SmartTranscript of Senate Appropriations – 2025-04-02 – 1:30PM

[Chair Andrew Perchlik]: I don't need one, but if some people might wanna walk through. So we okay. We're live. So it's April second, Senate Appropriations Committee. Somebody else wants The main line is. We're going through the fiscal year 'twenty six budget, which is H-four ninety three. We have Fletch Road, counsel Grady Newton to go through the language. [Grady Newton]: Thank you, Grady Nixon from the PESCO office. So, I believe the committee should have access to the document on their committee page now. This is just a bill as passed by the house, which highlights, marking, how much petitions. So as we go along, hopefully, it'll be clear when the house is out of this section. So starting on page one Wait. [Chair Andrew Perchlik]: Wait. Wait a sec. Just wanna get there. Yep. [Grady Newton]: Because sometimes you go back, and I'll miss several things. Uh-huh. There it is. Creating. Okay. Does everybody have it? Oh, yeah. [Speaker 2 ]: Oh, there is. [Grady Newton]: Only a hundred two pages. [Speaker 3 ]: Click click on one two. [Grady Newton]: Well, I cut out all the numbers, so it's shorter than it could do. Okay. I think we can get started. Great. So on page one, you'll see in sub b of section a one zero one, house added intent language. This relates to some language they added later on in the bill, regarding the expanded, e board authority, and FYI closeout. So they added intent language here just to clarify that any interim budget appropriation adjustments made shall support a priority of supporting the health, safety, and well-being of who monitors a robust education system and a strong economy. I would just note too in section a one zero one, the house pulled in capital bill appropriations. You'll see that later on the act. When that is done, the legislature typically adds in language in this purpose section, including capital bill appropriations in what's listed here. So that language would likely be added if those appropriations remain in the bill. [Speaker 4 ]: What does it do? [Grady Newton]: It just clarifies that the purpose of the bill includes making capital appropriations, not something through the use of bonded dollars. [Chair Andrew Perchlik]: Just so you know, Grady, the the the name [Grady Newton]: of your bill of your document is h has h four eighty nine. [Speaker 5 ]: Did I do it? [Grady Newton]: It's I mean, it's if on [Chair Andrew Perchlik]: the page, it says four ninety three, but it's when I want to [Grady Newton]: save it, it's it's s h four eighty nine. I think that's not [Speaker 4 ]: Okay. Sorry. [Chair Andrew Perchlik]: Yeah. For an industry. [Grady Newton]: The next change you'll see from the house this we're jumping ahead to the b eleven hundred section that begins on page six of the document. And you'll see here the reader says for fiscal year twenty twenty six based preparations and the fiscal year twenty twenty six one time preparations. That's where all the number sections are. They're just taken out of this document for simplification purposes, but the house did indeed make base of appropriations. In section b eleven hundred in sub a, one time operations agency of administration secretary's office, the house eliminated funding that was included for Ideal Vermont and technical assistance program. So you won't see that up here in sub a, but that was in the GovRec. On page seven So that that highlighted one just shows us the number in there, the paper release. Correct. On page seven, sub d, Department of Public Safety on time of preparations, the house added funds for the urban search and rescue team and removed a hundred and twenty thousand dollars from the GovRec appropriation for purchase of mobile and portable radio equipment. So that number has changed from nine hundred and twenty to eight hundred. In sub f, the house added two hundred and seventy five thousand to the Department of Forest Parks and Recreation for the purchase of a fire apparatus. [Member Anne Watson]: Can I just remind that can you contact them to come in and testify for parking round? Mhmm. [Grady Newton]: When they testified on their budget, they didn't mention this thing. So [Member Anne Watson]: then coming in and. [Grady Newton]: Yes. Quick question, Grady. On Page seven, line [Member Anne Watson]: five. [Grady Newton]: This is eight hundred thousand dollars general fund for the purpose of mobile and portable radio equipment. They didn't ask for that much originally. So the GovRec included nine hundred and twenty thousand, and the house use that appropriation by a hundred and twenty thousand dollars. There's a separate appropriation, similar language, for eighty thousand dollars that's directed elsewhere. So you'll see that later in the long time section. There's another appropriation in a much smaller amount for the purchase of mobile and portable radio equipment. So does their firearm show up later on in this? Or There is not an appropriation for that here. Okay. There's some discrepancy here then. Okay. Thank you. Because, yeah, they they testified. They said they were gonna ask for that. And then was [Chair Andrew Perchlik]: it any governor's record or nothing? [Grady Newton]: Yeah. It was five hundred for mobile equipment, for radios, and then the remainder for firearms. [Chair Andrew Perchlik]: It's the two references to mobile portable radio to [Grady Newton]: two different agencies. Right? Yes. So there's yeah. I wonder There's only eighty thousand professional wireless. For mobile radio. Correct. [Member Anne Watson]: But the firearms, [Chair Andrew Perchlik]: well, should that show up [Member Robert Norris]: in here? It does. Yeah. [Grady Newton]: It doesn't. No. [Speaker 8 ]: I'll retouch for this county. [Member Anne Watson]: Okay. Thank you. Alright. [Chair Andrew Perchlik]: Good catch, Norris. [Grady Newton]: I try. You said the Mariah. And that was not in the GovRec, from what I understand. What? The firearm, any language relating to that was not. Oh, really? Right. So it may have been it may be subsumed within that appropriation. I would just probably reach out for clarity. From the [Chair Andrew Perchlik]: eight hundred included radios and firearms. [Grady Newton]: That that's exactly I have that same question. Okay. But just wanted to clarify. The house did not take out a separate Right. Distinct appropriation relating to purchase firearms. [Chair Andrew Perchlik]: But I assume if it wasn't in the governor rent, they will just provide that and they came to testify. You could steal Baruch's copy over there if you want. [Member Robert Norris]: Oh, why don't I have one? [Chair Andrew Perchlik]: Well, no. We didn't print it out for him because it's on her two pages. [Member Robert Norris]: No. I have the I have the little one in the back of the Oh, okay. I'll steal his. [Grady Newton]: Continuing on, center lines. We're on page seven. [Speaker 5 ]: Thank you. [Member Robert Norris]: I had to get lunch and go to the ladies' room, so it took some time. [Grady Newton]: In sub e, agency of human services secretary's office. Or sorry, sub f, sub g, Department of Health. So the house cut funding for PCB testing by two hundred and forty thousand dollars, removed five hundred thousand dollars for pilot recovery campus start up, and appropriated forty thousand dollars for a grant for empty arms Vermont and three hundred thousand dollars for recovery residency certified by the Vermont Alliance for recovery residences. [Member Robert Norris]: There's no other language with that recovery residence appropriation. No. So we don't know what that means. And because there's no bill, I think, that relates to it. That's a concern. [Speaker 8 ]: Do you recall what the original amount was for the PCP testing? Four hundred eighty. [Member Robert Norris]: It was four eighty. Okay. [Speaker 8 ]: So they they did it. Correct. Okay. [Grady Newton]: On page eight, sub I, Department of Corrections, this two hundred thousand dollar appropriation to retain a consultant and develop an implementation plan to transition the Northeast Correctional Complex or the Caledonia County Board Camp or parts of either or of both to a treatment focused facility for incarcerated Vermonters. This language was recommended by the House Corrections and Institutions Committee. So the language changed from the GOVRAC and the appropriation was reduced by one hundred thousand dollars, but funds for this purpose were included in the GOVRAC. In sub j, agency education, similar thing here. The appropriation is in the same amount that it was in the GovRec language was just added regarding these funds for education transformation. On page nine, sub a, this appropriation was refused by five hundred thousand dollars. That's the five hundred thousand for the community college remote tuition advantage program. On the top of page ten, this is appropriations to the Department of Environmental Conservation. The five million dollar appropriation we see here from the environmental contingency contingency fund for PCB testing remediation was reduced by four million dollars. There's a correspondent reduction to a fund transfer related to that. So direct, that was nine million five hundred and ten thousand full spots. Also pulled in here is a fourteen point five million dollar appropriation from the cash fund for state and ask for IIJA clean water. This was pulled in from the house's version of capital, though. In sub n, DHCD appropriations, the house reduced funding for limited services and additions from the the government. So the dollar amount was reduced by half to one hundred and fifty thousand dollars to support just one limited service position. The house also reduced funding for rental revolving loan fund and the middle income homeownership development program. So those funding amounts were cut by seven point five million and five million respectively. And the house moved the appropriation to the Vermont Housing Improvement Program two point o to the one time section. [Chair Andrew Perchlik]: Senator Pro Tem, do you want language? [Grady Newton]: I do. That's right. David, [Chair Andrew Perchlik]: David, why have they stole yours? [Grady Newton]: I'll give you that. I'll go online. This is online. Right, Greg? Yes. [Chair Andrew Perchlik]: Yeah. Am I [Member Anne Watson]: right? Yeah. [Member Robert Norris]: They wanted I think I'm not getting one. [Chair Andrew Perchlik]: I would like one eventually, but [Grady Newton]: I'll go online for now. [Chair Andrew Perchlik]: So you did [Grady Newton]: get a copy [Chair Andrew Perchlik]: of the group? I did? [Grady Newton]: Oh, you because you had a copy. I got past. Okay. Continue. Musical. [Speaker 4 ]: Yes, Sharon. [Grady Newton]: On continuing with DHCD one time appropriations, on page eleven, the house included a two million dollars appropriation for the development of housing and related infrastructure and a fifteen thousand dollar appropriation for the residential universal design study committee, which is created in the house's housing bill. Could [Member Anne Watson]: you remind me what that is or [Grady Newton]: somebody reminded me? I forgot what that is, Universal Design. I believe it's intentional architectural design that it can serve a broad base of people, so inclusive of ADA and other concerns. So Kinda like architectural design more [Chair Andrew Perchlik]: kind of like that sort of [Grady Newton]: book that ACCD put out there. Yeah. More detail than that. Yeah. Okay. Continuing on page eleven, in sub o, the house removed funding for brownfield revitalization and reduced funds for the Vermont Professional Color Network by two hundred by fifty thousand dollars, bringing it to two hundred thousand. In sub p, the house moved funding for the land access opportunity board to the base and added a five million dollar appropriation to support and enhance the capacity, for the production and preservation of affordable mixed income rental housing and homeownership units. I won't go through all of this language. This is the BACB general appropriation that has been used in multiple funding bills in the past several years, and this past several BIAAs. So the language is the same language. Right. Sub q, office of the state treasurer. This is a one hundred and forty eight thousand dollar general fund appropriation for the volunteer income tax assistance program. At the top of page twelve, sub r, there are two appropriations to Diva, one eight hundred and thirty five thousand dollar appropriation for the payment reform unit, and a three million dollar appropriation for the LumCare primary care model transition. Sub s, University of Vermont, seven hundred and fifty thousand general fund was appropriated for the vegan tech hub. Sub t, Agency of Agriculture, Food, and Markets, three hundred thousand was appropriated for a grant to NOFA for the Crop Cash program, and five hundred thousand for a grant to the food bank for Vermonters eating Vermonters. Sub u, Dale, there was a two hundred and thirty five thousand dollar appropriation added for a grant to own share Vermont. On page thirteen, sub v, VSAC, there was a one hundred or one million five hundred thousand dollar appropriation added for freedom immunity grants. Sub w, there was a one time appropriation included for in the amount of ten thousand dollars for the USS Vermont support group. That appropriation, I believe, was left out from the government by error. It is typically included. I was wondering about