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BILL AS INTRODUCED 2007-2008

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S.350

Introduced by Senator Shumlin of Windham District, Senator Lyons of Chittenden District, Senator Ayer of Addison District, Senator Campbell of Windsor District, Senator Carris of Rutland District, Senator Condos of Chittenden District, Senator Cummings of Washington District, Senator Hartwell of Bennington District, Senator McCormack of Windsor District and Senator MacDonald of Orange District

Referred to Committee on

Date:

Subject:  Conservation; energy independence and economic prosperity

Statement of purpose:  This bill proposes to establish an inventory of greenhouse gas emissions and sinks, and to require reporting of certain emissions and the development of a regional greenhouse gas registry.  The bill proposes to establish an advisory group named the Vermont climate collaborative, and to direct it to develop a public education and engagement framework, to identify climate change “best practices,” to develop recommendations for funding greenhouse gas reduction efforts, to develop a climate change adaptation plan, to convene a task force to update Act 250 so as to integrate smart growth principles, concepts of carbon neutrality, and principles of energy efficiency, and to reduce the rate at which agricultural lands are converted to other purposes.  It requires this climate collaborative to encourage employers to offer commuter benefit programs which are designed to reduce the use of single occupancy vehicles.  It requires this group to develop a program that would implement a low-carbon fuel standard, to work with others to develop an action plan for the development of significant biofuel capacity, and to work with construction trades to develop and implement an energy efficiency training and education program for builders and others.  It proposes to require the climate collaborative annually to assess the extent to which the state assigns adequate resources to implement the bill, and to report on the annual funding of specified programs.

This bill proposes to require the secretary of agriculture, food and markets to facilitate development of high quality nutrient management plans, to recommend ways to create incentives for carbon sequestration on farm and forest land, to develop a program to reduce methane emissions from farms, and to develop recommendations for measures to reduce the loss and fragmentation of important primary agricultural soils located in rural areas.  It requires development of strategies to increase the production, processing, packaging, storage, and distribution of locally grown animal products, grains, vegetables, and fruits.  It proposes to require the adoption of rules that require companies that offer auto insurance to offer “pay as you drive” insurance, the effect of which costs a driver less money the less the person drives.  It requires that sewage treatment plants be retrofitted to be energy efficient.

The bill proposes to amend Act 250 to assure the accommodation of pedestrian and bicycle traffic and the ability to support multimodal transportation capabilities.  It requires solid waste plans be updated to include organic wastes, used clothing, obsolete electronic equipment, and construction and demolition debris, and requires consideration of single stream infrastructure for the entire population.  It encourages voluntary waste stream reduction on the part of manufacturers.  It proposes to enhance transportation planning for alternative modes of transportation, to facilitate a greater use of passenger rail and freight rail services, to assure adequate intermodal connections, to increase the availability of public transit and the use of rideshare, carpooling, and vanpool programs, and to improve pedestrian and bicycle opportunities.  It proposes to require automatic initiation of upgrades of the state’s residential and commercial building codes, and to require the development of minimum building efficiency standards that must be met at the time of sale of residential rental property, and standards that, over time, must be met when selling any residential property. 

The bill proposes to increase the registration fee for new cars that get a low number of miles per gallon, to decrease the purchase and use tax for certain efficient vehicles, and to assess a surcharge on the purchase of certain inefficient new vehicles.  It proposes to institute “green” state purchasing requirements.

The bill proposes to encourage the development of combined heat and power (CHP) facilities, and to require the adoption of a state biomass plan, a timber management program, and a forest land conservation program.  It proposes to establish goals for the electrical energy efficiency program, and to establish a process for the commissioning and energy tracking of buildings.  It proposes to allow utilities to recover a premium on investments in renewable energy generation and combined heat and power facilities located in Vermont.  It proposes to expand the RGGI cap and trade program to include all significant sources of greenhouse gases, ideally in coordination with comparable efforts in surrounding states.  It proposes to establish long-term goals for the state’s portfolio standards program for electric companies.  Finally, it proposes to establish a system to pay rebates for retail sales of biodiesel blends.

AN ACT RELATING TO ENERGY INDEPENDENCE AND ECONOMIC PROSPERITY

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

* * * Air Quality * * *

Sec. 1.  10 V.S.A. § 552 is amended to read:

§ 552.  DEFINITIONS

As used in this chapter:

* * *

(11)  “Greenhouse gas” means any chemical or physical substance that is emitted into the air and that the secretary may reasonably anticipate to cause or contribute to climate change, including, but not limited to, carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.

Sec. 2.  10 V.S.A. § 580 is added to read:

§ 580.  GREENHOUSE GAS INVENTORIES; REGISTRY

(a)  Inventory and forecasting.  The secretary shall work, in conjunction with other states or a regional consortium, to establish a periodic, consistent, and complete inventory of greenhouse gas emissions and sinks, and an accompanying forecast of future greenhouse gas emissions in at least five- and ten-year increments, out to the year 2030.  The initial version of this inventory shall be published by no later than July 1, 2009, and updates shall be published triennially thereafter.  The forecast shall reflect projected growth, as well as the implementation of scheduled policy initiatives.  The inventory shall reflect all natural- and human-caused emissions generated within the state, as well as emissions associated with energy imported and consumed in the state.

(b)  Emissions reporting.  By no later than January 15, 2009, the secretary shall develop rules to require, in phases, the reporting and verification of statewide greenhouse gas emissions and to monitor and eventually enforce compliance with this program.  The requirements shall include provisions for owner reporting according to an accessible and easy-to-understand format that will yield information with regard to all greenhouse gas emissions in a type and format that a regional registry can accommodate.  In addition, the rules shall:

(1)  Require the monitoring and annual public reporting of greenhouse gas emissions from all significant sources beginning with the sources or categories of sources that contribute the most to statewide emissions.  Reporting should be required on an organization-wide basis within the state, as well as on a significant-emitter-by-significant-emitter basis.  At any time before an entity is subject to reporting requirements under the rules, the entity shall be allowed to report emissions associated with its own activities and with any programs it may implement in order to reduce its emissions.

(2)  Account for greenhouse gas emissions from all electricity consumed in the state, including transmission and distribution line losses from electricity generated within the state or imported from outside the state.

(3)  Ensure rigorous and consistent accounting of emissions, and provide reporting tools and formats to ensure collection of necessary data.  Emission reports shall be verified through self-certification and shall be subject to spot checks by the department of environmental conservation; however, in order to qualify for future registry purposes, reports should undergo third party verification.  Reporting of emissions from greenhouse gas reduction projects shall qualify for reporting when they are identified as such and adhere to equally rigorous quantification standards.

(4)  Ensure that major greenhouse gas emission sources maintain comprehensive records of all reported greenhouse gas emissions.

(c)  Registry.  The secretary shall work, in conjunction with other states or a regional consortium, to establish a regional or national greenhouse gas registry that allows for the greatest possible flexibility in order to accommodate the range of greenhouse gas mitigation approaches that are likely to evolve.

(1)  The registry shall be designed to apply to the entire state and to as large a geographic area beyond state boundaries as is possible.

(2)  It shall accommodate as broad an array of sectors, sources, facilities and approaches as is possible, and shall allow sources to start as far back in time as is permitted by good data, affirmed by third-party verification.

(3)  It shall accommodate registration of project-based reductions or “offsets” that are equally rigorously quantified.

(4)  It shall incorporate safeguards adequate to ensure that reductions are not double-counted by multiple registry participants, and to ensure appropriate transparency.

(5)  The state and its political subdivisions shall be able to participate in the registry for purposes of registering reductions associated with their programs, direct activities, or efforts, including the registration of emission  reductions associated with the stationary and mobile sources they own, lease, or operate.  Similarly, the state and its political subdivisions should be allowed

to participate in emission trading if and when such a program is developed and authorized.  Consideration shall be given to allocating revenues from the sale of emission reduction credits generated by state action to support the state’s inventory, forecasting, reporting, and registry functions required by this section.

(d)  Rules.  The secretary may adopt rules to implement the provisions of this section and shall review existing and proposed international, federal, and state greenhouse gas emission reporting programs and make reasonable efforts to promote consistency among the programs established pursuant to this section and other programs, and to streamline reporting requirements on greenhouse gas emission sources.  Nothing in this section shall limit a state agency from adopting any rule within its authority.


* * * Department of Public Service * * *

Sec. 3.  30 V.S.A. § 1 is amended to read:

§ 1.  COMPOSITION OF DEPARTMENT

(a)  The department of public service shall consist of the commissioner of public service, a director for regulated utility planning, a director for public advocacy, a director for energy efficiency, a state energy office, and such other persons as the commissioner considers necessary to conduct the business of the department.

* * *

(d)  The state energy office shall be the lead agency and shall coordinate activities by other state agencies in implementing the Vermont clean energy program, pursuant to which all involved state agencies shall actively promote and support renewable energy development, market “Vermont, the Green Economy” as a center for innovative renewable energy businesses, and invest in Vermont-appropriate renewable energy research and development.  The state energy office shall be advised by the Vermont climate collaborative.

(1)  Vermont climate collaborative.

(A)  The Vermont climate collaborative is hereby created and established as a body corporate and politic and a public instrumentality of the state.  The climate collaborative shall have a board of directors of nine members, who may not be members of the general assembly at the time of appointment.  Members shall be appointed for four-year terms, with initial appointments being staggered.  Members shall include the chair of the natural resources board or a representative of the board appointed by the chair, and a representative of the state electric efficiency entity appointed by that entity.  In addition, membership shall include the following persons appointed by joint action of the governor and the joint energy committee:

(i)  Two representatives of the state’s institutions of higher learning;

(ii)  Two representatives of the state’s business community;

(iii)  One representative of nongovernmental organizations which represent conservation interests;

(iv)  One representative of nongovernmental organizations which represent the interests of low income persons;

(v)  One representative of nongovernmental organizations which represent interests relating to sustainable rural development.

(vi)  The chair of the natural resources board or a representative of the board appointed by the chair.

(B)  The climate collaborative shall elect a chair and vice-chair from among its membership.  The powers of the climate collaborative are vested in the board of directors, and a quorum shall consist of five members.  No action of the climate collaborative shall be considered valid unless the action is supported by a majority vote of the members present and voting.

(C)  The climate collaborative shall be entitled to staff assistance from designees of the secretaries of natural resources, transportation, commerce and community development, and agriculture, food and markets, together with designees of the departments of public service and of education.

