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H.516

AN ACT MAKING APPROPRIATIONS FOR THE SUPPORT OF GOVERNMENT

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  SHORT TITLE

(a)  This bill may be referred to as the BIG BILL - Fiscal Year 2006 Appropriations Act.

Sec. 2.  PURPOSE

(a)  The purpose of this act is to provide appropriations for the operations of state government during fiscal year 2006.  It is the express intent of the general assembly that activities of the various agencies, departments, divisions, boards, and commissions be limited to those which can be supported by funds appropriated in this act or other acts passed prior to June 30, 2005.  Agency and department heads are directed to implement staffing and service levels at the beginning of fiscal year 2006 so as to meet this condition unless otherwise directed by specific language in this act or other acts of the general assembly.

Sec. 3.  APPROPRIATIONS

(a)  It is the intent of the general assembly that this act serve as the primary source and reference for appropriations for fiscal year 2006.

(b)  The sums herein stated are appropriated for the purposes specified in the following sections of this act.  When no time is expressly stated during which any of the appropriations are to continue, the appropriations are single‑year appropriations, and only for the purpose indicated, and shall be paid from funds shown as the source of funds.  If in this act there is an error in either addition or subtraction, the totals shall be adjusted accordingly.  Apparent errors in referring to section numbers of statutory titles within this act may be disregarded by the commissioner of finance and management.

(c)  Unless codified or otherwise specified, all narrative portions of this act apply only to the fiscal year ending June 30, 2006.

(d)  The balance of any appropriations remaining unexpended and unencumbered at the end of the fiscal year shall revert to the appropriate fund balance unless otherwise specified in this act or other acts of the general assembly.  Refunds of expenditures and reimbursements shall be credited to the appropriate fund and to appropriation accounts in the current fiscal year.

Sec. 4.  DEFINITIONS

(a)  For the purposes of this act:

(1)  “Encumbrances” means a portion of an appropriation reserved for the subsequent payment of existing purchase orders or contracts.  The commissioner of finance and management shall make final decisions on the appropriateness of encumbrances.

(2)  “Grants” means subsidies, aid, or payments to local governments, to community and quasi-public agencies for providing local services, and to persons who are not wards of the state for services or supplies, and cash or other direct assistance, including pension contributions.

(3)  “Operating expenses” means property management, repair and maintenance; rental expenses; insurance, postage, travel, energy and utilities, office and other supplies; equipment, including motor vehicles, highway materials and construction, expenditures for the purchase of land, and construction of new buildings and permanent improvements; and similar items.

(4)  “Personal services” means wages and salaries, fringe benefits, per diems, and contracted third-party services; and similar items.

Sec. 5.  Secretary of administration - secretary’s office

                   Personal services                                            445,340

                   Operating expenses                                          51,583

                   Grants                                                            400,000

                        Total                                                         896,923

               Source of funds

                   General fund                                                   846,821

                   Transportation fund                                          50,102

                        Total                                                         896,923

(a)  The secretary of administration and the state archivist are directed to jointly develop a comprehensive strategy for the management of all records created by state agencies, including but not limited to the following areas:

          (1)  appraisal of all current records management programs required under 3 V.S.A. § 218;

          (2)  the use and management of electronic records;

          (3)  the development of records management training.

     (b)  The secretary of administration shall develop a preliminary plan of implementation of the comprehensive strategy in subsection (a), including proposed, phased time lines for the implementation, by January 1, 2006.  The comprehensive strategy shall be based on actual retrieval histories and applicable statutory mandates.

     (c)  The secretary of administration and the state archivist shall report to the house and senate committees on government operations and appropriations on this initiative on or before January 15, 2006, and recommend any statutory changes that will reduce the amount of records maintained and stored by state agencies.

     (d)  Of the above appropriation, $400,000 is for grants to the 11 existing regional marketing programs (RMP).  These funds plus additional funds appropriated in this act for regional marketing activities shall continue to be distributed by the existing formula.  RMP funds shall be used on the following marketing activities (in no specific order):  regional websites, consumer/trade shows, packages/itineraries, regional publications and guides, toll free phone lines and fulfillment, public relations, advertising, familiarization tours, welcome center promotion, joint projects, and administration.

Sec. 6.  IN-STATE TRAVEL REDUCTION

(a)  The secretary of administration is directed to reduce in-state travel budgets, thereby reducing operating expense appropriations by $300,000 in general funds throughout the executive branch of state government and in place of this funding, encourage departments and agencies to utilize Vermont interactive television for meetings.  The secretary shall report to the house and senate committees on appropriations by the end of December 2006 on the use of Vermont interactive television by state agencies and departments during fiscal year 2006.

Sec. 7.  Information and innovation - GOVnet

                   Personal services                                            567,046

                   Operating expenses                                        189,353

                        Total                                                         756,399

               Source of funds

                   Internal service funds                                      756,399

Sec. 8.  Information and innovation - communications and information technology

                   Personal services                                         3,482,819

                   Operating expenses                                        563,177

                        Total                                                      4,045,996

               Source of funds

                   Internal service funds                                   4,045,996

     (a)  The commissioner of information and innovation shall, with the cooperation of the legislative director of information technology, report to the general assembly by January 15, 2006 on the potential for conversion of the current legislative e-mail service to the same system used by the executive branch.  The report shall include direct savings and costs associated with such a conversion, a time line for such a conversion and how customer service, training, privacy, and security concerns would be addressed in such a conversion.

     (b)  The commissioner of information and innovation shall report to the general assembly by January 15, 2006 on the potential for conversion of the current telephone system to a voice-over internet protocol (VOIP) based system.  The report shall include the estimated cost of such a conversion, the potential savings a VOIP system may provide, and consideration of customer service concerns from both the state employee and state citizen perspective.

Sec. 9.    Finance and management - financial operations

                   Personal services                                         2,139,003

                   Operating expenses                                     1,203,059

                        Total                                                      3,342,062

               Source of funds

                   Internal service funds                                   3,342,062

(a)  Pursuant to 32 V.S.A. § 307(e), financial management fund charges not to exceed $4,295,964, plus the costs of fiscal year 2006 salary increases bargained as part of the State/VSEA agreement, are hereby approved.  Of this amount, $867,229 will be used to support the HRMS system that is operated by the department of human resources.

Sec. 10.  Finance and management - budget and management

                   Personal services                                            908,332

                   Operating expenses                                        128,752

                        Total                                                      1,037,084

               Source of funds

                   General fund                                                   816,881

                   Transportation fund                                        111,313

                   Interdepartmental transfer                               108,890

                        Total                                                      1,037,084

     (a) The department of finance and management shall propose to the general assembly on January 15, 2006 the necessary statutory language and process changes required to consolidate at least 20 percent of the special funds currently in the statewide accounting system.

Sec. 11.  Human resources - operations

                   Personal services                                         1,606,082

                   Operating expenses                                        314,842

                        Total                                                      1,920,924

               Source of funds

                   General fund                                                1,281,126

                   Transportation fund                                        347,778

                   Interdepartmental transfer                               292,020

                        Total                                                      1,920,924

Sec. 12.   Human resources - HR workforce planning & employment services

                   Personal services                                            841,435

                   Operating expenses                                        301,357

                        Total                                                      1,142,792

               Source of funds

                   General fund                                                   708,084

                   Transportation fund                                        199,708

                   Special funds                                                  235,000

                        Total                                                      1,142,792

Sec. 13.  Human resources - employee benefits & wellness

                   Personal services                                         1,448,884

                   Operating expenses                                        355,564

                        Total                                                      1,804,448

               Source of funds

                   Internal service funds                                   1,804,448

Sec. 14.  Human resources - information technology

                   Personal services                                            515,184

                   Operating expenses                                        370,605

                        Total                                                         885,789

               Source of funds

                   Internal service funds                                      885,789

Sec. 15.  Libraries

                   Personal services                                         1,881,114

                   Operating expenses                                     1,573,421

                   Grants                                                              70,000

                        Total                                                      3,524,535

               Source of funds

                   General fund                                                2,328,186

                   Special funds                                                  227,820

                   Federal funds                                                 812,529

                   Interdepartmental transfer                               156,000

                        Total                                                      3,524,535

Sec. 16.  Tax - administration/collection

                   Personal services                                       11,477,404

                   Operating expenses                                     2,684,071

                        Total                                                    14,161,475

               Source of funds

                   General fund                                              13,167,874

                   Transportation fund                                        213,601

                   Tobacco fund                                                   58,000

                   Special funds                                                  542,000

                   Interdepartmental transfer                               180,000

                        Total                                                    14,161,475

Sec. 17.  Buildings and general services - administration

                   Personal services                                         1,438,892

                   Operating expenses                                        109,308

                        Total                                                      1,548,200

               Source of funds

                   Interdepartmental transfer                            1,548,200

Sec. 18.  Buildings and general services - engineering

                   Personal services                                         1,876,190

                   Operating expenses                                        444,472

                        Total                                                      2,320,662

               Source of funds

                   General fund                                                2,173,473

                   Transportation fund                                        102,189

                   Interdepartmental transfer                                 45,000

                        Total                                                      2,320,662

Sec. 19.  Buildings and general services - information centers

                   Personal services                                         3,294,693

                   Operating expenses                                     1,177,513

                   Grants                                                            370,000

                        Total                                                      4,842,206

               Source of funds

                   General fund                                                     42,914

                   Transportation fund                                     4,799,292

                        Total                                                      4,842,206

Sec. 20.  Buildings and general services - purchasing

                   Personal services                                            704,895

                   Operating expenses                                        169,370

                        Total                                                         874,265

               Source of funds

                   General fund                                                   656,618

                   Transportation fund                                        217,647

                        Total                                                         874,265

Sec. 21.  Buildings and general services - public records

                   Personal services                                            863,949

                   Operating expenses                                        701,543

                        Total                                                      1,565,492

               Source of funds

                   General fund                                                1,071,612

                   Transportation fund                                        182,620

                   Special funds                                                  311,260

                        Total                                                      1,565,492

Sec. 22.  Buildings and general services - postal services

                   Personal services                                            599,500

                   Operating expenses                                        142,952

                        Total                                                         742,452

               Source of funds

                   General fund                                                     40,000

                   Transportation fund                                          30,000

                   Internal service funds                                      672,452

                        Total                                                         742,452

Sec. 23.  Buildings and general services - copy center

                   Personal services                                            788,629

                   Operating expenses                                        215,702

                        Total                                                      1,004,331

               Source of funds

                   Internal service funds                                   1,004,331

Sec. 24.  Buildings and general services - supply center

                   Personal services                                            246,376

                   Operating expenses                                        132,601

                        Total                                                         378,977

               Source of funds

                   Internal service funds                                      378,977

Sec. 25.  Buildings and general services - federal surplus property

                   Personal services                                              63,749

                   Operating expenses                                          70,299

                         Total                                                         134,048

               Source of funds

                   Enterprise funds                                              134,048

Sec. 26.  Buildings and general services - state surplus property

                   Personal services                                              58,930

                   Operating expenses                                          65,680

                        Total                                                         124,610

               Source of funds

                   Internal service funds                                      124,610

Sec. 27.  Buildings and general services - property management

                   Personal services                                         1,240,936

                   Operating expenses                                     2,606,448

                        Total                                                      3,847,384

               Source of funds

                   Internal service funds                                   3,847,384

Sec. 28.  Buildings and general services - all other insurance

                   Personal services                                              59,648

                   Operating expenses                                          11,739

                        Total                                                           71,387

               Source of funds

                   Internal service funds                                        71,387

Sec. 29.  Buildings and general services - general liability insurance

                   Personal services                                            223,314

                   Operating expenses                                          38,632

                        Total                                                         261,946

               Source of funds

                   Internal service funds                                      261,946

Sec. 30.  Buildings and general services - workers’ compensation insurance

                   Personal services                                            958,583

                   Operating expenses                                        152,019

                        Total                                                      1,110,602

               Source of funds

                   Internal service funds                                   1,110,602

(a)  Pursuant to 32 V.S.A. §  307(e), workers’ compensation fund charges not to exceed $8,664,387, plus the costs of fiscal year 2006 salary increases bargained as part of the State/VSEA agreement, are hereby approved.

Sec. 31.  Buildings and general services - fee for space

                   Personal services                                       10,385,701

                   Operating expenses                                     9,960,599

                        Total                                                    20,346,300

               Source of funds

                   Internal service funds                                 20,346,300

(a)  Pursuant to 29 V.S.A. § 160a(b)(3), facilities operations fund charges not to exceed $20,346,300, plus the costs of fiscal year 2006 salary increases bargained as part of the State/VSEA agreement, are hereby approved.

     (b)  The following 6 (six) classified positions with any incumbents shall be moved from the department of health – Vermont state hospital to the department of buildings and general services: Custodian I (position numbers 740652, 740684, 740716, 741010), Custodian III (position number 740651), and VSH Housekeeper (position number 740650).          

Sec. 32.  Geographic information system

                   Grants                                                            393,957

               Source of funds

                   Special funds                                                  393,957

Sec. 33.  Auditor of accounts

                   Personal services                                         1,866,196

                   Operating expenses                                        103,338

                        Total                                                      1,969,534

               Source of funds

                   General fund                                                   468,742

                   Transportation fund                                          59,317

                   Special funds                                                    54,455

                   Internal service funds                                   1,387,020

                        Total                                                      1,969,534

Sec. 34.  State treasurer

                   Personal services                                         2,158,253

                   Operating expenses                                        329,009

                   Grants                                                              25,000

                        Total                                                      2,512,262

               Source of funds

                   General fund                                                   837,580

                   Transportation fund                                        104,035

                   Special funds                                               1,475,133

                   Private purpose trust fund                                 95,514

                        Total                                                      2,512,262

(a)  Of the above general fund appropriation, $25,000 shall be transferred into the armed services scholarship fund established in 16 V.S.A. § 2541.

Sec. 34a.  32 V.S.A. § 436 is amended to read:

§ 436.  INTERFUND BORROWING

Notwithstanding any provisions of law, the state treasurer, with the approval of the governor, may borrow from any funds heretofore or hereafter created by the legislature such available amounts as he or she may determine to be necessary or desirable for the purpose of defraying the expenses of government, including the payment of notes issued for such purposes. Such borrowing may be only made twice a year; first, during the period commencing 15 business days prior to the end of the state’s fiscal year and ending 15 business days after the end of the state’s fiscal year, and second, during the period commencing on December 10, or the preceding Friday if December 10 shall fall on a Saturday or Sunday, and ending on January 10 of the succeeding yearDuring the period commencing with the first day of the state’s succeeding fiscal year and ending on a date not more than 15 business days thereafter, No later than the last day of the period during which the funds were borrowed, the state treasurer shall transfer to any such fund from which such initial borrowing has been made an amount equal to such borrowed amount, together with interest thereon at such rate as the state treasurer in his or her sole discretion shall determine.

Sec. 34b.  COMMISSION ON FUNDING THE STATE TEACHERS’

                 RETIREMENT SYSTEM OF VERMONT PENSION

                 ACCUMULATION FUND

(a)  A commission is created to make recommendations for funding an adequate, sustainable, and actuarially sound retirement benefit plan for the state teachers’ retirement system of Vermont.  The commission shall be comprised of the following 13 members:

(1)  two members of the house of representatives, appointed by the speaker of the house;

(2)  two members of the senate, appointed by the committee on committees;

(3)  the chair of the board of trustees of the Vermont state teachers’ retirement system;

(4)  the commissioner of finance and management;

(5)  the commissioner of education;

(6)  the state treasurer, who shall chair this commission;

(7)  two members of the Vermont national education association, appointed by the association;

(8)  one member of the Vermont superintendents’ association, appointed by the association;

(9)  one member of the Vermont school boards’ association, appointed by the association; and

(10)  one public member with pension and benefit experience, appointed by the governor.

(b)  The commission shall file a report of its recommendations with the governor and the general assembly on November 15, 2005.

     (c)  Legislative members shall be entitled to per diem compensation and expenses as provided for in section 406 of Title 2.

Sec. 35.  State treasurer - abandoned property

                   Personal services                                            541,534

                   Operating expenses                                        242,188

                        Total                                                         783,722

               Source of funds

                   Private purpose trust fund                               783,722

Sec. 36.  Vermont state retirement system

                   Personal services                                       20,448,159

                   Operating expenses                                        729,324

                        Total                                                    21,177,483

               Source of funds

                   Pension trust fund                                      21,177,483

Sec. 37.  Municipal employees’ retirement system

                   Personal services                                         1,427,518

                   Operating expenses                                        213,732

                        Total                                                      1,641,250

               Source of funds

                   Pension trust fund                                        1,641,250

Sec. 38.  State labor relations board

                   Personal services                                            157,439

                   Operating expenses                                          40,128

                        Total                                                         197,567

               Source of funds

                   General fund                                                   187,100

                   Transportation fund                                            4,597

                   Special funds                                                      5,870

                        Total                                                         197,567

Sec. 39.  Executive office - governor’s office

                   Personal services                                         1,158,112

                   Operating expenses                                        369,756

                        Total                                                      1,527,868

               Source of funds

                   General fund                                                1,206,200

                   Transportation fund                                        157,483

                   Special funds                                                      3,185

                   Interdepartmental transfer                               161,000

                        Total                                                      1,527,868

Sec. 40.  Executive office - national and community service

                   Personal services                                            191,634

                   Operating expenses                                        121,871

                   Grants                                                         1,745,415

                        Total                                                      2,058,920

               Source of funds

                   General fund                                                     56,528

                   Federal funds                                              2,002,392

                        Total                                                      2,058,920

Sec. 41.  VOSHA review board

                   Personal services                                              31,652

                   Operating expenses                                            8,542

                        Total                                                           40,194

               Source of funds

                   General fund                                                     20,097

                   Federal funds                                                   20,097

                        Total                                                           40,194

Sec. 42.  Use tax reimbursement fund - municipal current use

                   Grants                                                         6,898,455

               Source of funds

                   General fund                                                4,569,542

                   Transportation fund                                     2,328,913

                        Total                                                      6,898,455

Sec. 43.  Lieutenant governor

                   Personal services                                            118,723

                   Operating expenses                                          17,649

                        Total                                                         136,372

               Source of funds

                   General fund                                                   117,089

                   Transportation fund                                          19,283

                        Total                                                         136,372

Sec. 44.  Legislature

                   Personal services                                         2,925,702

                   Operating expenses                                     2,191,219

                        Total                                                      5,116,921

               Source of funds

                   General fund                                                4,414,316

                    Transportation fund                                        702,605

                        Total                                                      5,116,921

Sec. 45.  Legislative council

                   Personal services                                         1,685,880

                   Operating expenses                                        136,604

                        Total                                                      1,822,484

               Source of funds

                   General fund                                                1,588,701

                   Transportation fund                                        233,783

                        Total                                                      1,822,484

(a)  The amount of $30,000 in general funds that are carried forward in this appropriation shall revert to the general fund in fiscal year 2006.

Sec. 46.  Legislative information technology

                   Personal services                                            309,186

                   Operating expenses                                        254,227

                        Total                                                         563,413

               Source of funds

                   General fund                                                   563,413

(a)  The amount of $20,000 in general funds that are carried forward in this appropriation shall revert to the general fund in fiscal year 2006.

Sec. 47.  Sergeant at arms

                   Personal services                                            438,870

                   Operating expenses                                          62,909

                        Total                                                         501,779

               Source of funds

                   General fund                                                   461,044

                   Transportation fund                                          40,735

                        Total                                                         501,779

Sec. 48.  Joint fiscal committee

                   Personal services                                         1,045,988

                   Operating expenses                                          72,385

                        Total                                                      1,118,373

               Source of funds

                   General fund                                                   982,901

                   Transportation fund                                        135,472

                        Total                                                      1,118,373

Sec. 48a.  REPEAL

     (a)  Sec. 4 of No. 119 of the Acts of 2000 is repealed.  No further report on the basic needs budget calculation pursuant to this section shall be required.  However, the report shall be updated as needed on or before January 1 of the interim year, 2006, to reflect any significant economic, policy, or statutory changes that substantially affect the information in the report issued the previous January 15.

Sec. 49.  Lottery commission

                   Personal services                                         1,279,592

                   Operating expenses                                     1,057,167

                        Total                                                      2,336,759

               Source of funds

                   Enterprise funds                                           2,336,759

(a)  The lottery commission shall not reduce funding for the responsible gambling program.

(b)  The lottery commission shall transfer $130,000 to the department of health, office of alcohol and drug abuse programs, to support the gambling addiction program.

     (c)  Notwithstanding any other provision of law, all rules necessary to implement the Tri-State Triple Play game shall be promulgated by the Tri-State Lotto Commission, including those portions of the rules that are specific to the operation of the Tri-State Triple Play game in the state of Vermont.

Sec. 50.  Payments in lieu of taxes

                   Grants                                                         2,500,000

               Source of funds

                   General fund                                                   600,000

                   Special funds                                               1,900,000

                        Total                                                      2,500,000

(a)  The above appropriation is for state payments in lieu of property taxes under subchapter 4 of chapter 123 of Title 32, and the payments shall be calculated in addition to, and without regard to, the appropriations for PILOT for Montpelier and correctional facilities elsewhere in this act.

Sec. 51.  Payments in lieu of taxes - Montpelier

                   Grants                                                            184,000

               Source of funds

                   General fund                                                   184,000

Sec. 52.  Payments in lieu of taxes - correctional facilities

                   Grants                                                              40,000

               Source of funds

                   General fund                                                     40,000

Sec. 53.  Total general government                             125,912,602

               Source of funds

                   General fund                                              39,130,842

                   Transportation fund                                   10,040,473

                   Special funds                                               5,148,680

                   Tobacco fund                                                   58,000

                   Federal funds                                              2,835,018

                   Enterprise funds                                           2,470,807

                   Internal service funds                                 40,039,703

                   Pension trust funds                                     22,818,733

                   Private purpose trust funds                              879,236

                   Interdepartmental transfer                            2,491,110

                        Total                                                  125,912,602

Sec. 54.  Protection to persons and property - attorney general

                   Personal services                                         5,356,126

                   Operating expenses                                        924,563

                        Total                                                      6,280,689

               Source of funds

                   General fund                                                2,822,155

                   Transportation fund                                          69,615

                   Special funds                                               1,112,209

                   Tobacco fund                                                 290,000

                   Federal funds                                                 617,000

                   Interdepartmental transfer                            1,369,710

                        Total                                                      6,280,689

     (a)  Of the above appropriation, $25,000 shall be reserved by the attorney general for payment of expenses incurred by towns in defense of grand list appeals engaged in litigation with the Washington electric cooperative.

     (b)  Notwithstanding any other provisions of law, the office of the attorney general, Medicaid fraud control unit is authorized to retain one-half of any civil monetary penalty proceeds from global Medicaid fraud settlements.  All penalty funds retained shall be used to finance Medicaid fraud and residential abuse unit activities. 

Sec. 54a.  33 V.S.A. § 2005(a) is amended to read:

§ 2005.  PHARMACEUTICAL MARKETERS

(a)(1)  Annually on or before January 1 December 1 of each year, every pharmaceutical manufacturing company shall disclose to the office of the attorney general the value, nature, and purpose of any gift, fee, payment, subsidy, or other economic benefit provided in connection with detailing, promotional, or other marketing activities by the company, directly or through its pharmaceutical marketers, to any physician, hospital, nursing home, pharmacist, health benefit plan administrator, or any other person in Vermont authorized to prescribe, dispense, or purchase prescription drugs in this state.  Disclosure shall include the name of the recipient.  Disclosure shall be made on a form and in a manner prescribed by the office of the attorney general and shall require pharmaceutical manufacturing companies to report the value, nature, and purpose of all gift expenditures according to specific categories.  The office of the attorney general shall report annually on the disclosures made under this section to the general assembly and the governor on or before March 1 April 1.

(2)  Annually in the month of October on October 1, each company subject to the provisions of this section also shall disclose to the office of the attorney general, the name and address of the individual responsible for the company’s compliance with the provisions of this section, or if this information has been previously reported, any changes to the name or address of the individual responsible for the company’s compliance with the provisions of this section.

* * *

Sec. 54b.  COMMISSION ON SOCIAL SECURITY NUMBER USAGE

                 AND OTHER PRIVACY ISSUES

(a)  The Social Security Usage Study Commission is hereby created to study the usage of Social Security numbers and other privacy issues in the public and private sector.  The commission shall consist of the following members:  one representative from the agency of administration, one representative from the attorney general’s office, one representative from the agency of human services, one representative from the agency of commerce and community development, one representative from the department of banking, insurance, securities, and health care administration, one representative from the department of labor, the state archivist, two members of the senate chosen by the committee on committees, and two members of the house of representatives chosen by the speaker of the house.  The commission shall be chaired by the attorney general’s office.  The commission shall solicit participation from the Vermont League of Cities and Towns and any other interested affected parties.  The commission shall study the use of Social Security numbers by both public and private entities and develop proposals for reducing such use wherever possible and protecting privacy and security when the numbers must be used.  In addition, these entities shall study the costs and benefits of document destruction.  Assessment of the appropriate implementation periods, investigation of any potential secondary effects, and prohibiting the following shall be considered by the commission:

(1)  printing of an individual’s Social Security number on any card required for the individual to access products or services provided by the entity;

(2)  requiring that an individual transmit his or her Social Security number over the internet, unless the connection is secure or the Social Security number is encrypted and requiring an individual to use his or her Social Security number to access an internet website, unless a password or unique personal identification number or other authentication device is also required to access the internet website; or

(3)  printing of an individual’s Social Security number on any materials that are mailed to the individual, unless state or federal law requires the Social Security number to be on the materials.

     (b)  The commission shall also study the issue of security breaches experienced by collectors of personal information about consumers, and shall develop proposals for effectively notifying consumers about such security breaches.

     (c)  The commission shall prepare recommendations and report to the senate committees on judiciary and finance and the house committees on commerce and judiciary on or before January 15, 2006.

(d)  Legislative members shall be entitled to compensation and reimbursement as provided in section 406 of Title 2.

Sec. 54c.  EXTENSION OF SUNSET; CONFIDENTIALITY AND

                NONCOMMERCIAL DISTRIBUTION OF CERTAIN TAX

                RECORDS AND DATA

Sec. 6 of Act No. 158 of the Acts of 2004 is amended to read:

Sec. 6.  SUNSET

This act shall expire on June 30, 2005 2006, and sections of the Vermont Statutes Annotated which are amended by this act shall revert to the language in effect prior to the effective date of this act. 

Sec. 55.  Vermont court diversion

                   Grants                                                         1,525,071

               Source of funds

                   General fund                                                   981,093

                   Transportation fund                                        143,978

                   Special funds                                                  400,000

                        Total                                                      1,525,071

Sec. 56.  Center for crime victims services

                   Personal services                                         1,035,455

                   Operating expenses                                        220,612

                   Grants                                                         7,425,277

                        Total                                                      8,681,344

               Source of funds

                   General fund                                                1,018,644

                   Special funds                                               3,541,155

                   Federal funds                                              4,058,345

                   Interdepartmental transfer                                 63,200

                         Total                                                      8,681,344

     (a)  The center shall explore credit card use to facilitate restitution payments from offenders.

Sec. 57.  State’s attorneys

                   Personal services                                         7,807,300

                   Operating expenses                                     1,203,460

                   Grants                                                              45,000

                        Total                                                      9,055,760

               Source of funds

                   General fund                                                6,856,903

                   Transportation fund                                        369,310

                   Special funds                                                  146,375

                   Federal funds                                                     5,000

                   Interdepartmental transfer                            1,678,172

                        Total                                                      9,055,760

Sec. 58.  Sheriffs

                   Personal services                                         2,752,546

                   Operating expenses                                        307,269

                        Total                                                      3,059,815

               Source of funds

                   General fund                                                2,489,576

                   Transportation fund                                        570,239

                        Total                                                      3,059,815

(a)  Of the above appropriation, $15,000 shall be transferred to the state’s attorneys’ office as reimbursement for the cost of the executive director’s salary.

Sec. 59.  Defender general - public defense

                   Personal services                                         5,681,340

                   Operating expenses                                        636,231

                        Total                                                      6,317,571

               Source of funds

                   General fund                                                5,200,918

                   Transportation fund                                        495,230

                   Special funds                                                  502,502

                   Interdepartmental transfer                               118,921

                        Total                                                      6,317,571

Sec. 60.  Defender general - assigned counsel

                   Personal services                                         2,734,829

                   Operating expenses                                          52,850

                        Total                                                      2,787,679

               Source of funds

                   General fund                                                2,448,441

                   Transportation fund                                        239,238

                   Special funds                                                  100,000

                        Total                                                      2,787,679

Sec. 61.  Military - administration

                   Personal services                                            450,746

                   Operating expenses                                        152,035

                   Grants                                                            200,000

                        Total                                                         802,781

               Source of funds

                   General fund                                                   802,781

(a)  Of the above appropriation, an amount not to exceed $200,000 shall be disbursed to the Vermont student assistance corporation to replenish the amount available for the national guard scholarship program established in 16 V.S.A. § 2856 to a level of $200,000.  At the end of fiscal year 2006, any part of the $200,000 appropriation not transferred to the Vermont student assistance corporation shall be reverted to the general fund.

(b)  Total disbursements by the Vermont student assistance corporation under 16 V.S.A. § 2856 shall not exceed $200,000 in fiscal year 2006.

Sec. 62.  Military - air service contract

                   Personal services                                         3,838,895

                   Operating expenses                                        837,681

                        Total                                                      4,676,576

               Source of funds

                   General fund                                                   322,658

                   Federal funds                                              4,353,918

                        Total                                                      4,676,576

Sec. 63.  Military - army service contract

                   Personal services                                         2,692,018

                   Operating expenses                                     5,780,134

                        Total                                                      8,472,152

               Source of funds

                   General fund                                                   110,470

                   Federal funds                                              8,361,682

                        Total                                                      8,472,152

Sec. 64.  Military - building maintenance

                   Personal services                                            883,960

                   Operating expenses                                        383,512

                        Total                                                      1,267,472

               Source of funds

                   General fund                                                1,267,472

Sec. 65.  Military - veterans’ affairs

                   Personal services                                            246,316

                   Operating expenses                                        108,740

                   Grants                                                            121,165

                        Total                                                         476,221

               Source of funds

                   General fund                                                   476,221

(a)  Of the above appropriation, $15,000 shall be used for continuation of the Vermont Medal Program, $40,000 shall be used to provide assistance to the survivors of casualties in the War on Terrorism, $10,000 shall be used for the expenses of the governor’s Veterans’ Advisory Council, and $15,000 shall be used for the Veterans’ Day Parade.

(b)  Of the above appropriation, $5,000 shall be granted to the Vermont state council of the Vietnam Veterans of America to fund the service officer program.

Sec. 66.  Labor and industry

                   Personal services                                         3,149,401

                   Operating expenses                                        719,650

                   Grants                                                              75,000

                        Total                                                      3,944,051

               Source of funds

                   General fund                                                   836,000

                   Special funds                                               1,968,559

                   Federal funds                                              1,139,492

                        Total                                                      3,944,051

Sec. 67.  Criminal justice training council

                   Personal services                                            873,949

                   Operating expenses                                        880,979

                        Total                                                      1,754,928

               Source of funds

                   General fund                                                   902,574

                   Transportation fund                                        281,919

                   Special funds                                                  500,435

                   Interdepartmental transfer                                 70,000

                        Total                                                      1,754,928

Sec. 68.  Liquor control - enforcement and licensing

                   Personal services                                         1,557,469

                   Operating expenses                                        155,685

                        Total                                                      1,713,154

               Source of funds

                    Tobacco fund                                                 289,768

                   Enterprise funds                                           1,423,386

                        Total                                                      1,713,154

Sec. 68a.  DEPARTMENT OF LIQUOR CONTROL; THIRD CLASS

                 CABARET LICENSE; REFUND AUTHORITY

(a)  Upon request of a holder of a third class cabaret license, the department of liquor control shall refund the fee paid for the third class cabaret license prorated from the date of the request until the expiration of the license, provided the cabaret license was acquired for the purpose of permitting smoking in the cabaret licensed area.

Sec. 69.  Liquor control - administration

                   Personal services                                         1,250,029

                   Operating expenses                                        352,646

                        Total                                                      1,602,675

               Source of funds

                   Enterprise funds                                           1,602,675

Sec. 70.  Liquor control - warehousing and distribution

                   Personal services                                            716,954

                   Operating expenses                                        165,065

                        Total                                                         882,019

               Source of funds

                   Enterprise funds                                              882,019

Sec. 71.  Vermont racing commission

                   Personal services                                                2,076

                   Operating expenses                                            2,924

                        Total                                                             5,000

               Source of funds

                   General fund                                                       5,000

Sec. 72.  Secretary of state

                   Personal services                                         3,603,036

                   Operating expenses                                     2,746,911

                        Total                                                      6,349,947

               Source of funds

                   General fund                                                   583,525

                   Special funds                                               3,691,422

                   Federal funds                                              2,000,000

                   Interdepartmental transfer                                 75,000

                        Total                                                      6,349,947

(a)  Of the above special fund appropriation, the corporation division of the secretary of state’s office represents $456,403, and these funds shall be from the securities regulation and supervision fund in accordance with 9 V.S.A. § 4230(b).