that. Yeah. I don't oppose. I'm just what is that used for? What is that? The USS Vermont support group, I believe, sends care packages and post events for the sailors of that ship. So funds to support the namesake ship could do. [Speaker 4 ]: When we first started that center of Kitchell's, I had a family on the USS. Remember? [Grady Newton]: I should have called it the USS Kitchell. [Member Anne Watson]: I just said. [Grady Newton]: Sub x, Vermont Council on the Arts, funding was added in the amount of roughly seventy thousand dollars for state match for federal funds. Sub y, AOT, one million dollars was added for the mileage based user fee program, and one point four million was transportation fund, to direct to ACCD for programs to increase access to EVSE, charging ports. And that appropriation an appropriation for that purpose was in Act one thirteen as well. So that language is just pulling that in. Z, Department of Labor. This is two hundred thousand dollar general fund grant to Advance Vermont. Going on to section b eleven o one, fiscal year twenty twenty five closeout. The house added this language, in sub a. You'll see as part of the fiscal year twenty twenty five closeout, the Department of Finance and Management shall execute the requirements of thirty two BSA three zero eight and any reserve requirements pursuant to twenty twenty four action results number one thirteen, section d one zero three, which, would be amended by the second budget adjustment that was passed by the house. So this would ensure that the reserve requirements in three zero eight, the stabilization reserve, are met. And then the reserve requirements in d one zero three, which would be that one hundred and thirty three million dollar pop of money. Any balance remaining after meeting both of those requirements, notwithstanding thirty two BSA, three zero eight c, which would be the fifty percent split between pensions and the the rainy day fund, would reserve the remaining amounts for future appropriation to address potential federal funding shortfalls. So fulfilling some statutory reserve requirements, then setting aside the one hundred and thirty three million dollars that's being set aside with the second budget adjustment and then directing any funds that remain to be held on to for the use of addressing potential federal funding shortfalls. Additional above the one thirty three? When after fulfilling the reserve requirements. [Chair Andrew Perchlik]: And is it only to address potential federal funding shortfalls, or could it [Grady Newton]: be used for an In this language, that would [Member Anne Watson]: it would be solely to address federal funding shortfalls. Better for So I'm just checking. When you say the reserve requirements, is that the requirements for filling the reserves or the split of the pension fund? [Grady Newton]: So it it builds the reserves and then not withstands. So three zero eight c is that fifty percent of pension [Member Anne Watson]: No money will go to the pension? Correct. Okay. So that's worth flagging for. Yep. Mhmm. [Chair Andrew Perchlik]: That's the thing that we changed [Member Anne Watson]: Yeah. [Grady Newton]: The VA, and then [Chair Andrew Perchlik]: we just changed back to the new VA and [Grady Newton]: back to this one. Yeah. In sub b, in fiscal year twenty twenty six, when the general assembly is not in session, the joint fiscal committee would have the ability to make recommendations to the emergency board on transfer of funds reserved pursuant to that section or to subsection a of this section, and the emergency board would be authorized to unreserve and transfer funds to achieve the purposes of those JSC recommendations. I can yeah. I have [Chair Andrew Perchlik]: a question too back on the other one. If this if the BA with [Grady Newton]: the path, we'd have to command this language and see No. [Chair Andrew Perchlik]: Because it's it also has a year end contract. So this But I guess the new BA [Grady Newton]: is the same. This language would align with the BAA. Okay. Okay. [Member Anne Watson]: So I wanted to ask, first of all, how subsection b aligns with current law? What's what's being changed? And then second, in the second line, line nine, it says JFC may make recommendations, but then they may not. So under current law, what happens if we're out of session, it's just the eboard making decisions based on the one percent, four percent [Grady Newton]: So that that authority in statute is addressed and changes elsewhere in the bill. Oh, in the Yes. So there Maybe we'll wait till we get there. Yeah. It might it might be best to cover that section of the bill later on. [Member Anne Watson]: Am I right, though, before we leave that this is adding JFC as a party to that process voluntarily Correct. If they want to. [Grady Newton]: Correct. Okay. [Chair Andrew Perchlik]: I mean, they could make recommendations today if they [Speaker 4 ]: want. Right? [Grady Newton]: Correct. There's nothing prohibiting the joint fiscal committee too, but Yeah. This would clarify that while the general assembly is on sessions, the joint fiscal committee could make those recommendations. So spelling out [Member Anne Watson]: this The keyboard doesn't have to honor the recommendations. [Grady Newton]: Correct. So the keyboard would be authorized to unreserve and transfer funds to achieve the purpose of the joint fiscal committee recommendations, but the there's nothing in this language mandating that the e board would have to adopt those recommendations. [Member Anne Watson]: Because it so you're right. It doesn't really change anything from the current situation except maybe current The [Chair Andrew Perchlik]: only thing I wonder is the emergency fund. Because the e board right now can now reserve and transfer funds as well, so they would change their authority to this section. Because later on, it it gives them some percentages. But this doesn't change you. Correct. [Grady Newton]: B eleven o three, cash balance of capital and essential investments, the fiscal year twenty twenty six, one time appropriations. So this is language to pull in the house version of the capital bill, the appropriations that are made in that bill from the capital infrastructure subaccount of the cash fund. Does the [Chair Andrew Perchlik]: does the rest of the capital bill get pulled into your but that's since that's just bonded dollars doesn't come into the budget. So [Grady Newton]: the appropriations from the cash fund get pulled in. The rest of the capital bill does not. So you'll see there was that appropriation from the other subaccount of the cash fund in the b eleven hundred section, and then these appropriations from this subaccount, capital infrastructure subaccount are included in this section here. Yeah. What was that other? That's fourteen point five million for IOTA match. Okay. Continuing on to page sixteen, section c one zero two. This is a reduction from to the transportation fund transfer to the transportation infrastructure bond, TID fund. In the government. This was two point three million, and it was reduced here to nine hundred thousand. I would just flag for the committee that the Budget Adjustment Act also amends this section of Act one thirteen, not this particular transfer being added, but just the numbering for this would have to be updated to align with a BAA if it were to pass. [Chair Andrew Perchlik]: Can we do this every year, I assume, this transfer from the T funds and the fund fund? [Grady Newton]: There's typically a transfer from the T fund to the TIP fund. This was just reduced from the two hundred million to the nine hundred thousand. Because that's just [Chair Andrew Perchlik]: the reality of what was collected? [Grady Newton]: I believe it is to cover the one point four million dollar appropriation made in the eleven hundred for the electric vehicle charging ports. [Chair Andrew Perchlik]: That's good. Because that's supposed to come from the EV infrastructure. We do the DND fee with these eighty nine dollars to DND spot. That's where the one part four is going from. Not from the TIP. I not that we can only spend the TIP fund on. [Grady Newton]: So sorry. I not to say that it's coming from the tip fund, but the transfer to the tip fund is being reduced so that transportation fund dollars can be used for the EBSE chargers. But that other money with the business of [Chair Andrew Perchlik]: the ten fund of registration is [Grady Newton]: Correct. It's just to increase the amount available in the transportation fund for that one point four million dollar appropriation. This transfer was reduced from two point three million to nine hundred thousand, which frees up one point four million in the transportation fund. [Chair Andrew Perchlik]: Understand why we needed to free it up. [Grady Newton]: I would have to consult with our transportation analyst. Yeah. Okay. Section c one zero three. So this is where you'll see some things that look fairly familiar. This was language that was in the first version of the budget adjustment that is being pulled in here. So this is the one point eight million dollar appropriation for municipalities that were impacted by twenty twenty four flooding and twenty twenty three flooding as well. The committee will recall there's that that that that that that that that that that that an issue with Addison getting funds that they were supposed to get. So that one point eight million covered those Addison pounds and wind use affected by the twenty twenty four flooding. This also then reduces the appropriation made in the second Budget Adjustment Act to the office of the state treasurer. So the second Budget Adjustment Act added a fourteen million dollar appropriation to the treasurer for, bonds for bond redemption, and then this would reduce that appropriation to four million dollars. This also includes the appropriations to the appropriation to the Vermont Housing and Conservation Board in the amount of two point eight million to complete pilot projects identified in twenty twenty two action results number one eighty six, the developmentally disabled housing. And it adds in an appropriation to the judiciary in the amount of eight hundred and fifty thousand dollars for network security upgrades and the fifty thousand for upgrading or constructing bathrooms in the f six meeting house to comply with ADA. [Member Anne Watson]: Okay. Go construct. [Grady Newton]: So it's just an upgrade. Did you construct or upgrade? It was it was originally just construct, and I just thought it would be kind of funny to maybe they could upgrade it too. They're upgrading the network security, so I wanna get back in. [Speaker 4 ]: Is this the Vinsaluzi bathroom? [Grady Newton]: That's wrong. Yes. And they're left in what's the name of it? Vinsaluzi [Speaker 4 ]: Memorial. I'm sure it's already named. He's probably got his name on everything. [Grady Newton]: On page twenty one, section c one zero six, reserves. So this would be amending section d one zero three of act one thirteen as amended by the second Budget Adjustment Act. So the second Budget Adjustment Act reserves up to one million one hundred and thirty three million five hundred thousand for permanent housing properties actually and other uses determined in the best interest of the public. This would update that number to one hundred and thirty six million. And now it's saying that same thirty two three zero eight? Correct. Mhmm. So there are lots [Speaker 8 ]: And this is where the the split with the pensions is? [Chair Andrew Perchlik]: That that thirty two USA three [Grady Newton]: zero eight c is that split. It's not Mhmm. [Chair Andrew Perchlik]: Which with the rainy day fund is half of it, and the other half is split between teachers' health care fund and then [Member Anne Watson]: and [Grady Newton]: correct. Section c one zero seven. So this language just updated the phrasing, the construct for this this is referencing the seven million that was authorized by the e board for BGAP. Two million is now going to be used for a grant to Vita to establish a disaster relief fund. So this isn't changing any dollar amount. It's just updating the language here. And that's [Chair Andrew Perchlik]: because they just didn't I'm surprised they didn't spend all seven million dollars in. But that was two million leftover in the Deepgram. That's my understanding. [Grady Newton]: Skipping ahead to page twenty four, section b one zero one, fund transfers, and then popping over to page twenty five. So in sub f, the appropriate or the transfer to the communications and information technology fund was reduced by the house from fifteen million to ten million. The appropriation to the environmental contingency fund was reduced by four million from nine million five hundred twenty five twenty thousand to five million five hundred and twenty thousand, and a transfer was added to the domestic and sexual violence fund in the amount of four hundred and fifty thousand. [Chair Andrew Perchlik]: Yeah. For age, that was the makeup that well, shortfall if you want call that in the marriage license. [Grady Newton]: Is that the same issue? I would have to double check. I I I'm not sure that license fees are directed there. So I can't speak to a specific shortfall this year, but but those fees are directed to [Chair Andrew Perchlik]: that one. That increase in the fee. Did we extend the fee because of that fee that expires? Yes. So that [Grady Newton]: the change was the the sunset