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House Calendar

TUESDAY, APRIL 24, 2007

112th DAY OF BIENNIAL SESSION

House Convenes at 10:00 A M

TABLE OF CONTENTS

                                                                                                               Page No.

ACTION CALENDAR

     Third Reading

H. 453  The Job Start Program...................................................................... 987

Favorable with Amendment

S. 91  Banking, Insurance, Securities & Health Care Administration................ 987

               Rep. Kitzmiller for Commerce

               Rep. Branagan for Ways and Means.............................................. 1004

Senate Proposals of Amendment

H. 137  Restoration of Department and Commissioner of Mental Health....... 1004

H. 526  Education Quality and Cost Control................................................. 1005

H. 527  State’s Transportation Program....................................................... 1016

For Action Under Rule 52

H.R.  16  Essential Air Service for Rutland State Airport.............................. 1038

 

NOTICE CALENDAR

Favorable with Amendment

S.  39  Health Insurance Reimbursement for Naturopathic Physicians............ 1038

               Rep. Milkey for Health Care

Senate Proposal of Amendment

H. 405  Capital construction and state bonding............................................. 1039

Ordered to Lie

S.  78  Cost of Picking Up and Hauling Milk Paid by Purchaser.................... 1059

 

ORDERS OF THE DAY

ACTION CALENDAR

     Third Reading

H. 453

     An act relating to the Job Start Program.

Favorable with Amendment

S. 91

An act relating to the department of banking, insurance, securities and health care administration.

Rep. Kitzmiller of Montpelier, for the Committee on Commerce, recommends that the House propose to the Senate that the bill be amended as follows:

First:  In Sec. 5., in the first sentence, after “directors” by striking “and approved by the commissioner” and inserting in lieu thereof “and approved by the commissioner”

Second:  After Sec. 13, by inserting four new sections to be Secs. 14, 15, 16, and 17 to read as follows:

Sec. 14.  8 V.S.A. § 6001(4) is amended to read:

(4)  “Captive insurance company” means any pure captive insurance company, association captive insurance company, sponsored captive insurance company, industrial insured captive insurance company, or risk retention group, or special purpose financial captive insurance company formed or licensed under the provisions of this chapter.  For purposes of this chapter, a branch captive insurance company shall be a pure captive insurance company with respect to operations in this state, unless otherwise permitted by the commissioner.

Sec. 15.  8 V.S.A. § 6014(c) and (e) are amended to read:

(c)  The annual minimum aggregate tax to be paid by a captive insurance company calculated under subsections (a) and (b) of this section shall be $7,500.00, and the annual maximum aggregate tax shall be $200,000.00.  The maximum aggregate tax to be paid by a sponsored captive insurance company shall apply to each protected cell only and not to the sponsored captive insurance company as a whole.  If a captive insurance company is a special purpose financial captive organized and licensed under subchapter 4 of this chapter and if such captive insurance company is subject to subsection (e) of this section as a captive insurance company under common ownership and control with one or more other captive insurance companies (collectively, the “consolidated group”), the premium tax calculated with respect to the consolidated group under subsections (a) and (b) of this section shall be allocated to each member of the consolidated group in the same proportion that the premium allocable to such member bears to the total premium of all members.  The consolidated group shall pay an aggregate premium tax equal to the greater of the sum of the premium tax allocated to the members and $7,500.00; provided: 

(1)  If the premium tax allocated to a member that is a special purpose financial captive exceeds $200,000.00, the premium tax allocated to such member shall be $200,000.00; and

(2)  If the total of premium tax allocated to all members of the consolidated group that are not special purpose financial captive insurance companies exceeds $200,000.00, the total of premium tax allocated to such members shall be $200,000.00.

* * *

(e)  Two Subject to the provisions of subsection (c) of this section, two or more captive insurance companies under common ownership and control shall be taxed, as though they were a single captive insurance company.    

Sec. 16.  8 V.S.A. § 6035 is amended to read:

§ 6035.  QUALIFICATION OF SPONSORS

A sponsor of a sponsored captive insurance company shall be an insurer licensed under the laws of any state, a reinsurer authorized or approved under the laws of any state, a captive insurance company formed or licensed under this chapter, a broker‑dealer registered with the department pursuant to chapter 150 of title 9, a financial institution as defined under subdivision 11101(32) of this title, or a financial institution holding company as defined under subdivision 11101(33) of this title, including any affiliate or subsidiary of such financial institution holding company, or any other person approved by the commissioner in the exercise of his or her discretion, after finding that the approval of a person as a sponsor is not inconsistent with the purposes of this chapterA risk retention group shall not be either a sponsor or a participant of a sponsored captive insurance company.