Sec. 72a.  Sec. 12(a) of No. 108 of the Acts of 2004 is amended to read:

(a)  26 V.S.A. § 1724 (formulary committee) shall be repealed in its entirety on December 31, 2005 July 1, 2006.  Any formulary in effect on this date shall remain in effect unless or until a process for adopting a new formulary is authorized by law.

Sec. 72b.  REPEAL

26 V.S.A. § 1728b (disclosure of information by optometrist) is repealed.

Sec. 73.  Banking, insurance, securities, and health care administration - banking

                   Personal services                                         1,141,527

                   Operating expenses                                        248,745

                        Total                                                      1,390,272

               Source of funds

                   Special funds                                               1,390,272

(a)  Notwithstanding 9 V.S.A. § 4230(b), in fiscal year 2006, the commissioner of banking, insurance, securities, and health care administration may transfer up to $200,000 from the securities regulation and supervision fund to the banking supervision fund established in 8 V.S.A. § 19(f).

Sec. 74.  Banking, insurance, securities, and health care administration - insurance

                    Personal services                                         3,017,341

                   Operating expenses                                        530,135

                        Total                                                      3,547,476

               Source of funds

                   Special funds                                               3,547,476

Sec. 75.  Banking, insurance, securities, and health care administration - captive

                   Personal services                                         2,565,519

                   Operating expenses                                        387,214

                        Total                                                      2,952,733

               Source of funds

                   Special funds                                               2,952,733

Sec. 76.  Banking, insurance, securities, and health care administration - securities

                   Personal services                                            519,436

                   Operating expenses                                        130,100

                        Total                                                         649,536

               Source of funds

                   Special funds                                                  649,536

Sec. 77.  Banking, insurance, securities, and health care administration - health care administration

                   Personal services                                         3,609,269

                   Operating expenses                                        358,002

                        Total                                                      3,967,271

               Source of funds

                   General fund                                                   469,832

                   Special funds                                               3,397,439

                   Interdepartmental transfer                               100,000

                        Total                                                      3,967,271

Sec. 77a.  18 V.S.A. § 9405a is amended to read:

§ 9405a.  COMMUNITY NEEDS ASSESSMENT AND STRATEGIC

                PLANNING

On or before January 1, 2005, each hospital shall conduct a four-year community needs assessment.  The assessment shall identify and prioritize the health care needs of the service area or patient population for which a hospital provides services, and engage the public in the hospital’s strategic planning process.  It shall be accomplished in collaboration with community members, including other health care professionals in the community, local government officials, community organizations, and local businesses.  The process for assessing the community’s health care needs shall include at least one public meeting held solely for soliciting public comment, notice for which shall be provided pursuant to section 174 of Title 1.  The needs assessment shall be prepared in a uniform format approved by the commissioner and shall be summarized in the hospital’s community report.  In addition, each hospital shall develop a mechanism for receiving ongoing public comment, including an annual public meeting, regarding the community needs assessment and for revising it biannually so that the assessment will continue to project a four-year vision.  Subsequent community needs assessments shall be conducted every four years thereafter, beginning March 1, 2009.

Sec. 77b.  18 V.S.A. § 9405b(b) is amended to read:

(b)  On or before January 1, 2005, and annually thereafter beginning on June 1, 2006, the board of directors or other governing body of each hospital licensed under chapter 43 of this title shall publish on its website, making paper copies available upon request, its community report in a uniform format approved by the commissioner, and in accordance with the standards and procedures adopted by rule under this section, and shall hold one or more public hearings to permit community members to comment on the report.  Notice of meetings shall be by publication, consistent with section 174 of Title 1.  Hospitals located outside this state which serve a significant number of Vermont residents, as determined by the commissioner, shall be invited to participate in the community report process established by this subsection.

Sec. 77c.  18 V.S.A. § 9432(7) is amended to read:

(7)  “Health care facility” means all persons or institutions, including mobile facilities, whether public or private, proprietary or not for profit, which offer diagnosis, treatment, inpatient, or ambulatory care to two or more unrelated persons, and the buildings in which those services are offered.  The term shall not apply to any institution operated by religious groups relying solely on spiritual means through prayer for healing, but shall include but is not limited to:

* * *

Sec. 77d.  18 V.S.A. § 9435(c) is amended to read:

(c)  The provisions of subsection (a) of this section shall not apply to offices owned or, operated, or leased by a hospital or its subsidiary, parent, or holding company, outpatient diagnostic or therapy programs, kidney disease treatment centers, independent diagnostic laboratories, cardiac catheterization laboratories, radiation therapy facilities, ambulatory surgical centers, and diagnostic imaging facilities and similar facilities owned or operated by a physician, dentist, or other practitioner of the healing arts.

Sec. 77e.  18 V.S.A. § 9440 is amended to read:

§ 9440.  PROCEDURES

* * *

(c)  The application process shall be as follows:

* * *

(3)  The commissioner shall review each letter of intent and, if the letter contains the information required for letters of intent as established by the commissioner by rule, within 30 days, determine whether the project described in the letter will require a certificate of need.  If the commissioner determines that a certificate of need is required for a proposed expenditure or action, an application for a certificate of need shall be filed before development of the project begins.

(4)  Within 15 days or, in the case of review cycle applications under section 9439 of this title, within 30 days of receipt of an application, the commissioner shall notify the applicant that the application contains all necessary information required and is complete, or that additional information is required.

* * *

Sec. 77f.  18 V.S.A. § 9456(c) is amended to read:

(c)  Individual hospital budgets established under this section shall:

* * *

(5)  include a finding that the analysis provided in subdivision (b)(10) (b)(9) of this section is a reasonable methodology for reflecting a reduction in net revenues for non-Medicaid payers.

Sec. 77g.  SUSPENSION OF CERTIFICATE OF NEED “GAP”

                JURISDICTION

     (a)  The requirements of subsection 9434(d) of Title 18 are suspended through June 30, 2007.  As part of their annual budget reviews, hospitals shall report any projects that otherwise would have required a letter of intent to the commissioner of banking, insurance, securities, and health care administration under subsection 9434(d).

Sec. 78.  Banking, insurance, securities, and health care administration - administration

                   Personal services                                            922,370

                   Operating expenses                                          48,000

                        Total                                                         970,370

               Source of funds

                   Special funds                                                  970,370

(a)  Notwithstanding any provision of law to the contrary, the commissioner of BISHCA is authorized to take immediate action to remedy air quality problems that have resulted in chemical toxicity to one or more department employees; the commissioner may in his or her discretion authorize telecommuting or off-site work locations for employees who have documented medical problems which have been, or may be, related to workspace air quality that has resulted in chemical toxicity; and the commissioner may use funds appropriated to the department of buildings and general services to implement any necessary improvements, as approved by the secretary of administration.

Sec. 79.  Public safety - administration

                   Personal services                                         1,502,205

                   Operating expenses                                          27,548

                   Grants                                                              48,000

                        Total                                                      1,577,753

               Source of funds

                   General fund                                                1,577,753

(a)  The department of public safety shall provide business manager services for the Vermont criminal justice training council.

(b)  The department of public safety shall submit a plan for development of a statewide public safety communications system to the house and senate committees on appropriations and government operations and the joint fiscal committee.  No funds are to be expended for design, acquisition, or implementation of a new statewide public safety communications system pending review by the aforementioned committees and approval by the joint fiscal committee.

     (c)  The law enforcement advisory board is requested to include comments and recommendations on the proposed statewide public safety communications system in its next report to the governor and the general assembly.

     (d)  The commissioner of public safety and the commissioner of health shall work cooperatively to transition the forensic alcohol program from the Vermont department of health to the department of public safety as soon as administratively possible and shall report to the general assembly on the status of the transition during the 2006 legislative session.   In addition, the commissioner of buildings and general services and the commissioner of public safety shall submit a plan for the design and construction, including funding requirements of a new forensics laboratory, to the general assembly by January 15, 2006.

     (e)  Of the above appropriation, $26,000 shall be used for a grant to the Essex County sheriff department.

     (f)  In order to achieve better coordination of all law enforcement resources in the state, the law enforcement advisory board created pursuant to 24 V.S.A. § 1939 shall study the relationship between the state police and local coverage to ensure effective coverage in a cost-effective manner for Vermonters. Specifically it shall:

          (1)  Develop a list of the duties of the department of public safety that cover the entire state such as the crime lab, special investigations, and the mission and duties of the state police;

          (2)  Review the state police coverage and state and local public safety relationships in other states such as New Hampshire and Connecticut, including a review of models that require communities with over 3,500 in population to provide or pay for their law enforcement;

          (3)  Develop ideas for several pilot projects that use local law enforcement to enhance day-to-day coverage and free the state police to focus on its mission and statewide responsibilities;

          (4)  Submit recommendations to the house and senate committees on judiciary and appropriations as part of its annual budget submission to the general assembly in January 2006.

Sec. 80.  Public safety - homeland security

                   Personal services                                            851,441

                   Operating expenses                                        974,324

                   Grants                                                       11,771,817

                        Total                                                    13,597,582

               Source of funds

                   General fund                                                   363,007

                   Federal funds                                            13,217,575

                   Interdepartmental transfer                                 17,000

                        Total                                                    13,597,582

Sec. 81.  Public safety - Vermont state police

                   Personal services                                       36,221,326

                   Operating expenses                                     6,337,277

                   Grants                                                         1,759,547

                        Total                                                    44,318,150

               Source of funds

                   General fund                                              17,388,274

                   Transportation fund                                   18,555,988

                   Special funds                                               3,369,661

                   Federal funds                                              4,458,538

                   Interdepartmental transfer                               545,689

                        Total                                                    44,318,150

(a)  The above appropriation for personal services provides funding for 316 state troopers, including 10 “corridor” troopers.  Three additional troopers are funded in the homeland security section for a total of 319, the same number as in fiscal year 2005.  The above appropriation for operating expenses includes $1,042,000 for the purchase of replacement vehicles.

(b)  Of the above appropriation, $35,000 in special funds shall be available for snowmobile law enforcement activities and $35,000 in general funds shall be available to the southern Vermont wilderness search and rescue team, which comprises state police, the department of fish and wildlife, county sheriffs, and local law enforcement personnel in Bennington, Windham, and Windsor counties for snowmobile enforcement.

(c)  Of the $230,000 allocated for local heroin interdiction grants funded in this section, $190,000 shall be used by the Vermont drug task force to fund three (3) town task force officers.  These town task force officers will be dedicated to heroin and heroin-related drug (e.g. methadone, oxycontin, crack cocaine, and methamphetamine) enforcement efforts.  The remaining $40,000 shall remain as a “pool” of money available to local and county law enforcement to fund overtime costs associated with heroin investigations.  Any unexpended funds from prior fiscal years shall be carried forward.

(d)  In the event that federal funding currently supporting the Vermont drug task force is reduced, the department shall redirect any other federal funds that may be utilized for this purpose, including the methamphetamine grant, and shall redirect available state resources to maintain the activities of the task force.

Sec. 81a.  24 V.S.A. § 1939(a) is amended to read:

(a)  A law enforcement advisory board is created within the department of public safety to advise the commissioner of public safety, the governor, and the general assembly on issues involving the cooperation and coordination of all agencies which exercise law enforcement responsibilities.  The board shall review any matter which affects more than one law enforcement agency.  The board shall comprise the following members:

(1)  the commissioner of the department of public safety;

* * *

(11)  the executive director of the Vermont criminal justice training council; and

(12)  the defender general or his or her designee; and

(13)  one employee-representative of the Vermont state police, appointed by the director of the Vermont state employees’ association.

Sec. 82.  Public safety - criminal justice services

                   Personal services                                         4,933,618

                   Operating expenses                                     3,585,669

                   Grants                                                         3,969,200

                        Total                                                    12,488,487

               Source of funds

                   General fund                                                   280,000

                   Transportation fund                                     4,100,407

                   Special funds                                               1,256,685

                   Federal funds                                              6,272,395

                   Interdepartmental transfer                               579,000

                        Total                                                    12,488,487

     (a)  Of the above general fund appropriation, $30,000 plus available matching funds shall be used to address the DNA processing associated with S.15 of the 2005 legislative session.  This includes hiring additional staff at the Vermont crime lab.

Sec. 83.  Public safety - emergency management

                   Personal services                                         1,495,775

                   Operating expenses                                        532,443

                   Grants                                                            630,012

                        Total                                                      2,658,230

               Source of funds

                   Transportation fund                                          63,969

                   Special funds                                                  367,903

                   Federal funds                                              2,223,858

                   Interdepartmental transfer                                   2,500

                        Total                                                      2,658,230

Sec. 84.  Public safety – emergency management - radiological emergency response plan

                   Personal services                                            548,205

                   Operating expenses                                        271,030

                   Grants                                                            496,112

                        Total                                                      1,315,347

               Source of funds

                   Special funds                                               1,315,347

(a)  Of the above appropriation, the grants to the department of health are increased by $13,911 over fiscal year 2005 and are level-funded for other state agencies.

(b)  Of the above appropriation, $87,028 is provided to establish a western reception center.  This is subject to selection and approval of a site by the commissioner of public safety and VEM/RERP in collaboration with officials of the Emergency Planning Zone (EPZ).

(c)  The radiological emergency response plan (RERP) functions and funding shall be a separate appropriation in fiscal year 2006 and henceforth.

(d)  In fiscal year 2006, the division of emergency management in collaboration with the state agencies, the management of the nuclear power plant, the selectboards of the municipalities in the emergency planning zone, the Windham regional planning commission, and any other municipality or EPZ entity defined by the state as required to support the RERP shall develop the budget for expenditures from the radiological emergency response plan fund for fiscal year 2007 following the provisions of 20 V.S.A. § 38(a).  From the fund, each town within the emergency planning zone shall receive an annual base payment of no less than $5,000 for radiological emergency response related expenditures.  Additional expenditures by the municipalities in the emergency planning zone, the Windham regional planning commission, and any other municipality or EPZ entity defined by the state as required to support the plan shall be determined during the budget development process established by this section.

(e)  Of the above special fund appropriation, up to $30,000 shall be available to contract with any radio station serving the emergency planning zone for the emergency alert system.

Sec. 85.  Public safety - fire safety

                   Personal services                                         3,356,644

                   Operating expenses                                     1,099,628

                        Total                                                      4,456,272

               Source of funds

                   General fund                                                   582,688

                   Transportation fund                                          80,964

                   Special funds                                               3,481,236

                   Federal funds                                                   92,384

                   Interdepartmental transfer                               219,000

                        Total                                                      4,456,272

(a)  Of the above general fund appropriation, $50,000 shall be granted to the Vermont rural fire protection task force for the purpose of designing dry hydrants.

Sec. 86.  Agriculture, food and markets - administration

                   Personal services                                            880,196

                   Operating expenses                                        453,668

                   Grants                                                            342,004

                        Total                                                      1,675,868

               Source of funds

                   General fund                                                1,409,035

                   Special funds                                                  117,216

                   Federal funds                                                   91,004

                   Interdepartmental transfer                                 58,613

                        Total                                                      1,675,868

Sec. 87.  Agriculture, food and markets - food safety and consumer protection

                   Personal services                                         2,360,887

                   Operating expenses                                        281,572

                   Grants                                                         2,901,492

                        Total                                                      5,543,951

               Source of funds

                   General fund                                                1,381,891

                   Transportation fund                                          38,862

                   Special funds                                               3,344,115

                   Federal funds                                                 772,083

                   Interdepartmental transfer                                   7,000

                        Total                                                      5,543,951

Sec. 88.  Agriculture, food and markets - agricultural development

                   Personal services                                            816,602

                   Operating expenses                                        504,152

                   Grants                                                         1,049,421

                        Total                                                      2,370,175

               Source of funds

                   General fund                                                   609,472

                   Special funds                                               1,571,703

                   Federal funds                                                 189,000

                        Total                                                      2,370,175

Sec. 89.  Agriculture, food and markets - laboratories, agricultural resource management and environmental stewardship

                   Personal services                                         3,003,076

                   Operating expenses                                        554,576

                   Grants                                                            616,000

                        Total                                                      4,173,652

               Source of funds

                   General fund                                                1,805,695

                   Special funds                                               1,497,845

                   Federal funds                                                 598,324

                   Interdepartmental transfer                               271,788

                        Total                                                      4,173,652

Sec. 90.  Agriculture, food and markets - state stipend

                   Grants                                                            175,000

               Source of funds

                   General fund                                                   175,000

Sec. 91.  Agriculture, food and markets - mosquito control

                   Personal services                                              20,000

                   Operating expenses                                          70,000

                        Total                                                           90,000

               Source of funds

                   Special funds                                                    90,000

Sec. 92.  Public service - regulation and energy

                   Personal services                                         4,464,769

                   Operating expenses                                        631,466

                   Grants                                                            800,000

                        Total                                                      5,896,235

               Source of funds

                   Special funds                                               4,713,435

                   Federal funds                                              1,157,800

                   Interdepartmental transfer                                 25,000

                        Total                                                      5,896,235

     (a)  As part of its report on the use of the clean energy development fund as required by section 3 of H.545 of 2005, the department of public service shall consider efforts to support development and increased use of cogeneration and biomass technologies including the possible dedication of at least $250,000 annually for this purpose.

Sec. 93.  Public service - purchase and sale of power

                   Personal services                                              10,600

                   Operating expenses                                            2,215

                        Total                                                           12,815

               Source of funds

                   Special funds                                                    12,815

Sec. 94.  Enhanced 9-1-1 board

                   Personal services                                         2,020,257

                   Operating expenses                                        397,331

                        Total                                                      2,417,588

               Source of funds

                   Special funds                                               2,417,588

Sec. 95.  Public service board

                   Personal services                                         2,380,294

                   Operating expenses                                        310,000

                        Total                                                      2,690,294

               Source of funds

                   Special funds                                               2,690,294

Sec. 96.  Judiciary

                   Personal services                                       24,276,133

                   Operating expenses                                     6,576,667

                        Total                                                    30,852,800

               Source of funds

                   General fund                                              24,803,705

                   Transportation fund                                     3,028,595

                   Special funds                                                  622,500

                   Tobacco fund                                                   40,000

                   Federal funds                                                 333,000

                   Interdepartmental transfer                            2,025,000

                        Total                                                    30,852,800

(a)  The court administrator shall submit to the house and senate committees on appropriations and judiciary, no later than January 1, 2006, a plan and budget for the staffing and provision of court security services throughout the state.  The plan and budget should be based on the recommendations of the Supreme Court’s “Court Security Advisory Committee.”

(b)  The establishment of two (2) new exempt positions – one (1) Judicial Bureau Docket Clerk and one (1) Guardian ad Litem Volunteer Coordinator – is authorized in fiscal year 2006.

     (c)  The court administrator shall develop a preliminary plan of implementation of a comprehensive strategy for the management of all public records of all courts, including proposed, phased time lines for the implementation, by January 1, 2006.  The management strategy will be based on actual retrieval histories and applicable statutory mandates.

     (d)  The court administrator shall report to the house and senate committees on government operations and appropriations on the records storage reduction initiative on or before January 15, 2006, and recommend any statutory changes that will reduce the amount of records maintained and stored by state agencies.

Sec. 96a.  12 V.S.A. § 5540a is amended to read

§ 5540a.  JURISDICTION OVER SMALL CLAIMS; ASSISTANT JUDGES;

                ADDISON, BENNINGTON, CHITTENDEN, FRANKLIN,

                GRAND ISLE, LAMOILLE, ORANGE, ORLEANS,

                WASHINGTON, WINDHAM AND WINDSOR COUNTIES

* * *

(e)  This section shall be repealed effective on July 1, 2005 2008.

Sec. 96b.  CASH ADVANCES; COUNTY CLERKS

     (a)  Notwithstanding the provisions of 32 V.S.A §§ 469 and 470, cash advances to county clerks shall be administered in the same manner as advances for district courts under the provisions of 32 V.S.A § 466.

Sec. 97.  10 V.S.A. § 6618(b) is amended to read:

(b)  The secretary may authorize disbursements from the solid waste management assistance account for the purpose of enhancing solid waste management in the state in accordance with the adopted waste management plan.  This includes:

* * *

(7)  a portion of the costs of administering the waste facility panel established under subchapter 5 of chapter 151 of this title environmental court established under chapter 27 of Title 4.  The amount of $120,000.00 per fiscal year shall be disbursed for this purpose;

* * *

Sec. 98.  Human rights commission

                   Personal services                                            353,523

                   Operating expenses                                          84,182

                        Total                                                         437,705

               Source of funds

                   General fund                                                   278,014

                   Federal funds                                                 159,691

                        Total                                                         437,705

Sec. 98a.  9 V.S.A. § 4553(a)(6)(D) is amended to read:

               (D)  costs and reasonable attorney’s fees associated with the investigation and enforcement of actions; any such costs or fees recovered by the human rights commission under this chapter shall be deposited in the commission’s special fund and shall be available to the commission to offset the costs of providing legal services;

Sec. 98b.  9 V.S.A. § 4551(a) is amended to read:

     (a)  The human rights commission is hereby established. It shall consist of five members to be appointed by the governor, with the advice and consent of the senate, who shall designate one member to be its chair.  No more than three members shall be of the same political party.  At least one member shall be of a racial minority.

Sec. 99.  Total protection to persons and property      219,880,467

               Source of funds

                    General fund                                              78,248,797

                   Transportation fund                                   28,038,314

                   Special funds                                             51,738,826

                   Tobacco fund                                                 619,768

                   Federal funds                                            50,101,089

                   Enterprise funds                                           3,908,080

                   Interdepartmental transfer                            7,225,593

                        Total                                                  219,880,467

Sec. 100.  Human services - agency of human services - secretary’s office

                   Personal services                                         3,746,236

                   Operating expenses                                     1,245,070

                   Grants                                                         7,633,936

                        Total                                                    12,625,242

               Source of funds

                   General fund                                                4,507,196

                   Tobacco fund                                              1,375,845

                   Federal funds                                              5,742,201

                   Interdepartmental transfer                            1,000,000

                        Total                                                    12,625,242

(a)  Notwithstanding any other provisions of law, workers employed by persons who receive assistance from the agency of human services to procure attendant, personal care, or respite services or who utilize a qualified intermediary service organization providing services on behalf of the state shall not be considered state employees, except for purposes of 21 V.S.A. chapter 17.

(b)  Notwithstanding any other provisions of law, the state may provide workers’ compensation coverage to workers employed by persons who receive assistance from the agency of human services to procure attendant, personal care, or respite services, and the state shall not be considered their employer.  The state may also either permit a qualified intermediary service organization to purchase group insurance policies for persons served by their organization, or deem such persons to be members of an association and eligible for self‑insurance under 21 V.S.A. § 687a for purposes of providing workers’ compensation.  This provision is intended solely to reduce costs of providing workers’ compensation and shall not be considered for any other purpose.

(c)  Notwithstanding 32 V.S.A. § 706, the secretary may transfer funds allocated for the “high risk pool” and costs related to juvenile justice as outlined in this section as well as the substance-abuse-related allocations in subsection (i) outlined in this section to the departments in the agency of human services designated to provide these services.

(d)  Of the above tobacco settlement funds, $49,000 shall be used to provide a grant to the project against violent encounters for a statewide program for substance abuse prevention and mentoring program for youth.

(e)  Of the above tobacco fund appropriation, $100,000 shall be used for a grant to Lamoille County people in partnership for wrap-around services for at‑risk youth.

(f)  Of the above tobacco fund appropriation, $100,000 with any corresponding federal matching funds shall be for comprehensive treatment services and $15,000 for safe housing provisions for at-risk youth.

(g)  Of the above general fund appropriation, $30,000 shall be granted to Prevent Child Abuse Vermont for a comprehensive health education and violence prevention curriculum for seventh and eighth grade students.

(h)  Of the above general fund appropriation, $8,000 shall be granted to the Vermont council of girl scouts, of which $5,000 shall be used to support a girl scout special project to assist girls with incarcerated mothers and $3,000 shall be used to support a school vacation program.

(i)  Of the above appropriation, a total of $4,004,547 consisting of $1,838,720 in general funds, $811,845 in tobacco funds, and $1,353,973 in federal funds shall be used for the comprehensive substance abuse prevention and treatment component of the drug education treatment enforcement and rehabilitation program (DETER).

(1)  The amount of $1,440,660, of which $619,677 is from general funds and $141,682 is tobacco funds, shall be used to support the outpatient treatment, case management, and drug court component of the program.  Of the general and tobacco funds, $189,831 shall be allocated to the Rutland County drug court and shall be reserved to provide appropriate drug testing, case management, and other outpatient and inpatient treatment consistent with the design of the Rutland County drug court.  These are the state funds the agency of human services shall use as match for year 2 federal funds from the 2003 Department of Justice drug court implementation grant award.

(2)  The amount of $439,316, of which $202,808 is from general funds and $141,120 is from tobacco funds, shall be used to fund student assistance counselors.

(3)  The amount of $599,067, of which $518,010 is from general funds and $45,000 is from tobacco funds, shall be used for residential treatment programs, including transitional halfway house programs, including the serenity house program.

          (4)  The amount of $345,000, of which $95,000 is from general funds and $250,000 is from tobacco funds, shall be used for recovery centers as follows:

               (A)  $240,000 shall be distributed to recovery centers in Springfield, St. Johnsbury, Rutland, Burlington, Bennington, and Barre in the amounts of at least $35,000, but not more than $40,000, per fiscal year to each center;

               (B)  $25,000 to the recovery center in White River Junction;

               (C)  $80,000 to the department of health for grants to two new recovery centers and for development of and assistance to recovery centers, and programming and evaluation of recovery centers.

          (5)  The department of health shall be advised by an executive council of Vermont’s recovery center network on an ongoing basis to prioritize service needs, to assist with the review of recovery center funding proposals, and to provide recommendations for disbursement of funds to the recovery centers.  This executive council will consist of the director of the upper valley substance abuse foundation, a representative from the department of health, the director of FOR-VT, and four members elected by the recovery leadership network, which is comprised of a representative from each of the recovery centers.

(6)  The amount of $1,180,504, of which $403,255 is from general funds and $234,022 is from tobacco funds, shall be used for opiate treatment programs, including buprenorphine and methadone and treatment for pregnant and postpartum women.

(j)  Of the above tobacco fund appropriation, $200,000 along with available matching federal funds shall be available for services required for petitions filed by the agency under 33 V.S.A. § 5517(e).

(k)  The agency of human services shall report to the joint fiscal committee prior to January 1, 2006 on all existing information and referral lines across the agency and the lines that they propose to consolidate with the 2-1-1 program.  The report shall also include an update on the status of the 2-1-1 information line.

     (l)  The secretary of the agency shall implement master contracts with community providers as described in the agency of human services strategic plan dated February 2005, as soon as administratively feasible for the agency and the providers. 

          (1)  The secretary shall consult with all agency of human services commissioners and the commissioner of education to coordinate master contracts.

          (2)  The secretary of human services shall ensure that the funds allocated in the department budgets for programs provided by the Lund Family Center can be transferred across programs of the Lund Family Center and may modify definitions and program criteria as necessary to allow the transfer.

     (m)  The administration and the Vermont council of developmental and mental health services have agreed that in state fiscal years 2007 and 2008, a 7.5 percent state funding increase will be recommended for the designated agencies.  The agency of human services and Vermont council of developmental and mental health services will work collaboratively with consumers, families, and advocates to make a recommendation in each fiscal year as to how this increase will be allocated.

     (n)  Of the above general fund appropriation, $30,000 plus available matching federal funds shall be granted to Vermont legal aid for the purpose of providing cost of living increases to staff.

Sec. 101.  Rate setting

                   Personal services                                            632,040

                   Operating expenses                                          92,395

                        Total                                                         724,435

               Source of funds

                   Interdepartmental transfer                               724,435

Sec. 102.  Human services board

                   Personal services                                            278,443

                   Operating expenses                                          40,298

                        Total                                                         318,741

               Source of funds

                   General fund                                                   129,693

                   Federal funds                                                 134,679

                   Interdepartmental transfer                                 54,369

                        Total                                                         318,741

Sec. 103.  Developmental disabilities council

                   Personal services                                            110,310

                   Operating expenses                                          27,237

                   Grants                                                            350,838

                        Total                                                         488,385

               Source of funds

                   Federal funds                                                 488,385

Sec. 104.  Office of Vermont health access – administration

                   Personal services                                       27,263,444

                   Operating expenses                                        681,014

                        Total                                                    27,944,458

               Source of funds

                   Special funds                                             13,585,633

                   Federal funds                                            14,358,825

                        Total                                                    27,944,458

     (a)  The office shall transfer $100,000 of the above special fund appropriation to the department for children and families for the purpose of hiring additional quality assurance staff to review eligibility for long-term care services in the Medicaid program.

(b)  With the approval of the secretary of administration and the secretary of human services, the office of Vermont health access is authorized to identify and convert two (2) classified positions to two (2) exempt positions and create one (1) new exempt position.

     (c)  Of the above special fund appropriation, $1,500,000 is to be used for increased administration expenses for actuarial needs required by the federal government, increased cost associated with conversion of existing pharmacy to wrap around services of the Medicare Part D benefit and for direct support of the coverage and services management and for global clinical record systems.  These funds shall be matched with federal funds.  The office may add at least ten (10) new positions which shall be transferred and converted from vacant positions in the executive branch of state government.

     (d)  If the office of Vermont health access has insufficient funds to meet the outreach efforts required by the plan developed under Sec. 316(c) of this act regarding the implementation of Medicare part D, the office may seek authorization from the emergency board to expend additional funds necessary to ensure that the outreach plan provides meaningful and sufficient information to Vermonters.

Sec. 104a.  Office of Vermont health access – Medicaid program

                   Grants                                                     589,599,773

               Source of funds

                   Special funds                                           243,284,425

                   Federal funds                                          346,315,348

                        Total                                                  589,599,773

     (a)  The office of Vermont health access shall implement the following provisions relating to provider payments from the appropriations in this section.

(1)  The office of Vermont health access shall reduce base Medicaid spending for hospital services by $16,500,000.  In fiscal year 2006, the reduction in spending may be accomplished through a reduction in hospital reimbursement, an offset with payments from the hospitals made to the office in anticipation of the final settlement of outpatient costs for prior years, or a combination of both.  The offset shall be the payment amount above the anticipated settlement of $1,900,000, which the office has already included in its fiscal year 2006 outpatient projection, but the offset shall not offset spending reductions by more than $5,000,000.  Payments by hospitals shall be considered provisional and shall be adjusted as necessary based on final outpatient cost settlements.  In fiscal year 2006, Vermont hospitals shall be allowed to increase charges to the extent necessary to offset the reduction in reimbursement that results from this section.      

(2)  Home health agency fees shall be reduced by $500,000.

(3)  Dentists’ fees shall be amended, and other strategies, including a reduction to the cap on adult services, may be employed to reduce spending by $243,309.  To the extent possible, the reduction shall be targeted to health services received by adults to minimize the impact on dental services for children.

(4)  The amount of $2,400,000 in reductions shall be made in reimbursement rates to providers who use Current Procedural Technology (CPT) codes, but shall be implemented to minimize the impact on primary care services.

Sec. 104b.  FUND APPROPRIATION AND TRANSFER

(a)  The sum of $78,104,989 is appropriated and transferred from the general fund to the health access trust fund in fiscal year 2006.

(b)  The sum of $17,250,000 is appropriated and transferred from the tobacco litigation settlement fund to the health access trust fund in fiscal year 2006.

Sec. 104c.  OTHER MEDICAID APPROPRIATIONS; TRANSFER;

                  REPORT

     (a)  In addition to the appropriations in this act, all other appropriations of state, federal, and special fund amounts for Medicaid programs and purposes made in the fiscal year 2006 general appropriations act, or any other act appropriating funds in fiscal year 2006, shall be transferred to the health access trust fund established by section 1972 of Title 33 for use in fiscal year 2006 by the agency of human services for purposes of the trust fund.  The agency shall submit reports on any transfers made in accordance with this section to the joint fiscal committee on July 1, September 1, and November 1 for committee review and consideration at its July, September, and November 2005 committee meetings.

Sec. 105.  Health - administration and support

                   Personal services                                         5,606,480

                   Operating expenses                                     1,477,930

                        Total                                                      7,084,410

               Source of funds

                   General fund                                                1,864,184

                   Special funds                                                      1,701

                   Federal funds                                              5,214,525

                   Interdepartmental transfer                                   4,000

                        Total                                                      7,084,410

Sec. 106.  Health - health protection

                   Personal services                                         3,561,696

                   Operating expenses                                        680,062

                   Grants                                                         1,574,400

                        Total                                                      5,816,158

               Source of funds

                   General fund                                                1,165,201

                   Special funds                                                  942,000

                   Federal funds                                              3,321,732

                   Interdepartmental transfer                               387,225

                        Total                                                      5,816,158

Sec. 107.  Health - health surveillance

                   Personal services                                         7,258,188

                   Operating expenses                                     1,900,115

                   Grants                                                         2,461,560

                        Total                                                    11,619,863

               Source of funds

                   General fund                                                3,562,198

                   Special funds                                               1,254,750

                   Federal funds                                              6,672,515

                   Permanent trust funds                                       10,000

                   Interdepartmental transfer                               120,400

                        Total                                                    11,619,863

(a)  The amount of $250,000 of the above general fund appropriation and at least $50,000 of the above federal fund appropriation shall be appropriated to the Vermont AIDS service organizations for client-based support services. The grants in this section shall be awarded equitably on a per-client basis and shall be used for services.  No more than 15 percent may be used for the administration of such services by the Vermont AIDS service organizations.  The method by which AIDS service organizations’ clients are counted shall be determined by mutual agreement of the department of health, the AIDS service organizations, and the HIV/AIDS service advisory council (HASAC).  The department of health AIDS program shall be guided and advised by HASAC on an ongoing basis in prioritizing service needs in the disbursement of these funds.  The department of health AIDS program shall meet at least quarterly with HASAC and shall provide HASAC with current information and data relating to service initiatives.