for it was repealed in the second budget, Justin. Mhmm. If you get the tax. [Chair Andrew Perchlik]: The environmental contingency fund, that reduction nine to [Grady Newton]: five business PCV school program. Correct. Skipping ahead to page twenty seven and page twenty eight, this is the reversion section. Two million additional dollars were reverted from VHFA, So that reversion appears here. Page thirty, section e one hundred. The house added a number of positions. So the GovRec did not include section e one hundred. The house adds in a permanent classified position at the office of the attorney general, one precharge administrator. This position was originally included in the first budget adjustment, and it establishes permanent classified positions. One canine head trainer at the Vermont Criminal Justice Council and adds in those positions that were included in the first budget adjustment to the Human Rights Commission, one intake specialist, and one staff attorney investigator. On page thirty one, this is language just clarifying that nine limited service positions at the Department of State's attorneys and sheriffs are authorized to continue throughout the next fiscal year. Six deputy state's attorneys, two legal assistants, and one crime victim or one victim advocate. Section e one hundred point one on page thirty one. This is community based organizations report, directing the secretary of administration to conduct a comprehensive analysis of current funding structure for community based organizations and to submit that report from the general assembly on or before January fifteenth twenty twenty six. Section e one hundred point two, directs the secretary of the administration to report on the status of federal funds to the joint fiscal committee at each of its calendar year twenty twenty five meetings and as at other meetings as requested on any reductions to federal revenues to the state and the status of any appropriations that may be impacted by such reductions. Section e one hundred point three is a further reporting language relating to ARPA funds. So the secretary of administration is directed to report to the joint fiscal committee on a quarterly basis and at the request of the committee. Sarah, I [Member Robert Norris]: I'm just jumping back to sub a on page thirty two, the report to the joint fiscal committee. And it occurs to me that and I had this conversation in committee this morning that there are federal rules and guidelines that we follow when we get federal dollars. If we don't get federal dollars, then we can begin to look at how to better, you know, maybe use state rules and guidelines, criteria. And I did talk with this is secretary of administration, but I did mention this to the agency human services, and they were very open to and I think they are looking at what what criteria we might use if we don't have the federal guidelines in place. It might make things more efficient unless owner side. That's just a comment. It doesn't necessarily fit all here, but thinking through that. And maybe we'd like to have some report back on that at the same time. [Member Anne Watson]: Okay. [Grady Newton]: Jumping back to section e one hundred point three, so this would direct the secretary of the administration to report to JFC on the status of appropriations made from the ARPA fund, and also on a quarterly basis and at the request of JFC on the status of new any new spending authority established pursuant to act one thirteen, section e one zero six. So in act one thirteen, because of the timeline relating to ARPA funds where they have to be obligated by the end of last calendar year, there those funds were, sort of swapped. Any funds that were unobligated returned to the ARPA fund to be reappropriated, and then some general fund dollars used for those ARPA related projects. So this would just be reporting on those projects, both the continued use of ARPA funds and general fund dollars being used for ARPA related projects. And then in sub d, finally, or sub c relates to those general fund dollars that they would revert to the general fund balance reserve if they remain unextended and unencumbered on July first twenty twenty seven. And it would direct the secretary of administration to report to JFC at its July twenty twenty seven meeting meeting on the amount reverted to the balance reserve. Section e one zero five, ADS communications and information technology fund transfer. This is language directing the agency of digital service to request additional funds during the budget adjustment, during its twenty fiscal year twenty twenty six budget adjustment presentation if the transfer to the CIT fund in this act is insufficient to cover the cost of transitioning billable services from a service level agreement model to a core enterprise services model, and it prevents the agency from billing back to cover those costs. So they'll just have a debt. Is that It directs them to request additional funds during the midyear of adjustment if they need additional funds. [Chair Andrew Perchlik]: Okay. [Grady Newton]: Section e one eleven. So this is annual language linking up the federal income tax to Vermont taxes. The following section is the same. Why do we have to do that? Can't just [Chair Andrew Perchlik]: do that permanently, or is there [Grady Newton]: a chance that something would change? I believe it's done every year, but in session long to maintain flexibility, I am not clear on the minutia as to why there would be a need for that flexibility, but it's to preserve the ability to not link up if for whatever reason. Section e one twenty seven on page thirty five, interim budget and appropriation adjustments. So this is the language going back to that expanded emergency board and JFC authority. So you'll see here in several following pages and sections, if we jump ahead to page thirty seven [Member Anne Watson]: I have questions about the these pages. Are you coming back? No. So on page thirty five, it says except as otherwise provided in subsection after this section, in each instance that the official state revenue estimate for the general fund blah blah blah has been reduced by one percent. Is is it limited to what are currently the official estimate points in a year, or could the administration say, ask at some point for [Grady Newton]: a renewed estimate? So, typically, the state economist has the there's the January and July official consensus revenue forecast. There's nothing preventing an interim forecast from being developed, And I know that in the request for proposal relating to the contract for that, the possibility of additional forecast is included in that contract. So I don't think there would be anything that should [Member Anne Watson]: be prohibiting that. Okay. So we we would be saying and who could initiate let's say it's outside the January and July forecasts. Who could initiate one in, say, September? [Grady Newton]: I would have to get back to you on that. My country would be the joint fiscal committee, but I'm not sure. The governor alone could not do it? I would have to double check. Okay. [Chair Andrew Perchlik]: I think we both I think I asked this question before and that we since we have this consensus forecast, we want both Jeff Carr and talk to that to do it. So we would both need to ask Yeah. For them to do it. [Member Anne Watson]: Okay. This for I think it might be good to spell that out. Yeah. [Grady Newton]: Jumping to page thirty seven. So this language adds in in three that in each instance of a reduction of federal funds that results in a one percent or more reduction in total federal funds anticipated in the most recent fiscal year appropriations act. The secretary of administration shall prepare expenditure reduction in transfer plan for the consideration of the joint fiscal committee provided that any reductions in appropriations and transfer of funds are not greater than the reduction in federal funds. And then to maintain a balanced state budget, minimize the impact to Vermonters, and abide by the legislative intent set forth by the general assembly. The joint fiscal committee may make a recommendation to the emergency board to utilize the general fund balance reserve to support impacted programs at not more than the current fiscal year fund funding level, revert any on extended on obligated funds, or abolish any spending authority or both, make such reductions or transfers in appropriations that are necessary to support the priorities of the general assembly provided that any recommended deduction is not more than ten percent of any fund or ten percent of any appropriation. And in each instance that a reduction in federal funds results in a five percent or more reduction in the total funds available, the secretary of administration shall notify the joint fiscal committee. So, going back to those percentages, there's, what happens in statute, there's the one percent, then this addresses, this language addresses the one percent and the four percent. It adds some language regarding these JFC recommendations to the emergency board, and then it does not update anything regarding what happens beyond that. So in current law, the general assembly would need to the general assembly would be the ones to address any reduction from funding in excess of that amount. So this directs the secretary of administration to notify the JFC. [Member Anne Watson]: Mhmm. Yes. [Chair Andrew Perchlik]: That over [Member Anne Watson]: on page thirty six, I'm looking at line sixteen. This says the secretary may implement an expenditure reduction plan under the subdivision if plan reductions to the total amount appropriated in any section do not exceed five percent. The plan is designed to minimize any negative effects on the delivery of services to the public and the plan does not have any unduly disproportionate effect on any single function. I'm thinking those are pretty subjective criteria, especially the idea of negative effects on the delivery of services to public. But then if you're looking for reductions and you're under the gun, I would think you could identify something and say we don't need this expenditure in this environment but if if zeroing that out would be an unduly proportionate effect on that single function. So are you then limited to do you it seems like what it's demanding is that you'd be finding small reductions across a large number of areas rather than say finding two where you could find your savings. So that that language seems a little clunky to me in terms of how it might constrain you on one hand or allow too much leeway on the other. [Grady Newton]: Part of [Speaker 4 ]: my problem with this is this talks about cross the board reductions. And what if the bulk of all of our reductions are in one area? Yeah. And you disproportionately affect that one area, and we don't get to say anything, say the funds going to the agency of education get reduced, well, versus Medicaid, you could reduce almost everything they get and still not get to a one or a five percent. Mhmm. Yeah. So [Member Anne Watson]: I don't know if it we can just words in it, I suppose. But right now, it just seems like it's it's a little contradictory. Yeah. Yeah. [Grady Newton]: And I heard from JFO that after this language path of [Chair Andrew Perchlik]: the house, they've been talking with folks that went [Grady Newton]: through the last recession about kind of what [Chair Andrew Perchlik]: they wish what tools they had. So they I understand they're gonna come [Grady Newton]: with some recommendations with wordsmithing those further. So when we do [Chair Andrew Perchlik]: that, we'll have opportunity to to fix other parts of it. [Speaker 4 ]: Part of the problem in the overall is in the past, because it's been our revenue, it that really did make sense to say our revenue across the board because we got to pick individual items. We may have huge cuts just in Medicaid that don't affect other areas in across the budget. So or education gets a piece, transportation [Chair Andrew Perchlik]: gets a piece. [Speaker 4 ]: What if those cuts in the ed department ended up being thirty percent and it really doesn't trip versus Medicaid, which is two billion dollars in spending. Mhmm. How do we, in an individual area, not see a way out of services? [Chair Andrew Perchlik]: Yeah. Yeah. Right. Because this is you have to trip one percent of one of [Grady Newton]: the three major funds. But you could have, like you said, zero [Chair Andrew Perchlik]: it out, two hundred million dollar project that's up, not gonna hit one percent of [Grady Newton]: the general fund. Right. But it's gonna be a [Chair Andrew Perchlik]: huge impact on that. Right. So maybe a dollar or or maybe there's a a percentage of, well, [Grady Newton]: program or agencies, [Chair Andrew Perchlik]: I think, for some period? [Member Robert Norris]: By by size of program. I mean, that's what you're talking about. [Speaker 4 ]: Yeah. I I just great. You know, I think we we can struggle with that, like, maybe by function. Yeah. What's the function? [Member Robert Norris]: What's the function? [Speaker 4 ]: Well, I would think Medicaid would you could save the Medicaid budget. It was Would [Chair Andrew Perchlik]: Is there any section or subsection? [Speaker 4 ]: Or you could say by agency or [Chair Andrew Perchlik]: Okay. Well, something for you to think about, Brandon. [Grady Newton]: Section e one twenty seven point one and e one twenty seven point two, on