Sec. 17.  Subchapter 4 of chapter 141 of Title 8 is added to read:

Subchapter 4.  Special Purpose Financial Captive Insurance Companies

§ 6048a.  Applicable Law

(a)  A special purpose financial captive insurance company shall be subject to the provisions of this subchapter and to the provisions of subchapter 1 of this chapter.  In the event of any conflict between the provisions of this subchapter and the provisions of subchapter 1 of this chapter, the provisions of this subchapter shall control.

(b)  A special purpose financial captive insurance company shall be subject to all applicable rules adopted pursuant to section 6015 of this chapter that are in effect as of the effective date of this subchapter and that are promulgated after the effective date of this subchapter.

(c)  The commissioner may, by order, exempt a special purpose financial captive insurance company from any provision of this chapter or from any rule adopted pursuant to section 6015 of this chapter if the commissioner determines such provision to be inappropriate based on the special purpose financial captive insurance company’s plan of operation. 

§ 6048b.  Existing Licenses

Except as otherwise determined by the commissioner, a captive insurance company that has been licensed by the commissioner pursuant to this chapter as of the effective date of this subchapter and that is engaged in or that will be engaged in an insurance securitization shall be subject to the provisions of this subchapter as a special purpose financial captive insurance company.  The commissioner may require such captive insurance company to take any action that the commissioner determines is reasonably necessary to bring such captive insurance company into compliance with the provisions of this subchapter.  The commissioner may issue an order described in section 6048d(b) with respect to such captive insurance company.

§ 6048c.  Definitions

For purposes of this subchapter:

(1)  “Ceding insurer” means an insurance company approved by the commissioner and licensed or otherwise authorized to transact the business of insurance or reinsurance in its state or country of domicile, which cedes risk to a special purpose financial captive insurance company pursuant to a reinsurance contract.

(2)  “Insolvency” and “insolvent” for purpose of applying the provisions of chapter 145 of this title to a special purpose financial captive insurance company, mean: 

 

(A)  That the special purpose financial captive insurance company is unable to pay its obligations when they are due, unless those obligations are the subject of a bona fide dispute; or

(B)  The special purpose financial captive insurance company has failed to meet all criteria and conditions for solvency of the special purpose financial captive insurance company established by the commissioner by rule or order.

(3)  “Insurance securitization” and “securitization” mean a transaction or a group of related transactions, which may include capital market offerings, that are effected through related risk transfer instruments and facilitating administrative agreements where all or part of the result of such transactions is used to fund the special purpose financial captive insurance company’s obligations under a reinsurance contract with a ceding insurer and by which: 

(A)  Proceeds are obtained by a special purpose financial captive insurance company, directly or indirectly, through the issuance of securities by the special purpose financial captive insurance company or any other person; or

(B)  A person provides one or more letters of credit or other assets for the benefit of the special purpose financial captive insurance company, which the commissioner authorizes the special purpose financial captive insurance company to treat as admitted assets for purposes of the special purpose financial captive insurance company’s annual report; where all or any part of such proceeds, letters of credit, or assets, as applicable, are used to fund the special purpose financial captive insurance company’s obligations under a reinsurance contract with a ceding insurer.  The terms “insurance securitization” and “securitization” do not include the issuance of a letter of credit for the benefit of the commissioner to satisfy all or part of the special purpose financial captive insurance company’s capital and surplus requirements under section 6048g of this chapter.

(4)  “Management” means the board of directors, managing board, or other individual or individuals vested with overall responsibility for the management of the affairs of the special purpose financial captive insurance company, including but not limited to officers or other agents elected or appointed to act on behalf of the special purpose financial captive insurance company.

(5)  “Organizational document” means: 

(A)  In the case of a special purpose financial captive insurance company formed as a stock corporation, the special purpose financial captive insurance company’s articles of incorporation and bylaws; and

(B)  In the case of a special purpose financial captive insurance company formed as a limited liability company, the special purpose financial captive insurance company’s articles of organization and operating agreement. 

(6)  “Security” shall have the same meaning as defined in 9 V.S.A.

§ 5102(28), and shall also include any form of debt obligation, equity, surplus certificate, surplus note, funding agreement, derivative, or other financial instrument that the commissioner designates, by rule or order, as a “security” for purposes of this subchapter.

(7)  “Special purpose financial captive insurance company” means a captive insurance company that has received a license from the commissioner to operate as a special purpose financial captive insurance company pursuant to this subchapter.

