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Highlights from the 2024 Vermont Legislative Session: Cloud Tax, Data Privacy and More
The Vermont Legislature officially closed the second year of its biennium May 11 after a flurry of last-minute activity, which included passing an $8.6 billion state budget. Although the budget is approximately $21 million more than Governor Phil Scott’s budget, he said he would sign it. That may not be the case for several other bills, and lawmakers are scheduled to be back June 17 to address any potential vetoes.
Here is a summary of the key areas the VTTA has been following, particularly legislation involving the Cloud Tax and Data Privacy.
Cloud Tax
Despite our many years advocating against this tax, a scaled-back version of the so-called Cloud Tax is included in the education funding bill, referred to as the “yield bill” (H.887) that determines the statewide property tax. We were unable to prevent the inclusion of the tax this session, given the pressure legislators were facing to reduce property taxes. The bill adds the 6% sales tax on Software as a Service.
The original version also applied the tax to Infrastructure-as-a-Service and Platform-as-a-Service. However, testimony to the Senate Finance Committee from the VTTA and several tech businesses owners – Sky Chalmers (Image Relay), Ethan Carlson (Datablend), Robbie Adler (Faraday), Ted Adler (Union Street Media), and Rubin Bennett (rb Technologies) – prompted the committee to remove the tax on IaaS and PaaS, which they viewed as having the greatest impact on businesses. This lowered the projected annual revenue from the cloud tax from more than $20 million to an estimated $13 - 15 million.
The tax will apply to Prewritten computer software regardless of the method in which the prewritten computer software is paid for, delivered, or accessed. Because it is less specific, the tax department will be able to develop guidelines that do not include IaaS and PaaS. However, even without these categories, the tax on SaaS will have a cost impact on Vermont tech and other businesses.
Despite this tax, and a new 3% surcharge on rental properties and $25 million from projected general fund surplus, the projected average statewide property tax increase is 13.8%.This is lower than earlier projections, but still too high for the Governor, who has threatened to veto the bill.
Data Privacy
The respective House and Senate commerce committees engaged in back and forth on the data privacy bill (H.121) in the final days of the session. In the end, elements of the so-called Kids Code Bill (S.289), designed to increase online protection for children, were merged into H.121.
Despite concerns raised by the VTTA and other Vermont businesses, a targeted private right of action (PRA) was included, making Vermont the first to have such an option in a data privacy bill. The PRA allows trial attorneys to file class-action lawsuits against businesses they believe have violated the law. Most data privacy bills are either based on California’s, covering its 40 million residents, or Connecticut’s, which covers approximately 100 million Americans. The VTTA and other Vermont businesses had advocated for the Connecticut model for consistency and interoperability across states.
The bill states that the attorney general has the sole authority to bring legal action. However, consumers have the option to bring a PRA in situations when a large data holder, defined as having the information of 100,000 or more Vermonters, does the following:
- Processes sensitive data without consent
- Sells sensitive data, including that of minors
- Violates consumer health data protections, including using geofencing around health facilities.
Businesses would have 60 days to correct any violations before a PRA can be brought.
The PRA doesn’t take effect for two years (January 1, 2027) and is repealed two years later (January 1, 2029). The intent is to give time to educate businesses about the bill’s requirements before the PRA goes into effect. The repeal two years later is to allow lawmakers to review how the PRA worked in practice and require an affirmative act by the Legislature to continue it.
The Governor has raised concerns about the bill, but has not indicated whether he would veto it.
Housing - Act 250
Lawmakers passed H.687, which creates a three-tier approach over the next three years, based on a development’s location and environmental sensitivity. The result is that the building of housing units in many municipalities, town centers, growth centers, and neighborhood development areas across the state will be exempt from Act. 250. It also establishes a professional board intended to make the Act 250 process more predictable, fair, and timely. The Governor has been critical of the bill, saying that it does not go far enough to enable the building of new housing. It is unclear if he will veto the bill or allow it to become law without his signature.