page thirty eight and continuing on. So this relates to some expanded uses of the general and balance reserve to, in part, address some of the concerns that senator Rustman has. So this would allow the general assembly to un reserve and appropriate, or transfer an amount not to exceed ten percent of the reserve, to fund unforeseen or emergency needs. That's at the bottom of page thirty nine. [Chair Andrew Perchlik]: Is that is the underline, like, on left lines eleven and twelve? Why is that under [Grady Newton]: that's the other line? Is this other language from somewhere else? Yes. So this is amending current statute. So it's Just the underline. It's the only amendment. The underlining strike outs are amendments to existing statute. I like the whole section because it's because the house added it. [Speaker 4 ]: Is oh, [Chair Andrew Perchlik]: sorry. Yeah. Go ahead. [Member Anne Watson]: Is two percent Am I right? It's roughly eighty to ninety million. [Grady Newton]: It would be two percent of [Member Anne Watson]: the general fund. This language here is shall not exceed two percent of the total general fund appropriation. [Grady Newton]: Sorry. Can you look at the front end page? [Member Anne Watson]: I I thought it I'm sorry. It's bottom of thirty eight. [Member Robert Norris]: I said two. One second. [Member Anne Watson]: What's the question? I thought I remembered that one percent was forty four million or forty five million. [Grady Newton]: One the general fund is about two point four billion in fiscal year twenty twenty five. So one percent would be about twenty four million. Twenty five. I believe that in this language here in sub c, that's referring to two percent of the total general fund appropriation for the year of the expenditures, so that would be about forty eight million. Okay. E one twenty seven point two and e one twenty seven point one or sorry. And e one twenty seven point two, this would allow, at the bottom of page thirty nine, the general assembly to unreserve and appropriate or transferring not not to exceed ten percent of the balance reserve for emergency or unforeseen needs. And then in sub three on page forty, the emergency board in response to a declared emergency occurring while the general assembly is not in session or a reduction in state revenue estimates or federal funding while the general assembly is not in session, would be allowed to fund reserve and make an amount of not to exceed ten percent of the general fund balance reserve available to replenish spending majority impacted by that cleared emergency reduction in funding or reduction in funding to maintain a balanced state budget, minimize impacts to Vermonters, and abide by legislative intent. In no event would that amount be allowed to exceed the original amount appropriated. So the emergency board could then use funds, from the general fund balance reserve to address specific, funding shortfalls. K. On page forty one, section e one three one, these are amendments to the Vermont Saves program. This was language that was added for the request of the treasurer. Some of this is statutory cleanup, just changing VT saves to Vermont saves. And this language, there is also an amendment on the house floor, so it includes that amendment as well. On page forty four, section e one thirty one point one, this is Trevor requested language amending statute for the municipal equipment loan fund, adding in specifically vehicles to the municipal uses of that fund. So this would allow four loans from the fund to also be used for motorized highway building, maintenance equipment, heavy equipment, etcetera. On page e one thirty one point two, page forty seven, this is treasurer requesting language, relating to the Capital Debt Affordability Advisory Committee. This changes the committee's review process from an annual one to a biannual one. Review of what? So the committee makes recommendations relating to its recommended amount of capital debt and the affordability of it. They just do that every other year. Is that correct? On page fifty two, section e one thirty three, so there are a couple sections that relate to the amount of the appropriations for the pensions, that relate to the portion of that appropriation that is for VPIC. And so there are three sections that address a funding change related to VPIC that show up here. So you'll see the dollar amount change in those three sections. The first two are here, and then the one relating to the teacher's parent system shows up in section e five one four point one. So you'll see that a little bit later in the bill. But those dollar amounts were just treated slightly increase by will be by two hundred fifty thousand from the draft. On page fifty three, section e one thirty four point one and e one thirty four point two. This relates to compensation study for VPIC and a report on that study. [Chair Andrew Perchlik]: Do you know where that came from? [Grady Newton]: I do not recall. I would have to go back to see if it came from a standing committee or not. Because it wasn't in the governor's schedule? [Chair Andrew Perchlik]: No. And then, like, when we had the report on the pensions, it it didn't come up there. So I wonder [Grady Newton]: who proposed it. I can check on that and get back to you. [Member Robert Norris]: Why are you selling [Grady Newton]: On page fifty five, section e one forty two point two, this there was a similar program established in statute in the gov rep, for the municipal buyout program. This is house language, that would instead be for municipal brandless stabilization program. So similar intentions to address municipal needs related to flood prone properties rather than the buyout program. This would be the grainless stabilization program. On page fifty seven, this would be further, updates to statutes. So this would add in, twenty eight PSA section fifty one, flood prone properties, systems programs. This would direct the division of emergency management and ACCD to establish and maintain the voluntary buyout program for flood prone properties. So this is a different construct and approach to a similar intent from the GovRec. Where's the money from now? [Chair Andrew Perchlik]: The voluntary file. [Grady Newton]: I would have to go back and double check where that those funds live in the bill. [Chair Andrew Perchlik]: Mhmm. There's a isn't there a fund that we have set up for the club? There is [Grady Newton]: a one time appropriation for it. Correct. [Chair Andrew Perchlik]: From last year. [Grady Newton]: This would be a different program. This there's one million pilot fund appropriated in this bill for that. [Chair Andrew Perchlik]: And it is for the assisted program, flood prone properties assisted programs. Is that also one million, or [Grady Newton]: is it you're combining to the grand list stabilization program is one million? So there's one million for the grand list stabilization program. And then [Chair Andrew Perchlik]: for the e one forty two point three, is there any money for that? [Grady Newton]: There is no money specifically for that program, but it says that you can apply for funding. [Chair Andrew Perchlik]: You think there would be funding? So it must be connected to some dot [Grady Newton]: municipal hazard fund thing. [Chair Andrew Perchlik]: We'll figure it out later. [Grady Newton]: Remember, like, either in five years last year or [Chair Andrew Perchlik]: in in the in the [Grady Newton]: fiscal committee, we added five million to a Right. Other mitigation plan. This This could be making just something that exists for a minute and statute. I'm just not sure where the funding is currently. [Chair Andrew Perchlik]: Senator Watson? [Member Robert Norris]: I think I am a little confused about why it's the voluntary buyout program because as [Speaker 8 ]: far as I know, were there any properties that had no choice? [Grady Newton]: I'm sorry. Can you clarify the [Speaker 8 ]: Yeah. Well, I'm just I guess, I'm just wondering what the pro [Member Robert Norris]: program and why it's called voluntary buyout program. Sorry. [Grady Newton]: I think it was because I thought we had separate money. So, like, if [Chair Andrew Perchlik]: they couldn't get from FEMA to buy out, then this would be money for the state that [Member Anne Watson]: would do the buy out. Yeah. [Speaker 4 ]: And then [Chair Andrew Perchlik]: with dealing with FEMA separately, so they could [Grady Newton]: do a quarter. [Speaker 3 ]: Mhmm. I think [Member Robert Norris]: I'm just having a hard time remembering if in the with [Speaker 8 ]: the FEMA buyout, if I mean, I realized that people might have felt like they had no choices, but it was still they still had a choice. They could've stayed. I guess I'm moving with the voluntary part. Like, why is it voluntary as opposed to compulsory? [Grady Newton]: Right. They got flooded. Yeah. Yeah. [Speaker 8 ]: Anyway, I can ask someone else [Member Robert Norris]: who was more of a program. [Grady Newton]: So I think if I remember there's [Chair Andrew Perchlik]: and I think the program that I from some of the structures in my or our district, I should say, that they they would still have to fight for FEMA. FEMA would reject [Grady Newton]: them, then they could get the buyout if they could [Chair Andrew Perchlik]: run. Right. But it's voluntary. [Grady Newton]: Like Right. They might force the homeowners to Right. [Speaker 2 ]: So this is this is [Speaker 8 ]: still I mean, it's state money that's going towards the buyout. [Grady Newton]: Yes. This would be at the request of a property owner Right. For a flood from property and a flood damaged property. [Chair Andrew Perchlik]: They didn't apply. [Member Anne Watson]: Mhmm. Okay. [Grady Newton]: So the next section, the compulsory buyout program. And say On page sixty, section e two one five, So there was a one hundred thousand dollar reduction in the amount to be dispersed to VSAC for the National Guard Tuition Benefit Program. So that's just a number change there, knocking it down from one point three million to one point two million. Section e two thirty six point one was added. This specifies that of the funds appropriated in section e two thirty six point one, one point eight million enterprise funds shall be used for the business to business website design and implementation for the ordering and payment of on premise licensees. Is that different than [Chair Andrew Perchlik]: because I don't remember, like, running the lottery talking about that when they came in here. [Grady Newton]: So they didn't talk about this? Yeah. What's that about? And so this is not an appropriation in this section. This is just clarifying what that paid how long it's not that that base appropriation is for. Right. It's kinda like directing to use some of the money in there. Remember, they also had a deficit in their fund. We're still paying their paying off their debt capitalization that the government proposed? I believe so. Yes. So just saying specifically, we may need to work on the business business website to them in the organization. [Chair Andrew Perchlik]: Okay. Well, we should ask tonight, commissioner night about that. [Grady Newton]: On page sixty one, section e three hundred point one, this is reporting language relating to the fiscal year twenty twenty seven budget presentations from AHS and departments within AHS, related to residential beds for youth. So this would be language directing them to include information on the number of beds, both currently existing and the projected number of beds per facility needed to create forty one new beds for youth in high end facilities under DCF, DMAH, and Dale as part of the fiscal year twenty twenty seven budget process. On page sixty six, section e three zero six, nursing homes, skilled nursing facilities, extraordinary financial relief. This section states that extraordinary financial relief shall be used in rare occasions or as a last resort to prevent nursing homes that are in good standing and in compliance with state rules and federal regulations from closing. It also includes report language directing DEVA's division of rate setting to submit a report to the House Committee on Human Services and the Senate Committee on Health and Welfare on proactive measures and target interventions that may be used to reduce the necessity of extraordinary financial relief. Doesn't affect the language we had on this relief within the BAA? No. K. On page sixty eight, section e three eleven, this is a repeal of the sunset of the state youth council. Uh-huh. Section e three twelve, which begins on the same page. The language that was in the gut rec did not align with language that had been negotiated and worked on prior years in this section. So the house made changes just to align it with the same language that was used in act one fifteen. So this is just having a comport with language that is in the current fiscal year budget to match with this coming fiscal year's budget. [Member Robert Norris]: So this is on the syringe program? [Grady Newton]: Yes. So this is the harm reduction services and HIV AIDS funding. [Speaker 3 ]: Okay. [Grady Newton]: And, this language is, what is in Act one thirteen. [Member Robert Norris]: Okay. [Grady Newton]: On page seventy one, section e three one two point two, This language relates to the health, office of health equity. So this is just there are a couple of sections, that relate to placing it in, the proper in its proper home. The GovRec had