(8)  “Reinsurance contract” means a contract between a special purpose financial captive insurance company and a ceding insurer pursuant to which the special purpose financial captive insurance company agrees to provide reinsurance to the ceding insurer for risks associated with the ceding insurer’s insurance or reinsurance business.

(9)  “Special purpose financial captive insurance company security” means:

(A)  A security issued by a special purpose financial captive insurance company; or

(B)  A security issued by a third party, the proceeds of which are obtained directly or indirectly by a special purpose financial captive insurance company. 

(10)  “Surplus note” means an unsecured subordinated debt obligation possessing characteristics consistent with paragraph 3 of the National Association of Insurance Commissioners Statement of Statutory Accounting Principals No. 41, as amended from time to time and as modified or supplemented by rule or order of the commissioner. 

§ 6048d.  Licensing; authority

(a)  A special purpose financial captive insurance company may reinsure the risks of a ceding insurer only.  A special purpose financial captive insurance company may purchase reinsurance to cede the risks assumed under a reinsurance contract, subject to the prior approval of the commissioner.

(b)  In conjunction with the issuance of a license to a special purpose financial captive insurance company, the commissioner may issue an order that includes any provisions, terms, and conditions regarding the organization, licensing, and operation of the special purpose financial captive insurance company that are deemed appropriate by the commissioner and that are not inconsistent with the provisions of this chapter.  Except as provided in sections 6048l and 6048m of this subchapter, a license issued to a special purpose financial captive insurance company pursuant to this chapter and any order issued to a special purpose financial captive insurance company pursuant to this subsection shall not be revoked, suspended, amended, or modified other than as follows: 

(1)  The special purpose financial captive insurance company consents to such revocation, suspension, amendment, or modification; or

(2)  The commissioner makes a showing of clear and convincing evidence demonstrating that such revocation, suspension, amendment, or modification is necessary to avoid irreparable harm to the special purpose financial captive insurance company or to the ceding insurer.

(c)  To qualify for a license, a special purpose financial captive insurance company shall be subject, in addition to the requirements of subsection 6002(c) of this chapter, to the following:

(1)  The special purpose financial captive insurance company’s plan of operation shall include:

(A)  a complete description of all significant transactions, including reinsurance, reinsurance security arrangements, securitizations, related transactions or arrangements, and to the extent not included in the transactions listed in this subdivision (A), a complete description of all parties other than the special purpose financial captive insurance company and the ceding insurer that will be involved in the issuance of special purpose financial captive insurance company securities and a description of any pledge, hypothecation, or grant of a security interest in any of the special purpose financial captive insurance company’s assets and in any stock or limited liability company interest in the special purpose financial captive insurance company;

(B)  the source and form of the special purpose financial captive insurance company’s capital and surplus;

(C)  the proposed investment policy of the special purpose financial captive insurance company;

(D)  a description of the underwriting, reporting, and claims payment methods by which losses covered by the reinsurance contract are reported, accounted for, and settled; 

(E)  pro forma balance sheets and income statements illustrating one or more adverse case scenarios, as determined under criteria required by the commissioner, for the performance of the special purpose financial captive insurance company under all reinsurance contracts; and

(F)  the proposed rate and method for discounting reserves, if the special purpose financial captive insurance company is requesting authority to discount its reserves. 

(2)  The special purpose financial captive insurance company shall submit an affidavit of its president, a vice‑president, the treasurer, or the chief financial officer that includes the following statements, to the best of such person’s knowledge and belief after reasonable inquiry: 

(A)  the proposed organization and operation of the special purpose financial captive insurance company comply with all applicable provisions of this chapter;

(B)  the special purpose financial captive insurance company’s investment policy reflects and takes into account the liquidity of assets and the reasonable preservation, administration, and management of such assets with respect to the risks associated with the reinsurance contract and the insurance securitization transaction; and

(C)  the reinsurance contract and any arrangement for securing the special purpose financial captive insurance company’s obligations under such reinsurance contract, including but not limited to any agreements or other documentation to implement such arrangement, comply with the provisions of this subchapter.

(3)  The application shall include copies of all agreements and documentation described in subdivision (c)(1) unless otherwise approved by the commissioner and any other statements or documents required by the commissioner to evaluate the special purpose financial captive insurance company’s application for licensure. 