(b)  The amount of $175,000 of the above general fund appropriation shall be used for all aspects of the HIV/AIDS medication assistance program (AMAP), including costs of prescribed medications, related laboratory testing, nutritional supplements, and maximum cost-effectiveness for the program.  Any remaining AMAP general funds at the end of the fiscal year shall be equitably distributed to Vermont AIDS service organizations as provided for under subsection (a) of this section.

     (c)  The amount of  $100,000 of the above general fund appropriation shall be appropriated to the Vermont AIDS service organizations and other Vermont HIV/AIDS prevention providers for community-based HIV prevention programming which are currently not supported by federal funds due to federal restrictions.  These funds shall be used for HIV/AIDS prevention purposes, including, but not limited to, improving the availability of confidential and anonymous HIV testing; prevention work with at-risk groups such as women, intravenous drug users, and people of color; anti-stigma campaigns; and promotion of needle exchange programs.  No more than 10 percent of the funds may be used for the administration of such services by the recipients of these funds.  The method by which these prevention funds shall be distributed shall be determined by mutual agreement of the department of health, AIDS service organizations, the HIV/AIDS Service Advisory Committee (HASAC), and the Community Planning Group (CPG).  The department of health AIDS program shall be guided and advised by HASAC and CPG on an ongoing basis in prioritizing prevention service needs in the disbursement of these funds. 

(d)  The secretary of human services shall immediately notify the joint fiscal committee if, at any time, there are insufficient funds in AMAP to assist all eligible individuals.  The secretary shall work in cooperation with persons living with HIV/AIDS to develop a plan to continue access to AMAP medications until such time as the general assembly can take action.

(e)  The secretary of human services shall work in conjunction with the AMAP advisory committee, which shall be comprised of no less than 50 percent of members who are living with HIV/AIDS.  The committee shall make recommendations regarding the program’s formulary of approved medication, related laboratory testing, nutritional supplements, and eligibility for the program.

Sec. 108.  Health - health improvement

                   Personal services                                         8,355,130

                   Operating expenses                                     1,155,320

                   Grants                                                         9,362,086

                        Total                                                    18,872,536

               Source of funds

                   General fund                                                3,545,034

                   Special funds                                                  733,502

                   Tobacco fund                                              3,481,423

                   Federal funds                                            11,105,577

                   Interdepartmental transfer                                   7,000

                        Total                                                    18,872,536

(a)  The department of health may carry forward any unspent portion of funds designated for health professional loan repayment.  These funds may be used either alone or to match federal National Health Service Corps loan repayment funds, local funds, or private funds, and shall be made available to primary care providers, dentists, licensed nurses, and dental hygienists who agree to practice for a prescribed period of time in the state or at an accredited hospital within 10 miles of the Vermont border, serving a portion of the state designated as a health professional shortage population, or other rural or underserved areas.  Educational scholarships, loan repayment grants, loan deferment payments, and payments of taxes due on the award may be considered for payment.

(b)  The above tobacco fund appropriation in this section shall be utilized according to the provisions of 18 V.S.A. chapter 225 as follows:

(1)  community-based programs - $1,023,624;

(2)  media and public education - $1,007,799;

(3)  tobacco cessation programs - $1,130,000; these funds may also be used to provide tobacco cessation counseling services to persons incarcerated in Vermont correctional facilities, and $80,000 shall be used to make nicotine replacement therapies available to all persons enrolled in tobacco cessation counseling;

(4)  surveillance and evaluation activities - $320,000.

Sec. 109.  18 V.S.A. § 10 is amended to read:

§ 10.  Educational assistance; incentives; nurses

* * *

(f)  This section shall be repealed effective June 30, 2005.

Sec. 110.  Health - community public health

                   Personal services                                       11,727,467

                   Operating expenses                                     1,620,114

                   Grants                                                       11,782,520

                        Total                                                    25,130,101

               Source of funds

                   General fund                                                4,138,477

                   Special funds                                                  477,110

                   Federal funds                                            20,362,014

                   Interdepartmental transfer                               152,500

                        Total                                                    25,130,101

Sec. 111.  Health - alcohol and drug abuse programs

                   Personal services                                         2,391,227

                   Operating expenses                                        836,119

                   Grants                                                       18,725,833

                        Total                                                    21,953,179

               Source of funds

                   General fund                                                5,772,374

                   Special funds                                                  157,000

                   Tobacco fund                                              3,171,266

                   Federal funds                                            12,394,539

                   Interdepartmental transfer                               458,000

                        Total                                                    21,953,179

(a)  For the purpose of meeting the need for outpatient substance abuse services when the preferred provider system has a waiting list of five days or more or there is a lack of qualified clinicians to provide services in a region of the state, a state-qualified alcohol and drug abuse counselor may apply to the department of health, division of alcohol and drug abuse programs, for time‑limited authorization to participate as a Medicaid provider to deliver clinical and case coordination services, as authorized.

(b)(1)  In accordance with federal law, the division of alcohol and drug abuse programs may use the following interim criteria to determine whether to enroll a state-supported Medicaid and uninsured population substance abuse program in the division’s network of designated providers, as described in the state plan:

(A)  The program has the ability to provide the quality, quantity, and levels of care required under the division’s standards, licensure standards, and accreditation standards established by the commission of accreditation of rehabilitation facilities, the joint commission on accreditation of health care organizations, or the commission on accreditation for family services.

(B)  Any program that is currently being funded in the existing network shall continue to be a designated program until further standards are developed, provided the standards identified in this subdivision (b)(1) are satisfied.

(C)  All programs shall continue to fulfill grant or contract agreements.

(2)  The provisions of subdivision (1) of this subsection shall not preclude the division’s “request for bids” process.

(c)  Of the above interdepartmental transfer, $130,000 shall be used to support the gambling addiction program, $90,000 of which will be used to support the existing program.  Prior to expending the additional $40,000 of this allocation, the department shall develop a comprehensive gambling addiction services plan that identifies the need for services, states the goals to be achieved by the gambling addiction program, and outlines the use of these funds and future appropriations to achieve these goals.  The plan shall be submitted to the general assembly by January 15, 2006.

     (d)  Of the funds appropriated above and in Sec. 100 of this act, $110,000 shall be used for drug court programs in Bennington, Chittenden, and Rutland counties.  The sum of $35,000 is allocated for Chittenden to be used for court coordination.  The sum of $25,000 is allocated for Rutland to be used for treatment, case management, court coordination, and screening services as needed.  The sum of $25,000 is allocated for Bennington for court coordination, and an additional $25,000 is allocated for Bennington to be used for case management, treatment, and screening services as needed.

(e)  Of the above general fund appropriation, $35,000 shall be used to increase the daily rate to $20.00 for substance abuse halfway house services, including the Grace House program.

(f)  The office of alcohol and drug abuse programs shall report to the general assembly by January 15, 2006 on the fiscal status of all residential substance abuse programs supported by state appropriations. This report shall include the types of services provided, the cost of providing these services, and the sources of funds available at each of the respective residential programs.

Sec. 112.  Health - mental health

                   Personal services                                         3,404,696

                   Operating expenses                                        507,616

                   Grants                                                     106,674,609

                        Total                                                  110,586,921

               Source of funds

                   General fund                                              44,492,587

                   Special funds                                               6,945,611

                   Federal funds                                            55,125,950

                   Interdepartmental transfer                            4,022,773

                        Total                                                  110,586,921

     (a)  Of the above appropriation, $40,000 shall be used to maintain the Burlington downtown outreach program to develop a model program for expansion to other areas of the state.

Sec. 113.  Health - Vermont state hospital

                   Personal services                                       16,580,497

                   Operating expenses                                     1,813,522

                   Grants                                                                3,000

                        Total                                                    18,397,019

               Source of funds

                   General fund                                                2,417,915

                   Special funds                                                  110,000

                   Federal funds                                                 572,426

                   Interdepartmental transfer                          15,296,678

                        Total                                                    18,397,019

Sec. 113a.  13 V.S.A. § 4815(b) is amended to read:

     (b)  The order for examination may provide for an examination at any jail, or correctional center, or at the state hospital designated by the commissioner of health for forensic examinations pursuant to chapter 177 of Title 18, or at such other place as the court shall determine, after hearing a recommendation by the commissioner of developmental and mental health services.

Sec. 113b.  13 V.S.A. § 4815(g) is amended to read:

(g)(1)  Examination Inpatient examination at the state hospital or a designated hospital. Before ordering  the examination to take place at the state hospital, the court must determine that the state hospital is the least restrictive setting in which the examination may appropriately be conducted The court shall not order an inpatient examination unless the designated mental health professional determines that the defendant is a person in need of treatment as defined in 18 V.S.A. § 7101(17).

(2)  Before ordering the inpatient examination to take place at the state hospital, the court shall also determine what terms, if any, shall govern the defendant’s release from custody under sections 7553-7554 of this title once the examination has been completed.

(3)  An order for inpatient examination at the state hospital shall provide for placement of the defendant in the custody and care of the commissioner of developmental and mental health services for not more than 30 days from the date of the order, and the defendant shall be returned to court for further appearance as soon as the examination has been completed, if ordered by the court. If a return to court is ordered, such return shall occur within 48 hours of the commissioner’s request.  The commissioner shall have the authority to determine the most clinically appropriate designated hospital for the examination and, based on the most clinically appropriate determination, may transfer the defendant between designated hospitals at any time while the order is in effect.

(4)  If a return to court is not ordered and the defendant is not in the custody of the commissioner of corrections, the defendant shall be returned to the defendant’s residence or such other appropriate place within the state of Vermont by the department of developmental and mental health services at the expense of the court.

(5)  If it appears that an inpatient examination at the state hospital cannot reasonably be completed within 30 days, the court issuing the original order, on request of the commissioner and upon good cause shown may order placement at the state hospital extended for additional periods of 15 days in order to complete the examination, and the defendant on the expiration of the period provided for in such order shall be returned in accordance with this subsection.

(6)  Persons committed to the state hospital care and custody of the commissioner for purposes of examination or examined elsewhere under this section shall be given medical care and treatment in accordance with accepted standards of medical care and practice, to the extent facilities and personnel are available for this purpose.

Sec. 113c.  SUNSET

(a)  The amendments in Secs. 113a and 113b shall terminate on July 1, 2006 and 13 V.S.A. § 4815(b) and (g) shall revert to the prior statutory text.

Sec. 113d.  STUDY COMMITTEE

(a)  The commissioner of health shall convene a work group to address issues relating to forensic mental health patients and defendants.  The work group shall consist of the commissioner or designee, the defender general or designee, the court administrator or designee, a representative from the mental health law project of Vermont legal aid, the department of sheriffs and states attorneys, the Vermont association of hospitals and health systems, a representative of the Vermont Council on Developmental and Mental Health Services, the Vermont state employees’ association, and a designee of Vermont Psychiatric Survivors.  The department of health shall provide administrative support to the work group.

(b)  The work group shall report to the house committee on human services and the senate committee on health and welfare no later than January 31, 2006 and shall address the following issues:

(1)  transfers between hospitals, including standards, procedures, and rights of patients;

(2)  determination of the least restrictive setting for the forensic evaluation;

(3)  disposition of the defendant if it is determined after admission that the defendant does not meet the standards for hospitalization;

(4)  legal representation of defendants and the state in hospitalization hearings; and

(5)  other issues as determined by the work group.

Sec. 113e.  VERMONT STATE HOSPITAL; REPLACEMENT PLAN

(a)  The general assembly adopts the principles in the May 31, 2005 draft report from the department of health for restructuring the delivery of mental health services currently received in the Vermont state hospital, including the following:

(1)  The current state hospital facility should be replaced with a facility or facilities with fewer than 54 beds and with meaningful programmatic integration of medical and community mental health services.

(2)  As the replacement occurs, the operations and human resources in the state hospital should be supported and enhanced to ensure safety, and the clinical programming should effectively support recovery.

(3)  The capacity and network of community support services should be expanded to meet patient needs in a clinically appropriate manner consistent with system values.

(b)  When the general assembly is not in session, the department of health shall seek and receive approval from the mental health oversight committee on  specific programmatic recommendations, plans, or implementation steps to achieve the principles in the May 31, 2005 draft report prior to implementation.  The mental health oversight committee shall approve or deny the recommendations and steps within two weeks of submission and shall oversee the implementation of the restructuring of the delivery of mental health services currently received in the Vermont state hospital.

(c)  The commissioner of health shall report to the mental health oversight committee upon request in order to meet the requirements of this section.

Sec. 114.  HUMAN SERVICES CASELOAD RESERVE TRANSFER/LOAN

(a)  From the human services caseload reserve, $1,300,000 shall be transferred to the general fund to offset caseload and transition expenditures for services at the Vermont state hospital.  The secretary of administration and the secretary of human services shall ensure that these funds are repaid to the caseload reserve on or before July 1, 2008.

Sec. 115.  Health - medical practice board

                   Personal services                                            669,764

                   Operating expenses                                        130,309

                        Total                                                         800,073

               Source of funds

                   Special funds                                                  800,073

Sec. 116.  Department for children and families - administration & support services

                   Personal services                                       26,563,475

                   Operating expenses                                     5,025,540

                   Grants                                                         1,414,675

                        Total                                                    33,003,690

               Source of funds

                   General fund                                              13,926,443

                   Special funds                                               1,401,422

                   Federal funds                                            17,675,825

                        Total                                                    33,003,690

Sec. 117.  Department for children and families - office of child support

                   Personal services                                         8,220,005

                   Operating expenses                                     2,797,032

                        Total                                                    11,017,037

               Source of funds

                   General fund                                                1,550,424

                   Special funds                                                  638,014

                   Federal funds                                              8,721,499

                   Interdepartmental transfer                               107,100

                        Total                                                    11,017,037

     (a)  Medical coverage is presumed to be available to a parent at a reasonable cost only if the amount payable for individual insurance or a health benefit plan premium is five percent (5%) or less of the parent’s gross income.  The court, in its discretion, retains the right to order a parent to obtain health insurance coverage even if the cost exceeds five percent (5%) of the parent’s gross income if the cost is deemed reasonable under all the circumstances after considering the factors pursuant to 15 V.S.A. § 659. 

Sec. 118.  Department for children and families - child development

                   Personal services                                         2,412,885

                   Operating expenses                                        468,401

                   Grants                                                       45,178,245

                        Total                                                    48,059,531

               Source of funds

                   General fund                                              19,269,419

                   Transportation fund                                          60,732

                   Special funds                                               1,230,722

                   Federal funds                                            27,272,906

                   Interdepartmental transfer                               225,752

                        Total                                                    48,059,531

(a)  Of the above appropriation, $50,000 shall be granted to the Vermont center for the book.

(b)  The department for children and families in conjunction with the department of education shall track and report quarterly expenses and receipts for the family infant toddler program.

(1)  The first report shall include final expenses and receipts by source for fiscal year 2005 (through June 30, 2005) which shall be broken out by quarter and include enrollment data.

(2)  For fiscal year 2006, the quarterly reports shall include:

(A)  the number of enrolled children;

(B)  expenses; and

(C)  receipts by source, including federal part C dollars, Medicaid receipts, state general funds, and any other sources of funding.

(3)  The department for children and families shall submit these reports to the house and senate committees on appropriations, senate committee on health and welfare, and house committee on human services or to the joint health access oversight committee when the general assembly is not in session.

     (c)  Of the above appropriation, $290,000 shall be used to increase the subsidy rate and $30,000 shall be used for incentives to increase child care quality.

Sec. 119.  Department for children and families - family services

                   Personal services                                       18,261,673

                   Operating expenses                                     2,870,402

                   Grants                                                       62,032,908

                        Total                                                    83,164,983

               Source of funds

                   General fund                                              38,442,431

                   Special funds                                               1,306,152

                   Tobacco fund                                                   75,000

                   Federal funds                                            43,341,400

                        Total                                                    83,164,983

     (a)  Of the above general fund appropriation, $70,000 shall be used for a grant to the prevent child abuse Vermont program.

Sec. 120.  Department for children and families - Woodside rehabilitation center

                   Personal services                                         2,361,201

                   Operating expenses                                        432,306

                        Total                                                      2,793,507

               Source of funds

                   General fund                                                2,738,615

                   Interdepartmental transfer                                 54,892

                        Total                                                      2,793,507

     (a)  Of the above appropriation, $5,000 shall be used to maintain the arts program.

     (b)  The director of the Woodside rehabilitation center shall work with the commissioner of finance and management and the executive director of the state’s attorneys and sheriffs to identify if utilization of the sheriff’s office for transportation services could result in saved overtime costs at the center.

Sec. 121.  Department for children and families - disability determination services

                   Personal services                                         3,337,193

                   Operating expenses                                        495,020

                        Total                                                      3,832,213

               Source of funds

                   Federal funds                                              3,587,068

                   Interdepartmental transfer                               245,145

                        Total                                                      3,832,213

Sec. 122.  Department for children and families - aid to aged, blind and disabled

                   Personal services                                         1,365,966

                   Grants                                                         9,336,901

                        Total                                                    10,702,867

               Source of funds

                   General fund                                              10,702,867

Sec. 123.  Department for children and families - general assistance

                   Grants                                                         4,326,260

               Source of funds

                   General fund                                                3,214,939

                   Special funds                                                             1

                   Federal funds                                              1,111,320

                        Total                                                      4,326,260

(a)  Of the above appropriation, $527,000 in federal TANF funds is allocated specifically for rental or mortgage arrearage assistance to families who demonstrate they are faced with a reasonably preventable loss of housing and who meet state requirements for category I assistance, as established by regulation.  Assistance under this provision is not an entitlement and shall cease upon expenditure of these allocated funds. 

(b)  Of the above appropriation, an amount not to exceed $150,000 ($75,000 federal TANF funds and $75,000 general funds) may be expended for temporary housing assistance to individuals and families that have reached the 28-day maximum allowed under department regulations and have a continued need for this type of emergency assistance.  Assistance shall be limited to an additional 56 cumulative days beyond the current 28-day maximum.  Assistance under this provision is not an entitlement and shall cease upon expenditure of these allocated funds.

Sec. 124.  Department for children and families - reach up

                   Grants                                                       43,217,279

               Source of funds

                   General fund                                              14,290,063

                   Special funds                                               2,200,000

                   Federal funds                                            26,727,216

                        Total                                                    43,217,279

    (a)  If the governor’s fiscal year 2007 proposed budget includes a ratable reduction for reach up benefits that is below 50 percent, the department for children and families shall report to the house and senate committees on appropriations the cost of achieving a 50 percent ratable reduction.

     (b)  Of the above appropriation, up to $55,810 is to be used for the Lund family center’s learning edge program to serve women who are pregnant and/or reach up eligible.

Sec. 125.  Department for children and families - home heating fuel assistance/LIHEAP

                   Personal services                                              20,000

                   Operating expenses                                          90,000

                   Grants                                                       10,146,117

                        Total                                                    10,256,117

               Source of funds

                   Special funds                                             10,256,117

(a)  Of the funds appropriated for home heating fuel assistance/LIHEAP in this act, no more than $350,000 shall be expended for crisis fuel direct service/administration exclusive of statewide after-hours’ crisis coverage.

Sec. 126.  HOME HEATING FUEL ASSISTANCE/LIHEAP

(a)  All federal funds granted to the state for home heating fuel assistance under the Low Income Home Energy Assistance Program (LIHEAP) or other similar federal program in fiscal year 2006, and all unexpended LIHEAP funds granted to the state in fiscal year 2005, are hereby transferred to the home heating fuel assistance trust fund for the provision of home heating fuel assistance, including program administration, under 33 V.S.A. chapter 26.

(b)  For the purpose of a crisis set-aside, seasonal home heating fuel assistance through December 31, 2005, and program administration, the commissioner of finance and management shall transfer $2,550,000 from the home weatherization assistance trust fund to the home heating fuel assistance trust fund to the extent that federal LIHEAP or similar federal funds are not available.  An equivalent amount shall be returned to the home weatherization trust fund from the home heating fuel assistance trust fund to the extent that federal LIHEAP or similar federal funds are received.  Should a transfer of funds from the home weatherization assistance trust fund be necessary for the 2005-2006 crisis set-aside and seasonal home heating fuel assistance through December 31, 2005, and LIHEAP funds awarded as of December 31, 2005 for fiscal year 2006 do not exceed $2,550,000, subsequent payments under the home heating fuel assistance program shall not precede January 30, 2006.  Notwithstanding any other provision of law, payments authorized by the office of home heating fuel assistance shall not exceed funds available, except that for fuel assistance payments made through December 31, 2005, the commissioner of finance and management may anticipate receipts into the home weatherization assistance trust fund.

Sec. 127.  Department for children and families - food stamp cash out

                   Grants                                                         6,141,229

               Source of funds

                   Federal funds                                              6,141,229

Sec.  128.  TANF EXEMPTION

(a)  The commissioner may exempt all individuals domiciled in the state of Vermont from the implementation of Sec. 115(a) of Public Law 104-193 through June 30, 2006.

Sec. 129.  Department for children and families - office of economic opportunity

                   Personal services                                            261,733

                   Operating expenses                                          89,517

                   Grants                                                         5,035,390

                        Total                                                      5,386,640

               Source of funds

                   General fund                                                   890,147

                   Special funds                                                    80,012

                   Federal funds                                              4,165,408

                   Interdepartmental transfer                               251,073

                        Total                                                      5,386,640

(a)  Of the above general fund appropriation, $485,000 shall be granted to community agencies for homeless assistance by preserving existing services or increasing resources available statewide.  These funds may be granted alone or in conjunction with federal McKinney emergency shelter funds.  Grant decisions shall be made with assistance from the coalition of homeless Vermonters.

(b)  Of the above general fund appropriation, $25,000 shall be granted to the Vermont campaign to end childhood hunger for food stamp outreach.

Sec. 130.  Department for children and families - OEO - weatherization assistance

                   Personal services                                            150,478

                   Operating expenses                                          39,950

                   Grants                                                         7,079,010

                        Total                                                      7,269,438

               Source of funds

                   Special funds                                               5,991,517

                   Federal funds                                              1,277,921

                        Total                                                      7,269,438

(a)  Of the above special fund appropriation, $400,000 is for the replacement and repair of home heating equipment.

Sec. 131.  [Deleted]

Sec. 132.  Aging and independent living - administration and support

Personal services                                       20,691,990

Operating expenses                                     3,450,004

Total                                                    24,141,994

Source of funds

General fund                                                8,005,169

Special funds                                                  823,719

Federal funds                                            14,045,169

Interdepartmental transfer                            1,267,937

Total                                                    24,141,994

     (a)  Notwithstanding Sec. 288(a)(8) of No. 122 of the Acts of 2004, the department of aging and independent living may use $400,000 of the funds appropriated in Sec. 288(a)(8) of No. 122 of the Acts of 2004 to address fiscal year 2005 long-term care waiver funding needs.  The remaining $600,000 shall be used for community-based service infrastructure needs, including up to $70,000 for data system updates needed to implement the waiver.

Sec. 133.  Aging and independent living - advocacy and independent living

Grants                                                       20,577,895

Source of funds

General fund                                                9,162,065

Transportation fund                                        422,692

Special funds                                                  851,981

Federal funds                                            10,064,157

Interdepartmental transfer                                 77,000

Total                                                    20,577,895

Sec. 134.  Aging and independent living - blind and visually impaired

Grants                                                         1,359,000

Source of funds

General fund                                                   564,064

Special funds                                                  145,000

Federal funds                                                 649,936

Total                                                      1,359,000

Sec. 135.  21 V.S.A. § 504 is amended to read:

§ 504.  Income from vending facilities and machines

(a)  All net income from a vending facility on state property shall accrue to the blind or visually impaired person licensed to operate that facility.

(b)  All net income from vending machines not placed within vending facilities on state property shall accrue to the division.

(c)  Income which accrues to the division under this subchapter shall be used to:

(1)  maintain or enhance the vending facilities program; and

(2)  provide benefit programs, including, but not limited to, health insurance or pension plans for licensed blind or visually impaired persons who operate vending facilities;

(3)  provide vocational rehabilitation services for persons who are blind or visually impaired.

Sec. 136.  Aging and independent living - vocational rehabilitation

Grants                                                         5,402,643

Source of funds

General fund                                                1,599,195

Special funds                                                    40,000

Federal funds                                              3,564,061

Interdepartmental transfer                               199,387

Total                                                      5,402,643

Sec. 137.  Aging and independent living - TBI home- and community‑based waiver

Grants                                                         2,749,010

Source of funds

General fund                                                1,129,843

Federal funds                                              1,619,167

Total                                                      2,749,010

Sec. 138.  Aging and independent living - developmental services

Grants                                                     103,600,138

Source of funds

General fund                                              41,434,699

Special funds                                                  841,980

Federal funds                                            60,262,628

Interdepartmental transfer                            1,060,831

Total                                                  103,600,138

     (a)  The secretary of the agency of human services and the commissioner of the department of aging and independent living shall ensure the programs funded through this appropriation meet the following requirements:

          (1)  A minimum of 219 individuals under emergency caseload and a minimum of 23 individuals under public safety shall be funded.

          (2)  A minimum of 65 new “June graduates” shall be served.

          (3)  The funding level available to the flexible family funding program shall be at least equal to the amount available to this program in fiscal year 2005, which was $1,086,890, including any federal match.  If federal receipts are gained through the Global Commitment, eligibility for flexible family funding will require eligibility for Medicaid; the department may make exceptions to this on a case-by-case basis.  The anticipated waiting list for developmental services will be 31 or fewer, depending on the number of graduates who exit school.

     (b)  The commissioner of finance and management, the secretary of human services, and the commissioner of aging and independent living shall report to the joint fiscal committee at its September and November meetings as to the fiscal and program implications of meeting the requirements of subsection (a) of this section.  The report shall include a review of the fiscal year 2006 inflationary increase available to the designated provider agencies for developmental services and the impact on any other division or department with the agency.

     (c)  The department of aging and independent living shall report quarterly applications and enrollments for developmental services, tracking the fiscal implications of the requirements of subsection (a) of this section, compliance in doing so, and remaining need.  In particular, these reports will include:

          (1)  The number of new individuals entering the developmental services system in 2006, the types of services needed, and the cost per person.

          (2)  The expected annualization in fiscal year 2007, based upon services provided to date.

          (3)  The number of individuals on the waiting list for flexible family funding.

          (4)  The number of individuals who have requested and meet the basic requirements to qualify for services under the “Vermont state system of care plan for developmental services,” who have been denied services due to funding constraints (June graduates and others).

          (5)  The department of aging and independent living shall submit these reports to the house and senate committees on appropriations, senate committee on health and welfare, and house committee on human services or to the joint health access oversight committee when the general assembly is not in session.

Sec. 139.  Corrections - administration

Personal services                                         2,109,825

Operating expenses                                        322,087

Total                                                      2,431,912

Source of funds

General fund                                                2,270,042

Federal funds                                                   65,000

Interdepartmental transfer                                 96,870

Total                                                      2,431,912

     (a)  The department of corrections shall report to the joint corrections oversight committee at each of its meetings on the status of the health services contract.  The report shall include expenditures made year-to-date and the department’s assessment of the quality of the services provided by the contractor.

     (b)  The commissioner of the department of corrections shall research the viability of developing community mapping technologies in Vermont.  The research shall include reviewing the system developed for Connecticut by the Council of State Governments.  The commissioner shall report to the general assembly by January 15, 2006 on the cost, applicability to Vermont, and potential efficiency of assigning community supervision resources as well as other community-based human services resources based on a community resource mapping system.

Sec. 140.  Corrections - parole board

Personal services                                            232,722

Operating expenses                                          65,555

Total                                                         298,277

Source of funds

General fund                                                   298,277

Sec. 141.  Corrections - correctional education

Personal services                                         3,164,224

Operating expenses                                        343,662

Total                                                      3,507,886

Source of funds

General fund                                                3,110,736

Interdepartmental transfer                               397,150

Total                                                      3,507,886

     (a)  The general assembly finds that the state of Vermont funding level for special education services in the department of corrections meets special education requirements.  Vermont will add additional resources to corrections special education pursuant to the federal government funding special education at the level required by federal law.

Sec. 142.  Corrections - correctional services

Personal services                                       68,370,252

Operating expenses                                   30,657,454

Grants                                                         2,054,500

Total                                                  101,082,206

Source of funds

General fund                                              97,380,792

Transportation fund                                     1,153,658

Special funds                                                  549,500

Tobacco fund                                                   87,500

Federal funds                                              1,829,710

Interdepartmental transfer                                 81,046

Total                                                  101,082,206

(a)  Of the above general fund appropriation, $87,000 shall be used as a grant to Dismas House of Vermont, Inc.

     (b)  Of the above appropriation for transitional housing, the amount of $35,000 shall be granted to Morningside House, Inc. which serves homeless citizens in southern Vermont.  The funds shall support a pilot project between the department and Morningside House, Inc. jointly to develop and implement a plan to house between three and five offenders referred by the department to the shelter.

     (c)  Of the above appropriation, $20,000 shall be used for an employment placement and retention program expansion in Bennington County for individuals reentering the community under the supervision of the department of corrections.

     (d)  The establishment of seven (7) new classified community supervision and support positions – four (4) caseworkers, two (2) community corrections officers, and one (1) administrative position – is authorized as of October 1, 2005, contingent upon the out-of-state bed census being, on average, at or below 400 during the months of May, June, and July, excluding the impact of the renovations at the St. Albans correctional facility.  These positions shall be transferred and converted from existing vacant positions in the executive branch of state government.  Of the above appropriation, $318,750 shall be used to support these new positions.

     (e)  All other funds associated with a reduction of 45 out-of-state beds from the total included in the submitted budget in this appropriation shall be used for correctional services needs as directed by the commissioner of corrections which may include hiring up to four (4) mental health counselors.

Sec. 142a.  INTENT FOR FUNDS FROM ADDITIONAL OUT-OF-STATE

                  BED SAVINGS

     (a)  To the extent the number of out-of-state beds funded in Sec. 142 of this act falls from the budgeted level of 399, the savings of allocated funds associated with the first 50 out-of-state bed reduction shall be used first to fund  five (5) new community supervision positions:  three (3) caseworkers and two (2) community corrections officers, and the remaining funds shall be used for corrections services.

     (b)  For every additional increment of 50 beds that the out-of-state bed need is reduced, the savings associated with the reduction shall be used equally to fund additional community supports or supervision and other correctional services needs which may include hiring up to four (4) mental health counselors if they were not hired pursuant to Sec. 142(e) of this act.

Sec. 143.  DEPARTMENT OF CORRECTIONS; OVERCROWDING

(a)  It is the intent of the general assembly that the department of corrections should not operate any of the state correctional facilities at a level that exceeds the rated capacity of the facility.

(b)  The commissioner of corrections shall determine the rated capacity of each correctional facility to include only bed space designated for the general population and shall not include bed space used for segregation, isolation, or medical or mental health treatment, or high security bed space used for disciplinary or administrative purposes.

(c)  When the population housed in any facility exceeds the rated capacity of that facility, the commissioner of corrections may transfer appropriate offenders to another facility, including contracted facilities in another state; provided, however, that the commissioner shall strive to minimize transfers in order to avoid disruption of inmate programming.

(d)  It is also the intent of the general assembly that if the total population housed in Vermont exceeds the rated capacity of the Vermont facilities, this excess shall be limited to 50 beds, and that these 50 beds shall be proportionately distributed throughout the Vermont facilities.

(e)  On a quarterly basis, the commissioner shall report to the joint legislative corrections oversight committee setting forth the number of inmates housed in each correctional facility for the previous three‑month period and providing detailed information of the dates and length of time any facility exceeded 105 percent of its rated capacity.

Sec. 143a.  STUDY; WOMEN OFFENDERS; SUBSTANCE ABUSE

(a)  There is created a committee to explore recommendations relating to women offenders contained in the August 19, 2004 report of the governor’s commission on corrections overcrowding.  The committee’s work shall include consideration of community-based alternatives to incarceration for women offenders and options for treating nonviolent women who are incarcerated primarily for substance-abuse-related reasons.  After reviewing and evaluating successful models in other states, the committee shall develop a proposal for one or more pilot programs addressing the needs of women offenders. 

(b)  On or before January 15, 2006, the committee shall report to the senate committee on health and welfare, the house committee on human services, and the house and senate committees on appropriations, institutions, and judiciary regarding its research and recommendations under this section, including associated costs and the anticipated nonstate sources of funding for the proposed pilot program or programs.

(c)  Members of the committee shall include:

(1)  The commissioner of corrections, or the commissioner’s designee. 

(2)  The defender general or the defender general’s designee.

(3)  The adult community mental health program director, division of mental health, department of health, agency of human services, or the director’s designee. 