language relating to this, and legislative council council recommended adding a couple of sections just to make sure that statute, addresses that location change everywhere. Also in the VA, this language or something on this? I don't recall. I don't believe so. [Member Anne Watson]: The positions. [Chair Andrew Perchlik]: Yeah. Maybe. I remember talking about it this year, so I don't know what else it would be in. What was it gonna be in? [Member Robert Norris]: There was a bill. [Chair Andrew Perchlik]: There was a bill just on it? [Member Robert Norris]: On the to transfer it from the governor's office to the department office. Like, last year. [Chair Andrew Perchlik]: No. Did he? [Member Robert Norris]: Yeah. Yeah. [Grady Newton]: Yeah. But we hadn't got here yet. [Member Robert Norris]: No. It was in ours and theirs, and I don't know what's happening to it. It might just be going here. [Grady Newton]: I I believe so. Yes. I think that's right. And so a similar intent was in a section of the GovRec budget, and now there's multiple sections relating to that, carrying over to section e three twelve point four on page seventy six. So statutory cleanup relating to that location change to the Department of Health. Okay. On page seventy seven, section e three one six, this is language, just extending the existence of the stakeholder working group for the facility plan for justice involved youth from twenty twenty five to twenty twenty seven. So it allows that group to continue its work for another two years. Second e three one six point one, inflation for direct service providers. This puts in statute that as part of its annual budget presentation, the department of, I believe this is Dale. Dale shall inform standing committees on the cost of adding a one percent increase over the previous fiscal year's funding for community contracted direct service providers. Page seventy eight, this is section e three twenty one, general assistance emergency housing. This is putting, the same program parameters around the general assistance emergency housing program that exists in act one thirteen, for next fiscal year. And act one thirteen is The current fiscal year budget, not not the batches. Yeah. [Member Anne Watson]: Yes. Yep. Right? And can I ask, I know h ninety one is a revamp of GA, and that's proceeding? Is this for this coming fiscal year and then h ninety one will kick in thereafter? Do you happen to know? [Grady Newton]: I believe that h ninety one, it would impact fiscal year twenty twenty seven. So it establishes I don't know if it's a working group or a study committee or what, but it gets the ball rolling on work and then implementation from twenty seven. So we we should [Member Anne Watson]: bring to consciousness that this is the same thing we're [Member Robert Norris]: currently doing. System opens the same can of worms [Speaker 2 ]: Right. Another year. [Member Anne Watson]: So what we're doing in the budget adjustment now that we're fighting over is a change to to this. Yeah. So If we [Grady Newton]: don't wanna have that same fight next year, you might wanna change Exactly. Mhmm. [Chair Andrew Perchlik]: Or maybe you do. [Speaker 3 ]: Or maybe something on [Member Robert Norris]: h ninety one can help. [Speaker 4 ]: I I would just say in the one before that, we've had this fight over and over and over [Member Anne Watson]: about In the one before that, what do [Chair Andrew Perchlik]: you mean? The one before that The section before that. [Grady Newton]: The one percent after the deal. [Speaker 4 ]: Over and over and over. Why would you create an expectation about what you're gonna do? Either you're gonna give a rate increase to an area or you're [Member Anne Watson]: not. Right. [Speaker 4 ]: And so why would you create in in anticipation, Get something out there that you don't you know you can't do. Mhmm. Mhmm. And we've but we've they've had language like that in for the last five years, and we've taken it out every time. Mhmm. Just, you know, why would you create the expectation? If you're gonna do it, it joint of school will give you the number. [Grady Newton]: The ten g reports. You know what I mean? [Speaker 4 ]: Well, you create an expectation. It it just won't beat you up over. [Grady Newton]: Jumping ahead to page eighty four, section e three twenty one point one. This would direct the Department of CHIP for Children and Families to prioritize contracts with organizations that are in close proximity to the community served when contracting with emergency shelter organizations. Section e three twenty four, I just want to flag for the committee. The house made no change to this section, but as it came over from GovRec, it doesn't comport with statutory changes that were made in act one thirteen to these emergency fuel crisis benefits. So statute was changed to say that rather than shall to a may relating to one crisis fuel grant, so that allows some flexibility for the potential of additional ones. That change is not reflect this annual language if that change was not reflected here. So just for the change awareness. [Member Anne Watson]: We're [Grady Newton]: gonna go to section e three twenty nine at the bottom of page eighty five and at the top of page eighty six. So apologies for this not being highlighted, but this is similar to that Dale language for or sorry. The prior one was for DCF. This one is for Dale, but they did see direct service providers in one percent increase. [Chair Andrew Perchlik]: So that was the house edition just So that should be highlighted. Yes. [Grady Newton]: Page eighty six, section e three three three, developmental disability services, payment reform. This directs Dale to not implement the payment reform process for developmental disability services prior to July first twenty twenty six. And between the start of this coming fiscal year and that implementation, Dale should align conflict free case management with the existing payment model. Page eighty seven, section e three three eight point two, this is language report language related to that two hundred thousand dollar appropriation in section b eleven hundred, which was originally three hundred thousand dollars in the doc rec. So this language directs the Department of Corrections to, again, retain a consultant and develop an implementation plan for transition of all or parts of the Northeast Correctional Complex or the Caledonia County Work Camp or both to a treatment focused facility and directs the Department of Corrections to submit a report to the joint legislative justice oversight committee on or before December first concerning the consultant's findings and recommendations for such a transition. [Member Robert Norris]: So how does this relate to the earlier language way way back there? [Grady Newton]: So this that sub a language is the same as what's in that [Member Anne Watson]: Okay. [Grady Newton]: Language in section b eleven hundred, and then this just requires a report relating to that consultant's work. [Member Robert Norris]: Got it. Thank you. [Grady Newton]: Skipping ahead to page ninety one. In section e five zero four point one, there's just a number change in sub five for adult education. So increase I would have to go back and double check on the exact dollar amount, but an increase of the amount here that is specifically for adult education. And I believe that that is just to align with prior year updates to the adult education program. Section e five zero four point two also relates to changes to adult education. It directs the secretary to pay to a local adult education and literacy provider that provides an adult education secondary secondary credential program. An amount that shall be calculated pursuant to the funding formula contained in the State Board of Education adult education rules. And then, I believe that forty percent I'll go back and check statute, but I believe the forty dinner should should not be on their own. Yeah. That's definitely part of the current statute because it's the forty, sixty split where that's something general Section e five zero four point three, adult education. This is reporting language from the Agency of Education in consultation with local adult ed and literacy providers to submit a report to the standing relevant standing committees, with recommendations to modernize adult education funding to ensure that funds are distributed equitably across all regions of the state, and that in fiscal year twenty twenty six, AOE should negotiate in good faith to extend existing contracts with local adult ed and literacy providers for a term of one year. Following this section or preceding this section, there were a number of sections in the gov rec related to the repeal of the universal meals program, touched on various parts of statute. Some multiple sections that were in the gov rep are not in the house built because the house, took that one out. So here's where you don't see those sections. On page ninety four, section e five fourteen point one, again, this is related to that amount from the teachers retirement system appropriation with for VPIC. So those are the corresponding number changes there. On page ninety eight, section e seven fifteen repeals of the sunset of the property transfer tax clean water surcharge. There are similar language in section similar language in the gov rec to repeal the surcharge. Sections e seven one five and e seven five point one, and e seven e seven one five through e seven one five point three are the ledge council recommended construct relating to that same repeal. So this is language just replacing what was in the gut record multiple sections to achieve a similar purpose. And finally, on page one of two, we have the effective dates. I just highlighted the whole thing. That section always changes around. Sure. So that will be updating the coordinate. [Chair Andrew Perchlik]: Okay. Why is there a section after the just go ahead. The effective date. [Grady Newton]: Oh, sorry. What's that? The section after the effective date? What is this? I think one of [Member Robert Norris]: them. Two. [Grady Newton]: One of two. There's two effects. What is that? Steven? I I'm not sure. [Member Anne Watson]: Where are you? I don't know. Well, if you [Chair Andrew Perchlik]: look at the page Oh, you got [Grady Newton]: one or two, there's Yeah. [Chair Andrew Perchlik]: Effective dates, and then [Grady Newton]: there's Ninety nine? Page one zero one, that's where it's transportation for prime appropriations. Oh, sorry. Yeah. So that was in the gov rack, so I just didn't address it as a change from the gov rack to the house. Is it this is just separate than the other ones because it's about [Chair Andrew Perchlik]: the TPM, and we have that has its own effective date. [Grady Newton]: It it's not part of the effective date section, but that would be just effective on passage. But it's doesn't it [Chair Andrew Perchlik]: seem weird that there's effective dates, and then there's a section about the transportation time, and then there's more effective dates? [Grady Newton]: Yeah. You [Chair Andrew Perchlik]: see what I mean? [Grady Newton]: I I'm not sure I do see what you mean. I I see section so there's the highlighted section e seven five and three. Page one hundred. On page one hundred. It's on [Chair Andrew Perchlik]: ninety nine. It goes to one hundred. Then on page one zero one, there's [Grady Newton]: this section e nine hundred. [Chair Andrew Perchlik]: Which is not part of the the effective date. [Grady Newton]: It's not part of the effective date section. It's just a section that was in a correct and not changed by hack. [Chair Andrew Perchlik]: Okay. And then you have effective dates on page one zero two? Yes. What does what does effective date versus the other effective date? [Grady Newton]: I'm sorry. I might I just have to look at your computer and tell me about this online. There's only one effective date section. [Chair Andrew Perchlik]: Well, that's one hundred effective [Grady Newton]: dates. Yes. [Member Anne Watson]: And why [Member Robert Norris]: is the one hundred and two there? [Grady Newton]: What's that? [Member Robert Norris]: E seven one fifteen. [Chair Andrew Perchlik]: E seven one fifteen has effective dates. [Grady Newton]: Oh, I'm so sorry. So this is amending the effective dates of sex of act one or of act eighty five. So this is amending a different bill. Okay. Then then we have our own effective date. Yeah. I'm I'm sorry. So that's related to the repeal of the surcharge. I should have waited for the ellipses. Yeah. That that's the real effect. Okay. Do you have questions in our office? [Speaker 2 ]: No. I was just [Speaker 8 ]: I thought that it was affecting the the repeal of the transfer tax from the clean water surcharge. Is that are [Chair Andrew Perchlik]: those is that [Speaker 8 ]: the bill that it's amending? The effective date that [Chair Andrew Perchlik]: it's because it's Yes. Because it's [Speaker 8 ]: no longer it's it's repealing a sunset. [Grady Newton]: Exactly. So So it's removing it's removing the effective dates in that bill. [Speaker 8 ]: And just for context, I think this section is something that we have in our three acre bill for h forty one. So we will leave it in there, but as soon as it get taken out because of it's here. [Grady Newton]: Okay. Vice versa. Yeah. Okay. [Chair Andrew Perchlik]: Any other questions for Drady? [Grady Newton]: Comments? Two two. Found the nation. [Chair Andrew Perchlik]: It's