Vermont economy, and a significant source of jobs.  This bill will allow those craft brewers greater opportunity to get their product to market. 

Free Tuition Program for Members of the Vermont National Guard 

After three years of effort, the committee on which I serve in the House was successful in moving forward a program to provide higher education tuition benefits to the Vermont National Guard.  This tuition benefit - which will kick in after any GI Bill benefits have already been exhausted - is not only an important economic investment to support our National Guard members and their families, but it is absolutely critical to ensure our recruiting needs are met.  As the only state in the area without these kinds of benefits, we have been at a significant disadvantage with regard to recruitment.  Simply put, our recruiting is not keeping up with the needs of the Guard.  In fact, from what I understand, the goal is to recruit 300 non-prior service recruits per year.  Yet in 2013, that number of 248; in 2014 it was 219; in 2015 it was 190; and in 2016 it was 173.  This tuition benefit will, undoubtedly, turn this trend around.

Successfully Fought a Bill That Would Have Had a Dramatic Impact on our Incredibly Important, Statewide Outdoor Recreation Industry

The legislation (S. 105) would have mandated a "rebuttable presumption" of anti-consumer intent in all instances in which there is any limitation of a claim in a contract; essentially, that the 5 items listed in the bill would be considered "substantively unconscionable" when included in a contract.

What this change does, in a nutshell, is open up the door to a much wider array of legal claims - specifically very costly lawsuits, consumer fraud claims, and fine, in addition to the potential of costly increases in a business' liability insurance.  In the cases of the many recreational activities offered in this state by the thousands of non-profit and for-profit . provided - biking, skiing, horseback riding, fishing, boating, golf, etc. - this means that those who offer those activities may not be able to include in their contract some of the important waiver conditions that have historically been in their contracts.

The importance of these kinds of waivers in the outdoor recreation industry cannot be overstates, and the Vermont Outdoor Recreation Economic Collaborative outlined well this importance in testimony presented to the committee of jurisdiction:

"Waivers are an integral aspect of Vermont's recreational landscape.  Ski resorts, guide services, trail-based organizations, recreation event providers, environmental and educational programs, college outing groups, land owners, and summer camps all use waivers for protection under the law when a participant in an activity has agreed to assume the associated risks.  These entities depend on strong legislation to help them enforce waivers."

"States like New York, Connecticut and Illinois, have proposed model consumer bills similar to S. 105, which have not passed.  New Hampshire and Colorado, states like Vermont that are highly dependent on recreation, have passed language to enforce waiver forms and strengthen inherent risk laws."

"Meanwhile, Vermont has failed to provide legislative protections for recreation providers.  Further, this bill makes it easier for participants to sue and harder to recreation providers to secure liability insurance."

 

Additional Successes In Recent Years

2015 Economic Development Bill

Led by me in the Commerce and Economic Development Committee, this law included the following:

  • Necessary changes to the Vermont Economic Growth Incentive to ensure more Vermont companies are able to take advantage of this program that has more than proved its worth in helping to create jobs;
  • The elimination of the sales tax on prewritten software accessed remotely (cloud tax);
  • A first0time home-buyer downpayment assistance program to help young professional around the state into home ownership through the creation of a revolving loan fund
  • An economic development branding and marketing initiative to complement and supplement our tourism marketing efforts - including a $200,000 appropriation to create and implement it;
  • A Vermont-Quebec Initiative to recruit and expand into Vermont, Canadian businesses interested in a US location - including $100,000 appropriation to fund the program; and
  • An increase in our Licensed Lender limits from $75,000 to $250,000

2014 Comprehensive Economic Development Bill

Led by former Representative Paul Ralston (D-Middlebury) and me, this law included the following:

  • The creation of an Entrprenuerial Lending Program that will allow for greater access to capital for start-up and growth-stage businesses;
  • The creation of a Domestic Export Program that will provide technical assistance to our state's producers and help them connect to brokers, buyers, and distributors in other state and US regional markets;
  • The creation of a One-Stop Shop for businesses;
  • the creation of a de minimus exemption from Vermont's licensed lender laws for a person who makes three or fewer loans in and three year period; and
  • A Public Service Department examination of our state's electricity rate structure and design, and a requirement that the Department bring to the legislature proposals that would ensure greater business competitiveness for our state's manufacturers.

 

For the past 12 years, I have vigorously advocated for education reform and property tax relief. Time after time, I have tried to educate my colleagues on the unfairness and unsustainability of the current system, and have pleaded for comprehensive reform. Yet, time and again, my pleas have been dismissed by the legislative leaders.

Interestingly, this past biennium started out quite differently.

In fact, for the first two months of the session, I commended the Vermont House leadership and the Ways and Means Committee for working earnestly on meaningful reform to our education funding system in order to create a sustainable system and provide long-term property tax relief to Vermonters.

Specifically, as they were developing their initial proposal, one of the stated goals was to connect more Vermonters, better, to their spending decisions - a goal I have had through my years in the House.

I was very sorry, therefore, that the bill that eventually emerged from the committee and passed the House was a shadow of its former self, in that it did little to nothing to either reconnect people to their votes and spending decisions, or bring property tax relief to Vermont families and businesses.  For that reason, I made a valiant attempt on the House floor to make substantive changes to the education funding system that would have done both of those.  While that amendment was defeated, I was pleased that it garnered the attention of House members and provided greater opportunity for those members to learn more about the flaws of our current system.

In the end, as the tax bill progressed through the end of the session, the meaningful education funding system reform for which I had hoped never materialized.

So, where do we go from here?