(D)  On an annual basis, the climate collaborative in concert with the energy office will submit to the joint energy committee, the legislative committees on natural resources and energy, and any other relevant legislative committees a comprehensive report of its actions taken during the preceding year, actions taken by others in response to previous recommendations of the climate collaborative, and recommendations for future actions by the executive and legislative branches.

(2)  Information coordination.  The climate collaborative will:

(A)  Develop priorities and a public education and engagement framework to encourage behavior change to meet reduction goals.  In this process, the climate collaborative shall define and carry out social marketing strategies with broad ethical goals to ensure the content of the education and engagement programs provides impartial technical information as well as achievable mitigating measures to reach targeted reduction goals.

(B)  Provide guidance and oversight to state officials and legislators to help inform, plan, and implement a state-level web-based framework to facilitate communications.

(i)  The interactive web site shall be designed to

(I)  improve community leader, policy maker, and

community-based organizational access to useful resources and services;

(II)  provide tools and resources that support a

growing network of groups and project activities;

(III)  advance a statewide marketing brand to encourage behavior change and advancement of shared goals; and

(IV)  coordinate statewide activities on climate change and all related energy activities.

(ii)  Consideration shall be given to developing this interactive web site in a manner that would allow it to host the following:

(I)  A calendar of community-level events and educational programs open to the public and to specific sectors or interest groups.

(II)  An educational climate change library with links.

(III)  A catalogue of documents relevant to the greenhouse gas reduction plans of the state, state agencies, and other governmental entities, including pending and recently enacted legislation.

(IV)  Several managed forums for discussion:  one for input to Vermont’s greenhouse gas reduction plans and legislation related to climate change, and a second for the general exchange of ideas, technical solutions, success stories, and Vermont-specific needs.

(V)  An interactive directory of energy and climate change groups, structured to allow sharing of contemporary planning and project activities at the municipal and regional levels.

(VI)  Emissions calculator tools, such as the 10 percent Challenge program pursuant to which individual households and businesses are enabled to estimate their emissions.

(VII)  A listing of rebates and tax credits related to energy efficiency improvements.

(VIII)  A marketing and promotional kit containing educational outreach activities for use by interested entities and community-based groups to help raise public awareness and motivate behavior change.

(IX)  A recognition program that includes awards, “Vermont green,” for reductions of greenhouse gas emissions.

(C)  Recommend a state funding mechanism to help subsidize coordinated education, engagement, marketing, and technical assistance programs, including the following:

(i)  The Vermont energy education program, which provides

in-depth, science-based, in-school programs on energy efficiency and climate change at all levels.

(ii)  The 10 percent Challenge program, a voluntary civic outreach program to encourage households, businesses, and institutions to reduce their greenhouse gas emissions by at least 10 percent.

(iii)  The Vermont energy and climate action network, which encourages and supports energy committee project efforts in every community.

(iv)  The Vermont high performance schools initiative.

(v)  The Vermont land use education and training collaborative.

(D)  Identify and establish climate change “best practices” for public and private use in all sectors of the economy, with particular emphasis on integrating best practices into public school design, construction, and operations, in order to help educate students, staff, and parents about sustainable building environments.

(E)  Encourage, foster, and promote the research and academic excellence necessary to advance statewide solutions to climate change.  This may include:

(i)  developing university “Centers of Excellence” to advance technical solutions to climate problems; and

(ii)  encouraging faculty, staff, and student energy teams and student-led projects and initiatives as illustrated by the Vermont campus energy group.

(F)  Research and synthesize the other suggested statewide policies to ensure that a unified and multilayered marketing brand, such as “Vermont, the Green Economy,” is coordinated, implemented, and maintained.

(G)  Develop a consistent brand identity, such as “Vermont Green,”  framed with market data to adapt messaging to different user groups within Vermont in a manner that establishes a recognizable identity around climate change and connects individuals to the broader goals of the state’s reduction strategies.

(H)  Establish a benchmarking system in order to measure and track barriers and opportunities for behavior change, possibly by means of surveys that measure successes of greenhouse gas reduction strategies in the public sector.

(I)  Ensure the development of a consistent messaging strategy that will facilitate the ability of the public to make lifestyle changes that reduce emissions and that will be directly connected to and will support greenhouse gas reduction goals and strategies that exist throughout the state.

(3)  State government leading by example.  The climate collaborative will work with state entities in their efforts to reduce greenhouse gas emissions from state operations in a manner that will reduce emissions from a 1990 baseline by 25 percent by 2012, by 50 percent by 2028, and if practical, by 75 percent by 2050.  In order to meet these goals, it is intended that the state lead by example in adopting the best practices in all ways, including procurement and program development, in order to serve as a model for other emitters, and it is anticipated that state entities will accomplish continuous annual emission reductions that should average at least a three percent reduction per year.  The state fleet of motor vehicles should be a model of fuel efficiency, relying heavily on hybrid vehicles and other highly efficient transportation modes.  The climate collaborative should advise the state in the development of an internal offset program within state government, specific to functions, such as air travel, which may not be possible to eliminate or alter and should use the proceeds to otherwise reduce the state’s carbon footprint.  The climate collaborative will work to assure that high performing state entities receive public recognition and that there is greater interaction and information sharing, with regard to greenhouse gas reductions, within and among state entities.

(4)  Study of revenue alternatives.  The climate collaborative will establish a working group to evaluate and develop recommendations regarding various scenarios for funding greenhouse gas reduction efforts, and in this process, shall develop the following:

(A)  An evaluation of assessing a carbon tax for fossil fuel sources, with the revenue collected targeted toward funding programs that reduce the state’s overall carbon footprint.

(B)  An evaluation of ways to fund incentives:

(i)  to support clean consumer technologies, such as solar water heaters, to displace oil usage (including rebates, direct subsidies, and tax credits); and

(ii)  to support the conversion to lower carbon fuels, which may be targeted at:

(I)  the expansion of cleaner fuel production in the state; and

(II)  incentives for consumers to convert to lower carbon fuels.

(C)  An evaluation of ways, alternative to the gas tax, to fund the transportation system, including public transit operations.  As part of this process, consideration shall be given to enactment of or adjustments to a feebate system and to the imposition of taxes per gallon, per mile, per carbon unit, or per freight car.  Consideration shall be given to offsetting the increases in these taxes by reductions in the property tax.

(D)  Recommendations for ways to continue to fund incentives to encourage the purchase and use of alternative vehicles, particularly in case federal incentives expire.

(E)  Recommendations regarding how best to reduce or eliminate the motor fuels tax on biodiesel and ethanol.  As part of this process, consideration shall be given to developing a system to provide for monthly credit for biodiesel and ethanol-blended fuel that would be equivalent to the state motor fuels tax owed on the nonbiofuels portion of the fuel blend.  Under this system, monthly tax credit would be claimed on the same form, the biodiesel and fuel alcohol providers form, that marketers currently file with the department of motor vehicles, in order to pay the existing fuel tax.

(F)  Recommendations regarding how to craft incentives for development to take place on land that has easy access to public transit facilities.

(5)  Carbon sequestration.  The climate collaborative shall arrange for the expansion of existing educational programs for foresters and landowners with regard to the greenhouse gas sequestration benefits provided by forests and by farmland.

(6)  Climate change adaptation plan.  The climate collaborative shall establish a working group that includes the input of all state entities to advise it within one year of the working group’s creation with regard to the development and adoption of a climate change adaptation plan, which shall identify opportunities to address climate adaptation issues and risks within the state and shall recommend tangible, implementable measures that each state entity should take in order to mitigate these issues and risks to Vermont citizens.  The working group should include a broad enough range of participants to ensure that all potential impacts of climate change are identified in the plan.

(A)  The climate change adaptation plan shall include the following elements:

(i)  Comprehensive identification of potential short-term,

mid-term, and long-term impacts associated with climate change in Vermont.

(ii)  Recommended steps to minimize risk to humans, natural and economic systems, water resources, temperature-sensitive populations and systems, energy systems, transportation systems, communications systems, vital infrastructure and public facilities, and natural lands (such as wetlands, forests, and farmland), and all other identified and affected sectors or areas of concern throughout the state.

(iii)  Recommendations regarding the coordination of response efforts through the appropriate state, local, and federal agencies, organizations, or other entities or initiatives.

(iv)  Characterization of the potential risks and costs of inaction; characterization of the potential costs, benefits, and co-benefits associated with specific policy and program actions; and establishment of time- and

program-based goals, on a state-entity-by-state-entity basis, to be followed by monitoring and reporting regarding success in meeting those goals.

(v)  An examination of the benefits and costs of adaptation measures or responses relative to a status quo or no-action approach and the resources needed by each state entity, and overall, in order to implement adaptation measures in the plan.  The results of the cost-benefit analysis should also be used to set priorities, on an entity-by-entity basis as well as on an overall basis, for addressing short-term, mid-term, and long-term impacts of climate change on citizens, ecosystems, and the economy of Vermont.

(vi)  Creation of a scientific strategy, engaging the environmentally aware public, educational institutions, and state agencies in the monitoring of climate and ecological trajectories in Vermont, in order to inform updates to the adaptation plan.

(vii)  Priority consideration is given to adaptation measures that also mitigate greenhouse gas emissions.

(viii)  Recommendations are prioritized on a

state-entity-by-state-entity basis, as well as overall, based on the certainty and severity of adverse impacts to citizens, ecosystems, and local economies; and may address the establishment of financial structures and the creation of markets that are likely to thrive under anticipated climate impacts.

(ix)  Mechanisms are developed to assure that “low-hanging fruit” opportunities should be addressed by each state entity as rapidly as feasible, and that proactive adaptation initiatives will commence within the next 2–3 years.

(x)  Parallel public information and outreach efforts commence as soon as is reasonably practical, and continue as the adaptation plan is implemented.

(B)  The climate change adaptation plan shall be reviewed and updated no less frequently than every five years, or more frequently, as deemed necessary by the climate collaborative, or if requested by resolution of one or more houses of the general assembly.  In the updating process, consideration shall be given to the incorporation of new information regarding risks, responses, and opportunities; the identification of new initiatives; the improvement of existing initiatives; and an evaluation of the effectiveness of measures taken.

(C)  The commissioner of public service annually shall submit budget recommendations for funding adequate to cover development and revision of the climate adaptation plan, cost benefit analysis involved in guiding and informing the development of the plan, and the expenses incurred by the climate collaborative and working group members.

(D)  The climate collaborative may form subgroups, as may each state entity, to address and report with regard to specific issues and sectors, such as societal infrastructure, agricultural and forest resources, and recreational and ecological sectors.

