December 30, 2021
As the Legislature reconvenes in January, the issues are familiar – housing, child care, broadband, climate change, and pension reform. Fortunately, the federal American Rescue Plan Act of 2021 (ARPA) contained significant funding for states to address these chronic issues, with some funds appropriated last year and the balance to be appropriated this year. Yet, there are never enough funds to permanently solve these issues. Even with the ARPA funds being injected into ongoing programs, new tax revenue is already being discussed to sustain this higher level of spending. Of equal importance are the politics of the session with four seats open in the 2022 election. This legislative session will be packed with leaders jockeying for sound bites as they work to elevate their name recognition to the voters. With nearly a year before the election, Vermont currently has open seats for the U.S. Senate, the U.S. House of Representatives, the Lieutenant Governor, and the President Pro Tem. The ongoing pandemic also adds another element to this environment, which has caused the Vermont Chamber to invest more resources in advocacy, expanding our lobbying team to five people working on all the issues impacting the business community. Read more about the newest members of our lobbying team here or contact any member of our lobbying team at govaffairs@vtchamber.com.
Businesses across every sector of Vermont’s economy are experiencing a severe shortage of workers. According to the Department of Labor, there are only about 8,000 unemployed Vermonters and over 20,000 job openings. The Vermont Chamber will lobby for funding for programs including the Vermont Training Program, the RETAIN initiative, CTE programs, relocation grants and the Stay-to-Stay program, and a military retirement pay tax exemption, to encourage people to return to work, and to attract more workers to Vermont.
While there is universal agreement that Vermont has a housing shortage, how to fix it and where to allocate funds continues to be debated. Recently, Governor Scott requested $80 million in ARPA funds for multiple housing initiatives for the current year budget and another $100 million in ARPA funds for a housing package next year. The Vermont Chamber has suggested creating incentives for converting empty office buildings into housing in our downtowns and village centers and will advocate for the proposals outlined by the Vermont Future’s Project to create workforce housing. The Vermont Chamber will also be an active voice in supporting the modernization of Act 250 to facilitate a more predictable and less costly permit process to better enable the development of housing in our downtown and village centers.
The Legislature and agency regulators will be reviewing the Vermont Climate Action Plan recommendations and possible regulatory changes. Given the labor shortage, it is unclear how this plan could be carried out without addressing workforce shortages first. The Vermont Chamber supports increased density in downtowns and village centers as part of the climate solution.
Last session, the Legislature passed H.439 to address systemic inequities in Vermont’s economy, mandating that the Agency of Commerce and Community Development (ACCD) collaborate with BIPOC businesses and community organizations to develop recommendations on best practices to support BIPOC business development. The report from ACCD is due later in 2022. In the meantime, the Vermont Chamber has been working to center the voices of BIPOC leaders of the business community in discussions around building Vermont’s future economy. Diversity, equity, and inclusion are not just core Vermont values, but also critical to Vermont’s economic health and future.
In July, Governor Scott vetoed S.79, an Act Relating to Improving Rental Housing and Safety, which included a short term rental (STR) registry. There was wide disappointment in this action from both advocates and legislators. As a long-time lodging advocate, the Vermont Chamber sees a registry as the next step toward equity and ensuring a safe rental environment. While the House and Senate will not be attempting to override the Governor’s veto, legislators and advocates have returned to the drafting table to collaborate on a new iteration of the bill which will include efforts to address concerns expressed by select legislators and the Administration. Contact Vermont Chamber Vice President of Tourism Amy Spear with questions.
Last session, a significant liquor law modernization bill was signed into law. There were several provisions that positively impact businesses and serve as economic recovery tools such as a temporary measure to allow alcohol to-go until 2023. While Act 70 signified a major progression, there were important provisions left on the table that the committees of jurisdiction did not have enough time to fully consider. This includes allowing low-alcohol spirit beverages (ready to drink canned cocktails) to be sold by the same retailers that sell beer, wine, and hard cider, and allowing small Vermont distillers to ship directly to consumers. Permitting Vermont distillers to do so would bring Vermont in-line with other states that have already passed a similar measure. Discussions around these provisions will continue this session. Continued adjustment and modernization of alcohol regulatory and financial policies is a priority for both the Vermont Chamber and our partner, Vermont Independent Restaurants.
The Unemployment Insurance (UI) Study Committee issued a preliminary report outlining two possible ways to update weekly benefits and funding. Both options would raise the weekly minimum and maximum benefit amounts for claimants. The Committee explored paying for this change by decreasing unemployment insurance contributions by roughly $100 million over 10 years while creating a surcharge directed to a special fund to provide for increased benefits. The Vermont Chamber has protected the integrity of the UI Trust Fund and will work to secure unemployment insurance rate relief to help Vermont businesses have a safe and robust recovery. 
Continued Stalemate on Pension Reform
Pension reform for State employees and teachers is back on the agenda, with no clear path forward. The summer study committee was tasked with identifying new revenue sources to permanently address the $5 billion debt that has accumulated and must be paid by 2038. The unions have been clear that they don’t want substantive changes to their benefits and that any solution must have a dedicated revenue source. Given Governor Scott’s opposition to raising taxes, that is unlikely and the committee’s inability to name a tax recognized that political reality. Lawmakers previously set aside $150 million in one-time funds to put toward the pension debt as an incentive to find a solution. Since it’s an election year, it’s likely these funds will be appropriated, and no new tax will be levied, continuing the long-term impasse on this issue.
 
Will Single Member Districts Gain Traction?
The General Assembly will redraw its boundaries for electing House and Senate members in 2022, using new Census data to maintain adherence to the one person-one vote standard. The Legislative Apportionment Board approved a map for the Vermont House of Representatives, eliminating two-member districts. The Vermont Senate map has not yet been released, but the debate over single-member districts is in play there as well, with many legislators expressing concerns about fairness for their constituents, as well as the unspoken threat to their own electability.
 
Minimum Wage Is Set to Increase on January 1 
Beginning January 1, 2022, Vermont’s minimum wage will rise to $12.55 per hour, an increase of $0.80 from the current minimum wage of $11.75. Tipped employee minimum wages will rise from the current $5.88 to $6.28 per hour.
The Vermont Chamber's five-person lobbying team is tracking federal legislative issues that impact Vermont businesses. Learn what to know in this weekly roundup:
  • The Restaurant Revitalization Fund (RRF)
  • OSHA emergency temporary standard
  • Build Back Better
  • The Infrastructure Investment and Jobs Act
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