(4)  The application shall include an opinion of qualified legal counsel, in a form acceptable to the commissioner, that the offer and sale of any special purpose financial captive insurance company securities complies with all applicable registration requirements or applicable exemptions from or exceptions to such requirements of the federal securities laws and that the offer and sale of securities by the special purpose financial captive insurance company itself comply with all registration requirements or applicable exemptions from or exceptions to such requirements of the securities laws of this state.  Such opinions shall not be required as part of the application if the special purpose financial captive insurance company includes a specific statement in its plan of operation that such opinions will be provided to the commissioner in advance of the offer or sale of any special purpose financial captive insurance company securities.

(d)  The commissioner may grant a license, that shall be valid through the next April 1 following the date of initial issuance and may be renewed annually thereafter, authorizing the special purpose financial captive insurance company to transact reinsurance business as a special purpose financial captive insurance company in this state upon finding that:

(1)  The proposed plan of operation provides for a reasonable and expected successful operation;

(2)  The terms of the reinsurance contract and related transactions comply with this subchapter;

(3)  The proposed plan of operation is not hazardous to any ceding insurer; and

(4)  The insurance regulator of the state of domicile of each ceding insurer has notified the commissioner in writing or otherwise has provided assurance satisfactory to the commissioner that it has approved or has not disapproved the transaction, provided that the commissioner shall not be precluded from issuing a license to a special purpose financial captive insurance company in the event that the insurance regulator of the state of domicile of a ceding insurer has not responded with respect to all or any part of the transaction. 

(e)  The special purpose financial captive insurance company shall provide the commissioner with a copy of a complete set of executed documentation of an insurance securitization no later than 30 days after the closing on the transactions for such securitization.

(f)  Subdivision 6002(c)(3) of this chapter shall apply to all information submitted pursuant to subsections (c) and (e) of this section and to any order issued to the special purpose financial captive insurance company pursuant to subsection (b) of this section.

§ 6048e.  Changes in plan of operation; voluntary
     dissolution or cessation of business

(a)  Any change in the special purpose financial captive insurance company’s plan of operation shall require prior approval of the commissioner. 

(b)  Any transaction or series of transactions shall be subject to the prior approval of the commissioner if such transaction or series of transactions:

(1)  Is undertaken to dissolve a special purpose financial captive insurance company; or

(2)  Results in the termination of all or any part of a special purpose financial captive insurance company’s business; but no prior approval of the commissioner shall be required for any transaction or series of transactions described in this subdivision (2) if such transaction or series of transactions is done in accordance with a document or agreement described in the special purpose financial captive insurance company’s plan of operation and if the commissioner is notified in advance of such transaction or series of transactions.

(c)  A special purpose financial captive insurance company shall notify the commissioner in advance of any change in the legal ownership of any security issued by the special purpose financial captive insurance company.

§ 6048f.  Formation

(a)  A special purpose financial captive insurance company may be incorporated as a stock insurer with its capital divided into shares and held by its stockholders, or it may be organized as a manager‑managed limited liability company. 

(b)  A special purpose financial captive insurance company’s organizational documents shall limit the special purpose financial captive insurance company’s authority to transact the business of insurance or reinsurance to those activities that the special purpose financial captive insurance company conducts to accomplish its purposes as expressed in this subchapter.

§ 6048g.  Minimum Capital and Surplus

A special purpose financial captive insurance company shall not be issued a license unless it shall possess and thereafter maintain unimpaired paid‑in capital and surplus of not less than $250,000.00.

§ 6048h.  Securities

(a)  A special purpose financial captive insurance company may:

(1)  subject to the prior approval of the commissioner, account for the proceeds of a surplus note issued by the special purpose financial captive insurance company as surplus; and

(2)  submit for prior approval of the commissioner periodic written requests for authorization to make payments of interest on and repayments of principal of surplus notes and other debt obligations issued by the special purpose financial captive insurance company, provided that the commissioner shall not approve such payment if the commissioner determines that such payment would jeopardize the ability of the special purpose financial captive insurance company or any other person to fulfill their respective obligations pursuant to the special purpose financial captive insurance company securitization agreements, the reinsurance contract, or any related transaction.  In lieu of approval of periodic written requests for authorization to make payments of interest on and repayments of principal of surplus notes and other debt obligations issued by the special purpose financial captive insurance company, the commissioner may approve a formula or plan, which shall be included in the special purpose financial captive insurance company’s plan of operation as amended from time to time, for payment of interest, principal, or both with respect to such surplus notes and debt obligations.

(b)  In addition to the provisions of section 6005 of this chapter, no dividend or distribution may be declared or paid by a special purpose financial captive insurance company if such dividend or distribution would jeopardize the ability of the special purpose financial captive insurance company or any other person to fulfill the company’s or other person’s respective obligations pursuant to the special purpose financial captive insurance company securitization agreements, the reinsurance contract, or any related transaction.

