By Evan Johnson
Local business and community leaders came out early Monday morning for a legislative breakfast that featured updates and discussion on bills progressing through the state legislature in Montpelier. Rep. Butch Shaw (R – Rutland 6) said recent bills concerning paid family leave, a carbon tax, increasing the minimum wage and simplifying Act 250 were of particular interest to Rutland county residents and businesses.
Paid family leave
Rep. Jim Harrison (R – Windsor 1) led off with an update on a bill that would provide paid family leave. The bill was passed by the House in May 2017 and will be taken up in the Senate pending the passage of a bill for a $15 per-hour minimum wage.
As initially proposed, the bill provided up to 12 weeks of leave annually that would accommodate a broad range of conditions including an individual’s own illness. The leave was paid for by a payroll tax increase of 1 percent that was split between the employer and the employee. The version passed by the House reduced the leave to six weeks and narrowed the scope so that it would no longer include an individual’s own illness. The payroll tax increase was reduced to .141 percent, which, Harrison said, “in layman’s terms is about $70 a year on a $50,000 annual salary.”
“Many would argue that’s not very much,” he said. “Others would argue that that’s extremely optimistic and once people start taking six weeks, the cost will exceed the projections and the tax will have to go up.”
The tax would be built up for one year to create a reserve and the benefit would start the following year. Harrison said the bill’s safe passage was not guaranteed, as it would violate Gov. Phil Scott’s pledge not to increase taxes or fees.
“I don’t think anyone argues that this is not a valuable benefit,” he said. “The rub really comes in how to pay for it, which is true in life and in government.”
A carbon tax
Speaking on a proposed carbon tax, or what he called “carbon pricing,” Rep. Robin Chesnut-Tangerman (P – Middletown Springs) reassured, informed and challenged his audience—all in under five minutes.
The House Committee on Energy and Technology, which he serves on, has looked at five carbon pricing proposals that have been introduced as bills. Chesnut-Tangerman said he anticipated none of them would go anywhere this year. Chesnut-Tangerman described the most recent plan, titled the Economy Strengthening Energy Exchange (ESSEX) Plan, which was developed by business and community leaders around the state with input from Legislators to create the lowest electric rates in New England.
The plan would put a price on carbon pollution starting at $5 a ton that would increase over eight years to $40 a ton, a price arrived at by the Environmental Protection Agency under the Obama administration as the “environmental, health and social cost of carbon emissions.”
“It’s based on national figures that there is consensus around, not projects by the State of Vermont,” said Chesnut-Tangerman.
Hearing this cost, the room audibly gasped.
The entirety of the money collected would be used to reduce electric rates for commercial, industrial and residential use. Vermont’s electric grid currently draws about 50 percent from renewable sources.
“So by electrifying our energy load, we are automatically making it cleaner,” Chesnut-Tangerman said.
For the last portion of his presentation, Chesnut-Tangerman issued a challenge:
“Any plan like this is designed to change behavior. If we accept that climate change is the biggest challenge facing us nationally and globally, then what is our response? We keep kicking it down the road because it’s uncomfortable.”
A $15 minimum wage
While Sen. Brian Collamore (R – Rutland) said he supports Vermonters earning $15 per hour, he’s not a big fan of the Legislature’s current plan to make that a reality. Vermont’s current minimum wage is set at $10.50, which took effect in this month. Under the current law, the minimum wage will annually increase by the lower of either 5 percent or the percentage increase in the consumer price index. Collamore pointed out that Vermont’s minimum wage is the third highest in New England and the sixth highest in the country. Citing the Vermont Department of Labor, Collamore said 90 percent of Vermont employers have 20 or fewer employees. Small employers provide a third of the jobs in the state and pay a third of the wages in the private sector.
This summer, Collamore was one of two dissenting voices on a recommendation put forth by the the Minimum Wage and Benefits Cliff Study Committee to increase the minimum wage to $15 per hour. Reading from the minority report he submitted with Rep. Brian Keefe (R – Bennington-4), Collamore said a mandatory minimum wage increase would have direct inflationary impact on the costs of other state functions.
Collamore also said the increase would create what he called “wage compression” where workers who currently make more than the minimum wage would expect a pay increase as well. “I liken it to the dog chasing its tail,” he said. “It’s the constant chasing of a higher wage, so we need to take a look at that.”
In the private sector, Collamore said an increase would cause a decline in the number of jobs and cuts in workers’ hours. The increase could also prompt some businesses to move to neighboring states where the minimum wage is lower.
“In New Hampshire, the minimum wage is $7.25, the national average,” he said. “We’re at $10.50. If we go to $15 and they stay where they are, you have to wonder what business would want to be in Vermont when labor costs would initially double.”
Simplifying Act 250
House bill 665, a proposal for a more efficient Act 250, was introduced in the House Friday and was referred to the House Committee on Natural Resources, Fish and Wildlife. The bill’s lead sponsor, Rep. Peter Fagan (R – Rutland 5-1), said the bill was the result of two years of work with the Rutland Economic Development Corporation’s (REDC) policy committee to make the state’s land use law more predictable in terms of time, cost and outcome. The bill requires district environmental commissions to issue a decision on a project within 20 days. Projects that fail to receive a decision by the 20-day deadline would receive automatic approval, a detail that earned Fagan a round of applause.
The bill would also prohibit commissions from not issuing permits due to a project’s lack of other required permits.
“But you can go to the bank for financing. You can line up your contractors. You can get everything going because you know the hardest permit you’ve got to get is in your back pocket.”
The bill also introduces a new concept called “conclusive evidence” to Act 250, where the issuance of permits constitute evidence that activity described in the permit or approval is not detrimental to the public health.
Fagan said the bill has received support from the entire Rutland County delegation.
“What we have here is a start,” he said. “This bill is in committee. The challenge that I have and the other legislators have is the committee chair has said
publicly this past week that he will not entertain any Act 250 bills while the Act 250 commission is ongoing. I’m going to give it a heck of a go to get him to take this bill up.”