(4)  The deputy commissioner for the division of alcohol and drug abuse programs, department of health, agency of human services, or the deputy commissioner’s designee.

(5)  The administrative judge for trial courts or the judge’s designee.

(6)  The coordinator of offender services for the Howard Center for Human Services at the Chittenden County drug court or the coordinator’s designee.

(7)  A substance abuse provider offering services to women at the Dale correctional facility, to be selected by the commissioner of corrections.

(8)  The coordinator of the community justice center in Burlington or the coordinator’s designee.

          (9)  One additional member may be selected by the committee based upon experience working with women offenders, women with substance abuse issues, or other women in crisis.  One additional member who represents female former offenders may be selected by the commissioner of corrections.

Sec. 144.  Corrections - correctional facilities- recreation

Personal services                                            518,212

Operating expenses                                        473,986

Total                                                         992,198

Source of funds

Special funds                                                  992,198

     (a)  The department shall study and implement either a prepaid phone card system for inmates’ telephone service or another system that reduces inmates’ telephone costs during fiscal year 2007.  The department shall report to the general assembly on the fiscal impact of this change on the inmate recreation fund.

Sec. 145.  28 V.S.A. § 816 is amended to read:

§ 816.  Inmate recreation fund

The department shall accept monies generated by commissions on telephone services, commissary sales, and sales of vended items at its correctional facilities and shall establish with such monies an inmate recreation special fund.  The fund shall be used to provide postage to inmates in a manner consistent with department policy.  The fund may be used for costs associated with the oversight and accounting of inmate cash accounts.  The fund may be used, at the discretion of the commissioner, to hire persons or purchase services, equipment, and goods to establish or enhance recreation activities for inmates confined in any of the department’s facilities, and for voluntary inmate contributions that promote the restoration of crime victims or communities.  The inmates, through a process established by the inmate recreation fund committee, may also choose to create a loan fund, the operation of which shall be governed by rules adopted pursuant to chapter 25 of Title 3, from which offenders may borrow in order to help them obtain housing upon release from incarceration.

Sec. 146.  Corrections - Vermont offender work program

Personal services                                         1,391,272

Operating expenses                                     1,731,740

Total                                                      3,123,012

Source of funds

Internal service funds                                   3,123,012

Sec. 147.  Department for children and families - children’s trust fund

Grant                                                             340,891

Source of funds

General fund                                                   100,651

Special funds                                                    70,000

Federal funds                                                 170,240

Total                                                         340,891

(a)  Of the above amount, at least 65 percent will be awarded for community-based program activities for the broad range of child abuse and neglect prevention activities.

Sec. 147a.  Sec. 159 of No. 122 of the Acts of 2004 is amended to read:

Sec. 159.  Children’s trust fund Department for children and families - children’s trust fund

                   Grant                                                             310,651

               Source of funds

                   General fund                                                   100,651

                   Special funds                                                    70,000

                   Federal funds                                                 140,000

                        Total                                                         310,651

* * *

Sec. 148.  Commission on women

Personal services                                            194,319

Operating expenses                                          61,102

Total                                                         255,421

Source of funds

General fund                                                   250,421

Special funds                                                      5,000

Total                                                         255,421

Sec. 149.  Retired senior volunteer program

Grants                                                            131,096

Source of funds

General fund                                                   131,096

Sec. 150.  Vermont veterans’ home - care and support services

Personal services                                       12,833,472

Operating expenses                                     3,128,718

Total                                                    15,962,190

Source of funds

General fund                                                   912,495

Special funds                                             10,239,126

Federal funds                                              4,810,569

Total                                                    15,962,190

(a)  Notwithstanding 32 V.S.A. § 706(a)(1), the Vermont veterans’ home may transfer, with the approval of the secretary of administration, funds up to an amount equal to the general fund appropriation, to the health access trust fund for purposes of facilitating a Medicaid rate adjustment.

(b)  Notwithstanding 32 V.S.A. § 706(a)(1), the Vermont veterans’ home may transfer to the agency of human services’ secretary’s office, with the approval of the secretary of administration, funds to cover the costs of the contract for an interim administrator of the veterans’ home.

Sec. 150a.  VERMONT VETERANS’ HOME; REGIONAL BED CAPACITY

     (a)  The agency of human services shall not include the bed count at the Vermont veterans’ home when recommending and implementing policies that are based on or intended to impact regional nursing home bed capacity in the state.

Sec. 151.  Total human services                               1,502,442,843

Source of funds

General fund                                            421,074,741

Transportation fund                                     1,637,082

Special funds                                           305,954,266

Tobacco fund                                            25,441,034

Federal funds                                          718,911,145

Permanent trust funds                                       10,000

Internal service funds                                   3,123,012

Interdepartmental transfer                          26,291,563

Total                                               1,502,442,843

Sec. 152.  Employment and training

Personal services                                       18,317,440

Operating expenses                                     4,568,929

Grants                                                         1,615,210

Total                                                    24,501,579

Source of funds

General fund                                                1,395,248

Special funds                                                  866,000

Federal funds                                            19,472,969

Interdepartmental transfer                            2,767,362

Total                                                    24,501,579

Sec. 153.  Total employment and training                      24,501,579

Source of funds

General fund                                                1,395,248

Special funds                                                  866,000

Federal funds                                            19,472,969

Interdepartmental transfer                            2,767,362

Total                                                    24,501,579

Sec. 154.  Education - finance and administration

Personal services                                         4,533,633

Operating expenses                                     1,377,940

Grants                                                       10,620,000

Total                                                    16,531,573

Source of funds

General fund                                                3,166,006

Special funds                                                    63,697

Federal funds                                              1,968,752

Interdepartmental transfer                          11,333,118

Total                                                    16,531,573

     (a)  Notwithstanding 16 V.S.A. §§ 563(21) and 3448(a)(5)(E), of the above appropriation, up to $17,000 is available for a grant to Bradford school district to make up for delays in making a final school construction payment after completion of the final audit in fiscal year 2006. 

Sec. 154a.  Sec. 166 of No. 122 of the Acts of 2004, as amended by Sec. 52 of No. 6 of the Acts of 2005, is further amended to read:

Sec. 166.  Education – finance and administration

                   Personal services                  4,029,861       4,029,861

                   Operating expenses              1,273,159       1,273,159

                   Grants                                 11,216,066    11,816,066

                        Total                               16,519,086   17,119,086

               Source of funds

                   General fund                         3,045,720       3,045,720

                   Special funds                             20,088            20,088

                   Federal funds                        2,213,164      2,213,164

                   Interdepartmental transfer   11,240,114     11,840,114

                        Total                                16,519,086  17,119,086

Sec. 155.  Education - education programs

Personal services                                       12,107,019

Operating expenses                                     1,981,112

Grants                                                     108,322,608

Total                                                  122,410,739

Source of funds

General fund                                                7,132,600

Transportation fund                                        524,846

Special funds                                               1,139,188

Federal funds                                          112,461,461

Interdepartmental transfer                            1,152,644

Total                                                  122,410,739

Sec. 156.  Education - technical education

Grants                                                         9,836,396

Source of funds

Education fund                                            9,836,396

(a)  The appropriation in this section shall be authorized, notwithstanding 16 V.S.A § 1564.

Sec. 157.  Education - special education: formula grants

Grants                                                     116,120,000

Source of funds

Education fund                                        116,120,000

(a)  Of the appropriation authorized in this section, and notwithstanding any other provision of law, an amount not to exceed $3,001,131 shall be used by the department of education in fiscal year 2006 as funding for 16 V.S.A. § 2967(b)(2)-(6).  In addition to funding for 16 V.S.A. § 2967(b)(2)-(6), up to $153,720 may be used by the department of education for its participation in the higher education partnership plan.

Sec. 158.  Education - state-placed students

Grants                                                       12,500,000

Source of funds

Education fund                                          12,500,000

     (a)  The Independence Place program of the Lund family center shall be considered a 24-hour residential program for the purposes of reimbursement of education costs.

Sec. 159.  Education - adult education and literacy

Grants                                                         3,951,017

Source of funds

General fund                                                2,717,398

Federal funds                                                 983,619

Education fund                                               250,000

Total                                                      3,951,017

Sec. 160.  HIGH SCHOOL COMPLETION; ADVISORY COMMITTEE;

                ADULT EDUCATION AND LITERACY; REPORT

(a)  A high school completion advisory committee is hereby created.  The committee shall consist of a representative chosen by the speaker, a senator chosen by the committee on committees, a representative of Vermont adult learning chosen by the board of directors of Vermont Learning, Inc., a representative of the Vermont school boards association chosen by the association’s board of directors, a principal chosen by the Vermont principals’ association, a superintendent chosen by the Vermont superintendents association, and the commissioner of education or designee.  The legislative council and joint fiscal office shall provide staff services to the committee.  Members shall be entitled to per diem compensation and expenses.  The legislative members shall be responsible for convening the committee. 

(b)  The committee shall develop a recommended mechanism and procedure by which funding for high school completion programs carried out by the adult education and literacy systems, as described in 16 V.S.A. § 4011(f)(2), shall be paid to school districts or supervisory unions, or both.

(c)  The committee shall develop recommendations regarding:

(1)  allocation of payments between local school districts and supervisory unions and the statewide adult education and literacy system when programs are provided through contracts with qualified adult education and literacy service providers;

(2)  methods to ensure that programs are administered in a manner that promotes consistency with statewide standards and procedures;

(3)  the relationship between a high school diploma and the general equivalency degree that is provided through an adult education and literacy program;

(4)  mechanisms to ensure coordination between adult education and literacy programs and state requirements for individual education plans;

(5)  implementation of funding through school districts and supervisory unions in a manner that maximizes the efficient use of existing services for adult education and literacy programs;

(6)  methods by which school districts and supervisory unions can work with statewide adult education and literacy systems to improve services for students at risk of dropping out of school; and

(7)  whether funding for adult education and literacy activities should be paid through the current funding mechanism established in 16 V.S.A. § 4011(f)(2) or through a categorical grant program.

     (d)  On or before January 15, 2006, the committee shall submit its recommendations to the senate and house committees on education and appropriations.

Sec. 161.  EDUCATION - ADULT EDUCATION AND LITERACY

     (a)  It is the intent of the general assembly to appropriate funds for adult education and literacy programs from the education fund, notwithstanding the provisions of 16 V.S.A. § 4025(d) as it was the intent of the general assembly to do this in Sec. 173 of No. 122 of the Acts of the 2003.  Neither this appropriation nor the appropriation from Sec. 173 of No. 122 repeals the education property tax.

     (b)  It is further the intent of the general assembly to study the results of the report received pursuant to Sec. 160 of this act and, during the 2006 legislative session, to make a determination regarding how to fund adult education and literacy services for those students described in 16 V.S.A. § 4011(f)(2) in fiscal year 2007 and each year thereafter.

Sec. 162.  Education - adjusted education payment

Grants                                                     966,000,000

Source of funds

Education fund                                        966,000,000

Sec. 162a.  Sec. 176 of No. 122 of the Acts of 2004, as amended by Sec. 55 of No. 6 of the Acts of 2005, is further amended to read:

Sec. 176.  Education – adjusted education payment

                   Grants                          910,801,994       910,971,994

               Source of funds                                                               

                   Education fund            910,801,994        910,971,994

Sec. 162b.  EARLY CHILDHOOD EDUCATION SERVICES

(a)  School districts may offer early childhood education services through direct provision of services, collaborative programs, or direct contracting with other public or private providers, or any combination of these, and a school district may obtain funding for these services by counting resident early education pupils in its full-time equivalent enrollment pursuant to Vermont State Board of Education Rule 9200.4, as in effect on June 1, 2005.  School districts are encouraged to collaborate or contract with existing public and qualified private early education service providers.

Sec. 163.  Education - essential early education grant

Grants                                                         4,379,337

Source of funds

Education fund                                            4,379,337

Sec. 164.  Education - transportation

Grants                                                       13,496,399

Source of funds

Education fund                                          13,496,399

Sec. 165.  Education - small school grants

Grants                                                         5,250,000

Source of funds

Education fund                                            5,250,000

Sec. 165a.  Sec. 179 of No. 122 of the Acts of 2004, as amended by Sec. 56 of No. 6 of the Acts of 2005, is further amended to read:

Sec. 179.  Education – small school grants

                   Grants                     5,080,383                    5,213,383

               Source of funds

                   Education fund        5,080,383                    5,213,383

Sec. 166.  Education - capital debt service aid

Grants                                                            450,355

Source of funds

Education fund                                               450,355

Sec. 167.  Education - tobacco litigation

Personal services                                            116,151

Operating expenses                                          25,073

Grants                                                            842,783

Total                                                         984,007

Source of funds

Tobacco fund                                                 984,007

Sec. 168.  Education - Act 117 cost containment

Personal services                                            969,605

Operating expenses                                        104,571

Grants                                                              65,000

Total                                                      1,139,176

Source of funds

Interdepartmental transfer                            1,139,176

(a)  Notwithstanding any other provisions of law, expenditures made from this section shall be counted under 16 V.S.A. § 2967(b) as part of the state’s 60 percent of the statewide total special education expenditures of funds which are not derived from federal sources.

Sec. 168a.  COUNCIL ON EDUCATION GOVERNANCE;

                  APPROPRIATION

(a)  In Sec. 71 of No. 68 of the Acts of 2003, the general assembly created a Council on Education Governance to develop and implement a process for engaging a broad spectrum of Vermonters in a discussion of effective governance structures for delivery of public education with consideration of the need to address rising costs while maintaining Vermont’s high quality education system.  The Council obtained funding from a private foundation and, in 2004, awarded $71,000 in small grants to education communities of Vermont school districts and supervisory unions to help them engage in discussions about reorganization for better service delivery at a lower cost.  In their grant applications, several communities requested a workshop on policy governance, so the Council used an additional $7,500 to run one statewide workshop for all who wished to attend.  All of these communities have made progress toward productive reorganization and most need another round of small grants to continue and complete their work.

(b)  Therefore, notwithstanding 16 V.S.A. § 4025(b),  the amount of $75,000 is appropriated from the education fund to the commissioner of education for the purpose of enabling the department of education to continue working with the Council on Education Governance to award grants to education communities, and to document the processes, successes, and lessons to be learned from the work of these communities. 

(c)  The commissioner of education shall, at the direction of the Council on Education Governance, issue a request for proposals, choose grant recipients, determine the amounts to be awarded to each recipient, and monitor the progress of each grant recipient for fiscal year 2006.   The Council shall report to the general assembly each January on its progress and any recommendations for legislative change.

Sec. 169.  MEDICAID REIMBURSEMENT ADMINISTRATIVE SPECIAL

                FUND - DEPOSIT

(a)  In addition to deposits into the Medicaid reimbursement administrative special fund in accordance with 16 V.S.A. § 2959a(b), in fiscal year 2006, $1,139,176 of federal Medicaid receipts received for reimbursement of medically related services provided to students who are Medicaid‑eligible shall be deposited into the administrative special fund.

Sec. 170.  FUND APPROPRIATION AND TRANSFER

(a)  There is appropriated the amount of $259,300,000 in fiscal year 2006 from the general fund for transfer to the education fund.

Sec. 171.  State teachers’ retirement system

Personal services                                       17,061,408

Operating expenses                                        842,461

Grants                                                       24,446,282

Total                                                    42,350,151

Source of funds

General fund                                              24,446,282

Pension trust fund                                      17,903,869

Total                                                    42,350,151

(a)  Notwithstanding 16 V.S.A. § 1944(g)(2), the amount of the annual contribution to the Vermont state teachers’ retirement system shall be $24,446,282 in fiscal year 2006.

Sec. 172.  TAX DEPARTMENT - REAPPRAISAL AND LISTING

                 PAYMENTS

(a)  The amount of $3,210,000 in education funds is appropriated in fiscal year 2006 to implement the provisions of 32 V.S.A. §§ 4041a(a), relating to payments to municipalities for reappraisal costs, and 5405(f), relating to payments of $1.00 per grand list parcel.

     (b)  The towns currently engaged in litigation with the Washington electric cooperative regarding grand list appeals of the assessment of utility property may submit to the attorney general legal expenditures made by those towns as a result of this litigation, as those values were established by reference to information from the department of taxes, division of property valuation and review.  The attorney general shall review the submitted bills and, if reasonable, approve reimbursement.  As the litigation may have a substantial impact on the education grand list, $25,000 of the appropriation in this section shall be transferred to the attorney general and reserved for payment of expenses incurred by towns in defense of grand list appeals as provided herein.  Expenditures for this purpose shall be considered qualified expenditures under 16 V.S.A. § 4025(c).

Sec. 173.  Tax department - property tax assistance

Grants                                                     118,966,276

Source of funds

General fund                                                7,988,056

Transportation fund                                     2,378,220

Education fund                                        108,600,000

Total                                                  118,966,276

Sec. 173a.  Sec. 187 of No. 122 of the Acts of 2004, as amended by Sec. 58 of No. 6 of the Acts of 2005, is further amended to read:

Sec. 187.  Tax department – property tax assistance

                   Grants                            98,811,600       104,511,600

               Source of funds

                   General fund                    5,280,000            8,680,000

                   Transportation fund         3,520,000            3,520,000

                   Education fund               90,011,600         92,311,600

                        Total                          98,811,600      104,511,600

Sec. 174.  Total general education and property tax assistance       

                                                                               1,696,950,426

Source of funds

General fund                                            304,750,342

Transportation fund                                     2,903,066

Education fund                                     1,240,167,487

Special funds                                               1,202,885

Tobacco fund                                                 984,007

Federal funds                                          115,413,832

Pension trust fund                                      17,903,869

Interdepartmental transfer                          13,624,938

Total                                               1,696,950,426

Sec. 175.  University of Vermont

Grants                                                       39,271,166

Source of funds

General fund                                              39,271,166

(a)  The commissioner of finance and management shall issue warrants to pay one-twelfth of the appropriation to the University of Vermont on or about the 15th of each calendar month of the year.

(b)  Of the above appropriation, $367,965 shall be transferred to EPSCoR for the purpose of complying with state matching fund requirements necessary for the receipt of available federal or private funds, or both.

Sec. 176.  University of Vermont - Morgan horse farm

Grants                                                                5,000

Source of funds

General fund                                                       5,000

Sec. 177.  Vermont public television

Grants                                                            573,832

Source of funds

General fund                                                   573,832

Sec. 178.  Vermont state colleges

Grants                                                       22,532,878

Source of funds

General fund                                              22,532,878

(a)  The commissioner of finance and management shall issue warrants to pay one-twelfth of the appropriation to the Vermont state colleges on or about the 15th of each calendar month of the year.

(b)  Of the above appropriation, $100,000 shall be reserved for use as the state’s fiscal year 2006 contribution toward the growth of the endowment fund for the Vermont state colleges.  The state’s funds are to serve as a challenge match to enhance the state colleges’ ability to secure endowment contributions from alumni and other interested parties.  The intent is that the fiscal year 2006 appropriation will be the last of five annual appropriations, totaling $500,000.  The conditions of this challenge match are that the state colleges are required to raise three dollars for each dollar appropriated by the state.  A method for accounting for the state colleges’ share has been agreed to between the state colleges and the commissioner of finance and management.  Transfers to the state colleges’ endowment fund shall be under the condition that only the interest accruing to the fund will be available for purposes as designated by the board of trustees of the state colleges.  By June 30, 2007, any remaining state appropriations designated for the state colleges’ endowment fund that have not been matched by the state colleges shall revert to the general fund.  The funds appropriated for this purpose shall be retained by the state.

(c)  Of the above appropriation, $414,950 shall be transferred to the Vermont manufacturing extension center for the purpose of complying with the state matching fund requirements necessary for the receipt of available federal or private funds, or both.

     (d)  The balance held by the treasurer in the Vermont state college bond fund (#21010) in the principal amount of $723,850 shall be transferred to the Vermont state colleges for the purposes of a reserve for future debt service.

Sec. 178a.  VERMONT STATE COLLEGES; COLLECTIVE BARGAINING

                  AGREEMENT

(a)  With the exception of the early retirement provisions referenced in the decision of the Vermont labor relations board, 28 VLRB 28, the last best offer of the administration of the Vermont state colleges, as recommended by the VLRB to the general assembly, is approved, pursuant to the provisions of 3 V.S.A. § 925(i), and it shall be the collective bargaining agreement between the Vermont state colleges and the Vermont state colleges faculty federation, AFT Local #3180.  The early retirement provisions shall be determined in accordance with subsection (b) of this section.

     (b)  The parties to the collective bargaining agreement are directed to re‑commence negotiation of provisions regarding the early retirement program and if agreement is not reached and ratified by September 30, 2005, then the provisions shall be submitted for final and binding resolution to a neutral arbitrator selected in accordance with the procedures of and through the American Arbitration Association.  Until such time as any new early retirement provisions are determined pursuant to this subsection, provisions of the current early retirement program shall continue in effect.

     (c)  3 V.S.A. § 925(i) is amended to read:

     (i)  If the dispute remains unresolved 15 days after transmittal of findings and recommendations, each party shall submit as a single package its last best offer on all disputed issues to the board.  Each party’s last best offer shall be certified as such to the board by the fact-finding panel.  The board may hold hearings as it deems appropriate.  Within 30 days of the certifications it shall select between the last best offers of the parties, considered in their entirety without amendment.  In the case of the state of Vermont or the Vermont state colleges the board shall recommend its choice to the general assembly as the bargaining agreement which shall become effective subject to appropriations by the general assembly.  The board shall determine the cost of the package selected and request the appropriation necessary to fund the recommendation. In the case of the University of Vermont or the Vermont State Colleges, the decision of the board shall be final and binding on each party.  Nothing herein precludes the general assembly from enacting laws amending provisions of any collective bargaining agreement involving the state of Vermont or the Vermont state colleges arrived at under this section.

(d)  Subsections (a) and (b) of this section shall be effective on passage.  Subsection (c) of this section shall take effect July 1, 2005.  The provisions of subsection (c), amending 3 V.S.A. § 925(i), shall not affect the contract negotiations referenced in subsection (a) which shall be final and binding under the procedures of subsection (b).

Sec. 179.  Vermont state colleges - allied health

Grants                                                            993,527

Source of funds

General fund                                                   993,527

Sec. 180.  Vermont interactive television

Grants                                                            815,331

Source of funds

General fund                                                   815,331

Sec. 181.  Vermont student assistance corporation

Grants                                                       17,771,050

Source of funds

General fund                                              17,771,050

(a)  Of the above appropriation, $25,000 shall be deposited into the trust fund established in 16 V.S.A. § 2845.

(b)  Except as provided in subsection (a) of this section, not less than 100 percent of grants shall be used for direct student aid.

(c)  The balance held by the treasurer in fund #21385, approximately $62,552, from the amount appropriated in No. 38 of the Acts of 1964 and from such other amounts as may have been appropriated, earned, or otherwise deposited in that account from time to time and not previously expended for student loan default guaranty purposes, is hereby transferred to the trust fund established by 16 V.S.A. § 2845 and held therein and administered by the Vermont student assistance corporation to provide grants for students with remaining financial needs and who are or have been under the custody of the commissioner of the department for children and families, all in accordance with the provisions of section 2845.

Sec. 182.  New England higher education compact

Grants                                                              80,000

Source of funds

General fund                                                     80,000

Sec. 183.  Total higher education and other                   82,042,784

Source of funds

General fund                                              82,042,784

Sec. 184.  Natural resources - agency of natural resources - administration

Personal services                                         4,138,173

Operating expenses                                     1,651,001

Grants                                                              90,180

Total                                                      5,879,354

Source of funds

General fund                                                4,324,943

Special funds                                               1,042,150

Federal funds                                                 338,355

Interdepartmental transfer                               173,906

Total                                                      5,879,354

     (a)  The amount of $400,000 is appropriated from the solid waste management assistance fund to the brownfields revitalization fund in the agency of commerce and community development.  These funds are hereby appropriated to match federal funds available through the Environmental Protection Agency for brownfields redevelopment purposes and for grants to specific projects subject to 10 V.S.A. § 6615a(l)(5) and (6).

Sec.  184a.  10 V.S.A. § 6615a(l)(5) and (6) are amended to read:

(5)  Grants.  Grants may be issued by the secretary of commerce and community development, with the approval of the secretary of natural resources, as follows:

(A)  The secretary of commerce and community development They may award an applicant a grant not to exceed $50,000.00 for the characterization and assessment of a site.

(B)  The secretary of commerce and community development They may award an applicant a grant not to exceed $200,000.00 for the remediation of a site.

(C)  The secretary of commerce and community development They may make a grant to assist an applicant in purchasing environmental insurance relating to the performance of the characterization, assessment or remediation of a brownfields site in accordance with a corrective action plan approved by the secretary of natural resources.

(D)  The secretary of commerce and community development They may use a portion of the brownfields revitalization fund to develop a risk-sharing pool, an indemnity pool, or an insurance mechanism to provide financial assistance to applicants.

(E)  All reports generated with the assistance of grants awarded under the brownfields revitalization fund, including site assessments, site investigations, feasibility studies, corrective action plans, and completion reports, shall be provided to the secretary secretaries in hard copy and in electronic form.

(6)  Loans.

(A)  For the purpose of this chapter, “VEDA” means the Vermont economic development authority, which is authorized to make loans on behalf of the state under this section after the secretary of commerce and community development, in consultation with the approval of the secretary of natural resources, has first determined an applicant eligible to apply to VEDA for a loan.  These loans shall be issued and administered by VEDA, pursuant to this chapter, and VEDA’s enabling authority, pursuant to chapter 12 of this title.  The secretary of commerce and community development, in consultation with the approval of the secretary of natural resources and in consultation with the VEDA manager, shall annually determine the amount of the brownfields revitalization fund available to VEDA for loans under this section.

* * *

Sec. 185.  Connecticut River watershed advisory commission

Grants                                                              38,000

Source of funds

General fund                                                     22,500

Federal funds                                                   15,500

Total                                                           38,000

Sec. 186.  Citizens’ advisory committee on Lake Champlain’s future

Personal services                                                3,800

Operating expenses                                            3,700

Total                                                             7,500

Source of funds

General fund                                                       7,500

Sec. 187.  Natural resources - state land local property tax assessment

Operating expenses                                     1,449,000

Source of funds

General fund                                                   974,684

Transportation fund                                        212,816

Interdepartmental transfer                               261,500

Total                                                      1,449,000

Sec. 188.  Green up

Grants                                                              17,196

Source of funds

General fund                                                       6,646

Special funds                                                    10,550

Total                                                           17,196

Sec. 189.  Fish and wildlife - support and field services

Personal services                                         9,566,015

Operating expenses                                     4,004,370

Grants                                                            662,453

Total                                                    14,232,838

Source of funds

General fund                                                1,726,853

Transportation fund                                        367,926

Fish and wildlife fund                                 12,138,059

Total                                                    14,232,838

(a)  The department of fish and wildlife shall obtain approval of the general assembly prior to taking any action that would result in closure or consolidation of fish culture operations.

(b)  Of the above appropriation, $5,000 shall be used to provide scholarships for children wishing to attend one of the conservation camps administered by the department of fish and wildlife.  No portion of any general fund appropriation, tuition payments, donations made, or interest earned on endowment funds for the camps program within the department of fish and wildlife for the purposes of supporting the conservation camps shall be reallocated or used for any other purpose.

Sec. 190.  Fish and wildlife - watershed improvement

Grants                                                              50,661

Source of funds

Fish and wildlife fund                                        50,661

Sec. 191.  Forests, parks and recreation - administration

Personal services                                            849,194

Operating expenses                                        475,239

Grants                                                         1,998,100

Total                                                      3,322,533

Source of funds

General fund                                                   983,533

Special funds                                               1,046,000

Federal funds                                              1,293,000

Total                                                      3,322,533

Sec. 192.  DEPARTMENT OF FORESTS, PARKS AND RECREATION;

                 EMPLOYEES’ GROUP INSURANCE; REPEAL

(a)  3 V.S.A. § 631(b) (health insurance plan available to state departments on February 23, 1951) shall be repealed on July 1, 2005.

Sec. 193.  PARTICIPATION IN A STATE GROUP INSURANCE PLAN

(a)  Employees of a state department who participate in a group insurance plan under subsection 631(b) of Title 3 and who choose to continue to participate in a state group insurance plan shall choose from among those plans available to state employees no later than 30 days after the effective date of this act.  The commissioner of human resources shall assist these employees in the transition to a new health plan.

Sec. 194.  Forests, parks and recreation - forestry

Personal services                                         4,514,728

Operating expenses                                        503,152

Grants                                                            353,000

Total                                                      5,370,880

Source of funds

General fund                                                3,484,380

Transportation fund                                          21,500

Special funds                                                  360,000

Federal funds                                              1,291,000

Interdepartmental transfer                               214,000

Total                                                      5,370,880

Sec. 195.  Forests, parks and recreation - state parks

Personal services                                         4,538,235

Operating expenses                                     1,891,697

Grants                                                                5,000

Total                                                      6,434,932

Source of funds

General fund                                                   610,632

Special funds                                               5,824,300

Total                                                      6,434,932

Sec. 196.  Forests, parks and recreation - lands administration

Personal services                                            521,610

Operating expenses                                        237,989

Total                                                         759,599

Source of funds

General fund                                                   524,599

Special fund                                                   195,000

Interdepartmental transfer                                 40,000

Total                                                         759,599

Sec. 197.  Forests, parks and recreation - youth conservation corps

                   Personal services                                            387,133

                   Operating expenses                                          25,357

                   Grants                                                            500,000

                        Total                                                         912,490

               Source of funds

                   Special funds                                                  567,490

                   Federal funds                                                   95,000

                   Interdepartmental transfer                               250,000

                        Total                                                         912,490

Sec. 198.  Forests, parks and recreation - forest highway maintenance

                   Personal services                                            222,978

                   Operating expenses                                        301,000

                        Total                                                         523,978

               Source of funds

                   General fund                                                     36,920

                    Transportation fund                                        487,058

                        Total                                                         523,978

Sec. 199.  Environmental conservation - management and support services

                   Personal services                                         2,835,084

                   Operating expenses                                        823,118

                   Grants                                                              96,267

                        Total                                                      3,754,469

               Source of funds

                   General fund                                                1,123,601

                   Special funds                                                  701,255

                   Federal funds                                              1,023,119

                   Interdepartmental transfer                               906,494

                        Total                                                      3,754,469

     (a)  Of the above special fund appropriation, $75,000 shall be used to fund a brownfields project manager position.

Sec. 200.  Environmental conservation - air and waste management

                   Personal services                                         6,944,360

                   Operating expenses                                     6,328,003

                   Grants                                                         1,706,000

                        Total                                                    14,978,363

               Source of funds

                   General fund                                                   715,896

                   Special funds                                             11,147,684

                   Federal funds                                              2,944,783

                   Interdepartmental transfer                               170,000

                        Total                                                    14,978,363

Sec. 200a.  FISCAL YEAR 2006; ONE-TIME WASTE MANAGEMENT

                  GRANTS

     (a)  The amount of $150,000 is appropriated from the solid waste management assistance fund and shall be used on a one-time basis for the purpose of providing grants to municipalities for recycling, collection, and proper management of household hazardous waste and waste mercury-added products.

Sec. 201.  Environmental conservation - office of water programs

                    Personal services                                       12,236,776

                   Operating expenses                                     2,099,391

                   Grants                                                         2,953,502

                        Total                                                    17,289,669

               Source of funds

                   General fund                                                6,232,691

                   Transportation fund                                        185,182

                   Special funds                                               3,717,507

                   Federal funds                                              6,616,039

                   Interdepartmental transfer                               538,250

                        Total                                                    17,289,669

     (a)  The commissioner shall ensure that $75,000 from the river management grants program is granted to the Vermont youth conservation corps to support a comprehensive river management program.  This program shall be coordinated to meet the stated objectives of the streambed restoration plan outlined in the clean and clear program.  The Vermont youth conservation corps shall submit a report to the house and senate committees on appropriations and the house and senate committees on natural resources and energy no later than January 15, 2006 on actual streambed restoration outcomes achieved by the Vermont youth conservation corps in context of the clean and clear program’s stated objectives.

Sec. 202.  Environmental conservation - tax-loss-Connecticut River flood control

                   Operating expenses                                          40,000

               Source of funds

                   Special funds                                                    40,000

Sec. 203.  Natural resources board

                   Personal services                                         2,320,080

                   Operating expenses                                        394,264

                        Total                                                      2,714,344

               Source of funds

                   General fund                                                1,065,127

                   Special funds                                               1,649,217

                        Total                                                      2,714,344

Sec. 204.  Total natural resources                                 78,325,806

               Source of funds

                   General fund                                              21,840,505

                   Transportation fund                                     1,274,482

                   Fish and wildlife fund                                 12,188,720

                    Special funds                                             26,851,153

                   Federal funds                                            13,616,796

                   Interdepartmental transfer                            2,554,150

                        Total                                                    78,325,806

Sec. 205.  Commerce and community development - agency of commerce and community development - administration

                   Personal services                                         1,270,218

                   Operating expenses                                        441,401

                   Grants                                                            236,200

                        Total                                                      1,947,819

               Source of funds

                   General fund                                                1,947,819

     (a)  On January 15, 2006, the agency of commerce and community development with the assistance of the department of public service shall report to the general assembly on the status of the state in reaching its telecommunications coverage goals, specifically in the areas of cellular and broadband service coverage.  The report shall address the achievement to date of the telecom infrastructure and service development goals and desired improvement as stated in the Vermont telecommunications plan dated September 2004 and shall report on the agency’s actions taken and planned to help Vermont reach these goals.