fabulous. [Grady Newton]: Two thousand. Okay. Thank you, Grady. Thank you. [Chair Andrew Perchlik]: Okay. Sorry for the land access. How can you go? It seems like we've scheduled these three times and [Grady Newton]: have always missed. But if you're still at time, you can join us at the [Chair Andrew Perchlik]: end of the day when you can pull up another chair. [22 seconds of silence] [Speaker 2 ]: Am I in the right zone? [Speaker 5 ]: Yeah. I'm in my Okay. It looks like [Grady Newton]: Should've been in prior to Zoom? Yeah. It looks like. [Speaker 5 ]: Hi, everyone. Hi. [Chair Andrew Perchlik]: If you could introduce yourself for the record while you're getting me now. [Speaker 5 ]: Right. For the record, I am Fernanda Matasquiera, of advocacy and community engagement for the Land Access Opportunity team. And I'm [Speaker 3 ]: Jean Hamilton. I'm the director of program development for the Land Access and Opportunity Board, and we operate as a codirectorship. [Speaker 5 ]: Mhmm. We know is unusual. As most organizations have an executive director and then other staff. [Member Robert Norris]: Okay. Almost done. Hold on. [Grady Newton]: So you don't have any other staff? [Speaker 5 ]: Not yet. [Chair Andrew Perchlik]: So I just have to [Speaker 5 ]: Yes. Go again. We are a team of two at this moment, and we're hoping to hire more staff in a hundred month staff. Everywhere we land, we start with this slide, which are our touchstones. And we invite no matter where we're talking and sharing and discussing our work, We invite everyone to work with these touchstones. We listen generously, and we speak our truth from our heart and mind. We make that the work that we work the way that we work together an example of what is possible, And we trust that we all hold a piece of the puzzle and that we need each other's pieces to understand the big picture. The LAOB was first established in twenty twenty two as an independent state board to address disparities in land and homeownership in Vermont for people and groups that have been historically marginalized from land and homeownership. Who are these historically marginalized populations? All poor and low income Vermonters, Vermonters with developmental and intellectual disabilities, LGBTQIA Vermonters, immigrant people new to Vermont, and Vermonters who are people of color. Specifically, the LAOE was created to ask questions and work with the existing systems to improve the housing crisis and to address prevalent wealth disparities by creating new, secure housing opportunities for those who are who are most marginalized. And we believe foundationally that when those who are most marginalized in our communities do better, then we all do better. What are our priority objectives? We do our work by addressing historical barriers that continue to exist within the systems, thinking about and supporting state agencies and organizations to address things like the impacts of redlining or exclusionary zoning laws or the impact of poor farms or the overseer of the poor laws or helping organizations to understand, like, historical lack of access to credit. We also promote opportunities to land in home access by promoting different events, by creating a catalog of state programs, by building trust in community and supporting different organizations as they see their community engagement, and building a shared sense of solidarity. We also seek out, create funds, and build alternative models. And we do that by asking a lot of questions about why we've been doing the things the ways that we've been doing them, and asking whether doing things the same way makes sense in this moment in time. We're for example, we're exploring different models of affordable housing and asking questions about how that community engagement has worked and supporting processes to engage those who are closest to their problems to both find innovative solutions and reduce long term dependence on government funding. We also work to create an economic the economic and social conditions to make Vermont a haven. And we're taking every opportunity to talk with organizations and lawmakers and business owners and community members about what would it take to make Vermont a haven for them. And we're also looking at judicial, social, and political constraints that have allowed intergenerational poverty to flourish and foster opportunities, perfect to grow skills, health, and community connection. [Speaker 2 ]: Okay. [Speaker 3 ]: So in case you don't know, these are our appointed authorities. They are defined in our enabling statute. And some things that I'll I'll let you read who they are. But each of these entities holds two seats on our board. So our board is structured with a primary representative and an alternate. And some things that are notable about our board are that that structure really allows for deep participate participation, especially from organizations that because of the nature that these organizations represent marginalized communities, often these organizations themselves are marginalized. Some of these organizations have less than one full time paid staff person. And so having having two people on our board allows for robust participation, also sort of deep bench where organizations can process what's happening on the board. And the other thing that I'd like to point out about this this board is that it really represents all of those populations that Arnel spoke to. And so while, we we really value the intersectionality that happens in our conversations, What's shared between these organizations and the communities represented are that all of these communities have experienced some type of marginalization from from the center of policy making and the center of economic resourcing, but the individual needs of each of those communities are quite different. And what we've learned from working through these intersectionalities is that we can, when we work across difference and come up with solutions that solve across difference, come up with and build much more efficient and effective policy. So often when we have more time with groups, we share this invitation because LAOB's job as as Ornella described is really to create a Vermont where all people can live, grow, and thrive. Just to underscore our job is to identify the inequities that exist in Vermont's housing and land systems and fix those. That's our job. The two of us, plus our board. So we need everybody's help in that, and we definitely invite you all to to think about and work with us to achieve this goal. Community engagement is really the core of what LEO lead is. The board itself was created as a platform for community members who have been left out of policy making to have a seat at the policy making table. And we take that job very seriously, and we very much go out into the communities, to continue to invite every single community member to participate in this democracy. When we do community engagement, these are the kinds of needs that our communities identify particularly in relationship to live living, growing, and thriving on house in housing and on land. If you look through these things, I think you will see these are needs that many of your constituents have. They need help navigating the systems. They need help understanding where are these grant programs, how do they access them. This can be something as tactical as literal language access. It can also be something like relational access. [Member Anne Watson]: I'm gonna keep moving quickly because [Speaker 3 ]: I know we we have a lot. Similarly, these are the problems we're seeing. So Arnela and I have been in our positions as the first staff for the LEOB for just a little bit over a year. Over that time, we have we have been watching, listening, participating in all of these policy making systems and trying to ask this question, why are things so inequitable now? How did we get here? Do we need to change how we're doing things, and what needs to change? And these are the the issues, you know, again, which I think will resonate with you as seasoned lawmakers and also with your constituents. Vermont needs more people power. We need to empower people to participate because we don't have enough resources to just do this with money alone. There is a deep disconnect between our public institutions and the people they're they're supposed to serve. [Speaker 4 ]: There's a lack of trust. [Speaker 5 ]: There's a lack of communication. These silos exist not just between the public institutions [Speaker 3 ]: and the people, but also within the public institutions. Our agencies don't talk to each other. Our institutions don't talk to each other. I I sorry. That's a little bit [Speaker 5 ]: too too direct. [Speaker 3 ]: They do talk to each other, but the the silos are preventing us from coming up with better solutions. The compounding crisis of climate disasters and the, you know, substance use disorders and homelessness are really threatening our communities at a deep spiritual and, morale level, disempowering our people power. And, you know, fundamentally, the communities we serve who are most vulnerable, we see how our communities are are hit the hardest. They tend to be hit first, the hardest, and then with the most length lasting impact. And finally, that the lack of doing better policy making, the lack of effective solutions is not only failing our community members, but it's inefficient and it's in and it's expensive. [Speaker 5 ]: Thank you. Yes. So how has the LAOB been approaching these problems? We've been focused on the three things that you see there. Strengthening Vermont's human infrastructure, working in asking questions about stabilizing housing, and working to improve land access. We've started January twenty twenty four, and our priority was really to get a good look at the landscape. Keith and I are both thoughtful and strategic change makers, and we knew that we really needed to learn more about every single one of the organizations that we are working with and give that the time to really build a solid foundation with our partners to be able to really get at the roots of these problems so we could start offering ideas and solutions. We've been building trust and confidence with communities across Vermont, encouraging community members to believe in their participation and that their participation and leadership matters. It's hard to get people to the table right now because people haven't been heard and treated well, and that's something that we're working on is getting people to really feel like they are going to be heard. We've also been working to establish credibility and value within the housing and land access institutions and using our advisory powers to give fresh perspectives and encouragement of growth mindset and, working to put problems at the center of the table together instead of pointing fingers at one another and, personalizing problems. We've also been researching and identifying the most effective places for the Land Access and Opportunity Board to add value to the system, looking for leverage points that will unlock new and creative community potential. And we've been very careful to avoid duplication and program redundancy. We've been identifying securing opportunities to leverage complimentary and new funding sources for our communities as well and looking at federal funding and private funding too to support all of these housing initiatives. I think Do you remember? Okay. I think it's me. Okay. K. Our advisory policy community engagement, these are only some of the examples of the kind of community engagement that we've been doing and the kind of powers that we've been doing. We've been focused on centering the voices of those closest to the problems and promoting democratic systems because we believe that democracy is not built in one day. We believe that democracy is built with a practice and an ongoing practice of dialogue. We've been promoting healthy solutions focused dialogue everywhere we go. And you can see some of those examples there, and I won't read all of them. We've been supporting and working with advising leaders across all systems, as I mentioned before, with the lens of collaboration and resource sharing and self reflection and breaking down silos to empower creative problem solving. Thank you. [Speaker 3 ]: Thank you. So some of the other functions we've served in this past year are capacity building. We think about capacity building in terms of, you know, kind of confronting those silos that are limiting our creative potential and and really creating capacity for for each of us as members of the system to think about how can we work together better. We also think about capacity building in terms of literal funding and money and resourcing to our communities and and, the institutions that serve us. For example, you can see some of the grant writing that we have supported with specific projects. But, generally, we are a resource to many of the community organizations in our in our network to support grant writing, to support identifying grant resources, and to to cultivate this pipeline of funding. We've also provided a lot of direct services and are in the process of launching some signature programs. So in addition to sponsoring many, many community organizations and community events, we are right on the precipice of launching a housing coach program. Again, we've taken a lot of time this past year to investigate the system and ensure we're not launching