(c)  A special purpose financial captive insurance company security shall not be subject to regulation as an insurance or reinsurance contract.  An investor in such a security or a holder of such a security shall not be considered to be transacting the business of insurance in this state solely by reason of having an interest in the security.  The underwriter’s placement or selling agents and their partners, commissioners, officers, members, managers, employees, agents, representatives, and advisors involved in an insurance securitization by a special purpose financial captive insurance company shall not be considered to be insurance producers or brokers or to be conducting business as an insurance or reinsurance company or as an insurance agency, brokerage, intermediary, advisory, or consulting business solely by virtue of their underwriting activities in connection with such securitization.

§ 6048i.  Permitted Reinsurance

(a)  A special purpose financial captive insurance company may reinsure only the risks of a ceding insurer, pursuant to a reinsurance contract.  A special purpose financial captive insurance company may not issue a contract of insurance or a contract for assumption of risk or indemnification of loss other than such reinsurance contract. 

(b)  Unless otherwise approved in advance by the commissioner, a special purpose financial captive insurance company may not assume or retain exposure to insurance or reinsurance losses for its own account that are not funded by: 

(1)  Proceeds from a special purpose financial captive insurance company securitization or letters of credit or other assets described in subdivision 6048c(3) of this chapter;

(2)  Premium and other amounts payable by the ceding insurer to the special purpose financial captive insurance company pursuant to the reinsurance contract; and

(3)  Any return on investment of the items in subdivisions (1) and (2) of this subsection.

(c)  The reinsurance contract shall contain all provisions reasonably required or approved by the commissioner, which requirements shall take into account the laws applicable to the ceding insurer regarding the ceding insurer taking credit for the reinsurance provided under such reinsurance contract. 

(d)  A special purpose financial captive insurance company may cede risks assumed through a reinsurance contract to one or more reinsurers through the purchase of reinsurance, subject to the prior approval of the commissioner.

(e)  A special purpose financial captive insurance company may enter into contracts and conduct other commercial activities related or incidental to and necessary to fulfill the purposes of the reinsurance contract, the insurance securitization, and this subchapter, provided such contracts and activities are included in the special purpose financial captive insurance company’s plan of operation or are otherwise approved in advance by the commissioner.  Such contracts and activities may include but are not limited to:  entering into reinsurance contracts; issuing special purpose financial captive insurance company securities; complying with the terms of these contracts or securities; entering into trust, guaranteed investment contract, swap, or other derivative, tax, administration, reimbursement, or fiscal agent transactions; or complying with trust indenture, reinsurance, or retrocession; and other agreements necessary or incidental to effect an insurance securitization in compliance with this subchapter and the special purpose financial captive insurance company’s plan of operation.

(f)  Unless otherwise approved in advance by the commissioner, a reinsurance contract shall not contain any provision for payment by the special purpose financial captive insurance company in discharge of its obligations under the reinsurance contract to any person other than the ceding insurer or any receiver of the ceding insurer.

(g)  A special purpose financial captive insurance company shall notify the commissioner immediately of any action by a ceding insurer or any other person to foreclose on or otherwise take possession of collateral provided by the special purpose financial captive insurance company to secure any obligation of the special purpose financial captive insurance company.

§ 6048j.  Disposition of Assets; Investments

(a)  The assets of a special purpose financial captive insurance company shall be preserved and administered by or on behalf of the special purpose financial captive insurance company to satisfy the liabilities and obligations of the special purpose financial captive insurance company incident to the reinsurance contract, the insurance securitization, and other related agreements.

(b)  In the special purpose financial captive insurance company securitization, the security offering memorandum or other document issued to prospective investors regarding the offer and sale of a surplus note or other security shall include a disclosure that all or part of the proceeds of such insurance securitization will be used to fund the special purpose financial captive insurance company’s obligations to the ceding insurer. 

(c)  A special purpose financial captive insurance company shall not be subject to any restriction on investments other than the following:

(1)  A special purpose financial captive insurance company shall not make a loan to any person other than as permitted under its plan of operation or as otherwise approved in advance by the commissioner; and

(2)  The commissioner may prohibit or limit any investment that threatens the solvency or liquidity of the special purpose financial captive insurance company unless the investment is otherwise approved in its plan of operation or in an order issued to the special purpose financial captive insurance company pursuant to subsection 6048d(b) of this chapter, as either is amended from time to time.