Vermont Economic Growth Incentive
The Vermont Economic Growth Incentive Program, received a two-year extension in H.10. The bill sought to create a forgivable loan program, administered by VEDA, for small businesses with 50 or fewer employees, which the VTTA supported. However, funding for this was redirected to flood relief for businesses.
Pay Disclosure in Job Listings
Bill H.704 requires Vermont employers to include the compensation, or range of compensation, in any advertisement for a Vermont job opening, with exceptions for commission-based or tipped positions that require disclosure of payment structure or base wage. The Attorney General’s Office is tasked with publishing guidance for employers and employees regarding these provisions by January 1, 2025 before the law takes effect on July 1, 2025.
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Networking Event in Rutland
Plan to attend a networking event at The Hub CoWorks in Rutland May 30. This gathering is presented by Vermont Tech Meetup in partnership with the VTTA and hosted at The Hub CoWorks. This event promises an opportunity for professionals, entrepreneurs, and enthusiasts within the technology sector to meet and make new connections and listen to a discussion about creating a tech startup and Startup Rutland's accelerator program. And as at our previous networking event, we’ll have an Open Mic to share projects, activities or ask for help.
Find more and register here.
Jeff Couture
Executive Director
Vermont Technology Alliance
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Generator’s JumpStart Expo & Pitch Night
(May 29, 2024 – Generator)
JumpStart is a 12-week, personalized, group coaching experience hosted by Generator, that leads budding small business owners from prototype to fully functional product-based business. The JumpStart Expo & Pitch Night will feature a public showcase of the JumpStart participants’ products, and every entrepreneur will pitch their company/product to the public and their peers.
Find more here.
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Vermont Tech Networking Event at The Hub CoWorks in Rutland
(May 30, 2024 – The Hub CoWorks, Rutland )
Vermont Tech Meetup in partnership with the Vermont Technology Alliance are presenting a networking event at The Hub CoWorks in Rutland May 2. It’s an opportunity for professionals, entrepreneurs, and enthusiasts within the technology sector in the Rutland area and beyond to meet and make new connections and learn about Startup Rutland’s accelerator program.
Find more here.
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LaunchVT Demo Night
(June 11, 2024 – Hula)
This annual pitch competition highlights the 2024 LaunchVT cohort and their startup businesses. Demo Night showcases these promising new businesses and their founders after they have completed LaunchVT's intensive, 12-week accelerator program. Each cohort team will present their pitch to judges and the audience to win one of several cash prizes.
Find more here.
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2024 Rural Entrepreneurship Symposium
(June 19 -21, 2024 – UVM)
This symposium brings together researchers, teachers, policymakers, and entrepreneurs to discuss the theme of “High-Tech in Small Towns and Rural Spaces.” Workshops include: Sustainable Economic and Social Infrastructure, Diversity, Inclusivity, and Small Business, and Entrepreneurial Hubs & Platforms
Find more here.
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UVM Rise Summit
(June 24-25, 2024 – UVM)
UVM presents RISE (Research, Innovation, Sustainability, Entrepreneurship), a free, two-day, summit. The conference will bring together researchers, entrepreneurs, problem-solvers, and energized community members to address a myriad of complex challenges.
Topics of discussion will include how to build flood resilience, strengthen food systems, enhance educational opportunities for learners of all ages, amplify technology solutions for energy and community systems, and converge on ideas for a sustainable future.
Find more here.
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Education + AI Summit
(June 27, 2024 – Hula)
aiVermont is presenting a summit at Hula that will explore Artificial Intelligence in the classroom. The session is aimed toward secondary school educators, but is open to anyone interested in the teaching and use of AI in the classroom. The session will explore effective classroom strategies, tools, and ethical practices using AI. Interact with peers, newbies, and experts to learn the why, what, and how of AI tech.
Find more here.
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New Tech Podcast: Is There a Vermont Way of Building a Rural Economic Landscape?
The team of the Vermont Tech Podcast, sponsored by VTTA, is joined by Joshua Moses, who works with individuals, organizations, and communities to cultivate vision and resourcefulness in the face of uncertainty and socio-ecological transitions. He’s on the faculty of Haverford College, but currently is a visiting faculty member at UVM.