(E)  The climate change adaptation plan shall be developed in a manner that is coordinated with state and local emergency preparedness planning in a manner that will help prevent or reduce costs that may be associated with future catastrophic events and long-term climate change impacts.  It should help direct public and private investment more effectively, while ensuring preparedness to help avoid extensive cost implications to state, county, municipal, and federal entities.

(7)  Smart growth and Act 250.  The climate collaborative, in conjunction with the land use panel of the natural resources board and the agency of natural resources, shall convene a task force consisting of a wide range of interested persons, which shall be designated the smart growth and Act 250 task force.  The task force shall collaborate with state entities that often obtain party status under 10 V.S.A. chapter 151 to help those entities develop project review guidelines that inform an applicant how those entities integrate energy conservation policies, smart growth principles as defined in 24 V.S.A. § 2791, and rural lands protection concepts into the review they conduct and into the recommendations and testimony they may offer in particular instances regarding whether an applicant should be awarded an affirmative finding under 10 V.S.A. § 6086(b)(9)(H)(costs of scattered development), (J)(public utility services), and (L)(rural growth areas).  In addition, the smart growth and Act 250 task force shall report to the natural resources and energy committees of the general assembly with regard to the following:

(A)  Identification of alternative approaches by which the state might incorporate concepts of carbon neutrality and the smart growth principles established in 24 V.S.A. § 2791 into the review process established under 10 V.S.A. chapter 151, together with an evaluation of those alternatives, and appropriate recommendations.  As part of this process, consideration shall be given to assuring that smart growth principles and principles of energy efficiency are observed in the selection of land for off-site mitigation for the conversion of agricultural lands, as provided under 10 V.S.A. § 6093. 

(B)  Identification of reasonable alternative approaches, an evaluation of those alternatives, and recommendations regarding refinements of the Act 250 regulatory process that would help enable the state to meet its goals of reducing the rate at which agricultural lands are converted to development by 25 percent by 2012, reducing that rate by 50 percent by 2020, and maintaining that rate thereafter.

(8)  Commuter benefits program.  The climate collaborative, in coordination with the agency of transportation, employers, and interested persons shall encourage all government units, all colleges and universities, and all Vermont employers of more than 50 employees to offer commuter benefits programs, which shall focus on the workplace and reducing single occupancy commutes, by measures which may include reducing free parking for single occupancy vehicles, providing paid or pre-tax transit passes, providing a guaranteed ride home benefit, allowing periodic telecommuting, and joining a program pursuant to which an institutional identification card may serve as a transit pass.  Commuter benefits need not imply use of public transit.  Employers can reward or provide incentives for any commute that avoids a single occupancy vehicle.  To implement this program, the climate collaborative shall provide employer education and technical assistance, especially for large employers, and shall work with towns to help them update parking policies and requirements.

(9)  Low carbon fuel standard.  The climate collaborative shall establish a task force to include fuel retailers and wholesalers, vehicle fleet managers, biofuels producers, vehicle owners, and other interested persons to propose to the general assembly a program that would implement a low-carbon fuel standard.  This program would entail establishing a full life cycle greenhouse gas rating system, applying it to available fuels, and setting overall goals for the life cycle greenhouse gas emissions of the total statewide fuel mix.  Under the program, a fuel provider would be able to blend or sell an increasing proportion of low-carbon fuels, use previously banked credits, or purchase credits from fuel providers who have earned credits by exceeding requirements established for the program.  The program should contain a provision that ensures that if the cost of alternative fuels, over a period of time, exceeds the cost of conventional fuels by more than a specified amount, the renewable fuel standard would be temporarily suspended.  As part of this program, the climate collaborative shall:

(A)  Provide information and education outreach that focuses on voluntary methods of expanding the proportion of low-carbon fuels consumed; that provides the public with information on the use of and effects of using ethanol and other alternative fuels in their existing vehicles; that provides information about biodiesel use and effects to the general public and particularly to trucking and shipping companies and small business owners and operators; and that indicates where diesel and plug-in hybrid vehicles, and vehicles fueled by alternative fuels, may be purchased and that explains their environmental and fuel saving benefits.

(B)  Provide technical assistance through vehicle dealers, consumer technical support groups, fuels trade and advocacy groups, and public demonstrations. 

(C)  Pursue federal and state funding sources to finance the installation of additional fuel pumps and appropriate infrastructure throughout the state, and to provide financial incentives for renewable fuels distributors, such as grants or loan guarantees for the construction of renewable fuels distribution facilities.

(D)  Showcase examples of existing multi-fuel pumps in the state that provide a model  for dispensing three alternative fuels:  B20 (20 percent biodiesel, 80 percent diesel), E10(10 percent ethanol, 90 percent gasoline), and E85 (85 percent ethanol, 15 percent gasoline).

(E)  Develop a “Vermont Green” tourism package, in which bus tours fueled by biofuels are linked with the farms that produce the feedstocks for the biofuels, and conduct public demonstrations of expanded uses of biofuels produced from in-state sources.

(F)  Analyze, quantify, and publicize a range of cost-benefits that accrue to renewable fuels vehicle owners.

(G)  Ensure that the state advocates for significant federal funding for research and development in order to commercialize cellulosic ethanol technology and processes and to enable the state to meet its ethanol targets.

(H)  Support research on the production of hydrogen as a transportation fuel.

(10)  Biofuels action plan.

(A)  The climate collaborative shall collaborate with the agency of agriculture, food and markets and the private sector to develop an action plan for the development of significant biofuel capacity from high value feedstocks, to meet the following goals:

(i)  to produce biodiesel within the state in an amount equal to six percent of total distillate used, by 2015, and 21 percent by 2028;

(ii)  to produce cellulosic ethanol within the state in an amount equal to three percent of total distillate used, by 2015, and 15 percent by 2028.

(B)  The  biofuels action plan shall include:

(i)  Recommendations for incentives in the form of grants or tax incentives for incurred capital costs for producers of feedstocks, such as oil crops, methanol, and ethanol.

(ii)  Incentives for expanded research for oilseed production and processing, which shall include crops not typically grown in the state, and for the production of cellulosic ethanol from wood, forest residue, grass straw, or other sources.

(iii)  Active solicitation of new producers, technical assistance for new producers, and streamlined permitting of production facilities.

(iv)  Expanded producer education to assure the workforce has the skills required for production.

(v)  Consumer education regarding the benefits of creating a demand for locally produced biofuels.

(11)  Green building construction.  The climate collaborative shall work with construction trades, vocational schools, universities, and the state’s efficiency entities to develop and implement an energy efficiency training and education program for builders, contractors, building managers, buildings enforcement officials, building owners, and others that is designed to deliver high-quality training on various energy efficiency construction and energy management topics and to train buildings professionals to promote energy efficient construction and ensure ongoing wise energy management in buildings.

(A)  The program shall assure that assistance is provided to design teams and building owners with regard to preliminary studies of energy optimization options, and so as to ensure that Energy Star benchmarking, target finder, and other tools used to establish targets and goals and to track progress are incorporated into everyday design.

(B)  The program will be the subject of an annual report to the department of public service outlining accomplishments of the program and identifying goals for the upcoming year.

(C)  The department of public service shall provide for random audits of the buildings constructed or operated by individuals who participated in the program, and shall evaluate and report on the effectiveness of the program and on the degree of compliance with building construction recommendations and with energy efficient operating techniques.

(12)  Resource assessment.  On an annual basis, the climate collaborative shall assess the extent to which an adequate number of qualified personnel are assigned by the state and available to perform functions required by law with regard to climate change, and shall report to the governor and the general assembly with the results of that assessment.  In addition, the climate collaborative shall assure that its own budget recommendations to the governor contain adequate funding to allow the performance of the duties required of it, and it shall comment on the budget recommendations of other executive entities, to the extent that those budgets affect the state’s capabilities to address climate change.

(13)  Report on extent of funding.  The climate collaborative shall report annually on the extent to which:

(A)  Wastewater spending, school construction dollars, and transportation dollars are directed to downtowns and growth areas designated under 24 V.S.A. chapter 76A, as required by statute.

(B)  The housing and conservation board is fully funded, as required by statute.

(C)  Existing state buildings and schools are maintained in downtown and growth area locations, and new state buildings and schools are sited in those locations.

(D)  The Act 200 planning process is fully implemented, thereby assuring:

(i)  that state agencies conduct planning as required under 3 V.S.A. chapter 67;

(ii)  that the required coordination takes place among state agencies, and in the development of state agency plans, regional plans, and municipal plans;

(iii)  the development of accountable strategies in all plans to achieve the planning goals established in 24 V.S.A. chapter 117.

(E)  There is adequate staffing and support for the growth center planning coordination group established under 24 V.S.A. § 2793c.

(F)  Qualified personnel and technical and financial resources are assigned and available:

(i)  to assist municipalities in identifying and adopting planning principles and programs to reduce greenhouse gas emissions;

(ii)  to enable municipalities to focus growth within their communities by development of measures that include the incorporation of pedestrian and bicycle considerations into town plans;

(iii)  to expand and implement regional bicycle and pedestrian opportunities;

(iv)  to assure the ability of interested municipalities to identify appropriate growth center densities and to encourage appropriate development to attain those densities;

(v)  to enable the acquisition and implementation by municipalities of growth management techniques;

(vi)  to enable and encourage the use of regional and local land use planning tools that promote the viability of farms and forestland.

* * * Agency of Agriculture, Food and Markets * * *

Sec. 4.  6 V.S.A. § 1(c), (d), and (e) are added to read:

(c)  The secretary shall develop a program for increasing the development and implementation of nutrient management plans that meet the natural resources conservation service (NRCS) technical practice code and that are designed to increase soil carbon levels and minimize nitrogen run-off and subsequent nitrous oxide (N2O) emissions on 75 percent of farm acreage by 2012, and 90 percent by 2028.  In addition, the goal shall be to inject 10 percent of liquid dairy manure and processed waste water by 2012, and to increase acreage managed under cover crop to 25 percent of annual cropland by 2012 and to 50 percent by 2028.

(1)  The program shall include the evaluation of practices that will reduce nitrogen leaching and run-off and potentially increase soil carbon levels in order to determine their potential utility for a range of sizes of agricultural operations, and may include the following:

(A)  Maximizing the use of on-farm manure and processed waste water to reduce imported fertilizers.