§ 6048k.  Annual Report; Books and Records

(a)  For purposes of subsection 6007(b) of this chapter: 

(1)  The commissioner shall, by rule or order, establish the form and content of the annual report to be filed by a special purpose financial captive insurance company; and

(2)  A special purpose financial captive insurance company shall report using statutory accounting principles, unless the commissioner requires, approves, or accepts the use of generally accepted accounting principles, in either case with any appropriate or necessary modifications or adaptations thereof required or approved or accepted by the commissioner and as supplemented by additional information required by the commissioner.   

(b)  A special purpose financial captive insurance company may make written application to file its annual report on a fiscal‑year basis.  If an alternative reporting date is granted, the commissioner shall establish the due date and content of any filing required by the special purpose financial captive insurance company in addition to its annual report.

(c)  Unless otherwise approved in advance by the commissioner, a special purpose financial captive insurance company shall maintain its books, records, documents, accounts, vouchers and agreements in this state.  A special purpose financial captive insurance company shall make its books, records, documents, accounts, vouchers and agreements available for inspection by the commissioner at any time.  A special purpose financial captive insurance company shall keep its books and records in such manner that its financial condition, affairs, and operations can be readily ascertained and so that the commissioner may readily verify its financial statements and determine its compliance with this chapter.

(d)  Unless otherwise approved in advance by the commissioner, all original books, records, documents, accounts, vouchers, and agreements shall be preserved and kept available in this state for the purpose of examination and inspection and until such time as the commissioner approves the destruction or other disposition of such books, records, documents, accounts, vouchers, and agreements.  If the commissioner approves the keeping of the items listed in this subsection outside this state, the special purpose financial captive insurance company shall maintain in this state a complete and true copy of each such original.  Books, records, documents, accounts, vouchers, and agreements may be photographed, reproduced on film, or stored and reproduced electronically.

§ 6048l.  LICENSE Suspension and Revocation

(a)  The commissioner shall notify a special purpose financial captive insurance company not less than 30 days before suspending or revoking its license pursuant to section 6009 of this chapter, which notice shall state the basis for such suspension or revocation.  The special purpose financial captive insurance company shall be afforded the opportunity for a hearing pursuant to the provisions of the Vermont Administrative Procedure Act, 3 V.S.A. chapter 25. 

(b)  Notwithstanding subsection (a) of this section and 3 V.S.A. § 814(c), no prior notice or hearing shall be required if the grounds for suspension or revocation of a special purpose financial captive insurance company’s license pursuant to section 6009 of this chapter relate primarily to the financial condition or soundness of the special purpose financial captive insurance company or to a deficiency in its assets.

(c)  For purposes of this subchapter, reference to section 6004 in subdivision 6009(a)(2) shall be construed also as a reference to section 6048g. 

§ 6048m.  Delinquency

(a)  Except as otherwise provided in this section, the provisions of chapter 145 of this title shall apply in full to a special purpose financial captive insurance company.

(b)  Upon any order of supervision, rehabilitation, or liquidation of a special purpose financial captive insurance company, the receiver shall manage the assets and liabilities of the special purpose financial captive insurance company pursuant to the provisions of this subchapter. 

(c)  Amounts recoverable by the receiver of a special purpose financial captive insurance company under a reinsurance contract shall not be reduced or diminished as a result of the entry of an order of conservation, rehabilitation, or liquidation with respect to a ceding insurer, notwithstanding any provision in the contracts or other documentation governing the special purpose financial captive insurance company securitization. 

(d)  Notwithstanding the provisions of chapter 145 of this title or any other law of this state:

(1)  An application or petition or a temporary restraining order or injunction issued pursuant to the provisions of chapter 145 of this title with respect to a ceding insurer does not prohibit the transaction of business by a special purpose financial captive insurance company, including any payment by a special purpose financial captive insurance company made with respect to a special purpose financial captive insurance company security, or any action or proceeding against a special purpose financial captive insurance company or its assets;

(2)  The commencement of a summary proceeding with respect to a special purpose financial captive insurance company and any order issued by the court in such summary proceeding shall not prohibit payments by a special purpose financial captive insurance company and shall not prohibit the special purpose financial captive insurance company from taking any action required to make such payments, provided such payments are made: 

(A)  pursuant to a special purpose financial captive insurance company security or reinsurance contract; and

(B)  consistent with the special purpose financial captive insurance company’s plan of operation and any order issued to the special purpose financial captive insurance company pursuant to subsection 6048d(b), as either is amended from time to time. 