The conversation centers around why and how the tech sector requires the perspective of the humanities, fine arts and other broader disciplines. The discussion also turned to changing rural economics and the potential for technology to make a difference in rural communities, climate change and other issues. Is there a Vermont way when it comes to the tech sector?
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OnLogic Opens New Global Headquarters
(May 16, 2024 – Vermont Biz)
Global industrial computer hardware manufacturer and solution provider, and VTTA member, OnLogic cut the ribbon May 14 on its new 150,000-square-foot global headquarters in South Burlington.
While the building itself has become a landmark adjacent to the “Whale Tails” on Interstate 89, the campus will eventually add 150 employees. OnLogic co-founder Roland Groeneveld told VermontBiz that beyond the significance to his own firm, the company helps underpin the opportunity Vermont presents, while the building itself, intentionally along the interstate, shows it off. This is the kind of development the state needs in such a visible location, he said.
Read more here.
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Vermont’s Data Privacy Act Passes, But May Face Hurdles On Way To Governor’s Desk
(May 16, 2024 – Tech Policy Press)
At the eleventh hour on the final day of Vermont’s legislative session, state lawmakers passed what’s being hailed as one of the strongest data privacy bills in the country and a win for child online safety advocates. Sponsored by Republican Representative Michael Marcotte, who chairs the House Committee on Commerce and Economic Development, the bipartisan Vermont Data Privacy Act (H.121) includes a private right of action, a minimum duty of care for minors, and limits the amount of personal data companies can collect on consumers.
Passing a data privacy bill that includes a private right of action, which allows individuals to file suits against businesses violating the act, is a major feat for its proponents. It’s also one of the main concerns Republican Gov. Phil Scott has expressed as the legislation makes its way to his desk to either be signed into law or vetoed.
Read more here.
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Vermont ‘Tech Hub’ Competing for Major Federal Funding Boost
(May 9, 2024 – WCAX-TV)
The state of Vermont is making a multi-million-dollar pitch to become a leader in cutting-edge technology that has the potential to reshape electronics. The state is hoping to convince the federal government to invest big bucks to expand the state’s newly designated “Tech Hub,” reaping benefits for the entire region.
In the assembly room at OnLogic, custom computers are churned out every day.The South Burlington-based tech company prides itself on machines that are able to withstand environmental stressors that your laptop wouldn’t. “OnLogic is all about innovation, ” said the company’s Mike Kleiner.
That prompted them to step up to join Vermont’s burgeoning Tech Hub. The state got the designation last fall by the federal government as part of the CHIPS Act. The tech hub’s main focus is developing more efficient semiconductors from a compound called Gallium Nitride. GaN has the potential to take semiconductors — which are at the brains of most of our technology — to the next level.
Read more here.
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Technology for Tomorrow’s Microsoft TechSpark Program Exceeds Goals
(May 13, 2024 – Technology for Tomorrow)
Technology for Tomorrow (T4T) wrapped its inaugural year of the Microsoft TechSpark partnership with the completion of its digital literacy series.
T4T, a nonprofit based in Williston, was the Vermont organization selected for the inaugural Microsoft TechSpark Fellow Program to foster inclusive economic opportunity, job creation, and innovation in the state.
T4T developed “TechSpark Wednesdays,” a series of free digital literacy courses. The two 10-week cohorts centered on basic skill building and advanced AI understanding. The 90-minute hybrid classes met weekly in the Digital Lab at the South Burlington Public Library. Participants also were able to join virtually, ensuring access via digital learning.
Read more here.
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Progressive Technology with an Added Bit of Soul: Fluency Inc.
(May 2024 – VermontBiz)
“We have a super-complex, nuanced and nerdy business,“ says Fluency CEO Mike Lane. “But we’re building a great business. That is really the goal here.“
Fluency Inc. is a privately held, self-funded, successful and still-growing company founded in Burlington in 2017 by former executives from Dealer.com. The company automates digital advertising for large clients, who then place their ads with large global companies like Google and Meta (parent of Facebook, Instagram and WhatsApp).