(B)  Codifying and further supporting the farm agronomic practices program by using crop rotation and increasing the use of cover cropping on annual crop land to minimize the loss of organic matter from soil erosion.

(C)  Increasing the use of manure injector technologies on grass and no-till crop land.

(D)  Planned grazing, biological subsoiling (using root crops and deep tap-rooted plants), composting, and compost tea.

(E)  Pasture cropping, or double cropping; charcoal soil amendments (e.g., Amazon dark earths and the Epridra Process).

(F)  Biodynamic preparations and mineralization schemes, including rock dusts and sea minerals.

(G)  Microbial stimulants (e.g., effective microorganisms, indigenous microorganisms).

(H)  Green manures, mulches, seaweed products, recycled green wastes, biosolids, humic substances, and dung beetle and earthworm reintroduction.

(2)  As part of the program, the secretary, in consultation with the state climate change climate collaborative, shall:

(A)  Endeavor to fund and implement the natural resources conservation service (NRCS) grassland reserve program in order to increase carbon sequestration.

(B)  Provide cost-share assistance for farmers to purchase manure injection equipment to retrofit existing manure spreaders or purchase new equipment.

(C)  Provide cost-share assistance for farms to develop and implement nutrient management plans for smaller dairy farms and continue to provide annual assistance so that existing plans on medium-sized farms continue to be implemented.

(D)  Provide cost-share assistance under the farm agronomic practices program so that farms implement cover crops and other soil erosion and land cover practices.

(E)  Make recommendations regarding other ways to create incentives for carbon sequestration on farm and forest land, Vermont’s “green bank.”

(d)  The secretary shall develop a program designed to reduce methane and nitrous oxide emissions by providing cost-share assistance for construction of waste management systems, including those that would increase the capture of methane emissions from the anaerobic decomposition of manure and other wastes and the use of these emissions as energy sources.  The goal of the methane digester portion of the program shall be to digest and use 15 percent of the state’s dairy cattle manure by 2012, and 50 percent by 2028.  The goal of a second aspect of this emissions reduction program shall be to increase the percentage of manure composted on poultry and on appropriate livestock farms to 25 percent by 2012, and 50 percent by 2028.  In addition, the program shall provide technical assistance on the adoption of new technologies and shall support the development of service industries to maintain the new technologies.

(e)  The secretary shall develop recommendations for measures to reduce the loss and fragmentation of important primary agricultural soils located in rural areas, which shall include supporting the full funding of the Vermont housing and conservation fund, according to the statutory formula, and encouraging expanded enrollment in the use value appraisal program.  The state’s goal is to reduce the rate at which agricultural lands are converted to development by 25 percent by 2012, to reduce that rate by 50 percent by 2020, and to maintain that rate thereafter.  As part of this process, the secretary shall take steps which may include:

(1)  conducting a literature review of concepts and strategies for primary soils retention;

(2)  scenario planning for conservation and development;

(3)  establishing regional focus groups to collect public input on land use scenarios;

(4)  identifying strategies for retention of primary soils;

(5)  performing economic analysis of retention alternatives;

(6)  conducting an annual evaluation of the level of success of the program established by this section.

Sec. 5.  6 V.S.A. § 2963(c) is added to read:

(c)  The agricultural development division shall develop strategies designed to increase the production, processing, packaging, storage, and distribution of locally grown animal products, grains, vegetables, and fruits and their consumption in Vermont at a rate that, by 2012, will increase sales and consumption of local farm products by 50 percent above levels existing in 2007, and will increase storage and processing capacity of locally grown farm products by 20 percent above levels existing in 2007.  A goal is to increase the purchasing of Vermont-produced agriculture products to 30 percent of total purchased agricultural products in the state by 2028.  Among strategies developed under this subsection shall be strategies:

(1)  to establish and promote a “virtual farmers market” to help boost sales;

(2)  to expand meat production and self-sustaining cold and warm weather products;

(3)  to support the location of food processing, storage, and distribution centers adequate to serve the region’s needs;

(4)  to expand technical and financial assistance for mobile livestock processing and fruit and vegetable freezing facilities or other innovative approaches to process and store locally produced livestock, fruits, and vegetables;

(5)  to expand technical, financial, and economic development assistance to create year-round production facilities that use waste heat from industrial, commercial, utility, and farm production;

(6)  to engage surrounding states in the region to develop a regional plan to increase regional production, processing transport, and consumption of food grown in the region;

(7)  to retain the availability for agricultural uses of important agricultural soils that are located in rural areas and that may be subject to fragmentation or conversion to other uses, due to development that is not subject to regulation under 10 V.S.A. chapter 151.

* * * Auto Insurance * * *

Sec. 6.  8 V.S.A. § 4211 is added to read:

§ 4211.  PAY AS YOU DRIVE INSURANCE

The commissioner shall adopt rules that require companies that offer automobile insurance in the state to offer pay as you drive insurance, a more actuarially accurate insurance option in which a portion of the price of insurance increases as the number of miles travelled increases, and decreases as the vehicle is driven less.  Prior to initiating rulemaking under this section, the commissioner shall evaluate:

(1)  an alternative in which the consumer pays a fixed fee up front, with a reimbursement or additional payment due at the end of the policy period;

(2)  an alternative in which the consumer is billed on a monthly basis, similar to utility billing, based on mileage driven;

(3)  an alternative in which insurance is purchased for a certain mileage, instead of for a period of time;

(4)  an alternative in which premiums are set in advance, within specific ranges for anticipated mileage, and discounts may be paid, based on mileage actually driven;

(5)  components pursuant to which a consumer pays the same amount per mile, as compared to components in which a consumer pays an increasing rate as the number of miles driven increases.  If the latter alternative is pursued, it shall be constructed in a manner that avoids creating a perverse incentive for a multi-vehicle family to use a less efficient vehicle after the more efficient vehicle reaches the mileage at which the price per mile increases.

* * * Pollution Abatement Facilities * * *

Sec. 7.  10 V.S.A. § 1278 is amended to read:

§ 1278.  OPERATION, MANAGEMENT, AND EMERGENCY RESPONSE

               PLANS FOR POLLUTION ABATEMENT FACILITIES

(a)  Findings.  The general assembly finds that the state shall protect Vermont’s lakes, rivers, and streams from pollution by implementing programs to prevent sewage spills to Vermont waters and by requiring emergency planning to limit the damage from spills which do occur.  In addition, the general assembly finds it to be cost-effective and generally beneficial to the environment to ensure energy efficiency in the operation of treatment facilities.

(b)  Planning requirement.  Effective July 1, 2007, the secretary of natural resources shall, upon renewal of a permit issued under section 1263 of this title, require a pollution abatement facility, as that term is defined in section 1571 of this title, to prepare and implement an operation, management, and emergency response plan for each permitted facility.  An operation, management, and emergency response plan shall include the following:

(1)  Identification of those elements of the facility, including collection systems that are determined to be prone to failure based on installation, age, design, or other relevant factors.

(2)  Identification of those elements of the facility identified under subdivision (1) of this subsection which, if one or more failed, would result in a significant release of untreated or partially treated sewage to surface waters of the state.

(3)  A requirement that the elements identified in subdivision (2) of this subsection shall be inspected in accordance with a schedule approved by the secretary of natural resources.

(4)  An emergency contingency plan to reduce the volume of a detected spill and to mitigate the effect of such a spill on public health and the environment.

* * *

(d)  Energy efficiency.

(1)  The secretary shall require that there be conducted an evaluation of the potential for energy efficiency and energy production improvements, which shall include:

(A)  a quantification of annual energy consumption;

(B)  an assessment of the potential for energy savings;

(C)  an assessment of the potential for energy production through the use of digester gas;

(2)  The secretary shall institute a program for:

(A)  the installation and use of cost-effective lighting retrofits;

(B)  the cost-effective conversion to heat sources other than electric heat;

(C)  the installation of high-efficiency influent and effluent pumps, high-efficiency motors, and variable frequency drives;

(D)  evaluating the costs and benefits to second-stage activated sludge mixing and aeration, and implementing appropriate technologies, based upon that evaluation;

(E)  identifying and utilizing opportunities for peak demand reduction and for optimizing load profiles;

(F)  identifying and utilizing opportunities for energy savings by

co-generating electricity and thermal energy on site, through the capture and use of anaerobic digester gas.

(e)  Program efficiency goal.  It is a goal of the state to use wastewater digester gas to produce energy where feasible, and to increase the energy efficiency of treatment plant operations by 15 percent by 2012 and by 25 percent by 2028.

Sec. 8.  10 V.S.A. § 6086(a) is amended to read:

(a)  Before granting a permit, the district commission shall find that the subdivision or development:

* * *

(5)  Will not cause unreasonable congestion or unsafe conditions with respect to use of the highways, sidewalks, bikeways, waterways, railways, airports and airways, and other means of transportation existing or proposed and considers connections to transit, bicycle, and pedestrian flow, and minimizes increase in motor vehicle use. 

* * *

* * * Solid Waste Planning * * *

Sec. 9.  10 V.S.A. § 6604(a) and (c) are amended to read:

(a)  No later than April 30, 1988 the secretary shall publish and adopt, after notice and public hearing pursuant to chapter 25 of Title 3, a solid waste management plan which sets forth a comprehensive state-wide strategy for the management of waste, including whey.  No later than July 1, 1991, the secretary shall publish and adopt, after notice and public hearing pursuant to chapter 25 of Title 3, a hazardous waste management plan, which sets forth a comprehensive statewide strategy for the management of hazardous waste.

(1)(A)  The plans shall be based upon the following priorities, in descending order:

(A)(i)  the greatest feasible reduction in the amount of waste generated;

(B)(ii)  reuse and recycling of waste to reduce to the greatest extent feasible the volume remaining for processing and disposal;

(C)(iii)  waste processing to reduce the volume or toxicity of the waste stream necessary for disposal;

(D)(iv)  land disposal of the residuals.

(B)  Processing and disposal alternatives shall be preferred which do not foreclose the future ability of the state to reduce, reuse and recycle waste. In determining feasibility, the secretary shall evaluate alternatives in terms of their expected life-cycle costs.