(3)  A receiver of a ceding insurer may not void a nonfraudulent transfer by a ceding insurer to a special purpose financial captive insurance company of money or other property made pursuant to a reinsurance contract; and

(4)  A receiver of a special purpose financial captive insurance company may not void a nonfraudulent transfer by the special purpose financial captive insurance company of money or other property: 

(A)  made to a ceding insurer pursuant to a reinsurance contract or made to or for the benefit of any holder of a special purpose financial captive insurance company security with respect to the special purpose financial captive insurance company security; and

(B)  made consistent with the special purpose financial captive insurance company’s plan of operation and any order issued to the special purpose financial captive insurance company pursuant to subsection 6048d(b), as either is amended from time to time.

(e)  With the exception of the fulfillment of the obligations under a reinsurance contract and notwithstanding another provision of this subchapter or other laws of this state, the assets of a special purpose financial captive insurance company, including assets held in trust, on a funds‑withheld basis, or in any other arrangement to secure the special purpose financial captive insurance company’s obligations under a reinsurance contract, shall not be consolidated with or included in the estate of a ceding insurer in any delinquency proceeding against the ceding insurer pursuant to the provisions of this subchapter for any purpose including, without limitation, distribution to creditors of the ceding insurer. 

§ 6048n.  Sponsored Captives

In addition to the provisions of sections 6048a–6048m of this subchapter, the provisions of this section shall apply to any sponsored captive insurance company licensed as a special purpose financial captive insurance company pursuant to this subchapter.

(1)  A sponsored captive insurance company may be licensed as a special purpose financial captive insurance company pursuant to the provisions of this subchapter.

(2)  The special purpose financial captive insurance company shall be subject to the provisions of subchapter 2 of this chapter.  In the event of any conflict between the provisions of this subchapter and the provisions of subchapter 2 of this chapter, the provisions of this subchapter shall control.

(3)  Unless otherwise approved in advance by the commissioner, a participant in a special purpose financial captive insurance company shall be a ceding insurer.  Any change in a participant shall be subject to prior approval by the commissioner.

(4)  Notwithstanding subdivision 6034(1) of this chapter, the special purpose financial captive insurance company may issue securities to any person approved in advance by the commissioner.

(5)  Notwithstanding section 6048g of this subchapter, the special purpose financial captive insurance company shall possess and thereafter maintain unimpaired paid‑in capital and surplus of not less than $500,000.00. 

(6)  The “general account” of a sponsored captive insurance company licensed as a special purpose financial captive insurance company shall mean all assets and liabilities of the sponsored captive insurance company not attributable to a protected cell.

(7)  Any security issued by a special purpose financial captive insurance company with respect to a protected cell and any other contract or obligation of the special purpose financial captive insurance company with respect to a protected cell shall include the designation of such protected cell and shall include a disclosure in a form and content satisfactory to the commissioner to the effect that the holder of such security and any counterparty to such contract or obligation have no right or recourse against the special purpose financial captive insurance company and its assets other than against assets properly attributable to such protected cell.  Notwithstanding the requirements of this subdivision (7) and subject to the provisions of this chapter and other applicable law or regulation, the failure to include such disclosure, in whole or part, in such security, contract, or obligation with respect to a protected cell shall not serve as the sole basis for a creditor, ceding insurer, or any other person to have recourse against the general account of the special purpose financial captive insurance company or against the assets of any other protected cell.

(8)  In addition to the provisions of section 6034 of this chapter, the special purpose financial captive insurance company shall be subject to the following with respect to its protected cells:

(A)  The special purpose financial captive insurance company shall establish a protected cell only for the purpose of insuring or reinsuring risks of one or more reinsurance contracts with a ceding insurer with the intent of facilitating an insurance securitization.  A separate protected cell shall be established with respect to each such ceding insurer, provided that a separate protected cell shall be established with respect to each reinsurance contract or contracts that are funded in whole or in part by a separate securitization transaction; and

(B)  A sale, an exchange, or another transfer of assets may not be made by the special purpose financial captive between or among any of its protected cells without the prior approval of the commissioner.

(9)  All attributions of assets and liabilities to the protected cells and the general account shall be in accordance with the plan of operation approved by the commissioner.  No other attribution of assets or liabilities may be made by a special purpose financial captive insurance company between its general account and any protected cell or between any protected cells.  The special purpose financial captive insurance company shall attribute all insurance obligations, assets, and liabilities relating to a reinsurance contract entered into with respect to a protected cell and shall attribute the related insurance securitization transaction, including any securities issued by the special purpose financial captive insurance company as part of the insurance securitization, to such protected cell. The rights, benefits, obligations, and liabilities of any securities attributable to such protected cell and the performance under such reinsurance contract and the related securitization transaction and any tax benefits, losses, refunds, or credits allocated pursuant to a tax allocation agreement to which the special purpose financial captive insurance company is a party, including any payments made by or due to be made to the special purpose financial captive insurance company pursuant to the terms of such agreement, shall reflect the insurance obligations, assets, and liabilities relating to the reinsurance contract and the insurance securitization transaction that are attributed to such protected cell.