     (b)  The Vermont economic progress council shall consider the findings and recommendations of the economic development study committee in Sec. 205c of this act prior to developing the 10-year economic plan for the state.  The secretary of commerce and community development shall transfer at least $30,000 of funds appropriated to the department of economic development in Sec. 212 of this act to the Vermont economic progress council for the 10-year economic plan.

     (c)  Of the above general fund appropriation, $186,200 shall be for a grant to the Vermont sustainable jobs fund and $50,000 shall be for a grant to the Vermont council on rural development.

Sec. 205a.  CHIEF MARKETING OFFICER

    (a)  The establishment of one (1) new exempt position - Chief Marketing Officer - is authorized in fiscal year 2006.  This position shall be transferred and converted from existing vacant positions in the executive branch of state government and shall be established within the office of the secretary of commerce and community development, to be appointed by and report to the secretary of the agency of commerce and community development.

    (b)  It is the responsibility of the Chief Marketing Officer (CMO) to ensure consistency and efficiency in the use of state funds for marketing and promotional activities conducted by state agencies.  The duties of the CMO shall include, but not be limited to, the following:

(1)  Consolidate appropriate statewide marketing communications activities of the marketing and promotional (MAP) state agency partners, the department of tourism and marketing, the department of economic development, the agency of agriculture, food and markets, the division of historic preservation, the agency of transportation, the department of forests, parks and recreation, the department of fish and wildlife, and the information centers division.

          (2)  Develop, produce, and place marketing and promotional materials for all MAP agencies.  The CMO will work with the MAP agencies to develop annual marketing objectives, plans, and strategies and create objective metrics for evaluating the effectiveness of the centralized marketing approach.

(3)  Marketing and promotional funds allocated with agency budgets will be retained by the state agencies; however, the expenditure of these funds must first be approved by the CMO.

          (4)  The CMO shall consolidate state marketing and promotional activities with these existing resources in state agencies.  The CMO may make recommendations for reallocation through interdepartmental transfer of these resources.  Funds may be transferred with the approval of the general assembly or the joint fiscal committee if the general assembly is not in session.

          (5)  The CMO will conduct annual research to assess state agency satisfaction with the centralized marketing department and communicate the benefits of the consolidated statewide approach to all state agencies.

          (6)  The CMO shall report to the general assembly by January 15, 2006 on the potential for licensing a state-owned Vermont brand to state-based companies.  This report shall include the statutory changes that will be needed, including the repeal of existing regulations regarding the use of the Vermont name; and the estimated time line for establishing the Vermont brand program.

          (7)  The CMO shall work collaboratively with the higher education community in Vermont upon request by institutions of higher education.

     (c)  The CMO and the secretary of commerce and community development shall make recommendations to redirect state resources from administration and overhead in MAP agencies to marketing and promotional activities.

Sec. 205b.  RETROACTIVE APPLICATION OF DEFERRAL AND

                  MITIGATION TO PRIOR AWARDS

(a)  The deferral and mitigation of disallowance and recapture provisions of section 5930h of Title 32 shall continue in effect to defer and mitigate disallowance or recapture of any economic advancement tax incentive award granted prior to July 1, 2005, with the following modifications:

(1)  The deferral and mitigation provisions of subsection 5930h(f) of Title 32 shall be available whether or not the curtailment of trade or business resulting in the notice of recapture or disallowance occurred prior to July 1, 2003, the effective date of No. 67 of the Acts of 2003.

(2)  An application to the council for a deferral relating to an award granted prior to July 1, 2005 must be made within 90 days of the effective date of this act or within 90 days of receipt of written determination of recapture or disallowance, whichever is later.

(3)  The deferral period shall be for a nonrenewable period of 36 months, notwithstanding the 12‑month provision prescribed in subsection 5930h(f) of Title 32.

(4)  The minimum level of restoration of employment necessary within the recapture period shall be 75 percent of the highest annual average number of full-time employees of the applicant during any year in a period of six years after the initial authorization of an incentive by the council.

          (5)  The deferral and mitigation provisions of subsection 5930h(f) of Title 32 shall apply to credits which have been applied against tax liabilities and to carryforward of credits granted but not yet taken.  The council may in its discretion mitigate the disallowance or recapture of credits applied against tax liabilities.  With respect to disallowance of carryforward of credits, the council shall determine a mitigated amount based on the cost-benefit model analysis of the taxpayer’s actual job creation and performance, and any mitigated amount shall take account of credits applied against tax liabilities.  For the purposes of this section, the three‑year time limit on notices of deficiency and assessment of penalty and interest under section 5882 of Title 32 shall commence upon conclusion of the 36‑month deferral period allowed by this section.

Sec. 205c.  ECONOMIC DEVELOPMENT STUDY COMMITTEE

(a)  There is created an economic development study committee to be composed of six members of the general assembly, three from the senate appointed by the senate committee on committees, one each from the committees on appropriations, finance, and economic development, housing and general affairs; and three members of the house appointed by the speaker, one each from the committees on appropriations, commerce, and ways and means; one person to be appointed by the Vermont league of cities and towns; one person to be appointed by the associated industries of Vermont; one person to be appointed by Vermont businesses for social responsibility; and one person to be appointed by the Vermont natural resources council.

(b)  The committee may meet following adjournment of the 2005 session of the general assembly as it deems necessary to perform its duties, and for attendance at meetings members shall be entitled to reimbursement for expenses and compensation for services as provided in 2 V.S.A. § 406.

(c)  The economic development study committee shall have the assistance of the joint fiscal office, the legislative council, the department of taxes, the agency of commerce and community development, and the Vermont economic progress council.  With the approval of the joint fiscal committee, the economic development study committee may retain or contract for expert consulting assistance.

(d)  The committee shall be guided by the general assembly’s support for a strong economic development policy for Vermont which is fiscally responsible and targeted for actual development results and shall consult specifically with representatives of the types of business which the committee determines would be most attractive to Vermont; and by the general assembly’s intent to fulfill the state’s pending obligations to businesses which have been granted economic advancement tax incentives.  The committee shall:

(1)  Analyze whether targeted business incentive grants and nonmonetary business aid such as permit and regulatory assistance or other assistance and increased development of infrastructure would be more successful, efficient, and cost-effective than tax expenditures in encouraging desired economic activity in the state.  In analyzing this approach, the committee shall consider:

(A)  The types of new business Vermonters would like to attract to this state and the kind of business and economic growth Vermonters would find appropriate;

(B)  The specific grants and nonmonetary assistance which would attract those types of business to Vermont;

(C)  The best strategy and long-term goals for Vermont economic development and job retention, particularly in light of both domestic and global business competition;

(D)  Targeting incentives to startup and small businesses and whether these kinds of incentives would advance the long-term goals determined under subdivision (C) of this subdivision (1);

(E)  Targeting incentives to regions of the state with high unemployment, low wages, or other indications of need for economic development and job creation and whether these kinds of incentives would advance the long-term goals determined under subdivision (C) of this subdivision (1);

(F)  Vermont tax policies which place Vermont businesses at a competitive disadvantage and how best to address these policies and mitigate their effects;

(G)  Specific needs for development or improvement of transportation and telecommunications systems;

(H)  The types of postsecondary institution expansion or development which would attract research and technology firms;

(I)  The advisability of designating a single state official to advise and aid businesses in obtaining all necessary permits and other regulatory compliance.

(2)  Analyze the advantages and disadvantages of privatizing all or a portion of economic development functions of the state.

(3)  Review the advisability of current law limitations on approval for tax increment financing in downtown development projects and recommend any changes necessary to improve the approval process.

(4)  Review the advisability of a single, payroll‑based tax credit program, and if found advisable, recommend legislation to implement such a program.  In reviewing the advisability, the committee shall consider:

(A)  the utility of a “but for” test and whether it should be abolished; and whether an annual cap or other limitation is appropriate on the total awards to be made; and

(B)  whether to develop and link economic advancement tax incentives to municipal awards and incentives to municipalities and to account for these.

     (e)  The economic development study committee shall report its findings and recommendations to the senate committees on economic development, housing and general affairs, finance, and appropriations; and the house committees on commerce, ways and means, and appropriations no later than January 15, 2006.

Sec. 206.  FISCAL YEAR 2006 AGENCY‑WIDE GENERAL FUND

                 REDUCTION

     (a)  The secretary of the agency of commerce and community development shall reduce the total general fund appropriations to the agency in fiscal year 2006 by $25,000.

Sec. 207.  Housing and community affairs

                   Personal services                                         2,472,749

                   Operating expenses                                        301,356

                   Grants                                                         4,099,340

                        Total                                                      6,873,445

               Source of funds

                   General fund                                                1,531,188

                   Special funds                                               3,663,918

                   Federal funds                                              1,639,339

                   Interdepartmental transfer                                 39,000

                        Total                                                      6,873,445

     (a)  Of the above appropriation, no less than $60,000 in general funds shall be granted to the Champlain Valley Office of Economic Opportunity’s mobile home project for the “First Stop” program, which provides assistance to mobile home residents statewide.

Sec. 208.  Historic sites - operations

                   Personal services                                            604,583

                   Operating expenses                                        275,769

                        Total                                                         880,352

               Source of funds

                   General fund                                                   479,352

                   Special funds                                                  372,000

                   Interdepartmental transfer                                 29,000

                        Total                                                         880,352

Sec. 209.  Historic sites - special improvements

                   Personal services                                              71,408

                   Operating expenses                                        911,408

                        Total                                                         982,816

               Source of funds

                   Special funds                                                    50,000

                   Federal funds                                                 398,140

                   Interdepartmental transfer                               534,676

                        Total                                                         982,816

Sec. 210.  Community development block grants

                   Grants                                                         8,646,118

               Source of funds

                   Federal funds                                              8,646,118

(a)  Community development block grants will carry forward until expended.

     (b)  Community development block grant (CDBG) funds shall be expended in accordance with and in the order of the following priorities:

          (1)  The greatest priority for the use of CDBG funds will be the creation and retention of affordable housing and jobs.

          (2)  The overarching priority and fundamental objective in the use of funds for all affordable housing is to achieve perpetual affordability through the use of mechanisms that produce housing resources that will continue to remain affordable over time.  It is the goal of the state to maintain at least 45 to 55 percent of CDBG funds for affordable housing applications.

          (3)  Among affordable housing applications, the highest priorities are to preserve and increase the supply of affordable family housing, to reduce and strive to eliminate childhood homelessness, and to serve families and individuals at or below 30 percent of HUD Area Median Income and people with special needs as described in the Consolidated Plan.  Housing for seniors should be considered when it meets clear unmet needs in the region and when it leverages rental assistance or other public subsidies for the lowest income seniors.

          (4)  Projects which address the ongoing deterioration of the existing housing stock through acquisition, preservation, and rehabilitation of units shall comply with housing quality standards with priority given to lead hazard reduction and energy efficiency.

          (5)  Preference shall be given to projects that maintain the historic settlement pattern of compact village and downtown centers separated by a rural working landscape.  Funds generally should not be awarded to projects that promote or constitute sprawl, defined as dispersed development outside of compact urban and village centers, along highways, and in rural countryside.

     (c)  Up to $750,000 may be set aside for brownfield sites after submission of a plan to the joint fiscal committee.

Sec. 211.  Downtown transportation and capital improvement fund

                   Personal services                                              40,000

                   Grants                                                            760,000

                        Total                                                         800,000

               Source of funds

                   Special funds                                                  800,000

Sec. 212.  Economic development

                   Personal services                                         1,759,654

                   Operating expenses                                        726,057

                   Grants                                                         1,634,943

                        Total                                                      4,120,654

               Source of funds

                   General fund                                                3,467,184

                   Special funds                                                  455,000

                   Federal funds                                                 198,470

                        Total                                                      4,120,654

Sec. 213.  Vermont training program

                   Personal services                                              67,050

                   Operating expenses                                          26,637

                   Grants                                                         1,549,013

                        Total                                                      1,642,700

               Source of funds

                   General fund                                                1,607,700

                   Special funds                                                    35,000

                        Total                                                      1,642,700

Sec. 214.  Tourism and marketing

                   Personal services                                         1,804,143

                   Operating expenses                                     2,068,315

                   Grants                                                            337,000

                        Total                                                      4,209,458

               Source of funds

                   General fund                                                4,209,458

Sec. 215.  Vermont life

                   Personal services                                            719,770

                   Operating expenses                                        128,000

                        Total                                                         847,770

               Source of funds

                   Enterprise funds                                              847,770

Sec. 216.  Vermont council on the arts

                   Grants                                                            494,618

               Source of funds

                   General fund                                                   494,618

Sec. 217.  Vermont symphony orchestra

                   Grants                                                            101,960

               Source of funds

                   General fund                                                   101,960

Sec. 218.  Vermont historical society

                   Grants                                                            630,653

               Source of funds

                   General fund                                                   630,653

Sec. 219.  Vermont housing and conservation board

                   Grants                                                       26,246,036

               Source of funds

                   Special funds                                             14,088,426

                   Federal funds                                            12,157,610

                        Total                                                    26,246,036

Sec.  219a.  10 V.S.A. § 321 is amended to read:

§ 321.  GENERAL POWERS AND DUTIES

* * *

     (b)  The board shall seek out and fund not-for-profit organizations and municipalities that can assist any region of the state which has high housing prices, high unemployment and low per capita incomes in obtaining grants and loans under this chapter for perpetually affordable housing.  The board shall administer the “HOME” affordable housing program which was enacted under Title II of the Cranston-Gonzalez National Affordable Housing Act (Title II, P.L. 101-625, 42 U.S.C. 12701-12839).  The state of Vermont, as a participating jurisdiction designated by Department of Housing and Urban Development, shall enter into a written memorandum of understanding with the board, as subrecipient, authorizing the use of HOME funds for eligible activities in accordance with applicable federal law and regulations.  HOME funds shall be used to implement and effectuate the policies and purposes of this chapter related to affordable housing.  The memorandum of understanding shall include performance measures and outcomes that VHCB will annually report on to the Vermont department of housing and community affairs.

     (c)  On behalf of the state of Vermont, the board shall seek and administer federal farmland protection funds to facilitate the acquisition of interests in land to protect and preserve in perpetuity important farmland for future agricultural use.  Such funds shall be used to implement and effectuate the policies and purposes of this chapter.

     (c)(d)  The board shall inform all grant applicants and recipients of funds derived from the annual capital appropriations and state bonding act of the following:  “The Vermont Housing and Conservation Trust Fund is funded by the taxpayers of the State of Vermont, at the direction of the General Assembly, through the annual Capital Appropriation and State Bonding Act.”  An appropriate placard shall, if feasible, be displayed at the location of the proposed grant activity.

Sec. 220.  Vermont humanities council

                   Grants                                                            160,599

               Source of funds

                   General fund                                                   160,599

(a)  Of the above appropriation, $20,000 shall be used to support the connections program.

Sec. 221.  Total commerce and community development

                                                                                    58,559,998

               Source of funds

                   General fund                                              14,605,531

                   Special funds                                             19,464,344

                   Federal funds                                            23,039,677

                   Enterprise funds                                              847,770

                   Interdepartmental transfer                               602,676

                        Total                                                    58,559,998

Sec. 222.  TRANSPORTATION

(a)  Transportation fund appropriations made available for the agency of transportation in cooperation with the federal government shall be available until expended and shall not revert.

(b)  The commissioner of finance and management shall maintain and control transportation appropriations in separate state and federal appropriations, as needed, and may incur overdrafts in personal services and operating expenses pending distribution of payroll and employee charges to other appropriations.

Sec. 223.  Transportation - finance and administration

                   Personal services                                         8,155,420

                   Operating expenses                                     2,063,928

                        Total                                                    10,219,348

               Source of funds

                   Transportation fund                                     9,671,292

                   Federal funds                                                 548,056

                        Total                                                    10,219,348

Sec. 224.  Transportation - aviation

                   Personal services                                         1,199,104

                   Operating expenses                                     8,023,312

                   Grants                                                              50,000

                        Total                                                      9,272,416

               Source of funds

                   Transportation fund                                     2,222,416

                    Federal funds                                              7,050,000

                        Total                                                      9,272,416

Sec. 225.  Transportation - buildings

                   Personal services                                            210,000

                   Operating expenses                                     1,087,548

                        Total                                                      1,297,548

               Source of funds

                   Transportation fund                                     1,297,548

Sec. 226.  Transportation - program development

                   Personal services                                       37,671,918

                   Operating expenses                                   72,436,634

                   Grants                                                       37,115,246

                        Total                                                  147,223,798

               Source of funds

                   Transportation fund                                   28,453,772

                   Local match                                                1,898,426

                   Federal funds                                          116,871,600

                        Total                                                  147,223,798

Sec. 227.  [Deleted]

Sec. 228.  [Deleted]

Sec. 229.  Transportation - interstate rest areas

                   Personal services                                              80,000

                   Operating expenses                                        916,100

                        Total                                                         996,100

               Source of funds

                   Transportation fund                                          25,000

                   Federal funds                                                 971,100

                        Total                                                         996,100

Sec. 230.  Transportation – maintenance - state system

                   Personal services                                       29,352,669

                   Operating expenses                                   24,471,617

                   Grants                                                            987,800

                        Total                                                    54,812,086

               Source of funds

                   Transportation fund                                   54,104,586

                   Federal funds                                                 707,500

                        Total                                                    54,812,086

Sec. 231.  Transportation - policy and planning

                   Personal services                                         2,641,670

                   Operating expenses                                        492,908

                   Grants                                                         4,140,769

                        Total                                                      7,275,347

               Source of funds

                   Transportation fund                                     1,806,692

                   Federal funds                                              5,468,655

                        Total                                                      7,275,347

Sec. 232.  Transportation - rail

                   Personal services                                            743,456

                   Operating expenses                                     7,103,746

                   Grants                                                         2,700,000

                        Total                                                    10,547,202

               Source of funds

                   Transportation fund                                     8,196,929

                   Federal funds                                              2,350,273

                        Total                                                    10,547,202

Sec. 233.  Transportation - public transit

                   Personal services                                            470,313

                   Operating expenses                                        130,240

                   Grants                                                       14,288,340

                        Total                                                    14,888,893

               Source of funds

                   Transportation fund                                     5,796,599

                   Federal funds                                              9,092,294

                        Total                                                    14,888,893

Sec. 234.  Transportation - central garage

                   Personal services                                         3,183,942

                   Operating expenses                                     9,959,952

                        Total                                                    13,143,894

               Source of funds

                   Internal service funds                                 13,143,894

(a)  Of the above appropriation, $1,400,000 is from the transportation equipment replacement account within the central garage fund in accordance with 19 V.S.A. § 13(c) for the purchase of equipment as authorized in 19 V.S.A. § 13(b).

Sec. 235.  Department of motor vehicles

                   Personal services                                       16,324,559

                   Operating expenses                                     6,438,943

                   Grants                                                            156,250

                        Total                                                    22,919,752

               Source of funds

                   Transportation fund                                   22,286,370

                   Federal funds                                                 633,382

                        Total                                                    22,919,752

(a)  Of the above transportation fund appropriation, $127,483 shall be transferred to the department of education, education programs to support the driver education program.

Sec. 236.  Transportation - town highway - structures

                   Grants                                                         3,494,500

               Source of funds

                   Transportation fund                                     3,494,500

Sec. 237.  Transportation - town highway - emergency fund

                   Grants                                                              57,129

               Source of funds

                   Transportation fund                                          57,129

Sec. 238.  Transportation - town highway - Vermont local roads

                   Grants                                                            783,700

               Source of funds

                   Transportation fund                                        333,867

                   Federal funds                                                 449,833

                        Total                                                         783,700

Sec. 239.  Transportation - town highway - class 2 roadway

                   Grants                                                         4,748,750

               Source of funds

                   Transportation fund                                     4,748,750

Sec. 240.  Transportation - town highway - bridges

                   Personal services                                         3,650,000

                   Operating expenses                                   16,862,175

                   Grants                                                              43,000

                        Total                                                    20,555,175

               Source of funds

                   Transportation fund                                     3,892,314

                   Local match                                                1,563,678

                   Federal funds                                            15,099,183

                        Total                                                    20,555,175

Sec. 241.  Transportation - town highway - aid program

                   Grants                                                       24,982,744

               Source of funds

                   Transportation fund                                   24,982,744

(a)  The above appropriation is authorized, notwithstanding 19 V.S.A. § 306(a).

Sec. 242.  Transportation - town highway - class 1 supplemental grants

                   Grants                                                            128,750

               Source of funds

                   Transportation fund                                        128,750

Sec. 243.  Transportation - public assistance grant program

                   Grants                                                            200,001

               Source of funds

                   Local match                                                              1

                   Federal funds                                                 200,000

                        Total                                                         200,001

Sec. 244.  Transportation board

                   Personal services                                              72,795

                   Operating expenses                                          10,605

                        Total                                                           83,400

               Source of funds

                   Transportation fund                                          83,400

Sec. 244a.  Bridge maintenance program

                   Operating expenses                                     4,662,281

               Source of funds

                   Transportation fund                                        959,622

                   Local funds                                                      61,361

                   Federal funds                                              3,641,298

                        Total                                                      4,662,281

Sec. 244b.  Discretionary spending

                   Operating expenses                                     1,825,068

               Source of funds

                   Transportation fund                                        566,338

                   Federal funds                                              1,258,730

                        Total                                                      1,825,068

Sec. 245.  Total transportation                                    354,117,882

               Source of funds

                   Transportation fund                                 173,108,618

                   Local match                                                3,523,466

                   Federal funds                                          164,341,904

                   Internal service funds                                 13,143,894

                        Total                                                  354,117,882

Sec. 246.  Debt service

                   Debt service                                              67,461,234

               Source of funds

                   General fund                                              62,968,427

                   Transportation fund                                     2,109,547

                   Special funds                                               2,383,260

                        Total                                                    67,461,234

Sec. 247.  Total debt service                                        67,461,234

               Source of funds

                   General fund                                              62,968,427

                   Transportation fund                                     2,109,547

                   Special funds                                               2,383,260

                        Total                                                    67,461,234

Sec. 248.  RELATIONSHIP TO EXISTING LAWS

(a)  Except as specifically provided, this act shall not be construed in any way to negate or impair the full force and effect of existing laws.

Sec. 249.  OFFSETTING APPROPRIATIONS

(a)  In the absence of specific provisions to the contrary in this act, when total appropriations are offset by estimated receipts, the state appropriations shall control, notwithstanding receipts being greater or less than anticipated.

Sec. 250.  FEDERAL FUNDS

(a)  In fiscal year 2006, the governor, with the approval of the general assembly, or the joint fiscal committee if the general assembly is not in session, may accept federal funds available to the state of Vermont including block grants in lieu of or in addition to funds herein designated as federal.  The governor, with the approval of the general assembly, or the joint fiscal committee if the general assembly is not in session, may allocate all or any portion of such federal funds for any purpose consistent with the purposes for which the basic appropriations in this act have been made.

(b)  If, during fiscal year 2006, federal funds available to the state of Vermont and designated as federal in this and other acts of the 2005 session of the Vermont general assembly are converted into block grants or are abolished under their current title in federal law and reestablished under a new title in federal law, the governor may continue to accept such federal funds for any purpose consistent with the purposes for which the federal funds were appropriated.  The governor may spend such funds for such purposes for no more than 45 days prior to legislative or joint fiscal committee approval.  Notice shall be given to the joint fiscal committee without delay if the governor is intending to use the authority granted by this section, and the joint fiscal committee shall meet in an expedited manner to review the governor’s request for approval.

(c)  Any agreement, waiver of the federal Medicaid law, or commitment negotiated by the state with the federal government under which funding for the Medicaid program in Vermont is to be transformed from a system of state‑federal matching grants to any other system of federal participation, such as global funding commitments or block grants, is conditional upon approval by act of the general assembly, or, if the general assembly is not in session and the speaker and senate president pro tempore determine that it will not reconvene within the next 30 day period, by a majority vote of the members of the joint fiscal committee upon recommendation of the health access oversight committee.  For the purposes of this section, “Medicaid program” means any program for which Medicaid funding is currently spent or is anticipated to be spent, including Medicaid, the Vermont health access plan, VHAP pharmacy, VScript, special education services, home- and community‑based services, mental health services, services provided by the state ombudsman programs, or services for the developmentally disabled.  For the purposes of this section, “funding for the Medicaid program” also means federal allocations or other funding for the state children’s health insurance program (SCHIP) if such funding is to be included in or accounted for in any negotiated system of federal participation, including a determination of budget neutrality.

Sec. 251.  DEPARTMENTAL RECEIPTS

(a)  All receipts shall be credited to the general fund except as otherwise provided and except the following receipts, for which this subsection shall constitute authority to credit to special funds:

          Connecticut River flood control

          Department of public service ‑ sale of power

          Department of taxes ‑ unorganized towns and gores

(b)  Notwithstanding any other provision of law, departmental indirect cost recoveries (32 V.S.A. § 6) receipts are authorized, subject to the approval of the secretary of administration, to be retained by the department.  All recoveries not so authorized shall be covered into the general fund, or, for agency of transportation recoveries, the transportation fund.

Sec. 252.  NEW POSITIONS

(a)  Notwithstanding any other provision of law, the total number of authorized state positions, both classified and exempt, excluding temporary positions as defined in 3 V.S.A. § 311(11), shall not be increased during fiscal year 2006, except for new positions authorized by the 2005 legislative session.  Limited service positions approved pursuant to 32 V.S.A. § 5 shall not be subject to this restriction.

Sec. 253.  APPROPRIATIONS; PROPERTY TRANSFER TAX

(a)  This act contains the following amounts appropriated from special funds that receive revenue from the property transfer tax.  Expenditures from these appropriations shall not exceed available revenues:

(1)  Notwithstanding Sec. 273 of No. 122 of the Acts of the 2003 Adj. Sess (2004), the sum of $288,000 is appropriated from the property valuation and review administration special fund to the department of taxes for administration of the use tax reimbursement program.  Notwithstanding 32 V.S.A. § 9610(c), amounts above $288,000 from the property transfer tax that are deposited into the property valuation and review administration special fund shall be transferred into the general fund.

(2)  The sum of $13,171,180 is appropriated from the Vermont housing and conservation trust fund to the Vermont housing and conservation trust board. Notwithstanding 10 V.S.A. § 312, amounts above $13,171,180 from the property transfer tax that are deposited into the Vermont housing and conservation trust fund shall be transferred into the general fund.

(3)  The sum of $3,939,566 is appropriated from the municipal and regional planning fund.  Notwithstanding 24 V.S.A. § 4306(a), amounts above $3,939,566 from the property transfer tax that are deposited into the municipal and regional planning fund shall be transferred into the general fund.  The $3,939,566 shall be allocated as follows:

(A)  The sum of $2,757,696 for disbursement to regional planning commissions in a manner consistent with 24 V.S.A. § 4306(b);

(B)  The sum of $787,913 for disbursement to municipalities in a manner consistent with 24 V.S.A. § 4306(b);

               (C)  The sum of $393,957 to the Vermont center for geographic information.

(b)  Property transfer tax revenues in fiscal year 2006 shall be distributed pursuant to 32 V.S.A §§ 435(b)(10) and 9610(c), 10 V.S.A. § 312, and 24 V.S.A. § 4306(a) and transferred into the general fund consistent with the provisions of subsection (a) of this section, except that any property transfer tax revenues above $39,801,000, not to exceed $2,500,000, shall be deposited into the Vermont housing and conservation trust fund and appropriated to the Vermont housing and conservation trust board.

(c)  In fiscal year 2007, the appropriations in subdivisions (a)(1)-(3) of this section shall increase by 4.5 percent.

Sec. 254.  TRANSPORTATION FUND TRANSFER

(a)  The amount of $800,000 is transferred from the transportation fund to the downtown transportation and related capital improvement fund established by 24 V.S.A. § 2796 to be used by the Vermont downtown development board for the purposes of the fund.

Sec. 255.  FISCAL YEAR 2005 GENERAL FUND APPROPRIATIONS

                AND TRANSFERS

     (a)  In fiscal year 2005, the following amounts are appropriated or transferred from the general fund:

     (1)  The sum of $10,000,000 is transferred from the general fund to the health access trust fund.

     (2)  The sum of $6,220,000 is appropriated to the department of education for state aid for school construction projects pursuant to 16 V.S.A. § 3448 as set forth in Sec. 6 of H.518 of 2005 (the capital construction act of the 2005 session).  For the purposes of 32 V.S.A. § 308, this appropriation shall be considered to be made in fiscal year 2006.

          (3)  The sum of $300,000 is appropriated to the department of corrections for expenses related to the former Windsor prison site.

          (4)  The sum of  $200,000 is appropriated to the department of taxes for fiscal year 2006 PILOT payments in addition to funds appropriated in Sec. 50 of this act.

          (5)  The sum of $80,000 is appropriated to the department for children and families for a grant to spectrum youth and family services for the downtown education program.

          (6)  The sum of $55,000 is appropriated to the secretary of state.  $10,000 or so much thereof as may be necessary to assist in covering the costs of hiring a licensed land surveyor to conduct a survey of a portion of the boundary between the towns of Burke and Kirby.  $45,000 or so much thereof as may be necessary, to assist in covering the costs of hiring a licensed land surveyor who shall conduct a survey of the boundary between the towns of Bakersfield and Fairfield.  The general assembly intends that the boundary lines be located and established according to surveys to be conducted by a licensed land surveyor who shall be hired and directed by the secretary of state.  Upon completion, the results of the surveys shall be filed with the secretary of state.

          (7)  The sum of $1,964,000 is appropriated for the purposes of achieving health care reform as follows:

(A)  $725,000 to the legislature as follows:  $325,000 to support the activities of the legislative commission on health care reform as established by Sec. 277c of this act; $325,000 for studies as required by Sec. 277d of this act; and $75,000 for health care reform public information and outreach activities of the legislature as described in Sec. 277e of this act.

(B)  $1,039,000 to the office of Vermont health access to fund the Vermont Blueprint for Health:  The Chronic Care Initiative.  The goals of the initiative are to:  (1)  implement a statewide system of care that enables Vermonters with, and at risk for, chronic disease to lead healthier lives; (2)  develop a system of care that is financially sustainable; and (3)  forge a public-private partnership to develop and sustain the new system of care.  On or before January 1, 2006, and annually thereafter, the director of the office of Vermont health access, in consultation with the commissioner of health, shall file a report with the general assembly detailing progress made in reaching these three goals.

               (C)  $200,000 to the department of taxes to assist with implementation expenses for the payroll tax included in H.524.  In the event that H.524 is not enacted by July 15, 2005 the funds appropriated in this subdivision shall be appropriated as follows:  $100,000 to the department of health for additional grants consistent with the requirements of Sec. 277f of this act, $50,000 to the department of health for additional grants for the development and implementation of 340B pharmaceutical services, and the remaining $50,000 to the legislature for related standing committee expenses.

Sec. 256.  32 V.S.A. § 308c is added to read:

§ 308c.  GENERAL FUND AND TRANSPORTATION FUND SURPLUS

              RESERVES

(a)  There is hereby created within the general fund a general fund surplus reserve.  Monies from this reserve shall not be expended except by specific appropriation of the general assembly.

(b)  There is hereby created within the transportation fund a transportation fund surplus reserve.  Monies from this reserve shall not be expended except by specific appropriation of the general assembly.

(c)  The general fund surplus reserve created in subsection (a) of this section shall supersede and replace the general fund surplus reserve established in Sec. 277(5) of No. 147 of the Acts of the 1997 Adj. Sess. (1998), as amended by Sec. 88 of No. 1 of the Acts of 1999.

Sec. 257.  TRANSPORTATION; CONTINGENCY APPROPRIATION

                 AUTHORITY

     (a)  Subject to approval by a special committee consisting of the legislative joint fiscal committee and the chairs of the house and senate committees on transportation, the secretary of administration is authorized to transfer up to $5,000,000 in general funds from the general fund surplus reserve, established pursuant to 32 V.S.A. § 308c(a), to the transportation fund, and that amount of transportation funds is appropriated to the agency of transportation.  The special committee approval shall be based on the following:

          (1)  Passage of the federal “Safe, Accountable, Flexible, and Efficient Transportation Equity Act” (SAFETEA) with the result of additional federal funds available for Vermont;

(2)  A finding by the secretary of administration and a determination by the special committee that:

               (A)  The general fund surplus reserve has sufficient funds;

               (B)  Insufficient state funds have been appropriated for a match to transportation projects that could be done in state fiscal year 2006;

               (C)  Funding additional projects prior to awaiting the budget adjustment process is in the best interests of Vermont; and  

               (D)  The general fund budget adjustment needs will be able to be addressed with remaining or other funds. 

Sec. 258.  [Deleted] 

Sec. 259.  [Deleted] 

Sec. 260.  [Deleted] 

Sec. 261.  PERSONNEL EXPENDITURES GROWTH ANALYSIS

(a)  As part of the governor’s budget presentation, the administration shall include a comparative analysis of the growth of payroll by fund over the past three years and the growth rates of the source fund.  Where payroll is growing faster than fund growth, the administration shall provide an explanation for such growth and its impact on future budgets.