something duplicative, but instead launching something complimentary. [Member Anne Watson]: And we [Speaker 3 ]: can talk about some of these other programs as we get on to the our budget. So I'm gonna just move ahead here. You're welcome. Okay. So just a little bit of an orientation. We are in the house budget at the amount that the governor recommended, which is this one point six million dollars. That allows us to do our core funding sorry, our core programming, and we are in the house appropriation budget in as base funding, which will be really helpful moving forward. After the governor made his recommendation, we we participated in a c a cannabis control boards working group that then issued a report on January fifteen recommending an appropriation of twenty five percent of cannabis excise revenue for community reinvestment purposes in the land as as managed by the land access and opportunity board. We see that additional funding as being a a really targeted and exciting way that we can make some direct investments into Vermont's most marginalized communities in terms of housing and land access. And I'll show you, you know, some of what that looks like. [Chair Andrew Perchlik]: It's twenty five percent three point six five? [Speaker 3 ]: It is no. It's so the total is about five point six. And here, let me I don't know what the best way to show [Member Anne Watson]: you this is. So this [Speaker 3 ]: they're twenty five percent. JFO projects twenty five percent would be five point six million. The three point six five would be how it would basically netting out. Like, this is what we would do with that additional over our base, is what we're really excited about is, launching some new programs related to down payment assistance, grants for health housing and also for land access, and then developing a, a fund of capital for emerging developers. We work I'm really glad VHFA is queued up after us and that they're in the room because we, VHFA are among our favorite partners that we've worked with this past year, and we're really excited about developer emerging developer, community developer technical assistance program that we are working on with them. We've collectively identified that we you know, emerging developers not only need technical assistance, but they need capital that they can access. And so this kind of community reinvestment funding from Canvas revenue would be perfectly suited for really empower this is literally what community reinvestment would be. I will kind of I think I think the wrong ones. Yeah. I'll show you. So the these are our budget breakdown. I don't know how much you wanna go into this, but we can go back to these. This is what here's what this three point six. So this is this dark blue is kind of new programming that would be down payment assistance grants and capital for emerging developers. This is what our current budget at the one point six looks like. And, you know, just a little bit of orientation. Here's our our our operating expenses, our community engagement and advisory powers, and then our current direct program cost, which include housing coaches and emergency preparedness grants. This yellow, just so you all know, is we are participating in an EPA grant that's a multiyear grant. It's a little not [Member Anne Watson]: a little bit. [Speaker 3 ]: It's completely up in the air, but it does have it would provide us with a hundred and fifty thousand dollars a year of, basically, capacity building NTA services that we would give to community organizations. [Speaker 5 ]: So can we share about how much that program will make or what's gonna make available to our Vermont group you need? Yeah. [Speaker 3 ]: So this EPA Thriving Communities Grantmakers is a region one program, meaning that all of New England participates as a as a group. And the the EPA grant program is intended to make forty eight million dollars worth of grants available to community based organizations to address any kind of environmental justice issues, which include, water management, storm waters, you know, evolution issues. Yes. We it is continuing to move forward, although with all of the roller coaster that we [Speaker 4 ]: are seeing from our program. [Speaker 3 ]: So I know we took we took two extra minutes. No. We can [Speaker 5 ]: take it, but we can't do it right. [Chair Andrew Perchlik]: Yeah. Well, you you learned your extra two minutes for coming twice, and that's Yeah. [Grady Newton]: Not being here in New York. Okay? I think that's pretty clear. Any questions, folks have for the LAOP folks? Thanks for coming in. Appreciate it. We'll be in touch. [Chair Andrew Perchlik]: Do you see your gift of the three forty five? What? Do you [Member Anne Watson]: need the three forty five? Yes. [Grady Newton]: So maybe tell Emily we won't do the work report today. Okay. He's just saying, you're up. Good job waiting. [Speaker 2 ]: Time to follow. Yeah. Sorry. I'm just logging back into my computer. Hi. I'm Laura Collins. I'm the executive director of the Vermont Housing Finance Agency, and I'm here to talk about a couple different programs that are in s one twenty seven that BHP administers. And I'm pulling up the sorry. I'm just joining the Zoom now and pulling up a memo that's on your website where it shows the funding the housing funding programs that we wanna talk about. [Member Robert Norris]: We're gonna go to share the screen. And then [Chair Andrew Perchlik]: is there some that are in one twenty seven that aren't in the budget four ninety three? [Member Anne Watson]: Correct. [Chair Andrew Perchlik]: Yes. There are? [Speaker 2 ]: Yes. There are. [Speaker 3 ]: You need some help with that. [Speaker 2 ]: The I'm sorry. Can I call a can I call a friend? Chad Simmons from BHFA. Which one do you want on the budget? The two techs credit. [Speaker 4 ]: Correct. Currently, everything was removed Yes. From the s one twenty seven. So on the bookings back. [Chair Andrew Perchlik]: Okay. Well, that's the easy part to understand. The question is which two which things because you're funded in the budget. [Speaker 2 ]: The governor's recommend? [Grady Newton]: And in the house budget. Yes. [Chair Andrew Perchlik]: Which things are not in the budget that are were in one twenty seven? But some of these are Yeah. Some of those are in Yeah. Some of these budget programs are in one twenty seven. Yeah. But the tax credits were the Correct. You're gonna talk about that. Correct. Okay. [Speaker 2 ]: I apologize that sometimes these details are hard [Speaker 4 ]: to follow because they're moving so fast. Absolutely. [Speaker 2 ]: I want to start by just reiterating even though I am not with VHCB and it's very confusing, these four letter acronym agencies. The VHCB and VHFA do work hand in glove constantly, then I just wanna call out that, not only the base funding for VHCB, but also any one time money that can go to VHCB helps us use federal tax credits that VHFA does administer. And what's happened over the last few years is that we have been able to use just about all of the federal tax credits that we get [Member Anne Watson]: in [Speaker 2 ]: Vermont because the state had ample funding for VHCD, and that allowed us to put those tools together and, take advantage of all those federal tax credits. But as our ability as a state to have one time money for housing go down, we won't be able to use all the federal tax credits. And that's a loss because we've, we've been able to do an extra thousand units as a result of that BHCV support. So it is critical that BHCV those foundational investments are there, as well as funding for some newer programs that I'm gonna talk about here. In the governor's, recommended budget, there was fifteen million dollars for two different middle income programs, one that built affordable for sale homes, a homeownership program, and one that's building middle income affordable rental housing. They say affordable rental housing because it is affordable to the residents, but it is for people the residents have higher incomes than what traditional government subsidized housing typically houses. So, this is for people who earn just above those income limits. So you'd earn, you know, maybe like sixty or seventy thousand dollars up to it could be a six figure income, especially for a two person household. You may still be eligible for this rental revolving loan fund. Each of those programs had fifteen million dollars in the governor's recommended budget. They were cut back by the house. The home ownership program was cut back to ten million dollars. The rental program was cut back to seven and a half million dollars. I we would like to and what you'll see at the end of my memo is for you all to consider doing what you did last year in I don't know if this is the technical term, but waterfall provision of the budget last year. [Grady Newton]: We don't know if that's [Speaker 2 ]: Okay. Sorry. I didn't know that wasn't a term we don't [Grady Newton]: Yes. Contingency. [Speaker 2 ]: Contingency. Thank you. Last year, this committee knew that they was unsure of how much contingency funding there would be. And so you all picked a dollar amount for these two middle income programs and said, VHFA should get this amount for either the homeownership or the rental program. They're both middle income programs. They're both housing creation programs. They're addressing the stock of housing for similarly income folks. Mhmm. But by now, there wasn't enough contingency funding for us to get any money in that. But what I liked about that was that if there had only been a little bit of money, we would have been able to decide which program to open at some point. If if you all have to do haircuts enough and it gets down so low, it doesn't always make sense for us to open up two different programs and ask developers to submit applications if we don't really have enough to have, a well resourced program. So we might we'd love the flexibility. We could pivot and just open one of the two programs and not both. So one of [Chair Andrew Perchlik]: What is your minimum amount you have? Are you willing to [Speaker 2 ]: To open one program, I would say ten million dollars. [Grady Newton]: Okay. So, like, right now, with the seven and a half, it has to you gotta look at the language to not open that. [Speaker 2 ]: Correct. That seven and a half would not be enough to I end up what happens is the statute right now for this program says we have to have geographic diversity. I can't do that when we're funding two projects. You know, I can't hit the other targets that you all have put in statute. I was in this committee a few months ago and talking under the testimony about the budget adjustment act for a policy change to that rental revolving loan fund. It was about the rent cap that right now is in statute, and I want some flexibility. [Grady Newton]: That was also in that one time stuff. [Speaker 2 ]: Yes. And that that is right now, it passed the BAA. Both chambers just fine, but I think we know BAA is not in long right now. So, therefore, if we could get that language into the budget or all over the place, I'm feeling that policy language soon because I have loans closing from old money that needs that. So this, italicized note about where the language is exactly is right here. You again, both chambers already passed it. If we could take that language and insert it in as many bills as you see possible, that would be wonderful. Good. The the next thing I want to call out is what's not in the governor's recommend or in the budget is that for the last three years, there's been a million dollars each year given for us to create a first time home first generation, first time homebuyer grant program. This was a program that was really championed by grassroots organizations, many of which were organizations led by people of color who looked at the overlap between how people of color who do not have access to a more ship and the wealth creation, wealth generation that that creates, and how a lot of these folks would be first generation home buyers. And so we started up that program a few years ago, and it's been very successful. If I were to click this link about this hundred and sixteen buyers, it would take you to VHFA's website, which has demographics about who's being served, and I can tell you that it's younger households, much more likely to be people of color. Seventeen percent of our borrowers are people of color. And, that that program, I would love to be able to keep open. We had proposed that that be funded through a tax credit. We have other state tax credits that we administer, so we can sell those tax credits and use the proceeds of those sales to fund this program. So that was in the house housing budget and has gotten strong support from both house and senate, housing committees, and we would like for that language to be put in here. [Grady Newton]: Is that that that's in that's one thirty seven or was it? Says [Speaker 4 ]: Currently, there are no none of our techs in this case. [Chair Andrew Perchlik]: Right. Why not? Because we're [Grady Newton]: the one who took it out. Yep. And so what I mean, when it passed [Chair Andrew Perchlik]: out of economic development? Correct. Yes. Those tax credits. Yes. And your existing tax credits just just allows you to [Speaker 2 ]: The tax credit program is existing, but we've never used it to fund first gen. We always got appropriations for that. [Grady Newton]: Right. [Speaker 2 ]: So we were