(2)  The plans shall be revised at least once every five years and shall include:

(A)  methods to reduce and remove material from the waste stream, including commercially generated and other organic wastes, used clothing, and construction and demolition debris, and to separate, collect, and recycle, treat or dispose of specific waste materials that create environmental, health, safety, or management problems, including, but not limited to, tires, batteries, obsolete electronic equipment, and unregulated hazardous wastes.  These portions of the plans shall include strategies to assure recycling in the state, and to prevent the incineration or other disposal of marketable recyclables.  They shall consider both the current solid waste stream and its projected changes, and shall be based on:

(i)  an analysis of the volume and nature of wastes generated in the state, the sources of those wastes, and the current fate or disposition of those wastes;

(ii)  an assessment of the feasibility and cost of recycling each type of waste, including an assessment of the feasibility of providing the option of single source recycling;

(iii)  a survey of existing and potential markets for each type of waste that can be recycled;

(B)  a proposal for the development of facilities and programs necessary at the state, regional or local level to achieve the priorities identified in subdivision (a)(1) of this section.  Particular consideration shall be given to the need for additional regional or local composting facilities, the need to expand the collection of commercially generated organic wastes, and the cost effectiveness of developing single stream waste management infrastructure adequate to serve the entire population, which may include material recovery centers.  These portions of the plan shall be based, in part, on an assessment of the status, capacity, and life expectancy of existing treatment and disposal facilities, and they shall include siting criteria for waste management facilities, and shall establish requirements for full public involvement.

(3)  A goal of the plans shall be to reach a per-capita diversion rate of 35 percent by 2012 and 50 percent by 2028.   The effectiveness of the plans shall be assessed no less frequently than every three years, with regard to progress in meeting these goals, and they shall be revised to be more aggressive if trends indicate the goals may not be met, with consideration given to instituting additional waste diversion measures, including the establishment of a

source-separated organics waste program and disallowing the landfilling of organic wastes.

(c)  The secretary shall hold public hearings, perform studies as required, conduct ongoing analyses, develop and promote prototype residential and commercial waste prevention programs, develop sector-specific waste minimization strategies in conjunction with affected parties and local communities, develop a statewide communications portal that will promote and keep citizens aware of effective waste reduction and minimization initiatives, and make recommendations to the general assembly with respect to the development of accessible, cost-effective and sustainable policies, strategies and educational and media campaigns that will promote cultural and behavioral changes across the state, leading to a reduction of the waste stream.  In this process, the secretary shall consult with manufacturers of commercial products and of packaging used with commercial products, retail sales enterprises, health and environmental advocates, waste management specialists, the general public, and state agencies.  The goal of the process is to ensure that packaging used and products sold in the state are not an undue burden to the state’s ability to manage its waste.  The secretary shall develop an assistance program to provide engineering support to businesses in order to make it easier for them to reduce product packaging and shipping materials and to select product packaging and shipping materials that are highly recyclable, and otherwise shall seek voluntary changes on the part of the industrial and commercial sector in both their practices and the products they sell, so as to serve the purposes of this section.  In this process, the secretary shall encourage manufacturers to assure that end-of-life management solutions for their products are reasonable and consistent with the goal of reducing the environmental impact of waste.  The secretary may obtain voluntary compliance schedules from the appropriate industry or commercial enterprise, and shall entertain recommendations for alternative approaches.  The secretary shall report at the beginning of each biennium to the general assembly, with any recommendations or options for legislative consideration.

(1)  In carrying out the provisions of this subsection, the secretary first shall consider ways to keep hazardous material and nonrecyclable, nonbiodegradable material out of the waste stream, as soon as possible.  In this process, immediate consideration shall be given to the following:

(A)  evaluation of products and packaging that contain large concentrations of chlorides, such as packaging made with polyvinyl chloride (PVC);

(B)  evaluation of polystyrene packaging, particularly that used to package fast food on the premises where the food is sold;

(C)  evaluation of products and packaging that bring heavy metals into the waste stream, such as disposable batteries, paint and paint products and containers, and newspaper supplements and similar paper products;

(D)  identification of unnecessary packaging, which is nonrecyclable and nonbiodegradable.

(2)  With respect to the above, the secretary shall consider the following:

(A)  product and packaging bans, products or packaging which ought to be exempt from such bans, the existence of less burdensome alternatives, and alternative ways that a ban may be imposed;

(B)  tax incentives, including the following options:

(i)  product taxes, based on a sliding scale, according to the degree of undue harm caused by the product, the existence of less harmful alternatives, and other relevant factors;

(ii)  taxes on all nonrecyclable, nonbiodegradable products or packaging;

(C)  deposit and return legislation for certain products.

* * * Transportation * * *

Sec. 10.  19 V.S.A. § 10b(b) is amended to read:

(b)  In developing the state’s annual transportation program, the agency shall, consistent with the planning goals listed in 24 V.S.A. § 4302 as amended by No. 200 of the Acts of the 1987 Adj. Sess. (1988) and with appropriate consideration to local, regional, and state agency plans:

(1)  Develop or incorporate designs that provide safe and efficient transportation and promote economic opportunities for Vermonters and the best use of the state’s environmental and historic resources.  In this process, the agency shall assure that the state’s transportation policy adequately balances the rehabilitation and maintenance of existing highways with the need to plan and implement alternative modes of transportation in the future that will help alleviate present and future capacity needs through planning for and implementation of fiscally and environmentally sound projects.

(2)  Manage available funding to:

(A)  give priority to preserving the functionality of the existing transportation infrastructure; and

(B)  adhere to credible project delivery schedules.


Sec. 11.  19 V.S.A. § 10e is amended to read:

§ 10e.  STATEMENT OF POLICY; RAILROADS

(a)  The general assembly recognizes that rail service, both passenger and freight, is an integral part of the state’s transportation network. Accordingly, it is hereby declared to be the policy of the state of Vermont:

(1)  to To provide opportunities for rail passenger services by cooperating with the federal government, other states, and providers of those services, with priority to be given to the services likely to complement Vermont’s economic development efforts and meet the needs of the traveling public;.  It is a goal of the state to increase passenger rail use within the state by 200 percent by 2028.

(2)  to To preserve and modernize for continued freight railroad service those railroad lines, both within the state of Vermont and extending into adjoining states, which directly affect the economy of the state or provide connections to other railroad lines which directly affect the economy of the state;.  It is a goal of the state to increase the use of rail freight within the state by 100 percent by 2028.

(3)  in In those cases where continuation of freight railroad service is not economically feasible under present conditions, to preserve established railroad rights-of-way for future reactivation of railroad service, trail corridors, and other public purposes not inconsistent with future reactivation of railroad service; and.

(4)  to To seek federal aid for rail projects that implement this section’s policy goals.

(b)  To complement the regular maintenance efforts of the lessee/operators of state-owned railroads, taking into account each line’s long-term importance to the state’s transportation network, economic development, the resources available to the lessee/operator and relevant provisions of leases and other agreements, the agency may develop programs to assist in major rehabilitation or replacement of obsolete bridges, structures, rails, and other fixtures.  In addition, the agency shall maintain and improve intercity bus and rail, freight and commuter rail services, and the necessary intermodal connections, and shall increase the efficiency of equipment and the extent to which equipment selection and operation can limit or avoid the emission of greenhouse gases,  by means which may include the following:

(1)  Replacement of Amtrak engines with more efficient diesel multiple units.

(2)  Increasing the marketing of the state’s current Amtrak routes.

(3)  Expanding passenger rail service to Vermont’s western corridor.

(4)  Improving passenger rail connections to Montreal and Boston.

(5)  Determining the demand necessary to justify commuter rail service in certain corridors and working to provide that service, including piggybacking commuter and intercity rail services.

(6)  Providing adequate intermodal connections at all railroad stations, airports, and bus stops, which shall be accessible to bicycle and pedestrian traffic and which may include connections with jitney service, ski shuttles, and other shuttle bus service.

(7)  Targeting improved railroad station and airport intermodal connections for large institutions, companies, and the Vermont travel industry.

(8)  Providing adequate parking facilities at railroad and bus stations and airports.

(9)  Improving rail infrastructure to serve all freight needs, including  double-stacking on the western corridor.

(10)  Identifying and providing necessary freight modal transfer stations within Vermont and the region.

(11)  Working with municipalities to plan and regulate land use to accommodate rail and bus infrastructure and service.


* * *

Sec. 12.  19 V.S.A. § 10f is amended to read:

§ 10f.  STATEMENT OF POLICY; PUBLIC TRANSPORTATION

(a)  It shall be the state’s policy to make maximum use of available federal funds for the support of public transportation.  State operating support funds shall be included in agency operating budgets to the extent that funds are available. It shall be the state’s policy to support the maintenance of existing public transportation services and the creation of new service that is accessible and affordable to those who use these services.

(b)  The agency of transportation shall develop and periodically update a plan for investment in public transportation services and infrastructure as part of an integrated transportation system consistent with the goals established in 24 V.S.A. § 5083, and regional transportation development plan proposals and regional plans as required by 24 V.S.A. § 5089.

(1)  The plan shall include components that:

(A)  Expand public transit routes and ridership numbers in a manner that reduces vehicle miles traveled in commuting to and from work; that serves designated downtowns and growth centers, major employers and major highway corridors;  that improves intercity bus service throughout the northeast region; and that provides affordable, convenient, reliable, and frequent service.

(B)  Coordinate rideshare, public transit, park and ride, interstate, and bicycle and pedestrian planning and investment at the state, regional, and local levels, and create or expand regional connections within the state, in order to maximize interregional ridesharing and access to public transit.

(C)  Increase the number and capacity of park-and-ride facilities, assuring that they facilitate the use of public transit services, are integrated with bicycle and pedestrian facilities, and are available on the state highway system and at the regional, local, and neighborhood levels.

(D)  Establish or increase marketing and incentive programs to expand the extent to which individuals and places of employment participate in rideshare, carpooling, and vanpool programs and to promote specific alternative modes when those modes are ready to accept additional usage.  The rideshare program shall be configured so as to better promote and market both carpooling and vanpooling under a statewide, coordinated, interregional program.

(E)  Require periodic performance evaluations of existing transit routes and cost of service data so as to guide and evaluate the deployment of public transit services and assure that investment is directed to services that have the greatest potential to reduce vehicular miles traveled.

(F)  Encourage collaboration with existing public transit organizations, and among public transit provider regions, to evaluate, coordinate and plan services so as to increase rider density, whether by volunteer driver, van, or bus, and to deliver improved interregional services such as ridesharing and vanpools in order to reduce vehicular miles traveled.

(G)  Employ public-private partnerships to improve intercity bus service in the Route 7 corridor.

(2)  It is a goal of the state to increase the percentage of vehicles on the state’s highways that are not single occupancy vehicles (SOVs) by 40 percent by 2012 and by 100 percent by 2028.

