Leonine: Veto raises its head

EXECUTIVE DECISION

Leonine Public AffairsThe political fireworks continued this week on the heels of the gun safety debate that dominated the bulk of the 2018 session. S.103, a chemical regulation bill that removed the consideration of certain scientific criteria from the regulatory process and gave the Commissioner of Health unprecedented authority to ban children's products, was taken up for a veto override vote by the House. The bill was vetoed by the Governor Phil Scott last week because he did not think it created additional safety measures and instead made the regulatory process more arbitrary and unscientific. The veto of was first overridden in the Senate by a vote of 22-8.

That left the decision on whether or not the bill would become law in the hands of the House, where Democrats have control. Politically, the importance of the vote eclipsed the bill itself, as it was the first attempt in 2018 to override a veto. The stakes were high for all involved and the outcome seemed less certain than one would expect. This is because of the politics that swirled around the gun safety debate, and specifically because of the dynamic between the governor and House Republicans. Many House Republicans were angry about the governor’s decision to sign gun safety measures and some observers wondered if this would lead to a defection in the caucus on the override vote. When the bill came upon Wednesday, it was clear the House Republican Caucus was unified and would support the governor’s veto. The veto was sustained by a vote of 94-53 (two-thirds majority needed) and S.103 died.

It was a political victory for the governor and House Republicans and along with the first spring weather of the year seemed to indicate the end of the legislative session is near. The veto controversy gave way almost immediately to a familiar fight between the governor and legislative leaders - how to address the gap in the education fund. New fiscal analysis released this week showed the gap has ballooned from $40 million to $58 million, a daunting number, and disagreement about how to address the problem (and whose responsibility it is to propose solutions) exploded like a door in the movieBackdraft.

Democratic legislative leaders said the governor was not being helpful in finding solutions to the deficit, and said if they are going to avoid raising taxes the administration will have to work with them to balance the budget. The governor said lawmakers should have agreed to his proposal to create a statewide health plan for teachers last year, and that if they had done so the deficit would be smaller today.

The week ended with a failed long shot attempt to revive legislation establishing a system for the retail sale and taxation of marijuana. The action centered on H.167, which passed the House in 2017 as a bill dealing with the penalties for possessing different types of illegal drugs. It was then amended by the Senate toward the end of the 2017 session to establish a retail and taxation system. When the bill went back to the House it was “Ordered to Lie”, which for a bill is equivalent to being put in suspended animation. However,on ThursdayRepresentative Diana Gonzalez, P-Winooski, caused H.167 to be called up for action. When the bill came up on House floor on Friday Majority Leader Jill Krowinski, D-Burlington, moved that action on it be postponed indefinitely. That motion prevailed on a 106-28 roll call vote, with most of the votes to move forward with the bill coming from Progressives and Republicans. House Minority Leader Don Turner, R-Milton, who voted to kill the bill last year, explained his vote to move forward this year by essentially saying that since the Legislature legalized the growing and possession of marijuana in January the state might as well go all the way and set up a retail and taxation system. However, it is clear that unlike their Senate counterparts a majority of House Democrats are just not ready to take that step.

After a very unusual bulk of the session being spent passing gun safety measures championed by unexpected leaders, the past week seemed like political whiplash, with everyone snapping back to more familiar positions. The tone suddenly seems similar to the end of the 2017 session, when the first budget standoff between Scott and Democratic lawmakers occurred. There is no doubt that Scott proved his clout post-gun safety debate with the veto of S.103, but it is very unclear how (or when) the 2018 legislative session will adjourn.


TAX INCREASES
The House Ways and Means Committee voted 7-3-1 on Friday to raise the rooms and meals tax by 1/4 percent (to 9 1/4 percent) and have the state take the unclaimed bottle bill deposits from the beer and soda wholesalers. The two provisions are projected to raise $6.5 million annually. The revenue is directed toward water quality efforts. The provisions were added to S.260, a water quality bill. The effective date for both tax increases isJanuary 1, 2020. Lawmakers are trying to skirt the Governor’s demand to not raises taxes this year by delaying the effective date. However, many State House observers expect the Governor will veto the bill.

STRICT LIABILITY
One day after the House voted to sustain the governor’s veto of S.103, the House Judiciary Committee made a tentative decision to protect at least some of S.197 from suffering a similar fate. The bill would impose strict liability on any business responsible for a chemical release and also require such a business to bear the cost of medical monitoring if a claim of harm is brought against it. The committee tentatively decided that once it has finished considering and amending the bill’s language it would be split into two parts. The strict liability portion would be put into S.123, an unrelated bill, and sent to the Commerce and Economic Development Committee. That committee has jurisdiction over insurance matters and it has been claimed that the strict liability provisions will have significant ramifications on businesses’ ability to obtain liability insurance. The medical monitoring provisions will stay in S.197. It remains up in the air at the time we are writing this newsletter exactly what will happen with both sections of the bill.

BROADBAND EXPANSION
The Senate Institutions Committee amended the Capital Budget Adjustment Bill, H.923, to appropriate $1,293,000 to two telcom projects. The money had been previously appropriated to the Vermont Telecom Authority (VTA), and when the VTA was mothballed in 2015 the Department of Public Service (DPS) took over its functions and was holding the money. However, because the money had been unspent for so long the DPS could not spend it unless it was re-appropriated. The DPS came forward and proposed that $900,000 be appropriated to cover the DPS’ possible obligations relative to the CoverageCo wireless network the VTA had started funding and which is partially completed. However, because the CoverageCo is on the verge of insolvency the DPS told the Committee the money would only be spent on that company’s project if it comes up with a viable business plan. If it does not, the DPS intends to seek proposals for alternative ways of providing mobile wireless coverage in the areas served by (and intended to be served by) CoverageCo. The remaining $393,000 was appropriated to the DPS to fund the installation of cable splice enclosures on a fiber optic cable network the state owns in the Northeast Kingdom. The installation of the splice enclosures will allow a fiber to the premises cable network in Craftsbury to be connected to the state’s network, and thus allow the network serving Craftsbury to be activated as early as this summer.

UNIVERSAL PRIMARY CARE
The House Health Care Committee approved a version of S.53 that was previously approved by the Senate Health and Welfare Committee before it was subsequently weakened by the Senate Appropriations Committee. The bill as now supported by both the House Health Care Committee and the Senate Health and Welfare Committee directs the Green Mountain Care Board to create a draft operational model for a universal primary care program, and to follow with assessments of the model and legal and financial analysis. In theory, the universal primary care system under S.53 would go into place by 2022. The bill has been referred to the House Appropriations Committee. It will be very interesting to see what the Appropriations committee does with the bill. Governor Scott has stated publicly that he does not support this version of the bill.

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Source: Leonine Public Affairs, Montpelier, Week 16. 3.30.2018.leoninepublicaffairs.com.Through a special arrangement with Leonine, Vermont Business Magazine republishes Leonine's weekly legislative report on vermontbiz.com.leoninepublicaffairs.com