saying we could use a sale of tax credits to fund that since we're used to doing that for our other down payment programs. [Grady Newton]: Tax credits in our lending? [Chair Andrew Perchlik]: Or, like, why can't you just do that without one or sell those tax credits? [Speaker 2 ]: Because the tax credits that are in statute now are for other purposes and not for this. And they those have to be loans, not grants, and it doesn't speak to the first generation definition or anything. [Grady Newton]: Tax credit would be on the value of the home? [Speaker 2 ]: No. I'm sorry. The tax credit is a tax credit that a bank buys so that they can avoid paying their bank franchise fees. Right. No. I understand. Yeah. Well, how do we tax credit. So we we sell the five years of tax credits all in one fell swoop and receive for them about one point one million dollars for the sale of those tax credits. And for the next five years, those banks write off two hundred fifty grand on their taxes every year. We have that one point one million dollars, and we would give it out to people going to purchasing lenders and getting mortgages who are eligible. [Grady Newton]: But how is the tax credit value set? That you said [Speaker 2 ]: It's a market that we work with banks, and so it is a negotiation between us and the banks where we say you get a dollar of tax credit, and they say, well, I only wanna give you ninety cents on the dollar because I can't claim that tax credit for three, four, five years from now. [Chair Andrew Perchlik]: And is it just based on the appropriation, or is it based on some other connection to some other development? [Speaker 2 ]: It's not based on development at all because this is a buyer driven subsidy. It It has nothing to do with creating new units. It's based on, that we are allowed to sell, one point two five million dollars of these five year tax credits, and that's the cap that it's limited to. [Chair Andrew Perchlik]: Why wouldn't we just appropriate the money? Like, what would you You would be [Speaker 2 ]: you are welcome to appropriate the money going forward. What I was VHFA does not get direct appropriations from the state. I know I've been here a lot in the last few years. This is very unusual. Yeah. And it is a lot to staff and appropriations process for a million dollars every year, staff time and everything else. And so since we already sell tax credits for our other down payment assistance programs and the like, I was hoping to use that program facility so that I don't need to have Chad in your room for four months out of his life following that and doing it. But it is very efficient to do an appropriation, and so that's I'd love I I wanna keep the program open however it's hundred. [Chair Andrew Perchlik]: But for you, though, it'd be almost easier just to get the appropriation because you wouldn't have to go to sell the tax credits. But you're already saying you're already selling tax credits. [Speaker 2 ]: So Correct. I mean, what I'm saying is if you can get us into the base, we don't Sure. But coming in every year and talking about a million dollars is why the tax credits, we already are selling them in other regards. So And [Grady Newton]: so what what what was the next [Chair Andrew Perchlik]: one twenty seven is five years at two hundred fifty a year? [Speaker 2 ]: Correct. So that's the one point two five million. [Chair Andrew Perchlik]: Okay. [Speaker 2 ]: I wanna reiterate. I'm sorry if they just left. What Gina Arnela just said though about working with the Land Access Opportunity Board. I'm reviewing here many housing programs, obviously, not all the housing programs, but we do see that that LAOB has done a way that, VHFA has really changed our business practice, and, their advisory powers in the way that they've been able to work with us has been helpful. And I think that the funding through the cannabis headset packs or, you know, having them in the base are all strong moves to help with housing support. The last thing I'll say, and this was, you know, my recommendations at the very bottom here, which is, to merge the two oh, I can put water pollen here. I'm sorry. I didn't know that. That, to merge the two middle income programs into one reference, would be helpful. And knowing the budget situation, because we have seventeen and a half million dollars right now. If we needed to have the one point two five million come out of our own programs for first gen, I really would like to keep that program open. I know we need supply in stock, which is why the two middle income programs are so critical. But I also know that we need access to homes that we have available, and so I really don't wanna shut that program. [Member Anne Watson]: Can the can the home [Chair Andrew Perchlik]: buyer grant program include manufactured homes? [Speaker 2 ]: Yep. They can buy whatever kind of home they want. [Chair Andrew Perchlik]: I know other lenders have difficulty with manufacturing homes. Is that right? [Speaker 2 ]: Correct. We just have been able to expand what we've been able to do in manufactured housing. And so we [Speaker 4 ]: limited. [Grady Newton]: Okay. Then that's helpful to clarify because it's wasn't too clear on those tax credits. Any other questions [Chair Andrew Perchlik]: for you today? No. [Speaker 2 ]: I ran through because I know we're talking mostly about the money here, and I did the testimony in other committees on the programs. I just wanna, with my last minute, just say a couple highlights to excite you about the more ship program is that we did fund a hundred and twenty five homes. The average size, when I call them modest homes, it's thirteen hundred square feet. So that folks, we will pay for the value gap, the difference between the cost to construct the home and what it appraises for. This program is This is the home ownership, the middle income home ownership program. And then they're also if the price point needs to be even lower for, a borrower, then there can we can pay to make the home even more affordable. But we limit it to only funding thirty five percent of the cost of developing the home. So that's our [Grady Newton]: Is that the same with [Chair Andrew Perchlik]: the record of thirty five percent of the building? [Speaker 2 ]: Correct. It's thirty five percent of the cost of constructing it. What's unique about the rental program, I've been in house commerce a lot this year, and I I will say that there's a lot of employers who are looking to build housing on their own. And then you hear the chamber, and the chamber is saying, let's not make the housing problem become employer's problems where now they have to be the landlord. And I'm gonna agree with that. The I don't know that they all know fair housing and ADA the way and landlord tenant law the way that houses do. So having community based housing, the way this program does is great. [Member Anne Watson]: But the way we [Speaker 2 ]: structured this program ten million dollars of state investment pulled in twenty one million dollars from municipalities and employers. And by the way, we structured the program. So it's a subsidized interest rate loan to the developer of the housing. But if you have an employer or municipality paying for five percent of the cost of that building, then we're gonna give you even better loan terms. Some of them go down to zero percent loans. And it's a revolving loan fund. So we get that money back. The housing has to be affordable for the time that they have the benefit of that subsidized loan. But then three years after they pay that back to us, those affordability restrictions go away. We get the money back, and we turn it into a new investment in a new community. And so it's a powerful tool that I like having available to employers because so many employers right now are so interested in participating in solving the addressing the housing needs, but I think this is what really gives them that tool to come into the market. [Chair Andrew Perchlik]: So one the last question I have is you mentioned the DHCV funding being a priority. But when we look at how much money we have to do for housing, [Grady Newton]: and we have your program, the DHCV mainly, what would you recommend as far as, [Member Anne Watson]: would you [Grady Newton]: say, split it equally amongst these different programs, and how would you or is that an unfair question? [Speaker 2 ]: It's not an unfair question. I think it's the realistic question that we have to deal with. I think it goes back to for those of you who are in the all member briefing in December, the housing problems are not caused by one thing, and they're not gonna be solved by one thing. So to the extent that you limit your responses to one tool that is limiting, so I do think that there's room for lots of options. But let's be honest, the housing needs assessment shows that the, those disproportionately impacted by the housing shortage is the lowest income among us. And so BHCBs programs do leverage the tax credits that we administer, and together, we can, serve that lowest income, population. In addition, we're leaving money on the table from employers and municipalities and all that. We don't have this kind of rental model loan fund. And so I do think that you need to find a way to do it all. I mean, I think the treasurer has also been clear. It's impacting our ratings. It's holding our the chambers talk about how it's holding back the state's economy. And so Well, [Chair Andrew Perchlik]: there's no argument there. It's just that if you don't have a buck a bucket of money that's for housing Mhmm. [Grady Newton]: You just split it equally amongst [Speaker 2 ]: Well, we haven't even we are we are talking about rehab here, you know, which is renovating and so would [Chair Andrew Perchlik]: be another one. [Speaker 2 ]: Yeah. And the homeless response, which gets addressed through a lot of this. And so I I do appreciate the dilemma that you're in, but I'm gonna keep saying, like, we need to serve them all because that's the only way that I mean, it's a market. We need people to be able to move from shelter to rental housing to homeownership. Yeah. [Member Anne Watson]: Okay. So [Speaker 4 ]: can you just the rental revolving loan fund, How much are we spending per [Speaker 2 ]: unit? It's under forty thousand [Speaker 4 ]: dollars right now. Which is one of the cheapest things we've got [Grady Newton]: to have the meeting in living space. [Chair Andrew Perchlik]: Yeah. And for how [Grady Newton]: long does it have to meet the scores? And then is that the one [Chair Andrew Perchlik]: that we wanted to give you the permission to increase the rate over two percent? [Speaker 2 ]: It is. And like ten [Chair Andrew Perchlik]: or eleven or five. When it I heard the loan is over. [Speaker 2 ]: It's a minimum of seven years of affordability or the length of the loan. So they get thirty what they're what they all do is they get a thirty year loan from us, and it would be three years after that loan's paid off. So it would be thirty three years of affordability. But markets change, and I have a feeling a lot of those loans will pay off early and they're allowed to do that. And so they would at least have to have seven years of affordability. But if they paid us off in year ten, then they need to have another three years of affordable housing, but it'd be thirteen years. But it's gonna be different for every loan. My theory is for as long as you get the benefit of the subsidy, you should have affordable housing, and you should give an extra three years so the tenants have some, preparation that their rents may be going up higher. [Speaker 4 ]: We'll start with units, period. Yeah. And at at forty thousand, it's not with everything else we're doing, it's not very much to get a [Grady Newton]: unit going. Yeah. Because there's some renovation. It seems like [Chair Andrew Perchlik]: unbelievably close. [Speaker 2 ]: It is because this is a subordinate loan, meaning the developer has already gone to a regular bank and gotten a regular loan. So by getting a very low interest loan, they are essentially blending those rates together, which makes the whole thing more affordable. Also, again, remember, this is not serving the same kind of population. When I'm down here in my fictitious income shirt, you know, serving people who are on SSI income, it means that you have to subsidize those rents all the way down so they're only paying three or four hundred dollars a month in rent. Whereas the rental revolving loan fund, these units are renting for could be over two thousand dollars a month. It's cheaper than you'd get without this subsidy, but it's not necessarily serving the very lowest income households. But as we see, market rate housing is not penciling either, and that's why this efficient subsidy is helpful to kinda get that market rate housing happening while we wait [Chair Andrew Perchlik]: for And that forty thousand dollars is kinda based on [Grady Newton]: how much money you're putting into it, not, like, on the actual construction cost. [Speaker 2 ]: Right. Because, again, we limit it to thirty five percent of that construction cost, so we've created our own limiting factor in this. Right. [Member Anne Watson]: Okay. Alright. Thank you. Thank you very much. [Grady Newton]: Thanks for waiting around and walking through the whole Yes, sir. And unless [Member Anne Watson]: the [Grady Newton]: committee has anything else?

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