(3)  The agency shall develop and make available to the traveling public a statewide geographic information system (GIS) database that coordinates all transportation options, facilities, and programs, and that provides web-based access to all modes of transportation and all inter-connection opportunities.

Sec. 13.  19 V.S.A. § 11f is added to read:

§ 11f.  GREENHOUSE GAS REDUCTION ACCOUNT

(a)  There is created a special account within the transportation fund, to be known as the greenhouse gas reduction account, for the purpose of promoting transportation alternatives that emit no greenhouse gases or low levels of greenhouse gases, which may include financing infrastructure and equipment for public transit purposes, and tax credits or other incentives for the purchase and use of highly efficient vehicles.

(b)  The account shall consist of:

(1)  the receipts from the pleasure car registration fee established by 23 V.S.A. § 361, to the extent that those receipts exceed the minimum rate established by that section.

(2)  receipts from the surcharge established by 32 V.S.A. § 8903(h) on the purchase and use of certain new pleasure cars and trucks that have an EPA mileage rating below levels specified in that subsection.   

Sec. 14.  19 V.S.A. § 2310 is amended to read:

§ 2310.  PAVEMENT OF HIGHWAY SHOULDERS

(a)  Notwithstanding the provisions of section 10c of this title, it is the policy of the state to provide paved shoulders on major state highways with the intent to develop an integrated bicycle route system and to make it easier and safer for pedestrian traffic.  This shall not apply to the interstate highway and certain other limited access highways.

(b)  Any construction, or reconstruction, including upgrading and resurfacing projects on these highways, shall include paved shoulders unless the agency deems certain sections to be cost prohibitive maintain or improve existing access and road surface conditions for bicycles and pedestrians along the shoulders of these highways.  Whenever possible, paving projects and other transit facilities improvements also shall maintain or improve existing access and road surface conditions for bicycles and pedestrians.


* * * Building Standards * * *

Sec. 15.  21 V.S.A. § 266(c) is amended to read:

(c)  Revision and interpretation of energy standards.  On or about January 1, 1999, and at least every three years thereafter, the commissioner of public service shall amend and update the RBES, by means of administrative rules adopted in accordance with 3 V.S.A. chapter 25.  In addition, the commissioner shall commence a rulemaking process to reflect appropriate revisions of pertinent national building codes within one month of the issuance of an updated standard for residential construction under the international energy conservation code (IECC) or under ASHRAE 90.1, the code of the American Society of Heating, Refrigeration and Air-Conditioning Engineers.  The department of public service shall provide technical assistance and expert advice to the commissioner in the interpretation of the RBES and in the formulation of specific proposals for amending the RBES.  At least a year prior to final adoption of each required revision of the RBES, the department of public service shall convene an advisory committee to include one or more mortgage lenders, builders, building designers, utility representatives, and other persons with experience and expertise, such as consumer advocates and energy conservation experts.  The advisory committee shall develop and present to the commissioner a version of the national initiative titled Architecture 2030 which has been adapted to include provisions that reflect Vermont’s localized issues and constraints such as the climate (including temperature, humidity, and solar and wind opportunities), architecture (including historic preservation, urban infill, and revitalizing efforts in towns), and funding constraints.  In addition, the advisory committee may provide the commissioner with additional recommendations for revision of the RBES.

* * *

Sec. 16.  21 V.S.A. § 266(i) and (j) are added to read:

(i)  Time of purchase standards for residential rental property.  By no later than July 1, 2009, the commissioner of public service shall amend the RBES to create an additional category of minimum standards that must be met at the time of sale of residential rental property that is sold on or after December 31, 2009.  These standards shall include definitions that clearly define residential rental property, may be based upon an affidavit declaring the intent of the buyer, and, in the case of a single-family home, shall contain provisions that prohibit rental within six months of purchase, if the property is declared in the affidavit to be purchased for other than rental purposes.  If a property subject to this subsection was constructed recently enough to be subject to more stringent standards under this section, those more stringent standards shall apply. 

(j)  Time of purchase standards for nonrental residential property.  By no later than July 1, 2012, the commissioner of public service shall amend the RBES to create an additional category of minimum standards that must be met at the time of sale of all residential nonrental property that is sold on or after December 31, 2013.  If a property subject to this subsection was constructed recently enough to be subject to more stringent standards under this section, those more stringent standards shall apply. 

Sec. 17.  21 V.S.A. § 268(c) is amended to read:

(c)  Revision and interpretation of energy standards.  On or about January 1, 2009, and at least every three years thereafter, the commissioner of public service shall amend and update the CBES by means of administrative rules adopted in accordance with 3 V.S.A. chapter 25.  In addition, the commissioner shall commence a rulemaking process to reflect appropriate revisions of pertinent national building codes within one month of the issuance of an updated standard for commercial building construction under the international energy conservation code (IECC) or under ASHRAE 90.1, the code of the American Society of Heating, Refrigeration and Air-Conditioning Engineers.  At least a year prior to final adoption of each required revision of the CBES, the department of public service shall convene an advisory committee to include one or more mortgage lenders, builders, building designers, utility representatives, and other persons with experience and expertise, such as consumer advocates and energy conservation experts.  The advisory committee may provide the commissioner of public service with additional recommendations for revision of the CBES.

* * *

* * * Pleasure Car Registration Fees * * *

Sec. 18.  23 V.S.A. § 361 is amended to read:

§ 361.  PLEASURE CARS

(a)  The annual fee for registration of any motor vehicle of the pleasure car type, and all vehicles powered by electricity, shall be $59.00:

(1)  $59.00 annually if the vehicle has an average city-highway EPA rating of at least 30 miles per gallon, or the vehicle is powered by electricity, or the vehicle has been modified to accommodate a physical disability and is granted a purchase and use tax exemption under the provisions of 32 V.S.A. § 8911(12), and the biennial fee shall be $108.00.

(2)  $125.00 annually for vehicles of model year 2009 or later if the vehicle has an average city-highway EPA rating of between 25 and 29 miles per gallon, and the biennial fee shall be $240.00.

(3)  $160.00 annually for vehicles of model year 2009 or later if the vehicle has an average city-highway EPA rating of fewer than 25 miles per gallon, and the biennial fee shall be $310.00.

(b)  For vehicles purchased within the state, the registration fees established in subsection (a) of this section shall be paid by the dealer who sold the vehicle and remitted to the department of motor vehicles each quarter.  A certificate shall be provided by the dealer to the buyer at the time of sale, indicating that the fee has been paid.  The certificate shall be presented to the department of motor vehicles at the time of registration.  For vehicles purchased out of state, the fees shall be paid at the time of registration. 

* * * State Purchasing * * *

Sec. 19.  29 V.S.A. § 903(b) is amended to read:

(b)  When purchasing any items mentioned in this chapter, the commissioner of buildings and general services, in any determination of the best interest of the state shall consider (1) specified quality, (2) price, (3) ease of access of supply, (4) incidental administrative costs, (5) proven reliability of bidder, (6) use of recycled materials or products and the amount of embedded energy in particular material or products, (7) minimizing the creation, by the state, of solid waste, (8) the extent to which the manufacturing or usage of the item involves the generation of pollutants or the use of energy, (9) life cycle costs, if required under the state agency energy plan, as implemented, (10) the interests of the state relating to the proximity of the supplier and the costs of transportation, and relating to the economy of the state and the need to maintain and create jobs in the state and (11) the use of railroads and the increased revenues returning to the state from its railroad leasing program.  The commissioner shall review “green purchasing” programs developed in other jurisdictions, shall incorporate from those programs appropriate requirements that may be accomplished administratively, and shall present to the general assembly recommendations for any statutory adjustments necessary to strengthen the environmental integrity of Vermont’s purchasing practices.  The commissioner, in the commissioner’s discretion, may spend up to ten percent more for comparable products that are made of recycled materials.  If products made of recycled materials are to cost more than ten percent more than comparable products, the commissioner shall receive consent of state entities that are to use the product, before completing the order for the materials in question.  The commissioner shall develop a model “green purchasing” program in a form that may be easily used by municipalities and by the private sector, shall make it available to others, and shall encourage and facilitate its adoption by municipalities and interested businesses.

Sec. 20.  30 V.S.A. § 202(i) is added to read:

(i)  It shall be a goal of the electrical energy plan to assure, by 2028, that at least 60 MW of power are generated within the state by combined heat and power (CHP) facilities.  In order to meet this goal, the plan shall include incentives for development and strategies to identify locations in the state that would be suitable for CHP.  The plan shall include strategies, if necessary, that would allow energy service companies to sell CHP output to third party customers.  The plan shall include strategies to assure the consideration of CHP potential during any process related to the expansion of natural gas services in the state.

Sec. 21.  30 V.S.A. § 202e is added to read:

§ 202e.  MANAGING AND CONSERVING FORESTS FOR REDUCING

              GREENHOUSE GAS EMISSIONS

(a)  State biomass plan.  The agency of agriculture, food and markets, agency of natural resources, and department of public service jointly shall prepare a comprehensive state biomass plan, covering at least a 20-year period.  The plan shall seek to implement the state energy policy set forth in section 202a of this title.  One goal of the plan is to increase production and use of forest biomass energy feedstocks in the state by five percent by 2010 and by 30 percent by 2028.  Another goal of the plan is to increase the use of wood products, which have lower embodied energy use than many types of building materials, by two percent by 2012 and by 10 percent by 2028.  In developing and implementing the plan, due care shall be devoted to developing ways to pursue at the same time the potentially inconsistent goals of increasing forest biomass feedstocks and increasing the use of wood products as building materials.  The plan shall include:

(1)  an inventory of biomass quantity, quality, and location;

(2)  an evaluation of viable technologies for the state;

(3)  a determination of the estimated net energy contribution and highest value for biomass resources, giving due consideration to the most efficient uses of biomass, biomass access, regulatory requirements, including wood procurement standards, and water quality considerations and regulations;

(4)  proposed siting criteria for wood-fired electricity-generating facilities that give due regard to the existence of available, properly zoned property and its location relative to the strategic needs of the transmission and distribution grid and relative to appropriate transportation infrastructure;

(5)  wood procurement standards that protect site productivity, water quality, biological diversity, carbon storage capacity, and forest vitality for existing and new biomass facilities.  Procurement standards should ensure that forest biomass harvesting is conducted in a scientifically sound manner that does not compromise habitat values (e.g., availability of dead and dying wildlife trees) or impair long-term site productivity (i.e., soil nutrient capital) at the expense of biomass production;

(6)  strategies to assure that, during the planning stages for residences, businesses, and state buildings, due consideration is given to the potential for distributed heat and for the use of combined heat and power (CHP); 

(7)  strategies to encourage needed biomass market development:

(A)  by creating reasonable rail transportation options for wood fuel;

(B)  through the appropriate use of biomass by state government, the state’s educational institutions, and other major state-funded institutions, as well as by local governments and school districts;

(C)  by promoting appropriate wood pellet industrial development with a strong landowner cooperative component to increase areas of wood availability; and

(8)  strategies to divert and use suitable biomass materials from municipal waste streams.