Sec. 262.  IN-DEPTH BUDGETING PILOT PROGRAM

(a)  As part of the fiscal year 2007 budget development process, the commissioner of finance and management shall select up to two departments to undergo an in‑depth budget review.  The commissioner’s choices of agencies to be reviewed shall be submitted for comment to the joint fiscal committee at its July 2005 meeting.  Said review(s) when completed shall be submitted in writing no later than January 20, 2006 to the house and senate committees on appropriations along with the governor’s budget proposal.  The review shall examine all aspects of the department activities as to mission, goals, and performance measures, the various financial and budgetary systems in place, and specifically shall:

          (1)  Review department organization and finances for the effectiveness of achieving its mission.

          (2)  Evaluate whether there are any measures and specific measurable evidence of the value of the department’s programs and expenditures.

          (3)  Assess the costs and benefits that would occur if a portion of the funds spent were used for other programs that could reduce demand for the department’s services.

Sec. 263.  FISCAL YEAR 2005 DESIGNATED BALANCE (WATERFALL)

     (a)  At the close of fiscal year 2005, the fiscal year 2005 unreserved and undesignated general fund balance on a budgetary basis, as determined by the commissioner of finance and management on or before July 31, 2005, in order to the extent funds are available:

(1)  First, shall be transferred to the general fund budget stabilization reserve to the extent necessary to attain its statutory maximum;

(2)  Second, shall be transferred to the transportation fund budget stabilization reserve to the extent necessary to attain its statutory maximum after the application of 32 VSA § 308a;

(3)  Third, $1,300,000 shall be appropriated to the agency of human services for Vermont state hospital expenditures in fiscal year 2006;

(4)  Fourth, up to $3,415,000 shall be appropriated as necessary to the secretary of administration to ensure that said amount is available for fiscal year 2006 general fund pay act obligations.  This appropriation shall be made only to the extent necessary to make up the difference from the above amount and that amount appropriated under Sec. 264(a)(2) of this act [fiscal year 2006 contingent appropriation].

(5)  Fifth, up to $17,000,000 shall be transferred as necessary to the Vermont health access trust fund to ensure that said amount is available for fiscal year 2006 general fund obligations.  This transfer shall be made only to             the extent  necessary to make up the difference from the above amount and that amount appropriated under Sec. 264(a)(3) of this act [fiscal year 2006 contingent appropriation].

     (b)  To the extent additional funds are available; $21,096,000 shall be appropriated and transferred to the health access trust fund for the following:

          (1)  First, $14,347,000 to offset postponement of the second disproportionate share payment until fiscal year 2007; and

          (2)  Second, $6,749,000 to provide additional resources for Medicaid expenditures.

     (c)  To the extent additional funds are available $6,824,000 shall be appropriated to the following:

          (1)  First, $4,000,000 to the state teachers’ retirement fund.

          (2)  Second, $2,043,000 to the department of education for state aid for school construction projects pursuant to 16 V.S.A. § 3448 as set forth in Sec. 6 of H.518 of 2005 (the capital construction act of the 2005 session).  For the purposes of 32 V.S.A. § 308, this appropriation shall be considered to be made in fiscal year 2006.

          (3)  Third, $250,000 to the department of education for adult education one‑time transition costs.

          (4)  Fourth, $531,000 to the department of education for transfer to the department of corrections as needed for special education program expenses.  The department of corrections with the department of education shall develop a plan for special education within its corrections system high school program. The plan shall include spending targets and budgets, a description of how short‑term and longer‑term youth inmates’ needs are to be addressed, and the specific measurable outcomes on which the system will be evaluated.  The departments shall submit the plan to the house and senate committees on appropriations and education on or before December 15, 2005.

     (d)  To the extent additional funds are available, $1,325,000 shall be appropriated for the following:

          (1)  First, $250,000 to the department of health for area health education center activities.

          (2)  Second, $300,000 to the Vermont training program.

          (3) Third, $75,000 to the department of economic development for grants to regional development corporations.

          (4)  Fourth, $450,000 to the department of environmental conservation for stormwater contracts.

          (5)  Fifth, $250,000 to the department of aging and independent living for grants to area agencies on aging.

     (e)  To the extent additional funds are available, $1,525,000 shall be appropriated as follows for health care reform related initiatives:

          (1)  First, $25,000 to the legislature for interim committee meetings on health care reform.

          (2)  Second, $200,000 to the department of health for use as an additional appropriation to fund free clinics.

          (3)  Third, $700,000 to the department of banking, insurance, securities, and health care administration to carry out the purposes of Sec. 277 of this act, adding 18 V.S.A. § 9417, of which $500,000 is for dollar-for-dollar matching funds to leverage resources necessary to fund the pilot program authorized under subsection 9417(e) of Title 18 and to contract for the development of the health information technology plan and other duties in 18 V.S.A. § 9417.

          (4)  Fourth, $200,000 to the department of health for the purpose of providing grants consistent with the provisions of Sec. 277f of this act for federally qualified health center (FQHC) look‑alikes.

          (5)  Fifth, $50,000 to the department of health, $20,000 of which shall be used for a grant to the bi-state primary care association for activities related to Vermont FQHC’s and the remainder for grants for the development and implementation of 340B pharmaceutical services.

          (6)  Sixth, $350,000 to the department of health for a pilot program to provide training and capitated payment to primary care physicians treating Medicaid patients with substance abuse diagnoses.

     (f)  To the extent additional funds are available, $200,000 shall be transferred to the emergency relief and assistance fund, which amount is hereby authorized for expenditure by the agency of transportation as state match to municipalities for FEMA public assistance disasters.

     (g)  To the extent additional funds are available, $1,930,000 is appropriated as follows:

          (1) $500,000 to the secretary of administration to be utilized at the secretary’s discretion for projects including:  a) department of taxes to fund preliminary work in creating an automated corporate tax filing system, and b) to the agency of natural resources for a “permit on web” initiative.  The legislature’s goal for this initiative is to begin the functional process of bringing transparency and efficiency to the application, processing, and review process.

          (2)  $350,000 to the defender general for upgrading the departmental computer systems.

          (3)  $95,000 to the joint fiscal committee, $80,000 for budget system integration to be developed with consultation of the legislative information technology staff, and $15,000 to be available for transfer to the department of taxes for tax expenditure reporting obligations.

          (4)  $150,000 to the department of public safety for vehicle replacement.

          (5)  $150,000 to the department of health for replacement of datamaster units in the forensic alcohol program.

          (6)  $50,000 to the department of buildings and general services for a direct grant to the Northeast Kingdom Human Services Incorporated for building construction in St. Johnsbury.

          (7)  $50,000 to the department for children and families for the category II rental and mortgage arrearage assistance program.

          (8)  $25,000 to the office of military and veterans affairs for a grant for the purchase of vans for the disabled American veteran’s transportation network.

          (9)  $25,000 to the legislature for requirements under Sec. 205c of this act.

          (10)  $50,000 to the department of health for nursing loan repayment for nursing faculty.  These funds shall be used to provide education loan forgiveness or repayment of that debt of up to $10,000.00 per year of service on the nursing faculty of Castleton State College, Norwich University, Vermont Technical College, Southern Vermont College, or the University of Vermont.  Eligibility is for nurses with outstanding educational debt acquired in pursuit of an advanced nursing degree provided he or she either incurred such debt after July 1, 2005 or was first employed on the nursing faculty after July 1, 2005.  Eligibility for this program shall be determined by the department of health, in consultation with schools, providers and the Area Health Education Center (AHEC).  The commissioner may require certification of compliance with this subsection prior to making an award.  In addition, the educational debt forgiveness or repayment program shall be administered in such a way as to comply with the requirements of Section 108(f) of the Internal Revenue Code.

          (11)  $5,000 to the Vermont veterans home for a therapeutic exercise pool study.  The Vermont veterans home shall study adding a physical therapy exercise pool to the facility.  The home shall study issues of space, access, and its complementary nature to other home activities.  Said funds shall be used for the study, with any remainder being held for eventual purchase.

          (12)  $50,000 to the office of economic opportunity for a grant to the community action agencies for individual development accounts.

          (13)  $10,000 to the department of public service to be used for a grant to the Vermont public power supply authority to study the viability of a farm methane renewable energy generation project in Enosburg Falls.

          (14)  $200,000 to the department of fish and wildlife for Camp Kehoe capital needs.

          (15)  $10,000 to the Vermont humanities council as a contribution toward the purchase of a building.

          (16)  $25,000 to the Vermont symphony orchestra for the musical instrument purchase program for a concert grand Steinway piano.

          (17)  $50,000 to the secretary of administration for grants to regional marketing programs.  These grants shall be distributed in the same manner as other regional marketing grants made by the secretary. 

          (18)  $75,000 to the department for children and families for the building  bright spaces for bright futures fund.

          (19)  $60,000 to the legislative council for dairy policy contract consultant services.  These funds are for the sole purpose of retaining a consultant and supporting activities for the promotion of dairy price enhancement through interstate action.  The consultant shall be retained and associated expenditures made at the direction of the chairs of the senate and house committees on appropriations and the chairs and vice chairs of the senate and house committees on agriculture, respectively, with the approval of the president pro tempore of the senate and the speaker of the house.  Additional expenditures for this purpose may be made from funds appropriated to the general assembly with the approval of the president pro tempore of the senate and the speaker of the house.

     (h)  For the purposes of securing a line of credit with the Vermont economic development authority, private non-profit “program for all‑inclusive care for the elderly” (PACE) programs shall be considered an “eligible project” as defined under 10 V.S.A. chapter 12 § 212(6).  Notwithstanding the foregoing, the extension of loans or mortgage insurance pursuant to 10 V.S.A. chapter 12 shall be upon such terms and conditions as the authority may prescribe, including those findings required under 10 V.S.A. chapter 12.  VEDA shall consider such a guarantee prior to July 31, 2005.  $605,000 shall be appropriated to the office of Vermont health access to provide capitalization grants for Vermont‑based PACE centers if the PACE program does not qualify for such a guarantee.

     (i)  Any remaining funds shall be held in the general fund surplus reserve for appropriation during the budget adjustment process.

Sec. 264.  FISCAL YEAR 2006 CONTINGENT APPROPRIATIONS AND

                TRANSFERS

(a)  In the event the official 2006 fiscal year revenue forecast for the available general fund adopted by the emergency board at its July 2005 meeting exceeds $1,015,612,000, not including the first $1,020,000 of any increase attributable to the property transfer tax revenue growth, in excess of the official forecast of January 14, 2005:

(1)  First, in accordance with Sec. 272 of this act, additional payments of interest received during fiscal year 2006 from the Vermont economic development authority upon the authority’s note to the state dated May 15, 2003, shall be paid into the VEDA indemnification fund created in 10 V.S.A. § 222a.

(2)  Second, to the extent the forecast is exceeded, up to $3,415,000 is appropriated to the secretary of administration to fund fiscal year 2006 general fund pay act obligations.

(3)  Third, to the extent the forecast is exceeded, up to $17,000,000 is appropriated to the health access trust fund and shall be considered a “base appropriation” to fund fiscal year 2006 Medicaid obligations.

(4)  Fourth, to the extent the forecast is exceeded, up to $3,400,000 is appropriated to the tax department to supplement funds in Sec. 173 tax department - property tax assistance, to meet income sensitivity needs in fiscal year 2006.

(b)  Any remaining funds after subsection (a) above shall be reserved for appropriations during the fiscal year 2006 budget adjustment process.

Sec. 264a.  PAY ACT FUNDING

     (a)  In the event that the general fund pay act amount of $3,415,000 is not fully funded in subdivisions 263(a)(3) and 264(a)(2) of this act, the emergency board at its July 2005 meeting shall use its transfer authority to ensure that sufficient funds are available to fully fund the pay act general fund appropriation.

Sec. 265.  FISCAL YEAR 2006 TOBACCO SETTLEMENT FUND

                BALANCE

(a)  Notwithstanding 18 V.S.A. § 9502(b), in fiscal year 2006, the balance in the tobacco litigation settlement fund shall remain in the tobacco litigation settlement fund.

Sec. 266.  TRANSFER OF TOBACCO TRUST FUNDS

(a)  Notwithstanding 18 V.S.A. § 9502(a)(3), at the close of fiscal year 2006, the secretary of administration may transfer funds from the tobacco trust fund to the tobacco litigation settlement fund established in 32 V.S.A. § 435a in an amount needed to bring the ending balance of the tobacco litigation settlement fund to $0.00 for fiscal year 2006, but the amount transferred may not exceed the amount withheld from the payment to Vermont by participating manufacturers due in April 2006 under the Master Tobacco Settlement Agreement.  Upon release and deposit of the withheld funds into the tobacco litigation settlement fund, an amount equal to the amount transferred under this provision shall be returned to the tobacco trust fund.

(b)  This section shall not expire June 30, 2006.

Sec. 267.  16 V.S.A. § 2969 is amended to read:

§ 2969.  Payments

* * *

(b)  Reimbursements under sections 2962 and 2963 of this title and for state-placed students under section 2950 of this title for expenditures for the final period of any fiscal year shall be paid from the available funds appropriated for that fiscal year and shall be encumbered for that purpose.

(c)(b)  For the purpose of meeting the needs of students with emotional behavioral problems, each fiscal year the commissioner shall use for training, program development, and building school and regional capacity, up to one percent of the state funds appropriated under this subchapter.

(d)(c)  Each fiscal year the commissioner shall use for the training of teachers, administrators and other personnel in the identification and evaluation of, and provision of education services to children who require educational supports, up to 0.75 percent of the state funds appropriated under this subchapter.  In order to set priorities for the use of these funds, the commissioner shall identify effective practices and areas of critical need.  The commissioner may expend up to five percent of these funds for statewide training and shall distribute the remaining funds to school districts or supervisory unions.  School districts and supervisory unions that apply for funds under this section must submit a plan for training which will result in lasting changes in their school systems and give assurances that at least 50 percent of the costs of training including in‑kind costs will be assumed by the applicant.  The commissioner shall establish written procedures and criteria for the award of such funds.  In addition, the commissioner may identify schools most in need of training assistance and may pay for 100 percent of help provided to these schools.

Sec. 268.  8 V.S.A. § 80 is amended to read:

§ 80.  Insurance regulatory and supervision fund

* * *

(b)  Annually, $30,000.00 shall be transferred from the fund to the fire service training council special fund established in 20 V.S.A. § 3157.

(b)(c)  At the end of each fiscal year, the balance in the insurance regulatory and supervision fund shall be transferred to the general fund.

(c)(d)  The commissioner of finance and management may anticipate receipts to the insurance regulatory and supervision fund and issue warrants based thereon.

Sec. 269.  20 V.S.A. § 3157 is amended to read:

§ 3157.  Fire service training council special fund

The fire service training council special fund is established.  The fund shall be administered by the commissioner of public safety from which payments may be made to support training programs and activities authorized by this chapter, maintenance and operation of any permanent training facilities operated by the council, and the administrative expenses of the council.  The fund shall consist of all monies received from tuitions, contributions, capital grants, or other funds received by the council, transfers from the insurance regulatory and supervision fund under subsection 80(b) of Title 8, and assessments of insurance companies under subsection 8557(a) of Title 32, together with monies appropriated to the fund.  Monies remaining in the fund at the end of any fiscal year shall be carried forward and remain in the fund.  Disbursement from the fund shall be made by the state treasurer on warrants drawn by the commissioner of finance and management.

Sec. 270.  32 V.S.A. § 588(4)(A) is amended to read:

(A)  All monies to be expended from a special fund shall be appropriated annually by the general assembly, or allocated pursuant to the authority granted by the general assembly to the secretary of administration with regard to excess receipts, except when the state responsibility relative to the special fund is solely for the transference of monies between nonstate entities as determined by the commissioner.  No appropriation authorization shall carry forward beyond the fiscal year for which it was granted, except for properly encumbered payments and refunds of prior year expenditures.

Sec. 271.  REPEAL

(a)  16 V.S.A. § 2362 (commissioner of finance and management payments for medical students) is repealed.

Sec. 272.  Sec. 87f of No. 6 of the Acts of 2005 is amended to read:

Sec. 87f.  VEDA; INDEMNIFICATION FUND CAPITALIZATION

(a)  $100,000.00 of the payments of interest received annually during fiscal years 2005, 2006 and 2007 from the Vermont economic development authority upon the authority’s note to the state dated May 15, 2003, shall be paid into the VEDA indemnification fund created in 10 V.S.A. § 222a.

(a)  Capitalization of the indemnification fund created in 10 V.S.A. § 222a is from the annual interest received from the Vermont economic development authority upon the authority’s note to the state dated May 15, 2003 as follows:

(1)  In fiscal years 2005 and 2006, $100,000 of the payments of interest received shall be paid into the indemnification fund.

(2)  In fiscal year 2006, if the available general fund forecast for fiscal year 2006 adopted by the emergency board at its July 2005 meeting exceeds $1,015,612,000, additional interest payments received for fiscal year 2006 shall be paid into the indemnification fund.

(3)  In fiscal year 2007 and thereafter, the annual interest received shall be paid into the indemnification fund.

Sec. 273.  16 V.S.A. § 2885 is amended to read:

§ 2885.  Vermont higher education trust fund

* * *

(c)  In August of each fiscal year, beginning in the year 2000, the state treasurer shall withdraw and divide an amount equal to five percent of the assets equally among the University of Vermont, the Vermont state colleges, and the Vermont student assistance corporation.  In this subsection, “assets” means the average of the fund’s market values at the end of each quarter for the most recent 12 quarters, or all quarters of operation, whichever is less.  Therefore, up to five percent of the fund assets are hereby annually appropriated allocated pursuant to this section, provided that the amount appropriated allocated shall not exceed an amount which would bring the fund balance below the initial appropriation funding made in fiscal year 2000 plus any additional contributions to the principal.  The University of Vermont and the Vermont state colleges shall use the funds to provide nonloan financial aid to Vermont students attending their institutions; the Vermont student assistance corporation shall use the funds to provide nonloan financial aid to Vermont students attending a Vermont postsecondary institution.

(d)  In August During the first quarter of each fiscal year, beginning in the year 2000, the commission on higher education funding may authorize the state treasurer to make an amount equal to up to two percent of the assets available to Vermont public institutions for the purpose of creating or increasing a permanent endowment.  In this subsection, “assets” means the average of the fund’s market values at the end of each quarter for the most recent 12 quarters, or all quarters of operation, whichever is less.  Therefore, up to two percent of the fund assets are hereby annually appropriated allocated pursuant to this section, provided that the amount appropriated allocated shall not exceed an amount which would bring the fund balance below the initial appropriation funding made in fiscal year 2000 plus any additional contributions to the principal.  One-half of the amount appropriated allocated shall be available to the University of Vermont and one-half shall be available to the Vermont state colleges.  The University of Vermont or Vermont state colleges may withdraw funds upon certification by the withdrawing institution to the commissioner of finance and management that it has received private donations which are double the amount it plans to withdraw.

* * *

Sec. 274.  [Deleted] 

Sec. 275.  [Deleted] 

Sec. 276.  WORKING GROUP ON GROWTH CENTERS

     (a)  A legislative working group on growth centers is established to develop proposed legislation to support mixed use development in designated growth centers through local, regional, and state planning, regulatory reforms, and public investment financial incentives.  The working group shall also examine public and private costs associated with development including issues related to agricultural lands mitigation under Act 250.  In addition to other information, the working group shall consider the Report of the Governor’s Committee on Downtowns and Growth Centers, the planning  report of the Vermont Council on Rural Development, the Downtown Development Act, and the provisions of 24 V.S.A. Chapter 117.

     (b)  The working group shall consist of ten members: five members of the senate, appointed by the committee on committees, three coming from the membership of the committee on  natural resources and energy, and one each from the membership of the committee on agriculture and the committee on economic development, housing and general affairs; and five members of the house appointed by the speaker, one from the committee on natural resources and energy, one from the committee on agriculture, one from the committee on commerce, one from the committee on transportation and one from the committee on appropriations.  The working group shall be entitled to meet six times during the 2005 interim.  Members of the working group shall be entitled to compensation and expenses as provided in 32 V.S.A. § 1052.  The legislative council and joint fiscal office shall provide professional and clerical services to the working group, and the resources of the executive branch shall be available to the working group as required.  The report of the working group shall be presented to the general assembly in the form of draft legislation on or before January 15, 2006.

Sec. 277.  18 V.S.A. § 9417 is added to read:

§ 9417.  HEALTH INFORMATION TECHNOLOGY

(a)  The commissioner shall facilitate the development of a statewide health information technology plan that includes the implementation of an integrated electronic health information infrastructure for the sharing of electronic health information among health care facilities, health care professionals, public and private payers, and patients.  The plan shall include standards and protocols designed to promote patient education, patient privacy, physician best practices, electronic connectivity to health care data, and, overall, a more efficient and less costly means of delivering quality health care in Vermont.

(b)  The health information technology plan shall:

(1)  support the effective, efficient, statewide use of electronic health information in patient care, health care policymaking, clinical research, health care financing, and continuous quality improvements;

(2)  educate the general public and health care professionals about the value of an electronic health infrastructure for improving patient care;

(3)  promote the use of national standards for the development of an interoperable system, which shall include provisions relating to security, privacy, data content, structures and format, vocabulary, and transmission protocols;

(4)  propose strategic investments in equipment and other infrastructure elements that will facilitate the ongoing development of a statewide infrastructure; and

(5)  recommend funding mechanisms for the ongoing development and maintenance costs of a statewide health information system.

(c)  The commissioner shall contract with the Vermont information technology leaders (VITL), a broad-based health information technology advisory group that includes providers, payers, employers, patients, health care purchasers, information technology vendors, and other business leaders, to develop the health information technology plan, including applicable standards, protocols, and pilot programs.  In carrying out their responsibilities under this section, members of VITL shall be subject to conflict of interest policies established by the commissioner in the certificate of need regulations to ensure that deliberations and decisions are fair and equitable.

(d)  The following persons shall be members of VITL:

(1)  the commissioner of information and innovation, who shall advise the group on technology best practices and the state’s information technology policies and procedures, including the need for a functionality assessment and feasibility study related to establishing an electronic health information infrastructure under this section;

(2)  the director of the office of Vermont health access or his or her designee; and

(3)  the commissioner or his or her designee. 

(e)  On or before July 1, 2006, VITL shall initiate a pilot program involving at least two hospitals using existing sources of electronic health information to establish electronic data sharing for clinical decision support, pursuant to priorities and criteria established in conjunction with the health information technology advisory group.  Objectives of the pilot program may include:

(1)  supporting patient care and improving quality of care;

(2)  enhancing productivity of health care professionals and reducing administrative costs of health care delivery and financing;

(3)  determining whether and how best to expand the pilot program on a statewide basis;

(4)  implementing strategies for future developments in health care technology, policy, management, governance, and finance; and

(5)  ensuring patient data confidentiality at all times. 

(f)  The standards and protocols developed by VITL shall be no less stringent than the  “Standards for Privacy of Individually Identifiable Health Information” established under the Health Insurance Portability and Accountability Act of 1996 and contained in 45 C.F.R., Parts 160 and 164, and any subsequent amendments.  In addition, the standards and protocols shall ensure that there are clear prohibitions against the out-of-state release of individually identifiable health information for purposes unrelated to treatment, payment, and health care operations, and that such information shall under no circumstances be used for marketing purposes.  The standards and protocols shall require that access to individually identifiable health information is secure and traceable by an electronic audit trail.

(g)  On or before January 1, 2007, VITL shall submit to the commissioner, the commissioner of information and innovation, the director of the office of Vermont health access, and the general assembly a health information technology plan for establishing a statewide, integrated electronic health information infrastructure in Vermont, including specific steps for achieving the goals and objectives of this section.  The plan shall include also recommendations for self‑sustainable funding for the ongoing development, maintenance, and replacement of the health information technology system.  Upon recommendation by the commissioner and approval by the general assembly, the plan shall serve as the framework within which certificate of need applications for information technology are reviewed under section 9440b of this title by the commissioner.

(h)  Beginning January 1, 2006, and annually thereafter, VITL shall file a report with the commissioner, the commissioner of information and innovation, the director of the office of Vermont health access, and the general assembly.  The report shall include an assessment of progress in implementing the provisions of this section, recommendations for additional funding and legislation required, and an analysis of the costs, benefits, and effectiveness of the pilot program authorized under subsection (e) of this section, including, to the extent these can be measured, reductions in tests needed to determine patient medications, improved patient outcomes, or reductions in administrative or other costs achieved as a result of the pilot.  In addition, VITL shall file quarterly progress reports with the health access oversight committee and shall publish minutes of VITL meetings and any other relevant information on a public website.

(i)  VITL is authorized to seek matching funds to assist with carrying out the purposes of this section.  In addition, it may accept any and all donations, gifts, and grants of money, equipment, supplies, materials, and services from the federal or any local government, or any agency thereof, and from any person, firm, or corporation for any of its purposes and functions under this section and may receive and use the same subject to the terms, conditions, and regulations governing such donations, gifts, and grants.

(j)  The commissioner, in consultation with VITL, may seek any waivers of federal law, rule, or regulation that might assist with implementation of this section.

Sec. 277a.  18 V.S.A. § 9437(4) and (5) are amended and (6) is added to read:

(4)  in the case of a proposal for the addition of beds for the provision of skilled nursing or intermediate care, the number of beds to be approved is not inconsistent with the considerations identified under subsection 9439(e) of this title; and

(5)  The the proposed new health care project is consistent with the certificate of need guidelines published by the department in accordance with its rules, and is within the portion of the unified health care budget applicable to the proposed health care facility; and

(6)  if the application is for the purchase or lease of new health care information technology, it conforms with the health information technology plan established under section 9417 of this title, upon approval of the plan by the general assembly.

Sec. 277b.  18 V.S.A. § 9440b is added to read:

§ 9440b.  INFORMATION TECHNOLOGY; REVIEW PROCEDURES

     Notwithstanding the procedures in section 9440 of this title, upon approval by the general assembly of the health information technology plan developed under section 9417 of this title, the commissioner shall establish by rule standards and expedited procedures for reviewing applications for the purchase or lease of health care information technology that otherwise would be subject to review under this subchapter.  Such applications may not be granted or approved unless they are consistent with the health information technology plan and the health resource allocation plan.  The commissioner’s rules may include a provision requiring that applications be reviewed by the health information advisory group authorized under subsection 9417(c) of this title.  The advisory group shall make written findings and a recommendation to the commissioner in favor of or against each application.

Sec. 277c.  COMMISSION ON HEALTH CARE REFORM

(a)  There is established a commission on health care reform.  The commission, under the direction of co-chairs who shall be appointed by the speaker of the house and president pro tempore of the senate, shall monitor health care reform and recommend to the general assembly actions needed to attain the health care guidelines and goals set out in H.524 as passed by the house and senate.

(b)  Members of the commission shall include four representatives appointed by the speaker of the house, four senators appointed by the committee on committees, and two nonvoting members appointed by the governor. 

(c)  Beginning in the interim of the 2005 legislative session through July 1, 2009, the commission shall:

(1)  identify and report emerging trends and behaviors among various participants in the health care system;

(2)  assess the effectiveness of cost-containment and quality of care initiatives;

(3)  establish recommendations to the general assembly for demonstration or pilot projects designed to contain health care costs, improve the quality of health care, and to integrate systems of care that promote:  community-based evaluation and planning, improved financial management, information technology systems that advance the management and coordination of health care, governance models at the community level, and patient responsibility for and participation in health care decision making;

(4)  direct the studies established under Sec. 277d of this act;

(5)  develop a plan for creating an integrated, regional delivery system and developing integrated systems of care that:  (1) reorganize the health care delivery system to improve coordination, reduce medical errors, and reduce redundant or unnecessary care, (2) improve the quality of care in terms of process and outcomes, and (3) encourage alternative reimbursement mechanisms based on outcome-based payments to change the incentives for health care professionals and to control health care costs;

(6) make recommendations to the general assembly for a program to provide matching grants for long-term investments in health care systems, technology, and infrastructure in a manner that promotes the establishment of integrated systems of care;

(7)  assess the feasibility of:

(A)  a publicly financed stop-loss insurance policy for all health plans doing business in Vermont;

(B)  a public health care program that incorporates the health benefits covered under workers’ compensation policies;

(C)  tort reform consistent with the findings and recommendations of the medical malpractice study authorized under Sec. 292 of No. 122 of the Acts of the 2003 Adj. Sess (2004); and

(D)  a health care purchasing pool as described in Sec. 26 of H.524 as passed by the house and senate;

(8)  recommend alternative reimbursement mechanisms for health services that encourage cost effectiveness, improve the quality of care,  increase efficiency, reward primary care practices that prevent chronic illnesses, avoid preventable hospitalizations, and reduce long-term costs to the system, including a global hospital payment to each hospital. For the purposes of this section, “global hospital payment” means an amount to be paid to a hospital by each health insurer, employer or the state for services received at that hospital by all individuals covered by a health benefit plan offered by or through that insurer, employer or the state. A global hospital payment may be accomplished through negotiations between insurers or employers and hospitals, by requiring all public and private health insurers to pay for hospital services using this method to the extent permitted under federal law, or by another mechanism;

(9)  receive input and make recommendations, generally, to the house committees on health care and ways and means, the senate committees on health and welfare and finance and the general assembly regarding the long‑term development of policies and programs designed to ensure that, by 2009, Vermont has an integrated system of care that provides all Vermonters access to affordable, high quality health care that is financed in a fair and equitable manner; and

(10)  cooperate and coordinate with the public engagement process established in Sec. 277e of this act to receive public input on a health care reform plan.

(d)  The commission shall select, subject to final approval by the speaker of the house and the president pro tempore of the senate, the services of one full‑time director and such other staff as is needed, and shall receive administrative, fiscal, and legal support from the joint fiscal office and the legislative council.  The director shall have expertise in finance, planning, systems analysis, and processes involving weighing competing interests among parties.  In addition, with the approval of the speaker of the house and the president pro tempore of the senate, the commission may retain the services of one or more consultants or experts knowledgeable in health care systems, financing, or delivery to assist in its work and may request funding from the legislative budget.

(e)  The commission may request analysis from the office of Vermont health access, the department of banking, insurance, securities, and health care administration, and other appropriate agencies.  The agencies shall report to the commission at such times and with such information as the commission determines is necessary to fulfill its oversight responsibilities.

(f)  The commission may meet as needed and members shall be entitled to compensation and expenses as provided in 2 V.S.A. § 406.

(g)  The department of buildings and general services shall provide the commission with office space near the state capitol building in Montpelier for three individuals.

     (h)  To staff this commission, the legislature is authorized to establish three (3) new exempt positions – one (1) commission director and two (2) commission research/support staff in fiscal year 2005.

Sec. 277d.  HEALTH CARE REFORM; ECONOMIC, FINANCING, AND

                   ADMINISTRATIVE STUDIES

(a)  In order to assess more fully the benefits and costs and to prepare and plan for the implementation of full and universal access to health care in Vermont, the commission on health care reform, in consultation with the department of banking, insurance, securities, and health care administration, shall direct that the following economic impact, financing, and governance studies be undertaken during the interim of the 2005 legislative session.  The commission shall direct its staff or contract for one or more consultants to undertake the economic impact and financing studies authorized by this section.

(1)  Economic impact study.  The economic impact study shall examine the impact of implementing a system of universal access to health care for Vermonters versus the effects of sustaining the current system impact on business and the labor force, the future growth of the economy and the economic competitiveness of Vermont, and the effects on residents and population groups and on current and potential insurers and providers of health care.

(2)  Financing options.  The financing study shall examine the financing options that most effectively achieve the goal of universal access to health care and maintaining its affordability.  The study shall include examination of all financing options and their implications, including the income tax, a payroll tax, premiums or cost-sharing measures, consumption taxes, specific more limited taxes to support parts of the health care system’s financial needs, and other revenue sources including insurance risk pools and insurance assistance and incentives.

(A)  The study shall reference the fact and supporting empirical evidence that many countries have achieved universal access and more affordable health care utilizing public financing as a tool to achieve this goal. The study shall consider the strengths and weaknesses of such public financing systems with respect to fairness and adequacy of funding, access to and quality of services.

(B)  The study shall examine how implementation of any public financing options will be offset in corresponding reductions in premiums, other taxes, and individual cost-sharing contributions.

(C)  The study shall examine how any proposed changes in financing or delivery of health care could affect benefits Vermonters currently receive through Vermont employers.

(D)  The study shall address issues involved with federal law and taxation, including ERISA and other areas of preemption; technical proposals to exempt non-resident employees of Vermont businesses; a provision to ensure a soft landing for affected businesses and a recommendation as to the appropriate amount needed in a soft landing provision to mitigate negative effects on business; recommendations on the best method for unemployed individuals to contribute to the financing; a simplified structure based on employee numbers, employer payroll, or a combination for ease of administration and clarity; and the recommendations of the tax department. 

(E)  The study shall analyze methods for recapturing insurance premiums as a result of any reductions in uncompensated care, such as the Dirigo model enacted in the state of Maine, any reductions in insurance premiums resulting from public financing, and for ensuring that all Vermonters contribute to the financing of health care’s fixed costs.

