2015 Legislative Report
Davis & Hodgdon Associates CPAsRead member testimonial
The 2015 legislative session opened with some VBSR priority areas carrying over from the 2014 session, in particular legislation on earned paid leave made it through the House. Other issues such as Clean Water and Rent-to-Own legislation gained new momentum this session and VBSR worked closely to influence these policies.
We received tremendous support from our members this year, working to advance VBSR's legislative agenda and making positive change for Vermonters. We want to extend our gratitude to the many members who either spent time writing to legislators, testifying in committee hearings or simply taking time away from their daily responsibilities to support advocacy that truly makes an impact in promoting socially responsible business practices and policies in Vermont.
Below you will find a few of VBSR’s successful policy efforts from the last session; if you have questions or comments about any of this information, we invite you to contact our Public Policy Manager, Daniel Barlow, at email@example.com
Clean Water (H.35)
A bill creating a funded clean-up plan for Lake Champlain and other Vermont waterways was considered a must-pass by many this year, especially considering the Environmental Protection Agency was threatening to step in with its own regulations to crack down on pollution. The bill expands state authority and regulation on several forms of water pollution, including run-off from farms, parking lots, and other developments. The new law also allows the state to remove the Current Use status for farms that pollute. Additionally, the law uses a 0.2 percent surcharge on the property transfer tax, raising about $5.3 million, to create a state Clean Water Fund to help support water quality management projects, such as improvements to municipal water systems. VBSR was the only business group to support this bill.
Renewable Energy (H.40)
Lawmakers passed a bill this year that, for the first time, requires Vermont utilities to sell renewable energy and help their customers reduce their fossil fuel footprints. The new law launches a program called RESET (Renewable Energy Standard and Energy Transformation) that synchs state renewable energy programs with other New England states and avoids an upcoming 6-cent rate hike from changes in how renewable energy credits are sold to those states. The requirement that utilities help customers reduce their fossil fuel use could include programs such as on-bill financing for electric heat pumps, for example. Concerns over the siting of renewable energy projects in Vermont also spilled over to this bill and lawmakers included provisions that give municipalities party status in Public Service Board deliberations for projects they host and created minimum setback requirements for solar projects as well. VBSR was the largest business group to support this bill.
Comprehensive Tax Reform
Lawmakers considered cuts, new revenue, and changes to the state’s tax code as options for filling the $110 million budget gap this year. In the end, lawmakers and Gov. Shumlin agreed on a roughly $30 million tax package that eliminates about $15 million in state tax deductions and raises about $15 million in new revenue through other tax changes. These adjustments include limiting itemized deductions for state income taxes to 2.5 times the standard deduction ($15,000 for individuals and $31,500 for joint filers) and creating a 3 percent alternative minimum tax on earners making more than $150,000 a year. Vermont’s non-profit sector won an exemption from the tax reform proposals after raising concerns that the limits would hurt charitable giving; the cap on itemized income tax deductions does not include charitable donations or medical expenses. The tax changes made this year were recommendations of the state’s 2010 Blue Ribbon Tax Commission, but lawmakers did not pass the more controversial recommendations, such as expanding the sales tax to services or moving Vermont strictly to a system of taxing based on adjusted gross income, as most other states do already. VBSR was the only business group to support the tax reform changes this year.
Earned Paid Leave (H.187)
A bill establishing a minimum standard of paid time off for most Vermont workers passed the House this year and is scheduled to be taken up by the Senate when lawmakers return to Montpelier in January 2016. Sponsors of the bill made a number of changes to the proposal this year, including limiting and staggering the number of days off earned: a minimum of three days off during the first two years of implementation, moving up to five days after two years (a reduction from the seven days off that workers would earn each year proposed under last year’s bill). Part-time workers are still included in the proposal, but lawmakers excluded seasonal and temporary workers. Employers with more generous benefit packages would be unaffected by the bill. VBSR was the largest business group to support this bill.
Rent-to-Own Regulation (S.73)
This new law cracks down on some of the predatory practices of the so-called rent-to-own industry – businesses that target low-income residents with “deals” on furniture and other household items. Lawmakers found that very few of the customers end up owning the merchandise after spending hundreds or thousands of dollars in weekly fees and hidden costs. The bill, which VBSR supported, requires these businesses to be more transparent about their practices, including the total true cost of the merchandise, whether it was used or previously owned, and limits collection tactics that have been described as “harassing.” VBSR was the largest business group to support this bill.
