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May 31, 2019

2019 Final Legislative Update for Commerce

Final Analysis from DRM's Government & Public Affairs Team

Analysis by Topic

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Environment

COMMERCE & ECONOMIC DEVELOPMENT

Workforce Development (H.533)

Vermont Talent Pipeline Management (H.533)

Taxation and Regulation of Cannabis (S.54)

Automatic Contract Renewal/Data Privacy (H.327, S.110)

Insurance Deregulation (S.131)

Rural Economic Development (S.160)

Workforce Development

H.533

Early in the session, the House Commerce and Economic Development Committee established workforce development as its priority. The committee took weeks of extensive testimony on the workforce issues facing Vermont. Finally, in early March, the committee produced a bill that addressed opportunities for non-college educated workers, the nursing shortage, and the governor’s worker relocation program.

After further refinement in the Senate, the final version also mandates that the Agency of Commerce and Community Development allocate Vermont Training Program funding to increase credentials of value, apprenticeships, and to fund more training for small businesses. The bill also calls on the Department of Labor to work with training providers to increase the availability of programs that result in a credential of value in the health care, construction, manufacturing, or child care industries. To address the shortage of nurses in the state, the legislation has the Office of Professional Regulation review the standards for nursing programs and identify barriers to recruitment of nursing educators. 

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Vermont Talent Pipeline Management 

H.533

House and Senate committees spent a considerable amount of time this session learning about the Vermont Talent Pipeline Management, an employer-led program that aligns employer needs with education and workforce programs. The legislature included in its workforce development bill a provision that recognizes the contribution of VTPM and encourages state agencies to continue to work closely with it and other organizations to identify and meet the needs of employers and employees.

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Taxation and Regulation of Cannabis

S.54

The Senate passed a cannabis tax-and-regulate bill on March 1. The House Government Operations Committee spent the next two months refining the proposal before sending it to five separate committees, including the House money committees, for review. With a week left in the session, House Speaker Mitzi Johnson pulled the plug on the bill, saying there was not adequate time for the House to finish work on it.

Under the House Government Operations Committee’s version of the bill, the cannabis market would be regulated by five full-time board members. The cannabis tax rate would be 16 percent, with municipalities authorized to impose a two percent local option tax. Existing medical marijuana dispensaries would have been entitled to begin selling cannabis in February 2021, five months before the issuance of other retail licenses. The establishment of fees was delayed until the next legislative session.

In an effort to gain the support of Rep. Jim Harrison, R-Chittenden, the committee voted to support his amendment that would require municipal residents to vote affirmatively to accept retail cannabis sales within their borders. Harrison nonetheless was the lone vote against the bill in committee. 

The House Ways and Means Committee, which now has jurisdiction over the bill, will resume its consideration next January.

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Automatic Contract Renewal/Data Privacy 

H.327S.110

The House voted to repeal a law passed in 2018 that requires consumer contracts that automatically renew to include separate, opt-in provision. Tech companies strongly objected to the requirement last year, arguing that it would make Vermont an outlier and require costly programming changes. Although companies were less engaged on this issue this year, the House was nonetheless convinced that a California bill – requiring notice prior to renewal and an opportunity to cancel – was better for consumers. The Senate was unconvinced and refused to pass the bill.

Meanwhile, both the House and Senate passed legislation to expand security breach notice requirements to include data collectors that possess consumer login credentials. The legislation also would have expanded the definition of personally identifiable information and enacted a variety of requirements for student data privacy.

The House added the automatic renewal repeal to the privacy bill, but the Senate refused to go along. The combined bill failed to move out of conference committee. 

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Insurance Deregulation

S.131

The legislature passed a far-reaching bill that allows the Department of Financial Regulation to waive hundreds of insurance filing requirements – a surprising outcome given the composition of the General Assembly. The Commissioner may grant an “innovation waiver” if a person subject to regulation can show that:

  • The requirement would prohibit the introduction of an innovative product or service;
  • The policy goals of the regulation can be achieved by other means;
  • The waiver will not unreasonably increase risk to consumers; and
  • The waiver is in the public interest.

The bill as passed was scaled back from its original version following objections by the Vermont Insurance Agents Association. Among other things, the bill was amended to require public notice of proposed waivers.

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Rural Economic Development 

S.160

It is common knowledge that farms are hurting financially, locally and across the country. Agricultural producers have suffered tremendous financial losses from the Trump administration’s trade war with China, and milk prices – always volatile – hit decade low levels as of mid-April. Vermont farmers have also been heavily criticized in the debate about nutrient pollution in Vermont’s surface waters.

S.160 represents a strong collaborative effort among stakeholders and legislators to improve the business climate for Vermont’s oldest, and arguably culturally most important, industry.

The bill, which is expected to be signed by the governor, provides for the following significant reports, policy initiatives and changes to law:

  • A strategic plan to be delivered by the Farm-to-Plate Investment Program and Secretary of Agriculture, Food and Markets with prioritized steps to assist in stabilizing, diversifying and revitalizing Vermont’s food systems;
  • A report from the Secretary of Agriculture assessing market opportunities for Vermont dairy products in major metropolitan markets;
  • A working group convened by the Secretary of Agriculture tasked with identifying financial incentives for farms implementing environmental practices that exceed current legal requirements for soil health, crop resilience and reduced run off to waters of the state;
  • A working group to evaluate the current status of carbon sequestration markets and make recommendations for a program to facilitate enrollment of Vermont forest lands in carbon sequestration markets; and 
    • New programs at the Agency of Agriculture, Food and Markets, including:
      A Vermont Environmental Stewardship Program to provide technical and financial assistance to Vermont farmers seeking to implement regenerative farming practices;
    • A Conservation Reserve Enhancement Program to provide farms with financial assistance for implementation of alternative practices to improve soil health and nutrient retention and reduce agricultural waste; and
    • An Agricultural Environmental Management Program to provide farms with financial assistance to address water quality concerns associated with management of farmsteads, cropland and pastures.

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DRM’s Government and Public Affairs professionals help the state's critical industries to achieve key objectives involving government, the press and the public. For more information about the content of this Legislative Update, please contact any team member:

 
John Hollar | Trey Martin | Lucie GarandRebecca Lewandoski

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