(3)  Governance and administrative study.  The secretary of administration, in consultation with the office of Vermont health access, the department of banking, insurance, securities, and health care administration, and the agency of human services, shall examine and develop a plan for reorganizing their respective offices and functions to further full and universal access to health care in Vermont and the integration of the health care system. The recommendations shall include personnel, operations, and budgetary requirements and consider the most appropriate and efficient approach to integrating health care policy, planning, delivery, regulation, and defining clear lines of accountability within the health care system.  The study shall include also an examination of means to coordinate or integrate a universal health care system with the current workers’ compensation system and the feasibility and merits of authorizing the state to act as an insurer in pooling risk and providing benefits, including a common benefits plan, to participants of the health care purchasing pool.

(b)  Reports, including findings and recommendations, from each study required by this section shall be submitted to the general assembly not later than January 15, 2006.

Sec. 277e.  PUBLIC ENGAGEMENT PROCESS

(a)  In recognition of the importance of public engagement, the house committee on health care and the senate committee on health and welfare shall have six public hearings during the interim of the 2005 legislative session to solicit input from citizens, employers, hospitals, health care professionals, insurers, other stakeholders, and interested parties about health care reform.

(b)  Throughout the interim, the commission on health care reform at the request of the chairs of the committees shall brief the committees on the commission’s activities and recommendations to date.

(c)  For attendance at meetings, committee members shall be entitled to compensation and expenses as provided in 2 V.S.A. § 406.

Sec. 277f.  FEDERALLY QUALIFIED HEALTH CENTER (FQHC)

                  LOOK-ALIKES; CAPITALIZATION GRANTS; CASE

                  MANAGEMENT

     (a)  Funds appropriated in Sec. 263(e)(4) of this act to the department of health shall be expended for the purpose of providing to federally qualified health center (FQHC) look-alikes funds for initial capitalization and to establish an income‑sensitized sliding scale fee schedule for patients of these organizations.  In distributing the grants, the department shall consider ensuring the geographic distribution of health centers around the state as well as criteria under federal law.  Initial priority shall be given to health centers in Lamoille, Washington, and Windsor/Windham counties, and other counties that demonstrate readiness to achieve look-alike status.  The goal shall be to ensure there are FQHC look-alikes in each county in Vermont.

Sec. 278.  PUBLICLY OPERATED MANAGED CARE ORGANIZATION

(a)  To enable the state to manage public resources effectively, while preserving and enhancing access to health care services in the state, the office of Vermont health access is authorized to serve as a publicly operated managed care organization (MCO).

(b)  As the publicly operated MCO, the office of Vermont health access shall be responsible for the overall management of the health care delivery system and for reimbursement of all eligible services as may be provided by state or federal law.

(c)  The office of Vermont health access shall be exempt from any health maintenance organization (HMO) or MCO statutes in Vermont law and shall not be considered to be an HMO or MCO for purposes of state regulatory and reporting requirements.

(d)  Upon approval of the global commitment by the federal Centers for Medicare and Medicaid Services and by the Vermont general assembly, the office of Vermont health access shall report to the health access oversight committee and the joint fiscal committee in a manner and at a frequency to be determined by the committees.  Reporting shall, at a minimum, enable the tracking of expenditures by eligibility category, the type of care received, and to the extent possible allow historical comparison with expenditures under the previous Medicaid appropriation model (by department and program) and, if appropriate, to the amounts transferred by the department to the office of Vermont health access.  Reporting shall include spending in comparison to any applicable budget neutrality standards.

(e)  In the event the Global Commitment to Health section 1115a Demonstration Waiver is approved by the federal government and requires the creation of a new department, the governor shall create a new department, the department of health access (TDHA), an independent department within Vermont state government. The office of Vermont health access with its current duties will be subsumed by the department of health access. 

Sec. 279.  VHAP PREMIUM ADJUSTMENTS

Sec. 147(d) of No. 66 of the Acts of 2003, as amended by Sec. 129 of No. 122 of the Acts of the 2003 Adj. Sess. (2004), is further amended to read:

(d)  VHAP, premium-based.

* * *

(2)  The department agency shall establish per individual premiums for the VHAP Uninsured program for the following brackets of income for the VHAP group as a percentage of federal poverty level (FPL):

(A)  Income greater than 50 percent and less than or equal to 75 percent of FPL:  $10.00 $11.00 per month.

(B)  Income greater than 75 percent and less than or equal to 100 percent of FPL:  $35.00 $39.00 per month.

(C)  Income greater than 100 percent and less than or equal to 150 percent of FPL:  $45.00 $50.00 per month.

(D)  Income greater than 150 percent and less than or equal to 185 percent of FPL:  $65.00 $75.00 per month.

Sec. 280.  DR. DYNASAUR AND SCHIP PREMIUM ADJUSTMENTS 

Sec. 147(f) of No. 66 of the Acts of 2003 is amended to read:

(f)  Dr. Dynasaur and SCHIP premium changes.

(1)  The department agency is authorized to amend the rules for individuals eligible for Dr. Dynasaur under the federal Medicaid and SCHIP programs to require beneficiary households to pay a monthly premium based on the following:

(A)  for individuals living in households whose incomes are greater than 225 percent of FPL and less than or equal to 300 percent of FPL, and who have no other insurance coverage:  $70.00 $80.00 per household per month.

(B)  for individuals living in households whose incomes are greater than 225 percent of FPL and less than or equal to 300 percent of FPL, and who have other insurance coverage:  $35.00 $40.00 per household per month.

(C)  for individuals living in households whose incomes are greater than 185 percent of FPL and less than or equal to 225 percent of FPL:  $25.00 $30.00 per household per month.

* * *

Sec. 281.  REPORTS ON DISENROLLMENT

(a)  The department for children and families and the office of Vermont health access shall monitor and evaluate and report quarterly beginning July 1, 2005 on the following:

(1)  The disenrollment in each of the programs subject to premiums;

(2)  The number of beneficiaries receiving termination notices for failure to pay premiums;

(3)  The number of beneficiaries terminated from coverage as a result of failure to pay premiums as of the second business day of the month following the termination notice.  The number of beneficiaries terminated from coverage for nonpayment of premiums shall be reported by program and income level within each program; and

(4)  The number of beneficiaries terminated from coverage as a result of failure to pay premiums whose coverage is not restored three months after the termination notice. 

(b)  The department and the office shall submit reports required by subsection (a) of this section to the house and senate committees on appropriations, the senate committee on health and welfare, the house committee on human services, the health access oversight committee, and the Medicaid advisory board at the end of each quarter.

Sec. 282.  33 V.S.A. § 1950(a) and (b) are amended to read:

(a)  The purpose of this subchapter is to establish a revolving fund consisting of assessments from on health care providers, which funds shall be used in the state’s health care program in such a way as to be eligible for federal financial participation.

(b)  The secretary and the commissioner director shall interpret and administer the provisions of this subchapter so as to maximize federal financial participation and avoid disallowances of federal financial participation.

Sec. 283.  33 V.S.A. § 1951 is amended to read:

§ 1951.  DEFINITIONS

As used in this subchapter:

(1)  “Assessment” means a tax levied on a health care provider pursuant to this chapter.

(2)  “Commissioner” means the commissioner of prevention, assistance, transition, and health access, or a designee.

(3)  “Core home health care services” means those medically-necessary skilled nursing, home health aide, therapeutic, and persona1 care attendant services, provided exclusively in the home by home health agencies.  Core home health services do not include private duty nursing, hospice, homemaker or physician services, or services provided under early periodic screening and, diagnostic services diagnosis, and treatment (EPSDT), traumatic brain injury (TBI), high technology programs, or services provided by a home for the terminally ill as defined in subdivision 7102(10) of this title.

(4)(3)  “Department” means the department of prevention, assistance, transition, and health access “Director” means the director of the office of Vermont health access.

(5)(4)  “Fund” means the Vermont health care access trust fund consisting primarily in part of assessments from health care providers under this subchapter.

(6)(5)  “Health care provider” means any hospital, nursing home, intermediate care facility for the mentally retarded, or home health agency, or retail pharmacy.

(7)(6)  “Home health agency” means an entity that has received a certificate of need from the state to provide home health services or is certified by the state to provide services pursuant to 42 U.S.C. § 1395x(o).

(8)(7)  “Hospital” means a hospital licensed under chapter 43 of Title 18.

(9)(8)  “Intermediate Care Facility for the Mentally Retarded” (“ICF/MR”) means a facility which provides long-term health related care to residents with mental retardation pursuant to section subdivision 1902(a)(31) of the Social Security Act (42 U.S.C. § 1396a(a)(31)).

(10)(9)  “Mental hospital” or “psychiatric facility” means a hospital as defined in 18 V.S.A. § 1902(a)(2) or (8) 18 V.S.A. § 1902(1)(B) or (H), but does not include psychiatric units of general hospitals.

(11)(10)  “Net operating revenues” means a provider’s gross charges less any deductions for bad debts, charity care, contractual allowances, and other payer discounts.

(12)(11)  “Nursing home” means a health care facility licensed under chapter 71 of Title 33 this title.

(12)  “Office” means the office of Vermont health access.

(13)  “Pharmacy” means a Vermont drug outlet licensed by the Vermont state board of pharmacy pursuant to chapter 36 of Title 26 in which prescription drugs are sold at retail.

(14)  “Secretary” means the secretary of the agency of human services.

Sec. 284.  33 V.S.A. § 1952(b) is amended to read:

(b)  The department office may use not more than one percent of the assessments received under the provisions of this subchapter for necessary administrative expenses associated with this subchapter.

Sec. 285.  33 V.S.A. § 1953 is amended to read:

§ 1953.  HOSPITAL ASSESSMENT

(a)  Hospitals shall be subject to an annual assessment as follows:

(1)  Beginning July 1, 2004 2005, each hospital’s annual assessment, except for hospitals assessed under subdivision (2) of this subsection, shall be 4.54 6.0 percent of its net patient revenues (less chronic, skilled, and swing bed revenues) for the most recent completed hospital hospital’s fiscal year as determined annually by the commissioner director from the hospital’s financial reports and other data filed with the department of banking, insurance, securities, and health care administration before December 1 of the previous yearThe annual assessment shall be based on data from a hospital’s third most recent full fiscal year.

* * *

(b)  Each hospital shall be notified in writing by the department office of the assessment made pursuant to this section.  If no hospital submits a request for reconsideration under section 1958 of this title, the assessment shall be considered final.

(c)  Each hospital shall submit its assessment to the department office according to a payment schedule adopted by the commissioner director. Variations in payment schedules shall be permitted as deemed necessary by the commissioner director.

(d)  Any hospital that fails to make a payment to the department office on or before the specified schedule, or under any schedule for delayed payments established by the commissioner director, shall be assessed not more than $1,000.00.  The commissioner shall director may waive this late payment assessment provided for in this subsection for good cause shown by the hospital.

Sec. 286.  33 V.S.A. § 1954 is amended to read:

§ 1954.  NURSING HOME ASSESSMENT

(a)  Beginning July 1, 2004 2005, each nursing home’s annual assessment rate shall be $3,787.79 per bed licensed pursuant to section 7105 of this title on June 30 of the immediately preceding fiscal year shall be as follows:

(1)  Until such time as the United States Department of Health and Human Services grants a waiver to the uniform assessment rate, pursuant to 42 C.F.R. § 433.68(e), all licensed nursing home beds shall be assessed at the uniform rate of $3,676.06.

(2)  At such time as the United States Department of Health and Human Services grants a waiver to the uniform assessment, the assessment shall be $4,000.00 per bed for privately-owned nursing homes with more than 30 licensed beds, $1,900.00 per bed for privately-owned nursing homes with 30 beds or fewer, and $100.00 per bed for state-owned or operated nursing homes.  If a waiver is granted, these rates shall be retroactive to the effective date of this subsection and any difference between the assessments under this subdivision and the payments under subdivision (1) of this subsection shall be reconciled by the collection of underpayments and the refund of overpayments.

(3)  The annual assessment for each bed licensed as of the beginning of the fiscal year shall be prorated for the number of days during which the bed was actually licensed and any over payment shall be refunded to the facility.  To receive the refund, a facility shall notify the commissioner director in writing of the size of the decrease in the number of its licensed beds and dates on which the beds ceased to be licensed.

(b)  The department office shall provide written notification of the assessment amount to each nursing home.  The assessment amount determined shall be considered final unless the home requests a reconsideration.  Requests for reconsideration shall be subject to the provisions of section 1958 of this title.

(c)  Each nursing home shall submit its assessment to the department office according to a schedule adopted by the commissioner director.  The commissioner director may permit variations in the schedule of payment as deemed necessary.

(d)  Any nursing home that fails to make a payment to the department office on or before the specified schedule, or under any schedule of delayed payments established by the commissioner director, shall be assessed not more than $1,000.00.  The commissioner shall director may waive this late-payment assessment provided for in this subsection for good cause shown by the nursing home.

Sec. 287.  33 V.S.A. § 1955 is amended to read:

§ 1955.  ICF/MR ASSESSMENT

(a)  Each ICF/MR’s annual assessment shall be six percent of the ICF/MR’s total annual direct and indirect expenses for the most recently settled ICF/MR audit.

(b)  The department office shall provide written notification of the assessment amount to each ICF/MR.  The assessment amount determined shall be considered final unless the facility requests a reconsideration.  Requests for reconsideration shall be subject to the provisions of section 1958 of this title.

(c)  Each ICF/MR shall remit its assessment to the department office according to a schedule adopted by the commissioner director.  The commissioner director may permit variations in the schedule of payment as deemed necessary.

(d)  Any ICF/MR that fails to make a payment to the department office on or before the specified schedule, or under any schedule of delayed payments established by the commissioner director, shall be assessed not more than $1,000.00.  The commissioner shall director may waive this late-payment assessment provided for in this subsection for good cause shown by the ICF/MR.

Sec. 288.  33 V.S.A. § 1955a is amended to read:

§ 1955a.  HOME HEALTH AGENCY ASSESSMENT

(a)  Beginning July 1, 2003 2005, each home health agency’s assessment shall be 16.0 18.45 percent of its net operating revenues from core home health care services, excluding revenues for services provided under Title XVIII of the federal Social Security Act.  The amount of the tax shall be determined by the commissioner director based on the home health agency’s most recent audited financial statements at the time of submission, a copy of which shall be provided on or before December 1 of each year to the office of Vermont health accessFor providers who begin operations as a home health agency after January 1, 2005, the tax shall be assessed as follows:

(1)  Until such time as the home health agency submits audited financial statements for its first full year of operation as a home health agency, the director, in consultation with the home health agency, shall annually estimate the amount of tax payable and shall prescribe a schedule for interim payments.

(2)  At such time as the full-year audited financial statement is filed, the final assessment shall be determined, and the home health agency shall pay any underpayment or the office shall refund any overpayment.  The assessment for the state fiscal year in which a provider commences operations as a home health agency shall be prorated for the proportion of the state fiscal year in which the new home health agency was in operation.

(b)  Each home health agency shall be notified in writing by the department office of the assessment made pursuant to this section.  If no home health agency submits a request for reconsideration under section 1958 of this title, the assessment shall be considered final.

(c)  Each home health agency shall submit its assessment to the department office according to a payment schedule adopted by the commissioner director. Variations in payment schedules shall be permitted as deemed necessary by the commissioner director.

(d)  Any home health agency that fails to make a payment to the department office on or before the specified schedule, or under any schedule for delayed payments established by the commissioner director, shall be assessed not more than $1,000.00.  The commissioner shall director may waive this late payment assessment provided for in this subsection for good cause shown by the home health agency.

Sec. 289.  33 V.S.A. § 1955b is added to read:

§ 1955b.  PHARMACY ASSESSMENT

(a)  Beginning July 1, 2005, each pharmacy’s monthly assessment shall be $0.10 for each prescription filled and refilled.

(b)  Each pharmacy shall declare and provide supporting documentation to the director of the total number of prescriptions filled and refilled in the previous month and remit the assessment due for that month.  The declaration and payment shall be due by the end of the following month.

(c)  Each pharmacy shall submit its assessment payment to the office monthly.  Variations in payment timing shall be permitted as deemed necessary by the director.

(d)  Any pharmacy that fails to pay an assessment to the office on or before the due date shall be assessed a late payment penalty of two percent of the assessment amount for each month it remains unpaid; but late payment penalties for any one quarter shall not exceed $500.00.  The director may waive a penalty under this subsection for good cause shown by the pharmacy, as determined by the director in his or her discretion.

Sec. 290.  REPEAL OF ASSESSMENT SUNSETS

(a)  Sec. 205 of No. 49 of the Acts of 1999, as amended by Sec. 18 of No. 65 of the Acts of 2001 and Sec. 311 of No. 66 of the Acts of 2003 (sunset of home health agency assessment), is repealed.

(b)  Sec. 4 of No. 56 of the Acts of 1993, as amended by Sec. 11 of No. 14 of the Acts of 1995, Sec. 71 of No. 59 of the Acts of 1997, Sec. 198 of No. 49 of the Acts of 1999, Sec. 17 of No. 65 of the Acts of 2001, and Sec. 312 of No. 66 of the Acts of 2003 (sunset of hospital assessment and nursing home assessment), is repealed.

Sec. 291.  33 V.S.A. § 1956 is amended to read:

§ 1956.  HEALTH CARE TRUST FUND PROCEEDS FROM 

              ASSESSMENTS

(a)  The health care trust fund is hereby established in the state treasury is abolished.  All remaining assets in the health care trust fund shall be deposited in the Vermont health access trust fund established by section 1972 of this title.  All assessments, including late-payment assessments, from health care providers under this subchapter shall be deposited in the Vermont health access trust fund established in section 1972 of this titleThe proceeds of other taxes designated by law and donations may also be deposited in the fund. Interest earned on the fund and any remaining balance shall be retained in the fund for the purposes of this subchapter.  The department shall maintain records showing the amount of money in the fund at any time.

(b)  All monies received from or generated to the fund shall be used for the state portion of Medicaid expenditures and for administration of provisions of this subchapter under subsection 1952(c) of this title.  Of the net revenues generated by the per bed annual assessment on nursing homes under subsection 1954(a) of this title, the net revenues generated by $200.00 per bed shall be used for home- and community-based Medicaid waiver services and the net revenues generated by $1,768.69 per bed, less the total amount of the state share of the inflation factor adjustments for state fiscal year 2002, as calculated by the division of rate setting pursuant to subsection 905(c) of this title, shall be used solely for Medicaid nursing home reimbursement as follows:

(1)  Beginning on July 1, 1999, until such time as all cost categories have been rebased pursuant to section 905(c) of this title on a base year no earlier than 2002, wage supplements shall be paid on a schedule to be determined by the commissioner.  Such supplements shall be based on the change in expenditures incurred on or after January 1, 1999, as determined by the division of rate setting, for wages, salaries and fringe benefits incurred by nursing homes for direct care staff and for other employee groups in nursing homes, other than owners and administrators (net expenditures).  The division of rate setting shall annually calculate the net expenditures for each nursing home.  Notwithstanding subsection 905(c) of this title or any other provision of law, the change of base year for any component of the nursing home payment rate shall not be made later than January 1, 2005.

(2)  The wage supplement shall not be subject to any payment limitations imposed pursuant to section 907 of this title.  The aggregate amount of the wage supplements paid to all nursing homes during any fiscal year shall not exceed the net revenues from the nursing home assessments set aside for that purpose for that year plus the federal matching funds for those net revenues.  The annual wage supplement payment for a nursing home shall be its proportional share of the net revenues, based on the ratio of its nursing wages, salaries and fringe benefits paid by the nursing home for direct care staff and for other employee groups, other than owners and administrators, to the total for all nursing homes participating in the Vermont Medicaid program in the 1997 cost reports.

(3)  After all cost categories have been rebased, wage supplements shall cease.  To the extent that total net expenditures by a nursing home are less than the total wage supplement payments to that home, the excess shall be deemed an overpayment and shall be recouped from the home on a schedule to be determined by the commissioner and deposited in the health care trust fund.

(4)  No wage supplement payments shall be made until such time as the lawsuit filed by nursing homes against the state of Vermont now pending in Washington superior court is dismissed with prejudice.

(c)  On or before January 1, 2000, the commissioner shall report to the general assembly on the operation of the health care trust fund and wage supplements.

(d)  No provision of this subchapter shall permit the state to reduce the level of state funds expended on the nursing home Medicaid program in any fiscal year below the level expended in fiscal year 1991 from the general fund for the nursing home Medicaid program.

(e)  The general assembly shall appropriate funds from the health care trust fund to the department of prevention, assistance, transition, and health access, the department of aging and disabilities, and the department of developmental and mental health services, and such funds shall be transferred to the departments’ Medicaid and administrative appropriations as requested by the departments to carry out the purposes of this subchapter.

Sec. 292.  33 V.S.A. § 1957 is amended to read:

§ 1957.  AUDITS

The commissioner director may require the submission of audited information as needed from health care providers to determine that amounts received from health care providers were correct.  If an audit identifies amounts received due to errors by the department office, the commissioner director shall make payments to any health care provider which the audit reveals paid amounts it should not have been required to pay.  Payments made under this section shall be made from the fund.

Sec. 293.  33 V.S.A. § 1958 is amended to read:

§ 1958.  APPEALS

(a)  Any health care provider may submit a written request to the department office for reconsideration of the determination of the assessment within 20 days of notice of the determination.  The request shall be accompanied by written materials setting forth the basis for reconsideration.  If requested, the department office shall hold a hearing within 20 days from the date on which the reconsideration request was received.  The department office shall mail written notice of the date, time, and place of the hearing to the health care provider at least 10 days before the date of the hearing.  On the basis of the evidence submitted to the department office or presented at the hearing, the department office shall reconsider and may adjust the assessment.  Within 20 days of the hearing, the department office shall provide notice in writing to the health care provider of the final determination of the amount it is required to pay based on any adjustments made by it.  Proceedings under this section are not subject to the requirements of 3 V.S.A. chapter 25.

(b)  Upon request, the commissioner director shall enter into nonbinding arbitration with any health care provider dissatisfied with the department’s office’s decision regarding the amount it is required to pay.  The arbitrator shall be selected by mutual consent, and compensation shall be provided jointly.

(c)  Any health care provider may appeal the decision of the department office as to the amount it is required to pay either before or after arbitration, to the superior court having jurisdiction over the health care provider.

Sec. 294.  33 V.S.A. § 1971(3) is amended to read:

(3)  “Office of Vermont health access” means the division office of Medicaid within the agency of human services.

Sec. 295.  33 V.S.A. § 1972 is amended to read:

§ 1972.  VERMONT HEALTH ACCESS TRUST FUND ESTABLISHED

(a)  The Vermont health access trust fund is hereby established in the state treasury for the purpose of establishing a special fund to be the single source to finance health care coverage for beneficiaries of all state health care assistance programs administered by the department of prevention, assistance, transition, and health access agency.

(b)  Into the fund shall be deposited:

* * *

(2)  revenue from health care provider assessments collected and deposited into the health care trust fund pursuant to subchapter 2 of chapter 19 of this title;

* * *

(c)  The fund shall be administered pursuant to subchapter 5 of chapter 7 of Title 32, except that interest earned on the fund and any remaining balance shall be retained in the fund.  The department agency shall maintain records indicating the amount of money in the fund at any time.

(d)  All monies received by or generated to the fund shall be used only for the administration and delivery of health care covered through state health care assistance programs administered by the department of prevention, assistance, transition, and health access agency, including the Medicaid program, the Vermont health access plan program, the Vermont health access plan‑pharmacy program, the VScript program, the VScript-Expanded program, the state children’s health insurance program, the General Assistance program, and any other state health care assistance program administered directly or indirectly by or through the department agency.

Sec. 296.  MEDICAID PROGRAM ADMINISTRATION

(a)  Twenty-four-hour coverage.  The office of Vermont health access shall establish a telephone line, staffed by physicians or nurses, which shall be available, initially,  to medically complex beneficiaries at all times, 24 hours each day of the week, to provide appropriate advice to these beneficiaries and to improve communications between these beneficiaries and their caregivers.  The office shall take active steps to ensure that these beneficiaries and their providers are knowledgeable about the 24/7 telephone line. 

(b)  Care coordination.  The office shall establish a program to assist in improving care by providing coordination among the multiple providers who treat individuals with serious illnesses.  Goals of the program shall be collaboration and patient involvement in care, while promoting clinically appropriate and cost efficient services.

     (c)  The office, in collaboration with the department of aging and independent living, shall undertake a study of ways to improve coordination of long‑term and acute care for individuals served by the state’s long‑term care waiver.

(d)  The office shall establish a program to improve planning for post‑hospital care to be provided during the patient’s hospital stay and to assist in post-discharge care.

(e)  Sole source authority.  Notwithstanding current state laws, including 3 V.S.A. § 222(g), and regulations to the contrary and in order to implement the program changes required by this act during state fiscal year 2006, including system development, actuarial certification, pharmaceutical counter‑detailing, preferred drug list data analysis, and outreach services, the secretary of the agency of human services may negotiate sole source contracts to meet the implementation deadlines in this act.

Sec. 297.  MEDICAID COVERAGE; DENTURES; EYEGLASSES

(a)  The health access oversight committee of the legislature shall review the costs, benefits, and financing alternatives of including coverage for full dentures, partial dentures, and eyeglasses under the Medicaid program.  In this review, the committee shall have the assistance of the office of Vermont health access, the joint fiscal office, and the legislative council.  The committee shall report its findings and recommendations to the general assembly no later than January 15, 2006.

Sec. 298.  CHIROPRACTIC BENEFITS FOR ADULTS

(a)  The office of Vermont health access shall design a chiropractic trial to begin in state fiscal year 2007.  This trial shall be predicated upon and will proceed only if federal financial participation can be secured for the trial.  The trial shall include limited diagnoses where chiropractic services, identified by the office of Vermont health access, shall be covered for the duration of the trial.  The study period shall include an analysis of both the clinical efficacy of chiropractic treatment for the diagnoses identified along with a comparison to other treatment modalities for the same diagnoses and a financial analysis of the different treatment modalities.  At the conclusion of the trial period and upon confirmation from the centers for Medicare and Medicaid services that federal financial participation would be available, a recommendation shall be made to the general assembly for the reinstatement of chiropractic services where positive clinical outcomes and lower overall treatment costs have been shown.  This recommendation may be limited by the scope and definitions of the trial.

Sec. 299.  EMPLOYER SPONSORED INSURANCE

(a)  The office of Vermont health access with the assistance of the department of banking, insurance, securities and health care administration shall develop a program to provide subsidies for individuals applying for and enrolled in the Vermont health access program and the Dr. Dynasaur program who have employer sponsored health insurance.  The office and department shall report to the health access oversight committee, the senate and house appropriations committees, the senate committee on health and welfare and the house committee on human services with a plan for the employer-sponsored insurance program no later than January 15, 2006.  The plan shall include recommendations for the subsidy amounts to be provided for each program by relevant income amounts based on federal poverty level, administrative cost estimates, implementation timelines, existing employer sponsored insurance options, a recommendation on the minimum health insurance coverage to be subsidized, and a recommendation on how to define “affordable” coverage for individuals, families and children by relevant income amounts based on federal poverty level. 

Sec. 300.  CAPITATED PROGRAM FOR TREATMENT OF OPIATE

                 DEPENDENCY

(a)  As part of the development of the office of Vermont health access’s care coordination initiative, there shall be developed a capitated program for the treatment of opiate dependency. In cooperation with all commercial insurers present in Vermont, the department of corrections, the office of drug and alcohol abuse programs, and office of Vermont health access shall:

(1)  develop a statewide electronic registry and treatment service assessment of patients with opiate dependency;

(2) develop a statewide, integrated protocol for the treatment of opiate dependency;

(3)  identify the administrative and financial resources necessary to successfully implement and maintain the capitated program for the treatment of opiate dependency;

(4)  use a capitated payment methodology and set payment rates; and

(5)  create a plan to measure program outcomes with specific benchmarks.

(b)  The office shall provide a preliminary report and a recommendation for ongoing funding to the house and senate committees on appropriations, the house human services committee, and the senate health and welfare committee no later than January 15, 2006. 

Sec. 301.  ENHANCED REGIONAL DISEASE SCREENING

(a)  In collaboration with the Vermont department of health (VDH), the office of Vermont health access shall promote primary disease detection activities in the following manner:

(1)  heighten awareness of ongoing public health screenings conducted by the VDH such as the Ladies First and Wise Woman programs;

(2)  procure and analyze Medicaid claims and Center for Disease Control public health data to develop regional disease prevalence rates to help prioritize specific screening programs; and

(3)  collaborate on joint ventures with the VDH utilizing the twelve district public health offices to implement and coordinate the above stated efforts on a regional basis.

Sec. 302.  FISCAL YEAR 2006 MEDICAID RELATED RULE-MAKING

(a)  Nursing homes.  The division of rate setting shall amend the rules for establishing Medicaid rates for nursing home services to raise the minimum occupancy used in setting Medicaid rates to 93 percent, effective July 1, 2005.  Notwithstanding any other provisions of law, this rule change shall be adopted as soon as practicable after passage of this act and shall be exempt from the procedural requirements of 3 V.S.A. chapter 25, except that the agency of human services shall make reasonable efforts to ensure that the change is made known to persons who may be affected by it.  The required rule change shall stay in effect until such time as it is amended pursuant to 3 V.S.A. chapter 25.

(b)  Emergency rulemaking for July 1, 2005.  Authority for emergency rulemaking is granted to the agency of human services in order to control expenditures in the Medicaid program in a timely manner, respond to the fiscal crisis in the Medicaid program, and retain Medicaid funds available to support essential programs for truly needy applicants and recipients.  Therefore, the secretary of the agency of human services may adopt emergency rules pursuant to section 844 of Title 3 in order that the changes reflected in Sec. 279 (VHAP premium adjustments), and Sec. 280 (Dr. Dynasaur and SCHIP premium adjustments) of this act may be implemented no later than July 1, 2005.  Emergency rules adopted under this section remain in effect until superseded, extended, or amended by the secretary of the agency of human services under the process for adoption of agency rules in chapter 25 of Title 3.

(c)  Expedited rulemaking.  Notwithstanding the provisions of chapter 25 of Title 3, if specifically authorized by the general assembly by law, the agency of human services may adopt rules pursuant to the following expedited rulemaking process:

(1)  The agency shall file proposed rules with the secretary of state and the legislative committee on administrative rules under 3 V.S.A. § 841 after copies are sent to the house committees on appropriations and human services and after publication in three daily newspapers with the highest average circulation in the state of a notice that lists the rules to be adopted pursuant to this process and a seven-day public comment period following publication.

(2)  The agency shall file final proposed rules with the legislative committee on administrative rules 14 days after the public comment period.

(3)  The legislative committee on administrative rules shall review and may approve or object to the final proposed rules under 3 V.S.A. § 842, except that its action shall be completed no later than 14 days after the final proposed rules are filed with the committee.

(4)  The agency may adopt a properly filed final proposed rule after the passage of 14 days from the date of filing final proposed rules with the legislative committee on administrative rules or after receiving notice of approval from the committee, provided the agency:

(A)  has not received a notice of objection from the legislative committee on administrative rules; or

(B)  after having received a notice of objection from the committee, has responded pursuant to 3 V.S.A. § 842.

(5)  Rules adopted under this section shall be effective upon being filed with the secretary of state and shall have the full force and effect of rules adopted pursuant to chapter 25 of Title 3.  Rules filed by an agency  with the secretary of state pursuant to this section shall be deemed to be in full compliance with 3 V.S.A. § 843 and shall be accepted by the secretary of state if filed with a certification by the secretary of human services that the rule is required to meet the purposes of this section.

Sec. 303.  LONG-TERM CARE; FINANCIAL ELIGIBILITY

(a)  The secretary of the agency of human services is directed to amend the Medicaid rules and procedures related to income, resources, and transfers of assets used to determine eligibility of individuals for long‑term care coverage under the expedited rulemaking authority granted in Sec. 302(c) of this act.  The amendments to the Medicaid rules made under this section must be in accord with federal law.  The agency’s authority to utilize the expedited rulemaking process is limited only to adoption of rules to effect the following changes: 

(1)  To subject long-term care recipients to post-eligibility rules only if the recipients qualify for long-term care as part of the special income group under 42 U.S.C. § 1396a(a)(10)(A)(ii)(VI), or as medically needy under 42 U.S.C. § 1396a(a)(10)(C), or if they are in a medical institution;

(2)  To require individuals with income above the institutional standard requesting long-term care to spend down to the protected income level;

(3)  To permit reasonable expenses specified in current rules to reduce to the share of income applied to the cost of long‑term care.  (For the purposes of this subdivision, “reasonable expenses” do not include long‑term care services received during periods of ineligibility for long‑term care.);

(4)  To impose requirements on private contracts for care to limit their use as an excluded resource;

(5)  To count as a resource a life estate held by the applicant or recipient with a reserved power‑to-mortgage (other than the principal place of residence) and value the life estate at the full fair market value of the fee estate, notwithstanding the purported creation of a remainder interest in another party;

(6)  To treat promissory notes and other similar income-producing resources in the same fashion as annuities and excludable only if certain collateral criteria of eligibility are met;

(7)  To implement additional tools to determine life expectancy;

(8)  To penalize transfers beginning on the first day of the month following the date of the transfer.