I believe strongly that having more Vermonters better connected to their education spending decisions is the only way we will be able ensure spending sustainability and long-term property tax relief.  I am also hopeful that the discussions we had this past year in the House will lead to more agreement and understanding that the system is broken and beyond repair.  More importantly, I am hopeful it leads to the realization that the only way we will achieve true sustainability in the program and long-term property tax relief is to create a system in which more Vermonters are connected, better, to their spending decisions; that as many Vermonters as possible have skin in the game - even the modest amounts I suggested in my amendment.

Rest assured I will continue my vigorous advocacy for just that in the 2018-2019 legislative biennium.

My long, and sometimes lonely, quest to establish an Ethics Commission and develop a conflict of interest code of conduct for elected and appointed officials in Vermont finally came to fruition this year.

As background, in July 2013, the Telecom Czar appointed by Governor Peter Shumlin resigned to take a senior position with VTel, a company that had received $8.5 million in state funds in the two years this person was a voting members of the state board that authorized the funds.

In February 2014, a sitting Democratic legislator was hired as a director of a special interest group having just led the passage of the organization's legislation the prior year.  Her responsibilities as a new employee (while she was also a legislator) were to work with lobbyists to prepare for any future legislative action.

And, in March 2014, the Vermont House Majority Whip, a Democrat, resigned mid-term to become executive director of a single-payer health care advocacy organization.

While in my mind, and the mind of others, these - and other similar instances - raised significant ethical questions perceptions of conflicts of interest, there was no support in Montpelier for putting into place an independent ethics commission or code of conduct for our elected and appointed officials.

Yet, I continued my quest anyway - year after year!

After all, we hear over and over again the distrust the public has for politics and politicians.  While politics should be regarded as a noble profession, as it is a critical way to ensure government works for the people, it has been reduced, with good reason in many cases, to the butt of late-night talk show jokes.

While ours is a small state, and our public officials are very accessible, that does not mean that transparency and accountability are always present.  And, it certainly doesn't mean that conflicts of interest don't arise.

Instead of Vermont leading the way in this regard, though, we were far behind most states.  We were one of only five states that did not have an Ethics Commission, and was last ranked 37th in government integrity from the Center for Public Integrity.

I was very happy, therefore, that in 2017, the Vermont House and Senate passed its first Ethics Bill.  And the Governor happily signed it.  While the final piece of legislation is not all I had hoped for, it is an important first step to ensure accountability and transparency in our government.

Through the last decade or so, I have been leading an effort - working with colleagues from across the political spectrum - to bring our labor laws and regulations into the 21st Century.

As background, as both native Vermonters and Vermonters by choice know well, our state has a long tradition of independence.  One manifestation of that independence throughout the years has been in work.  For greater flexibility and autonomy, and greater control over their destinies, many Vermonters have chosen to work for themselves, and be what we now call independent contractors.

Over the years, this style of work has sometimes come into conflict with various labor laws - specifically in workers' compensation and unemployment insurance - because of how we in Vermont, define employer.  In the past, this conflict has mostly arisen in the construction industry with general contractors hiring subcontractors to do specific parts of the job.  The Department of Labor (or the hiring entity's insurance company) then determines through an audit that the subcontractor should have been classified as an employee.

To be clear, the goal has always been to ensure that businesses are following the laws and that employees are being treated fairly; that when an individual works for somebody, and is, in fact, and employee, that person is employed as such by the business and covered under workers' compensation and unemployment insurance.

However, this conflict has recently reared its head in our new economy.  The 21st Century economy is fast-growing, but is very different, Instead of the traditional economy of an employer with many employees, in many ways, it is an independent workforce coming together to collaborate on projects.  Couple this with the sharing economy, and we have a new kind of independent workforce around which we must tailor our laws.

Every state in the country is trying to address this issue, but I would like Vermont to lead the charge.  If we can position ourselves as the place to come to work both independently and collaboratively, and do so successfully, we can attract this new workforce and start to address our significant demographic challenges.

I am really pleased to report that in 2017, we started to do just that!

Through both a unanimous decision from the Vermont Supreme Court and a Guidance Document released a bit later by the Department of Labor, we have begun to open the doors wider for the independent workforce.

In June 2017, the Vermont Supreme Court, in Bourbeau Custom Homes, unanimously ruled that a single-members LLC could not be classified as an employee for the purposes of Unemployment Insurance.

To be clear, this decision was limited to Unemployment Insurance, with the Court specifically saying "We need not decide whether any of these individuals are employees of Bourbeau for other purposes, such as tort law or tax law."

That said, many of the arguments used by the Court in making the determination would hold true in the Workers' Compensation program as well.

The Vermont Department of Labor clearly realized that as well, so released a Guidance Document, "Workers' Compensation Best Practices When Hiring an Independent Contractor."

Like the Supreme Court decision, this Guidance Document opens the door to allow greater flexibility and greater opportunity for the independent, creative, collaborative workforce in Vermont.  Importantly, it also provides some critical best practices for businesses when they hire a LLC, Corporation, Sole Proprietor, or Partnership.

If you pay an individual to perform work for your business, you are required to provide workers' compensation insurance for that individual unless:

You can demonstrate the individual is covered by his/her own workers' compensation policy

OR

The individual is a member, manager or executive officer of a Corporation or LLC registered with the Vermont Secretary of State's office or with another State

AND

The individual has filed an exclusion using Form 29 with the Vermont Department of Labor and had it APPROVED

It should be noted that if a hiring entity is not responsible for workers' compensation coverage, it is potentially civilly liable for injures to its independent contractor and the possible civil damages may be considerably costlier than worker's compensation coverage.