(b)  Timber management.  In addition to the biomass plan developed under subsection (a) of this section, the secretary of natural resources shall develop a timber management program, which shall include:

(1)  a wood harvest and ecosystem monitoring program, which shall evaluate, on an annual basis, the impacts, if any, of fuel wood harvesting on forest ecosystems, forest inventory and productivity, the development of the wood products industry, and carbon sequestration;

(2)  strategies to maintain existing programs such as sustainable forestry certification programs that support sustainable forestry practices and programs that monitor and detect forest stress agents and generate management recommendations that promote forest health;

(3)  strategies to assure that forest land that is managed continues to be managed in a sustainable fashion and that net carbon sequestration be increased by improving the production of high density, quality saw logs and subsequent use of these products in durable wood products, and by supporting acquisition and use of new technology to achieve these goals. 

(c)  Forest land conservation.  In addition to the timber management plan developed under subsection (b) of this section, the secretary of natural resources shall develop a forest land conservation program, which shall include:

(1)  strategies to promote the development of landowner cooperatives, as a means of enabling carbon trading and ecosystem services compensation in the marketplace;

(2)  development of a new forest management support program that recognizes and compensates forest landowners for the ecosystem services produced on private lands for public benefits;

(3)  strategies regarding how to assist existing municipal entities such as conservation commissions in promoting voluntary forest land carbon sequestration and storage programs;

(4)  strategies to reduce the rate of forest loss by seven percent by 2010 and by 50 percent by 2028, by measures that include:

(A)  increasing the number of acres purchased for conservation or protected under conservation easements;

(B)  increasing enrollment in the use value appraisal program;

(C)  creating incentives to maintain forest cover in developed areas through land use regulations, planning assistance, and stormwater crediting;

(D)  establishing incentives to reduce the extent to which landowners divide forests into small parcels.

(d)  Public input.  In developing or updating the biomass plan’s recommendations and the timber management and forest land conservation program strategies, the agencies of natural resources and of agriculture, food and markets and the department of public service shall seek public comment by holding public hearings in at least five different geographic regions of the state on at least three different dates, and by providing notice through publication once a week and at least seven days apart for two or more successive weeks in a newspaper or newspapers of general circulation in the regions where the hearings will be held, and by delivering notices to all licensed commercial radio and television stations with transmitting facilities within the state, plus Vermont Public Radio and Vermont Public Television.

(e)  Dates for completed action.  The agency of agriculture, food and markets, agency of natural resources and department of public service jointly shall adopt a state biomass plan by no later than January 1, 2009.  The agency of natural resources shall adopt the timber management and forest land conservation programs no later than January 1, 2009.  Upon adoption of the plans, analytical portions of the plans may be updated annually.  The  implementation recommendations in the plans shall be updated in the same manner no less frequently than every five years.  These recommendations shall be updated prior to the expiration of five years if the general assembly passes a joint resolution making a request to that effect.

* * * Regulation of Electricity and Gas * * *

Sec. 22.  30 V.S.A. § 209(d)(4) is amended to read:

(4)  The charge established by the board pursuant to subdivision (3) of this subsection shall be in an amount determined by the board by rule or order that is consistent with the principles of least cost integrated planning as defined in section 218c of this title.  As circumstances and programs evolve, the amount of the charge shall be reviewed for unrealized energy efficiency potential and shall be adjusted as necessary in order to realize all reasonably available, cost-effective energy efficiency savings.  In setting the amount of the charge and its allocation, the board shall determine an appropriate balance among the following objectives; provided, however, that particular emphasis shall be accorded to the first four of these objectives: reducing the size of future power purchases; reducing the generation of greenhouse gases; limiting the need to upgrade the state’s transmission and distribution infrastructure; minimizing the costs of electricity; providing efficiency and conservation as a part of a comprehensive resource supply strategy; providing the opportunity for all Vermonters to participate in efficiency and conservation programs; and the value of targeting efficiency and conservation efforts to locations, markets or customers where they may provide the greatest value.  In addition to establishing a balance among the foregoing objectives, the board shall assure that by 2015, efficiency improvements are sufficient to reduce consumption of electricity and natural gas by at least 15 percent, relative to the department of public service reference projection, and that by 2028, those improvements shall reduce consumption by at least 31 percent, relative to that reference projection.  In setting these goals, it is assumed that the 2028 goal is a provisional one, which is expected to be updated as warranted by the emergence of additional efficiency opportunities.  The board, by rule or order, shall establish a process by which a customer may apply to the board for an exemption from some or all of the charges assessed under this subdivision.  The board shall establish criteria by which these applications shall be measured.  Any such exemption shall extend for a period of time not to exceed one year.  In addition, the board may authorize exemptions only if, at a minimum, a customer demonstrates that, during the preceding year, it implemented an extraordinary amount of cost-effective energy efficiency at the customer’s own expense or incurred extraordinary costs on those measures and the customer did not and will not receive reimbursement for those measures from the entity designated by the board under this section.

Sec. 23.  30 V.S.A. § 209(e) is amended to read:

(e)  The board shall:

(1)  Ensure that all retail consumers, regardless of retail electricity or gas provider, will have an opportunity to participate in and benefit from a comprehensive set of cost-effective energy efficiency programs and initiatives designed to overcome barriers to participation.

(2)  Require that continued or improved efficiencies be made in the production, delivery, and use of energy efficiency services.  As part of this effort, the board shall develop and implement a comprehensive building commissioning, building recommissioning, energy tracking, and energy benchmarking program for builders, contractors, building managers, enforcement officials, building owners, and others.

* * *

Sec. 24.  30 V.S.A. § 209(h) is added to read:

(h)  With regard to the expansion of the state’s demand side management efforts to include the residential, commercial, and industrial use of oil, liquefied petroleum gas, or kerosene, there shall be an efficiency component and an energy component.

(1)  For the efficiency component, the goal shall be to install efficiency improvements by 2016 that are sufficient to reduce consumption by at least 12 percent, relative to the department of public service reference projection, and to install efficiency improvements by 2028 that are sufficient to reduce consumption by 29 percent, relative to that reference projection.  In setting these goals, it is assumed that the 2028 goal is a provisional one, which is expected to be updated as warranted by the emergence of additional efficiency opportunities. 

(2)  The energy component shall be structured to facilitate the appropriate installation of clean technologies such as solar water heaters, rooftop photovoltaics, and on-site wind generation, and to support switching to less carbon-intensive fuels, including biomass and natural gas.

Sec. 25.  30 V.S.A. § 218(e) is added to read:

(e)(1)  The board shall allow a company to recover a premium on the allowed return on equity for the company’s investment in renewable energy generation or combined heat and power projects located in Vermont or for the company’s commitment to purchase power from nonutility-owned renewable energy generation or combined heat and power projects located in Vermont.  This incentive shall apply to investments in equipment that allow existing generating sources to increase their electric output or investments that extend contractual commitments to purchase renewable energy generation located in Vermont.

(2)  A company’s investment in or contractual commitment to purchase renewable energy generation, as specified in this subsection, once approved by the board, shall be deemed prudent and useful, for rate-setting purposes.


* * * Cap and Trade Program * * *

Sec. 26.  30 V.S.A. § 255 is amended to read:

§ 255.  REGIONAL COORDINATION TO REDUCE GREENHOUSE

            GASES

(a)  Legislative findings.  The general assembly finds:

(1)  There is a growing scientific consensus that the increased anthropogenic emissions of greenhouse gases are enhancing the natural greenhouse effect, resulting in changes in the earth’s climate.

(2)  Climate change poses serious potential risks to human health and terrestrial and aquatic ecosystems globally, regionally, and in Vermont.

(3)  A carbon constraint on fossil fuel-fired electricity generation and on other forms of fossil fuel consumption and the development of a CO2 allowance trading mechanism will create a strong incentive for the creation and deployment of more efficient fuel-burning technologies, renewable resources, and end-use efficiency resources and will lead to lower dependence on imported fossil fuels.

(4)  Absent federal action, a number of states are taking actions to work regionally to reduce power sector carbon emissions.

(5)  Vermont has joined with at least six other states to design the Regional Greenhouse Gas Initiative (RGGI), and, in 2005, Vermont’s governor signed a memorandum of understanding (MOU) signaling Vermont’s intention to develop rules and programs to participate in RGGI.

(6)  It is crucial to manage Vermont’s implementation of RGGI and its consumption of fossil fuels for transportation, residential and commercial heating, and industrial processes, so as to maximize the state’s contribution to lowering carbon emissions while:

(A)  minimizing impacts on electric system reliability and unnecessary costs to Vermont power consumers;

(B)  assuring transportation needs are able to be met at affordable prices;

(C)  assuring the availability of adequate space heat and processing heat for residential, commercial, and industrial purposes.

(7)  The accelerated deployment of low-cost thermal and electrical energy efficiency, and the strategic use of low- and zero-carbon generation, the selective use of switching fuel sources, and the design and use of systems that limit vehicular miles travelled and increase vehicular efficiency, are the best means to achieve these goals.

(8)  It is crucial that funds made available from operation of a regional carbon credits cap and trade system be devoted to the benefit of Vermont power consumers through investments in a strategic portfolio of energy efficiency and low-carbon generation resources.

(b)  Cap and trade program creation.

(1)  The agency of natural resources and the public service board shall, through appropriate rules and orders, establish a carbon cap and trade program that will limit and then reduce the total carbon emissions released:

(A)  by major electric generating stations that provide electric power to Vermont utilities and end-use customers;

(B)  for transportation purposes;

(C)  for space and process heating purposes

(2)  Vermont rules and orders establishing a carbon cap and trade program shall be designed initially so as to permit the holders of carbon credits to trade them in a regional market proposed to be established through the RGGI.  The program shall be expanded to address the carbon sources not covered by RGGI, in coordination with efforts in other states, shall rely upon auctions to determine allocations of permits for substantial sources of carbon, shall be designed to strengthen linkages between greenhouse gas reduction policies and other established programs such as RGGI, and shall pursue recognizing more nonelectric sector initiatives as RGGI offsets.  Consideration shall be given to allowing the trading of credits among RGGI-certified state greenhouse gas cap and trade programs. 