(b)  In addition, in order to control expenditures and retain Medicaid funds available to support essential programs for truly needy applicants and recipients, the agency of human services may utilize the expedited rulemaking authority set out in Sec. 302(c) of this act to amend rules related to income, resources, and transfers of assets used to determine eligibility of individuals for long‑term care, if required to do so to address ambiguity, omission, or expectations that are providing a way for otherwise ineligible SSI‑related medically needy applicants with income above 300 percent of the SSI payment standard for one person in the community pursuant to 42 USC 1396a(a)(10)(C)(ii), or optionally categorically needy applicants with income above the protected income level and below 300 percent of the SSI payment standard for one who qualifies as part of the “special income group” pursuant to 42 USC 1396a(a)(10)(A)(ii)(VI), to avoid such asset and financial eligibility rules.

Sec. 304.  HIV/AIDS HEALTH INSURANCE ASSISTANCE PROGRAM

(a)  The office of Vermont health access, in cooperation with the department of health, shall operate an HIV/AIDS insurance assistance program.

(b)  The program shall pay all or a portion of continuation health insurance premiums for those eligible individuals with HIV/AIDS for whom it can be determined that continuation of private insurance coverage is less costly to the state than other alternatives.

(c)  Eligibility for this program shall be limited to individuals whose household income does not exceed 200 percent of the federal poverty level, after deducting unreimbursed medical expenses and health insurance premiums from gross income, and whose assets, exclusive of the primary residence and certain other exclusions to be defined by the office of Vermont health access, do not exceed $10,000.00.

     (d)  Expenditures under this program shall not exceed $55,000.00 in fiscal year 2006.

Sec. 305.  Preferred Drug List; Drug Utilization Review

(a)  Preferred drug list (PDL) revisions.

(1)  Prescribers shall be required to comply with any changes in the PDL within reasonable time frames prescribed by the office of Vermont health access in consultation with the drug utilization review board.

(2)(A)  The exemption of certain classes of drugs used to treat certain types of severe and persistent mental illness from inclusion in the prior authorization process may end after the review of the report required in Sec. 5(2)(B) of No. 127 of the Acts of  the 2001 Adj. Sess. (2002) as amended by Sec. 128h of No. 122 of the Acts of the 2003 Adj. Sess. (2004) and Sec. 310 of this act is completed, the proposed changes to the preferred drug list have been reviewed by the drug utilization review board, and the health access oversight committee has made any recommendations to the drug utilization review board no later than September 15, 2005.

(B)  The proposed changes to the preferred drug list shall ensure that adults with severe and persistent mental illness and children with a severe emotional disorder receiving pharmaceuticals under Medicaid or a state pharmaceutical program subject to subchapter 5 of chapter 19 of Title 33 prior to the end of the exemption shall receive the same pharmaceuticals without following the new rules or procedures if:

(i)  the individual is at risk of psychiatric destabilization from changing to a therapeutically comparable pharmaceutical; and

(ii)  the risk is certified in a manner established by the drug utilization review board.

(b)  Drug utilization review revisions. 

(1)  The members of the drug utilization review board are entitled to compensation for services and reimbursement of expenses as provided to members of state boards under 32 V.S.A. § 1010.

(2)  The director, in consultation with the drug utilization review board,  shall establish an advisory panel of three persons with clinical and pharmacological expertise to advise the drug utilization review board on scientific, technical, and clinical issues relating to the clinical efficacy, safety, and cost‑effectiveness of drugs considered for inclusion on the preferred drug list.  Experts on the panel shall be entitled to compensation for services as provided by contract with the director.

(3)  The office, in consultation with the drug utilization review board, shall establish a policy to increase the appropriate use of generic drugs.  The policy may include education, outreach, and the use of prior authorization whenever a brand is prescribed and a generic drug is available.  The policy shall have a target of 95 percent utilization of generic drug prescriptions when generic equivalent drugs are available and 60 percent when generic alternative drugs are available.

(4)  The office, in consultation with the drug utilization review board, shall identify new therapeutic classes from which savings are possible through the use of a PDL.  In order to assist in making this determination, the office shall be provided with comparative information such as that developed by the drug effectiveness review project.

(5)  The drug utilization review board shall make recommendations to establish criteria for the supply of prescription drugs to be dispensed.

Sec. 306.  18 V.S.A. § 4605(a) is amended to read:

(a)  When a pharmacist receives a prescription for a drug which is listed either by generic name or brand name in the most recent edition of the federal Food and Drug Administration’s “Orange Book” of approved drug products, the pharmacist shall select the lowest priced drug from such list which is chemically and therapeutically equivalent and which the pharmacist has in stock, unless otherwise instructed by the prescriber, or by the purchaser if the purchaser agrees to pay any additional cost in excess of the benefits provided by the purchaser’s health benefit plan if allowed under the legal requirements applicable to the plan, otherwise to pay the full cost for the higher priced drug. 

Sec. 307.  33 V.S.A. § 1998a is added to read:

§ 1998a.  PHARMACY MAIL ORDER

The pharmacy best practices and cost control program shall require consumers to purchase prescription drugs using mail order for selected pharmacy products.

Sec. 308.  33 V.S.A. § 1998(f)(1) and (2) are amended to read:

(1)  The drug utilization review board shall make recommendations to the commissioner director for the adoption of the preferred drug list.  The board’s recommendations shall be based upon considerations of clinical efficacy, safety, and cost-effectiveness.

(2)  The board shall meet at least quarterly.  The board shall comply with the requirements of subchapter 2 of chapter 5 of Title 1 (open meetings) and subchapter 3 of chapter 5 of Title 1 (open records), except that the board may go into executive session in order to comply with subsection 2002(c) of this title to consider information relating to a pharmaceutical rebate or to supplemental rebate agreements, which is protected from disclosure by federal law or the terms and conditions required by the Centers for Medicare and Medicaid Services as a condition of rebate authorization under the Medicaid program.

Sec. 308a.  1 V.S.A. § 313(a) is amended to read:

(a)  No public body described in section 312 of this title may hold an executive session from which the public is excluded, except by the affirmative vote of two-thirds of its members present in the case of any public body of state government or of a majority of its members present in the case of any public body of a municipality or other political subdivision.  A motion to go into executive session shall indicate the nature of the business of the executive session, and no other matter may be considered in the executive session.  Such vote shall be taken in the course of an open meeting and the result of the vote recorded in the minutes.  No formal or binding action shall be taken in executive session except actions relating to the securing of real estate options under subdivision (2) of this subsection.  Minutes of an executive session need not be taken, but if they are, shall not be made public subject to section subsection 312(b) of this title.  A public body may not hold an executive session except to consider one or more of the following:

* * *

(9)  information relating to a pharmaceutical rebate or to supplemental rebate agreements, which is protected from disclosure by federal law or the terms and conditions required by the Centers for Medicare and Medicaid Services as a condition of rebate authorization under the Medicaid program, considered pursuant to 33 V.S.A. § 1998(f)(2) and § 2002(c).

Sec. 309.  33 V.S.A. § 1999(a)(2) is amended to read:

(2)(A)  The program shall authorize coverage under the same terms as coverage for preferred choice drugs if the prescriber determines, after consultation with the pharmacist, or with the participating health benefit plan if required by the terms of the plan, that:

(i)  the preferred choice has not been effective, or with reasonable certainty is not expected to be effective, in treating the patient’s condition; or

(ii)  the preferred choice causes or is reasonably expected to cause adverse or harmful reactions in the patient.

(B)  The prescriber’s determination concerning whether the standards established in this subdivision (2) have been demonstrated shall be final if any documentation required at the direction of the drug utilization board has been provided.

Sec. 310.  MENTAL HEALTH DRUGS; PRIOR AUTHORIZATION

Sec. 5(2) of No. 127 of the Acts of the 2001 Adj. Sess. (2002) as amended by Sec. 128h of No. 122 of the Acts of the 2003 Adj. Sess. (2004) is amended to read:

(2)(A)  Sec. 1, 33 V.S.A. § 1999(d) (prior authorization and drugs used to treat mental illness), shall be repealed on July 1, 2006 amended to read:

(d)  The program’s prior authorization process shall not apply to prescription drugs prescribed for the treatment of severe and persistent mental illness including schizophrenia, severe depression, or bipolar disorder. The agency may include prescription drugs prescribed for the treatment of severe and persistent mental illness, including schizophrenia, major depression, or bipolar disorder, in the prior authorization process after the health access oversight committee has reviewed the report as provided for in Sec. 305(a)(2)(A) of H.516 of the 2005 legislative session.

(B)  The commissioner of prevention, assistance, transition, and health office of Vermont health access shall report to the health access oversight committee concerning the drug utilization review board’s analysis of prescribing patterns, literature, and testimony regarding clinical efficacy and outcomes, expenditure trends, and any proposed revisions to the preferred drug list as it pertains to drugs used to treat mental illness no later than September 1, 2005.  The commissioner’s director’s report shall include also an assessment of the use of medication algorithms and of the behavioral pharmacy project implemented in the state of Missouri and other such cost‑saving alternatives in use in other states that do not include the use of a formulary, preferred drug list, or prior authorization process

Sec. 311.  33 V.S.A. § 2002(b) is amended to read:

(b)  The commissioner director shall negotiate supplemental rebates, price discounts, and other mechanisms to reduce net prescription drug costs by means of any negotiation strategy which the commissioner director determines will result in the maximum economic benefit to the program and to consumers in this state, while maintaining access to high quality prescription drug therapies.  The director may negotiate through a purchasing pool or directly with manufacturers.  The provisions of this subsection do not authorize agreements with pharmaceutical manufacturers whereby financial support for medical services covered by the Medicaid program is accepted as consideration for placement of one or more prescription drugs on the preferred drug list.  The January 1, 2003 report of the commissioner pursuant to subsection 2001(d) of this title shall include a cost-benefit analysis of alternative negotiation strategies, including the strategy used by the State of Florida to secure supplemental rebates, the strategy used by the State of Michigan to secure supplemental rebates, and any other alternative negotiation strategy that might secure lower net prescription drug costs.

Sec. 312. 18 V.S.A. § 9410(h) is added to read:

(h)  Data Collection and Information Sharing.

(1)  All health insurers shall electronically provide to the commissioner in accordance with standards and procedures adopted by the commissioner by rule:

(A)  their encrypted claims data;

(B)  cross-matched claims data on requested members, subscribers, or policyholders; and

(C)  member, subscriber, or policyholder information necessary to determine third party liability for benefits provided.

(2)  The collection, storage, and release of health care data and statistical information that is subject to the federal requirements of the Health Insurance Portability and Accountability Act (“HIPAA”) shall be governed exclusively by the rules adopted thereunder in 45 CFR Parts 160 and 164.

(A)  All health insurers that collect the Health Employer Data and Information Set (HEDIS) shall annually submit the HEDIS information to the commissioner in a form and in a manner prescribed by the commissioner.

(B)  All health insurers shall accept electronic claims submitted in Centers for Medicare and Medicaid Services format for UB-92 or HCFA-1500 records, or as amended by the Centers for Medicare and Medicaid Services.

(3)(A)  The commissioner shall collaborate with the agency of human services and participants in agency of human services initiatives in the development of a comprehensive health care information system.  The collaboration is intended to address the formulation of a description of the data sets that will be included in the comprehensive health care information system, the criteria and procedures for the development of limited use data sets, the criteria and procedures to ensure that HIPAA compliant limited use data sets are accessible, and a proposed time frame for the creation of a comprehensive health care information system.

(B)  To the extent allowed by HIPAA, the data shall be available as a resource for insurers, employers, providers, purchasers of health care, and state agencies to continuously review health care utilization, expenditures, and performance in Vermont and to enhance the ability of Vermont consumers and employers to make informed and cost-effective health care choices.  In presenting data for public access, comparative considerations shall be made regarding geography, demographics, general economic factors, and institutional size.

(C)  Notwithstanding HIPAA or any other provision of law, the comprehensive health care information system shall not include or disclose any data that contains direct personal identifiers.  For the purposes of this section, “direct personal identifiers” include information relating to an individual that contains primary or obvious identifiers, such as the individual’s name, street address, e-mail address, telephone number, and Social Security number.

Sec. 313.  PHARMACEUTICAL ASSISTANCE PROGRAMS; PREMIUM

                ADJUSTMENTS

(a)  On July 1, 2006, the premiums for the pharmaceutical assistance programs established in 33 V.S.A. § 2074 shall be increased as follows:

(1)  In the case of recipients whose household income is greater than the income eligibility level for Medicaid and no greater than 150 percent of the federal poverty level, such premium shall be $15.00 per month.

(2)  In the case of recipients whose household income is greater than 150 percent of the federal poverty level and no greater than 175 percent of the federal poverty level, the premium shall be $20.00 per month.

(3)  In the case of recipients whose household income is greater than 175 percent of the federal poverty level and no greater than 225 percent of the federal poverty level, the premium shall be $42.00 per month.

(b)  On July 1, 2006, the base cost-sharing amount for V-Pharm shall be increased to:

(1)  $15.00 per month or $180.00 per year in the case of recipients whose household income is no greater than 150 percent of the federal poverty level.

(2)  $20.00 per month or $240.00 per year in the case of recipients whose household income is greater than 150 percent of the federal poverty level and no greater than 175 percent of the federal poverty level.

(3)  $42.00 per month or $504.00 per year in the case of recipients whose household income is greater than 175 percent of the federal poverty level and no greater than 225 percent of the federal poverty level.

Sec. 314.  33 V.S.A. chapter 19, subchapter 8 is added to read:

Subchapter 8.  Vermont Pharmaceutical Assistance Programs

§ 2071.  DEFINITIONS

For purposes of this subchapter:

(1)  “Individual with disabilities” means an individual who is under age 65 and is entitled, under the federal Social Security Act, to disability insurance benefits or is eligible for Medicare. 

(2)  “Maintenance drug” means a drug approved by the FDA for continuous use and prescribed to treat a chronic condition for a prolonged period of time of 30 days or longer and includes insulin, an insulin syringe, and an insulin needle

(3)  “Medicare part D” means the prescription drug program established under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, P.L. 108-173, including the prescription drug plans offered pursuant to the act.

(4)  “OVHA” means the office of Vermont health access.

(5)  “Pharmaceutical” means a drug that may not be dispensed unless prescribed by a health care provider as defined by subdivision 9402(8) of Title 18 acting within the scope of the provider’s license.  The term excludes a drug determined less than effective under the federal Food, Drug and Cosmetics Act.

(6)  “Pharmacy” means a retail or institutional drug outlet licensed by the Vermont state board of pharmacy pursuant to chapter 36 of Title 26, or by an equivalent board in another state, in which pharmaceuticals are sold at retail and which has entered into a written agreement with the state to dispense pharmaceuticals in accordance with the provisions of this chapter.

§ 2072.  GENERAL ELIGIBILITY

(a)  An individual shall be eligible for assistance under this subchapter if the individual:

(1)  is a resident of Vermont at the time of application for benefits;

(2)  is at least 65 years of age or is an individual with disabilities as defined in subdivision 2071(1) of this title; and

(3)  has a household income, when calculated in accordance with the rules adopted for the Vermont health access plan under No. 14 of the Acts of 1995, as amended, no greater than 225 percent of the federal poverty level.

(b)  An individual whose pharmaceutical expenses are paid or reimbursable, either in whole or in part, by any plan of assistance or insurance, other than Title XVIII (Medicare) and Title XIX (Medicaid) of the Social Security Act, shall not be eligible for pharmaceutical assistance under this subchapter.  No assistance shall be provided under this subchapter with respect to an individual pharmaceutical purchase that may be covered in whole by Title XVIII.

§ 2073.  V-PHARM ASSISTANCE PROGRAM

(a)  Effective January 1, 2006, the V-Pharm program is established as a state pharmaceutical assistance program to provide supplemental pharmaceutical coverage to Medicare beneficiaries.  The supplemental coverage under subsection (c) of this section shall provide only the same pharmaceutical coverage as the Medicaid program to enrolled individuals whose income is not greater than 150 percent of the federal poverty guidelines and only coverage for maintenance drugs for enrolled individuals whose income is greater than 150 percent and no greater than 225 percent of the federal poverty guidelines.

(b)  Any individual with income no greater than 225 percent of the federal poverty guidelines participating in Medicare part D, having secured the low income subsidy if the individual is eligible and meeting the general eligibility requirements established in section 2072 of this title, shall be eligible for V‑Pharm.

(c) V-Pharm shall provide supplemental benefits by paying or subsidizing:

(1)  the actual Medicare part D premium for the standard prescription drug benefit offered by Medicare part D prescription drug programs, except for any late enrollment penalties, provided that OVHA may pay or subsidize a higher premium for a Medicare part D prescription drug plan offering expanded benefits if it is cost-effective to do so; 

(2)  any other cost-sharing required by Medicare part D, except for co‑payments for individuals eligible for Medicaid;

(3)  the following pharmaceuticals if they are not covered by the individual’s Medicare part D prescription drug plan:  pharmaceuticals or classes of pharmaceuticals, or their medical uses, which may be excluded from coverage or otherwise restricted under Medicaid under Section 1927(d)(2) or (3) of the Social Security Act; and

(4)  pharmaceuticals that are not covered after the individual has exhausted the Medicare part D prescription drug plan’s appeal process or the prescription drug plan’s transition plan approved by the Centers for Medicare and Medicaid Services, and that are deemed medically necessary by the individual’s prescriber in a manner established by the director of the office of Vermont health access.  The coverage decision under this subdivision shall not be subject to the exceptions process established under Medicaid.  An individual may appeal to the human services board or pursue any other remedies provided by law. 

(d)(1)  The secretary of the agency of human services shall develop by rule the manner by which an individual shall contribute the individual’s cost established in subdivision (2) of this section, except that individuals eligible for Medicaid shall only be subject to the cost-sharing requirements established by Medicaid and Medicare.  The rule shall seek to minimize the possibility of inadvertent loss of eligibility for Medicare part D and V‑Pharm benefits.  Prior to filing the rule, the secretary shall submit the proposed rule to the health access oversight committee established in Sec. 13 of No. 14 of the Acts of 1995, as amended.  The health access oversight committee shall review and advise on the agency rules and policies developed under this subsection and shall submit for consideration any recommendations to the joint legislative committee on administrative rules.

(2)  An individual shall contribute the following base cost-sharing amounts which shall be indexed to the increases established under 42 C.F.R. § 423.104(d)(5)(iv) and then rounded to the nearest dollar amount:

(A)  $13.00 per month or $156.00 per year in the case of recipients whose household income is no greater than 150 percent of the federal poverty level.

(B)  $17.00 per month or $204.00 per year in the case of recipients whose household income is greater than 150 percent of the federal poverty level and no greater than 175 percent of the federal poverty level.

(C)  $35.00 per month or $420.00 per year in the case of recipients whose household income is greater than 175 percent of the federal poverty level and no greater than 225 percent of the federal poverty level.

(e)  In order to ensure the appropriate payment of claims, OVHA may expand the Medicare advocacy program established under chapter 67 of this title to individuals receiving benefits from the V-Pharm program.

§ 2074.  VERMONT-Rx PROGRAM

(a)  Effective January 1, 2006, Vermont-Rx is established within the office of Vermont health access and shall be the continuation of the state pharmaceutical programs in existence upon passage of this subchapter for those individuals not eligible for Medicare part D.  Vermont-Rx is a pharmaceutical assistance program for individuals age 65 or older who are not eligible for Medicare and for individuals with disabilities who are receiving Social Security disability benefits and who are not eligible for Medicare. Vermont‑Rx may retain the current program names of VHAP-Pharmacy, VScript, and VScript Expanded if it is cost-effective to retain the current names in lieu of combining the current programs into one program.

(1)  The program shall be administered by OVHA which, to the extent funding permits, shall establish application, eligibility, coverage, and payment standards.  In addition to the general eligibility requirements established in section 2072 of this title, an individual must not be eligible for Medicare in order to be eligible for benefits under Vermont‑Rx. 

(2)  To the extent necessary under federal law, OVHA shall administer Vermont-Rx in such a manner as to ensure that any permissible federal funding may be received to support the program.  OVHA may establish a division of the Vermont-Rx program to administer federal Medicaid funds separately in accordance with a federal waiver pursuant to Section 1115 of the Social Security Act.

(3)  If permissible under federal law, OVHA shall use the same forms and application process for individuals to enroll in Vermont-Rx, regardless of the funding source for the program.

(b)  Vermont-Rx shall provide:

(1)  the same pharmaceutical coverage as the Medicaid program to elderly individuals and individuals with disabilities whose income is no greater than 150 percent of the federal poverty guidelines; and

(2)  maintenance drugs to elderly individuals and individuals with disabilities whose income is greater than 150 percent and no greater than 225 percent of the federal poverty guidelines.

(c)  Benefits under Vermont‑Rx shall be subject to payment of a premium amount by the recipient in accordance with the provisions of this section.

(1)  In the case of recipients whose household income is no greater than 150 percent of the federal poverty level, such premium shall be $13.00 per month.

(2)  In the case of recipients whose household income is greater than 150 percent of the federal poverty level and no greater than 175 percent of the federal poverty level, the premium shall be $17.00 per month.

(3)  In the case of recipients whose household income is greater than 175 percent of the federal poverty level and no greater than 225 percent of the federal poverty level, the premium shall be $35.00 per month.

(d)  Any manufacturer of pharmaceuticals purchased by individuals receiving assistance from Vermont-Rx established under this section shall pay to OVHA, as a condition of participation in the program, a rebate in an amount at least as favorable as the rebate paid to OVHA in connection with the Medicaid program.

(e)  Under Vermont-Rx, a pharmaceutical may be dispensed to an eligible recipient provided such dispensing is pursuant to and in accordance with any contractual arrangement that OVHA may enter into or approve for the group discount purchase of pharmaceuticals.  When a person or business located in Vermont and employing citizens of this state has submitted a bid for the group discount purchase of pharmaceuticals and has not been selected, the director of OVHA shall record the reason for nonselection.  The director’s report shall be a public record available to any interested person.  All bids or quotations shall be kept on file in the director’s office and open to public inspection.

§ 2075.  ASSISTANCE IN ENROLLING IN MEDICARE PART D

The agency of human services may act, if permissible under federal law, as an individual’s agent to enroll the individual in a Medicare part D prescription drug plan and a low income subsidy if the individual has not enrolled prior to the application for V‑Pharm.  The agency shall provide applicants for V-Pharm with information on Medicare part D and the low income subsidy if applicable, and on how to obtain assistance in enrolling in Medicare part D or the subsidy.

§ 2076.  OVER‑THE‑COUNTER AND GENERIC MEDICATIONS

(a)  All public pharmaceutical assistance programs shall provide coverage for those over‑the‑counter pharmaceuticals on the preferred drug list developed under section 1998 of this title, provided the pharmaceuticals are authorized as part of the medical treatment of a specific disease or condition, and they are a less costly, medically appropriate substitute for currently covered pharmaceuticals.

(b)  All public pharmaceutical assistance programs shall comply with the provisions regarding generic drugs established in chapter 91 of Title 18.

(c)  OVHA shall seek any waivers of federal law, rule, or regulation necessary to implement the provisions of this section.

§ 2077.  ADMINISTRATION

(a)  The programs established under this subchapter shall be designed to provide maximum access to program participants, to incorporate mechanisms that are easily understood and require minimum effort for applicants and health care providers, and to promote quality, efficiency, and effectiveness through cost controls and utilization review.  OVHA may contract with a fiscal agent for the purpose of processing claims and performing related functions required in the administration of the pharmaceutical programs established under this subchapter.

(b)  Upon determining that an applicant is eligible under this subchapter, OVHA shall issue an identification card to the applicant.

(c)  A pharmacy which dispenses a pharmaceutical to an individual eligible for a pharmaceutical program established under this subchapter shall collect payment for the pharmaceutical from OVHA.

§ 2078.  EDUCATION AND OUTREACH

The department of aging and independent living shall conduct ongoing education and outreach to inform elderly Vermonters and Vermonters with disabilities of the benefits they may be entitled to pursuant to this subchapter, make available information concerning pharmaceutical assistance programs, and minimize any confusion and duplication of pharmaceutical coverage resulting from a multiplicity of pharmaceutical programs.

§ 2079.  CONSTRUCTION

The benefits provided by the pharmaceutical assistance programs established under this subchapter constitute medical services for purposes of section 141 of this title.

§ 2080.  VERMONT PRESCRIPTION DRUG PRICING AND CONSUMER

              PROTECTION PROGRAM

The secretary of the agency of human services shall administer this subchapter in conformity with the pharmacy best practices and cost control program established under subchapter 5 of this chapter to enable the citizens of Vermont to purchase necessary prescription pharmaceuticals at the lowest possible price, to ensure access to such pharmaceuticals, and to support Vermont pharmacies, consistent with the time frames, standards, and procedures established by the general assembly.

§ 2081.  RULES AND LEGISLATIVE OVERSIGHT

(a)  The agency of human services shall adopt rules necessary to implement and administer the provisions of this subchapter, including standards and schedules establishing coverage and exclusion of pharmaceuticals and maximum quantities of pharmaceuticals to be dispensed, and to comply with the requirements of the Medicare Modernization Act.  The agency of human services shall submit the proposed rule to the health access oversight committee established in Sec. 13 of No. 14 of the Acts of 1995, as amended. The health access oversight committee shall review and advise on the agency rules and policies developed under this subsection and shall submit for consideration any recommendations to the joint legislative committee on administrative rules.

(b)  OVHA shall report on the status of the pharmaceutical assistance programs established by this subchapter to the health access oversight committee in accordance with Sec. 13 of No. 14 of the Acts of 1995, as amended.

Sec. 315.  FEDERAL APPROVAL; V-PHARM PROGRAM

(a)  If required by federal law, the agency of human services shall apply to the Centers for Medicare and Medicaid Services to establish the V‑Pharm program established in Sec. 314 of this act as a state pharmaceutical assistance program eligible to provide supplemental pharmaceutical benefits to Medicare beneficiaries and shall apply for any necessary Medicaid waiver in order to secure federal contributions.  If allowable under federal law, the agency of human services shall continue to operate all or part of Vermont-Rx under a Medicaid waiver in order to secure federal contributions.

Sec. 316.  TRANSITIONAL PROVISIONS

(a)  The programs established under subchapter 8 of chapter 19 of Title 33 shall be the successor to and continuation of the VHAP-Pharmacy, VScript, and VScript Expanded programs.

(b)  The office of Vermont health access (OVHA) shall develop necessary rules to ensure that individuals do not lose coverage for necessary pharmaceuticals at the beginning of coverage under Medicare part D if the individual:

(1)  has applied for and attempted to enroll in Medicare part D and has not received coverage for the needed pharmaceutical due to an operational problem with Medicare part D; or

(2)  has otherwise not received coverage for the needed pharmaceutical; provided such failure to receive coverage is due to good cause shown and presents a hardship to the individual, as good cause and hardship are defined by OVHA.

(c)(1)  The commissioner of aging and independent living and the director of the office of Vermont health access shall continue to convene the working group of individuals with disabilities, elderly individuals, advocates, and providers established under Sec. 128j of No. 122 of the Acts of the 2003 Adj. Sess. (2004).  The working group shall meet monthly or more frequently as needed and shall:

(A)  revise as necessary and implement a plan which at a minimum shall include outreach, education, and assistance to Vermont Medicare beneficiaries in order to minimize confusion and duplication of coverage caused by the introduction of the new, federally mandated Medicare part D pharmacy program.  The plan shall focus on those individuals who may also be eligible for another program which provides supplemental pharmacy benefits, including Medicaid, VHAP‑Pharmacy, VScript, VScript Expanded, Healthy Vermonters, or the programs established under this act;

(B)  plan for the implementation of Medicare part D in the state beginning January 1, 2006.  Such planning shall include both monitoring and advocacy on federal policy as it relates to Vermont state pharmaceutical assistance programs with a goal of minimizing any reduction of assistance to these beneficiaries.  The plan shall analyze fully the potential gains and losses to Vermont and to its state pharmaceutical assistance beneficiaries resulting from Medicare part D and the balance of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, P.L. 108-173, and shall provide ongoing cost projections and identify sources of funding for holding these beneficiaries harmless from pharmacy benefit cuts once Medicare part D is implemented; and

(C)  report as requested to the house committee on human services, the senate committee on health and welfare, or, outside the legislative session and on November 1, 2005, to the health access oversight committee.

(2)  For the purpose of this section, “holding harmless” means the payment of premiums, of cost-sharing, and for pharmaceuticals in drug classes not covered by Medicare part D in an amount sufficient to ensure that Vermonters enrolled in the state’s pharmaceutical programs prior to the implementation of Medicare part D do not have an increased financial burden and have pharmaceutical benefits therapeutically comparable to those offered by the state pharmaceutical programs prior to implementation of Medicare part D.

(d)  The agency of human services shall report the number of beneficiaries of VHAP-Pharmacy, VScript, and VScript-Expanded as of January 1, 2006 who did not enroll in V-Pharm by December 31, 2005 or who were ineligible for V-Pharm for failure to enroll in Medicare part D or the Medicare part D low income subsidy.  The agency shall report to the house committees on human services and on appropriations and the senate committees on health and welfare and on appropriations not later than February 15, 2006.

Sec. 317.  MEDICARE PART D; PHARMACEUTICAL BENEFITS FOR

                 NURSING HOME RESIDENTS

(a)  The agency of human services shall make such rules as are necessary to ensure that residents in nursing homes are held harmless from the transition to the Medicare part D pharmaceutical program and by the consolidation of the state pharmaceutical programs under this act.  For the purpose of this section, “held harmless” means that the state shall ensure that Vermonters enrolled in the state’s pharmaceutical programs prior to the implementation of Medicare part D do not have an increased financial burden and have pharmaceutical benefits therapeutically comparable to those offered by the state pharmaceutical programs prior to implementation of Medicare part D.

Sec. 318.  MEDICARE; CHANGES TO ASSET AND INCOME RULES

(a)  Subject to any required federal approval, the agency of human services shall eliminate the asset requirements and raise the income limits for individuals who qualify as qualified Medicare beneficiaries (QMB), specified low income Medicare beneficiaries (SLMB), and qualifying individuals (QI) in order to maximize the eligibility of these individuals for the low income subsidy program under Medicare part D, provided that the agency finds that the elimination of the asset test, or the increase in the income limits, or both for each program will be, at a minimum, cost neutral to the state in that the costs of the resulting increased Medicaid participation would not exceed the benefits from greater participation in the low income subsidy program as it relates to the Medicare part D program and any decrease in the administrative savings from simplifying eligibility.  The agency shall evaluate the cost neutrality of each eligibility requirement for each program separately to determine which changes to which programs meet this standard.

Sec. 319.  MEDICARE PART D EMPLOYER SUBSIDY

(a)  The commissioner of human resources shall investigate and evaluate the costs and benefits of the state’s electing to receive the employer subsidy under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, P.L. 108-173 and, upon expiration of the current collective bargaining agreement, the state’s modifying the state employee and retiree pharmaceutical benefits to wrap around the Medicare part D prescription drug program.  The commissioner shall consider the benefits and costs to state retirees, taxpayers, and beneficiaries of the state pharmaceutical programs.  The commissioner shall report on the investigation and evaluation to the general assembly no later than January 15, 2006.  The report shall include information regarding the current employee and retiree pharmaceutical benefits, the cost-sharing requirements for employees, retirees, and the state, the projected subsidy to be received, and any other information considered by the commissioner in the evaluation.

(b)  The state treasurer shall report to the general assembly no later than January 15, 2006 regarding the amount of any expected employer subsidy to be received by the state under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, P.L. 108-173

(c)  The state treasurer, in consultation with the Vermont state teachers’ retirement board, shall investigate and evaluate the costs and benefits of  electing the employer subsidy under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, P.L. 108-173 and the modification of the teacher retiree pharmaceutical benefits to wrap around the Medicare part D prescription drug program.  The treasurer shall consider the benefits and costs to teacher retirees, taxpayers, and beneficiaries of the state pharmaceutical programs.  The treasurer shall report on the investigation and evaluation to the general assembly no later than January 15, 2006.  The report shall include information regarding the current teacher retiree pharmaceutical benefits, the cost-sharing requirements for retirees, the subsidy to be received, and any other information considered by the treasurer in the evaluation.  The treasurer shall report to the general assembly no later than January 15, 2006 with the amount of the subsidy to be received under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, P.L. 108-173.

Sec. 320.  STATUTORY REVISION

(a)  The legislative council shall make such technical revisions to the Vermont Statutes Annotated to reflect the consolidation of the state pharmaceutical programs and the creation of V-Pharm, including revisions to the names of programs and to statutory citations.  

Sec. 321.  REPEAL

(a)  Subchapter 4 of chapter 19 of Title 33 is repealed as of January 1, 2006.  Any other provisions in session law enacted prior to this act which established premiums or other cost sharing for state pharmaceutical programs are repealed by the codification of cost sharing in this act.

Sec. 322.  EFFECTIVE  DATES

(a)  This section and Secs. 109, 132(a), 147a, 150(b), 154a, 162a, 165a, 173a, 193, 205c, 250(c), 255, 263, 272, 277c, 277d, 277e, 277f, 279, 280, 302, 303, 307, 315, 317, and 318 of this act shall take effect on passage.

(b)  Sec. 31(b) shall take effect July 10, 2005

(c)  Sec. 169a shall take effect July 1, 2006.

 

 



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us