Health Care Reform (S.139)
This was the session of diminished expectations for health care reform in Vermont. Weeks before the session started, Gov. Shumlin abandoned his plans for a single-payer system. His alternative proposal was to raise $90 million through a 0.7% payroll tax and use those funds to draw down an additional $100 million in federal matching funds. The money was earmarked to fix the Medicaid cost shift and the proposal received weeks of testimony at the State House, but only one positive committee vote before fizzling out. The policy behind the proposal was solid, but the politics of the building have turned against major changes in health care following the debacle of Vermont Health Connect. Instead, the House and Senate passed a modest $3 million health care package, funded partly through an increase in the tobacco tax, that funds VHC subsidies for low-income residents, expands the powers of the Green Mountain Care Board, and continues the work of the Blueprint for Health Program. Two provisions were included in the bill that VBSR strongly supports: (1) The creation of an on-line tool allowing Vermonters to shop by price for common medical procedures, and (2) A state study on the creation of a universal primary care system in Vermont.
Thank you again to everyone using their businesses to make a difference! If you have questions or ideas for changemaking, please do contact Dan! Also, don't forget that nany of VBSR’s letters and testimony to the Legislature can be read in the Public Policy section of the website.
Vermont Businesses for Social Responsibility is disappointed in Wednesday’s announcement that the Governor and his administration is abandoning a health care financing plan for “the foreseeable future.” We would have preferred that the Governor release a menu of financing options and used his position to facilitate a debate about the challenges and opportunities for fixing the current broken financing system for health care. As the Governor acknowledged in his opening remarks, health care costs and the unresolved cost shift, threaten to overwhelm our economy.
VBSR has spent 25 years advocating for health care reform and that work will not stop. Problems with the equity and financing of health care persist and must be addressed. Vermont’s business community needs a level-playing field in which all contribute based on ability to pay and all will benefit. We need to remove the link between insurance and employment. That will allow businesses to do what businesses do best - expand operations, create jobs, and increase the wages of hard-working Vermonters.
VBSR will continue to work for the reforms our business members and their employees need. We believe that with sufficient will and imagination, we can bend the cost curve and design a financing system that benefits Vermonters and the Vermont economy. We look forward to having that conversation and furthering the goals of health care reform in 2015.
VBSR's Public Policy team looks forward to working with the Legislature and our members to craft policies that support socially responsible businesses. If you have any questions about our agenda, or you want to participate in advancing parts of our agenda, please contact VBSR Policy Manager Daniel Barlow.
- Vermont needs to reform health care so that all residents are covered under a basic plan that is funded based on a person’s ability to pay, not how much care they need.
- Remove the link between health care and employment. All businesses should contribute to publicly financed health care through a payroll tax system.
- Just as all Vermonters are covered, all Vermonters should pay something toward our public health care system. This includes taxes on earned and unearned income to ensure that everyone is contributing based on their ability to pay.
- A sustainable financing plan for health care should weather economic downturns and major external changes. This plan should include multiple revenue options to create a broad tax base and minimize regressive taxes and one-time sources of money.
- The financing plan should stress simplicity and be easily understood by most Vermonters. Residents and businesses should have no problem linking the taxes they pay to the benefits they receive.
- A strong basic health care benefit package for all Vermonters is essential to reform. This benefit should meet the basic health care needs of residents and minimize the use of co-pays and deductibles and other barriers to accessing care.
- The transition from our present health care system to the new one should be measured and orderly, including phasing in key reform elements over several years to reduce the volatility of change and to allow Vermonters and businesses to prepare.
- Vermont needs to take bold action to combat climate change and move away from dirty fuels. Taxing pollution and returning a majority of the revenue back to Vermonters while also investing a small portion in energy efficiency and renewable energy projects is essential to meeting the state’s carbon reduction goals.
- Economic modeling has shown that a fairly priced pollution tax will increase jobs, put more money in the pockets of hard-working Vermonters and reduce the state’s greenhouse gas emissions.
- Reduce the regressivness of a pollution tax by targeting financial relief to low-income families using existing benefits infrastructure, such as the electronic benefits transfer system.
- Vermont's businesses and residents depend on clean, safe water and the State needs to fulfill our federal legal obligations regarding water quality. VBSR would like to see the State of Vermont take actions to solve our growing water pollution problems including placing an appropriate price on water pollution.
- Adopt the recommendations of the Blue Ribbon Tax Commission, including moving to Adjusted Gross Income, creating a fair minimum tax rate for high-income earners and adopting a rigorous review standard for tax credits and exemptions.
- Raise the profile with the Vermont Legislature and the state’s business community about the economic and social importance of creating jobs that have the wages and benefits that allow Vermont families to thrive.
- Highlight the ways Vermont businesses use the state’s Basic Needs Budget and how the state can support, retain and attract businesses that offer living jobs.
- Vermont can incentivize companies that create Living Jobs by creating a state contract purchasing preference for companies that pay a living wage, offer strong benefits to their employees, and follow good workplace practices. State contracts paid for through our tax dollars should not be awarded to companies that pay so little that their employees need public assistance to survive.