(c)  Allocation of tradable carbon credits.

(1)  The secretary of natural resources, by rule, shall establish a set of annual carbon budgets for emissions associated with the electric power sector in Vermont consistent with the 2005 RGGI MOU, including any amendments to that MOU, and on a reciprocal basis with the other states participating in the RGGI process.  Similarly, the secretary, by rule, shall establish a set of annual carbon budgets for emissions associated with transportation, space heating, and industrial processes.

(2)  In order to provide the maximum long-term benefit to Vermont electric consumers, particularly benefits that will result from accelerated and sustained investments in energy efficiency and other low-cost, low-carbon power system, transportation system, and other investments, the public service board, by rule or order, shall establish a process to allocate 100 percent of the Vermont statewide budget of tradable power sector carbon credits and the proceeds from the sale of those credits through allocation to one or more trustees acting on behalf of consumers in accordance with the following principles.  To the extent feasible, the allocation plan shall accomplish the following goals:

(A)  minimize windfall financial gains to power generators and other consumers of fossil fuels as a result of the operation of the cap and trade program, considering both the costs that power generators and other consumers of fossil fuels may incur to participate in the program and any power revenue increases they are likely to receive as a result of changes in regional power markets;

(B)  employ an administrative structure that will enable program managers to perform any combination of holding, banking, and selling carbon credits in regional, national, and international carbon credit markets in a financially responsible and market-sensitive fashion, and provide funds to defray the reasonable costs of the program trustee or trustees and Vermont’s pro-rata share of the costs of the RGGI regional organization and of any other regional cap and trade organization;

(C)  optimize the revenues received from the management and sale of carbon credits for the benefit of Vermont electric customers, fossil fuel consumers, and the Vermont economy;

(D)  minimize any incentives from operation of the cap and trade program for Vermont utilities or fossil fuel consumers to increase the overall carbon emissions associated with serving their customers;

(E)  build upon existing regulatory and administrative structures and programs that lower power, transportation, and heating costs, improve efficiency, and lower the state’s carbon profile of the state’s power supply while minimizing adverse impacts on electric system reliability and unnecessary costs to Vermont power consumers, assuring transportation needs are able to be met at affordable prices, and assuring the availability of adequate space heat and processing heat for residential, commercial, and industrial purposes;

(F)  ensure that carbon credits allocated under the RGGI portion of this program and revenues associated with their sale remain power system assets managed for the benefit of electric consumers, particularly benefits that will result from accelerated and sustained investments in energy efficiency and other low-cost, low-carbon power system investments, and ensure that carbon credits allocated under the other portions of the program and the associated revenues remain assets managed for the benefit of transportation consumers and consumers of space heat and process heat;

(G)  where practicable, support efforts recommended by the agency of natural resources or the department of public service to stimulate or support investment in the development of innovative power sector carbon emissions abatement technologies that have significant carbon reduction potential.

(d)  Appointment of consumer trustees.  The public service board, by rule, order, or competitive solicitation, may appoint one or more consumer trustees to receive, hold, bank, and sell tradable carbon credits created under this program.  Trustees may include Vermont electric distribution utilities, the fiscal agent collecting and disbursing funds to support the statewide efficiency utility, or a financial institution or other entity with the expertise and financial resources to manage a portfolio of carbon credits for the long-term benefit of Vermont consumers.

(e)  Reports.  By January 15 of each year, commencing in 2007, the department of public service in consultation with the agency of natural resources and the public service board shall provide to the house and senate committees on natural resources and energy, the senate committee on finance, and the house committee on commerce a report detailing the implementation and operation of RGGI, the implementation and operation of the expanded cap and trade program, and the revenues collected and the expenditures made under this section, together with recommended principles to be followed in the allocation of funds.

(f)  Timing of program expansion.  The agency of natural resources and the public service board shall endeavor to coordinate with surrounding states the timing of the program expansion under this section, but if regional action on this issue is not forthcoming by January 1, 2010, the secretary and the board shall commence rulemaking to establish a stand-alone, expanded cap and trade program.

* * * Portfolio Standards * * *

Sec. 27.  30 V.S.A. § 8004(b) is amended to read:

(b)  Each retail electricity provider in Vermont shall provide a certain amount of new renewable resources in its portfolio.  Subject to subdivision 8005(d)(1) of this title each retail electricity provider in Vermont shall supply an amount of energy equal to its total incremental energy growth between January 1, 2005 and 17 percent of its annual retail electric sales, as of January 1, 2012 through the use of electricity generated by new renewable resources.  The retail electricity provider may meet this requirement through eligible new renewable energy credits, new renewable energy resources with renewable energy credits still attached, or a combination of those credits and resources. No retail electricity provider shall be required to provide in excess of a total of 10 percent of its calendar year 2005 retail electric sales with electricity generated by new renewable resources.  In addition, it is a goal of the state to supply an amount of energy equal to 45 percent of its annual retail electric sales as of January 1, 2028 through the use of electricity generated by new renewable resources, provided that the state’s contracts for nuclear power from a Vermont nuclear facility and its contracts for power from Hydro Quebec together constitute no more than a total of one-half of the amount supplied from those sources as of January 1, 2008.  If, on the other hand, the state’s contracts for power from these two sources approximates the amount of power received from those sources as of January 1, 2008, this goal shall be to supply an amount of energy equal to 25 percent of its annual retail electric sales as of January 1, 2028 through the use of electricity generated by new renewable resources.

* * * Motor Vehicle Purchase and Use Tax * * *

Sec. 28.  32 V.S.A. § 8902 is amended to read:

§ 8902.  DEFINITIONS

Unless otherwise expressly provided, the words and phrases used in this chapter shall be construed to mean:

* * *

(11)(A)  “Motor home” means a new or used pleasure car designed to provide temporary living quarters, built into as an integral part of, or permanently attached to, a self-propelled motor vehicle chassis or van.

(B)  The vehicle must contain at least four of the following facilities: cooking, refrigeration or ice box, self-contained toilet, heating and/or air conditioning, a portable water supply system including a sink and faucet, separate 110-125 volt electrical power supply, and/or an LP gas supply.

(12)  “EPA rating” means, for purposes of subsections 8903(a) and (b) of this title, the average miles per gallon of fuel consumed in city-highway use under ratings determined by the federal Environmental Protection Agency.

Sec. 29.  32 V.S.A. § 8903(a)(1) and (b)(1) are amended to read:

(a)(1)  There is hereby imposed upon the purchase in Vermont of a motor vehicle by a resident a tax at the time of such purchase, payable as hereinafter provided.  The

(A)  Except as provided in subdivision (B) of this subdivision (1), the amount of the tax shall be six percent of the taxable cost of a:

pleasure car as defined in 23 V.S.A. § 4;

motorcycle as defined in 23 V.S.A. § 4;

motor home as defined in subdivision 8902(11) of this title; or

vehicle weighing up to 10,099 pounds, registered pursuant to 23 V.S.A. § 367, other than a farm truck.

(B)  For any motor vehicle defined in this subdivision (1) of a model year 2009 or later which has an EPA rating of at least 30 miles per gallon, the amount of the tax shall be five percent of the vehicle’s taxable cost.

(b)(1)  There (A)  Except as provided in subdivision (B) of this subdivision (1), there is hereby imposed upon the use within this state a tax of six percent of the taxable cost of a:

pleasure car as defined in 23 V.S.A. § 4;

motorcycle as defined in 23 V.S.A. § 4;

motor home as defined in subdivision 8902(11) of this title; or

vehicle weighing up to 10,099 pounds, registered pursuant to 23 V.S.A. § 367, other than a farm truck.

(B)  For any motor vehicle defined in this subdivision (1) of a model year 2009 or later which has an EPA rating of at least 30 miles per gallon, the amount of the tax on its use in this state shall be five percent of the vehicle’s taxable cost.

Sec. 30.  32 V.S.A. § 8903(g) is amended and (h) is added to read:

(g)(1)  There is hereby imposed upon the titling in this state a tax at the rate provided for in subsection (a) or (b) of this section of the taxable cost of a:

pleasure car as defined in 23 V.S.A. § 4;

motorcycle as defined in 23 V.S.A. § 4;

motor home as defined in subdivision 8902(11) of this title; or

vehicle weighing up to 10,099 pounds, registered pursuant to 23 V.S.A. § 367, other than a farm truck.

(2)  For any other motor vehicle, it shall be at the rate provided for in subsection (a) or (b) of this section and paid by a person at the time of obtaining a certificate of title to the vehicle, except no tax shall be payable hereunder if the tax imposed by subsection (a) or (b) of this section has been paid, or the vehicle is a pleasure car which was purchased, leased or otherwise acquired for use in short-term rentals, in which case the vehicle shall be subject to taxation under subsection (d) of this section.

(h)  There is imposed a surcharge of $150.00 on the purchase or use, subject to subsection (a) or (b) of this section, of new vehicles of model year 2009 or later, as follows:

(1)  Vehicles registered at the pleasure car rate with an EPA rating of 20 miles per gallon or fewer.

(2)  Trucks weighing more than 6,000 pounds and up to 10,099 pounds with an EPA rating of 17 miles per gallon or fewer.

* * * Biodiesel Rebates * * *

Sec. 31.  33 V.S.A. § 2504 is added to read:

§ 2504.  REBATE FOR RETAIL SALES OF BIODIESEL BLENDS

(a)  As used in this section:

(1)  “Biodiesel blend” means a blend of biodiesel fuel and number two home heating oil that contains at least ten percent biodiesel fuel by volume.

(2)  “Biodiesel fuel” means a renewable, biodegradable, mono alkyl ester combustible liquid fuel derived from vegetable oil or animal fat which meets the American Society for Testing and Materials (ASTM) specification D6751‑02 for Biodiesel Fuel (B100) Blend Stock for Distillate Fuel.

(b)  Sellers of heating oil subject to the tax under section 2503 of this title or section 9901 of Title 32 are eligible for a rebate equal to $0.05 for each gallon of biodiesel blend sold at retail in Vermont and delivered in Vermont in the reporting period.  Eligible sellers may apply to the Vermont department of taxes for credit pertaining to sales at the time of filing quarterly returns as required by section 2503 of this title or section 9901 of Title 32.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us