The technology world has certainly noticed. Fluency ranks No. 58 on Inc Magazine’s list of the Northeast region’s fastest-growing companies and No. 200 on its list of 5,000 fastest-growing companies in the country. It also landed at No. 76 on the Deloitte Technology Fast 500.
Read more here.
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Featured Member – Coldwell Banker Hickok & Boardman | |
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A longtime member of the Vermont Technology Alliance, Coldwell Banker Hickok & Boardman is dedicated to supporting people moving to or from Vermont and assisting VTTA members in helping employees and new hires with community and housing resources. This locally owned agency, affiliated with a globally known brand, has a reputation for excellence. It ranks among the top 35 Coldwell Banker offices nationwide, maintains a 99% client satisfaction rating, and is recognized as a "Best Place to Work in Vermont."
Their relocation department, the only one of its kind locally, is designed to enhance recruitment and retention strategies for Vermont companies of all sizes. Complementary services include one-on-one consultations, community tours for interviewing candidates or recent new hires, home-finding assistance, educational sessions for employees considering home purchases, and real estate market updates for your leadership team.
As a market leader with over 65 years of serving northwest Vermont, Coldwell Banker Hickok & Boardman maintains a deep connection to the region while continuously investing in the education and training of its Agents to ensure their clients' success. This dedication extends to an investment in a suite of technology resources, most notably HickokandBoardman.com, and in-house capabilities to equip Agents and clients with the latest tools and resources to make their move in a fast, evolving real estate landscape.
For more information on how their services can assist your team, contact Enya Murphy, Business Development & Relocation Manager, at 802-846-9560 or Enya@HickokandBoardman.com
Find more at https://www.hickokandboardman.com/
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Useful Information & Links | |
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Explore commercialization in an NSF I-Corps Regional Courses
Led by the NSF I-Corps Hub: Interior Northeast (IN I-Corps), these free, month-long, virtual and hybrid courses are designed for university-based STEM researchers and early-stage founders interested in evaluating the market potential of their technology and learning valuable entrepreneurial skills.
Semiconductor I-Corps Regional Course
Calling all Semiconductor innovators! Evaluate the market potential of your technology in a specially tailored NSF I-Corps regional course from June 17 to July 17, hosted in partnership with Syracuse University and the University of Rochester. This course begins with virtual entrepreneurship training and culminates in a funded customer discovery trip to SEMICON West, a conference bringing the global electronics supply chain together.
Apply by May 28: https://bit.ly/3QEuRCw
UVM I-Corps Regional Course
Explore the potential to translate your innovation from lab to market in this free virtual entrepreneurship course designed for tech innovators in all STEM fields. From June 8 to August 7, hosted in partnership with the University of Vermont.
Apply by June 12: https://www.tfaforms.com/5125056
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Online Professional Development Courses
The VTTA has partnered with MindEdge to offer easy-to-access, affordable, online professional development courses. Whether you are looking to expand your skill set, earn professional credits, or learn something new, these courses are an option to gain essential and in-demand skills on your own time, at your own pace, and from any location. As a bonus, VTTA members save 10% on all offerings.
Find more here.
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VTTA Career Center
Vermont Technology Alliance member companies are hiring, and when you visit the Career Center on the Vermont Technology Alliance website you can browse and search for these job openings and subscribe to updates. The Career Center on average features 200+ tech and non-tech jobs with Vermont Technology Alliance member businesses. Jobs available from VTTA members are listed at no charge in the Career Center as a member benefit.
Find the Career Center here.
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Find the Software Development Staff with Recruiting Services from VTTA and ScaleTech
The Vermont Technology Alliance has partnered with tech talent solution firm ScaleTech to offer talent solution services to help Vermont businesses find the software developers and engineers. they need to sustain and grow their businesses. ScaleTech focuses on developing a working partnership with businesses between 5 to 200 employees, and offers discounted rates for VTTA members.
Find more here.
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The VTTA Thanks Its Member/Sponsors
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