(10)  For purposes of applying the provisions of chapter 145 of this title to a sponsored captive insurance company licensed as a special purpose financial captive insurance company, the definition of “insolvency” and “insolvent” in subdivision 6048c(2) shall be applied separately to each protected cell and to the special purpose financial captive insurance company’s general account.   

(11)  In addition to the provisions of section 6048m of this chapter:

(A)  The provisions of chapter 145 of this title shall apply to each protected cell of the special purpose financial captive.  Any proceeding or action taken by the commissioner pursuant to chapter 145 of this title with respect to a protected cell of a special purpose financial captive shall not be the sole basis for a proceeding pursuant to chapter 145 of this title with respect to any other protected cell of such special purpose financial captive insurance company or the special purpose financial captive insurance company’s general account.

(B)  The receiver of a special purpose financial captive insurance company shall ensure that the assets attributable to one protected cell are not applied to the liabilities attributable to another protected cell or to the special purpose financial captive insurance company’s general account unless an asset or liability is attributable to more than one protected cell, in which case the receiver shall deal with the asset or liability in accordance with the terms of any relevant governing instrument or contract.

(C)  The insolvency of a protected cell shall not be the sole basis for the commissioner to prohibit payments by the special purpose financial captive insurance company made pursuant to a special purpose financial captive insurance company security or reinsurance contract with respect to any other protected cell or to prohibit any action required to make such payments.

and by renumbering the following sections to be numerically correct.

(Committee vote: 10-0-1)

Rep. Branagan of Georgia, for the Committee on Ways and Means, recommends the bill ought to pass in concurrence when amended as recommended by the Committee on Commerce.

(Committee vote: 11-0-0)

(No Senate amendments to the bill)

Senate Proposals of Amendment

H. 137

     An act relating to the restoration of a department of mental health and a commissioner of mental health.

The Senate proposes to the House to amend the bill as follows:

First:  By adding a new Sec. 13a to read as follows:

Sec. 13a.  18 V.S.A. § 7401 is amended to read:

§ 7401.  Powers and duties

Except insofar as this part of this title specifically confers certain powers, duties, and functions upon others, the commissioner shall be charged with its administration.  The commissioner may:

* * *

(17)  ensure the provision of services to children and adolescents with a severe emotional disturbance in coordination with the commissioners commissioner of education and social and rehabilitation services the commissioner for children and families in accordance with the provisions of chapter 43 of Title 33;

(18)  ensure the development of community‑based prevention and early intervention services for children and adults and ensure the coordination of these services throughout all parts of the public and private health care delivery system;

(19)  ensure the development of chronic care services, addressing mental health and substance abuse, for children and adults and ensure the coordination of these services with other chronic care initiatives, including the Blueprint for Health, and the care coordination and case management programs of the office of Vermont health access;

(20)  ensure the coordination of mental health, physical health, and substance abuse services provided by the public and private health care delivery systems;

(21)  ensure the coordination of public mental health and substance abuse services with mental health and substance abuse services offered through the private health care delivery system, including services offered by primary care physicians.

Second:  In Sec. 23, [REPORT] in the first sentence, after the date “January 15, 2008,” by inserting and on January 15 of every even-numbered year thereafter, and after the last sentence, by adding a new sentence to read:

The report shall address prevention, early intervention, and chronic care health services for children and adults, coordination of mental health, substance abuse, and physical health services, and coordination with all parts of the health care delivery system, public and private, including the office of Vermont health access, the office of alcohol and drug abuse, and primary care physicians.

(For text of House amendments  see House Journal 2/15/07 – Pp. 195-196)

H. 526

     An act relating to education quality and cost control.

     The Senate proposes to the House to amend the bill by striking out all after the enacting clause and inserting in lieu thereof the following:

* * * Findings * * *

Sec. 1.  FINDINGS

(a)  Vermonters expect excellence from their schools and are justifiably proud of the state’s system of public education.

(b)  Vermont has demonstrated a commitment to equity in public school financing.  Nevertheless, the state cannot sustain public school spending at its present rate of growth. 

(c)  The general assembly acknowledges the commitment of school boards to managing costs under difficult circumstances.

(d)  The effect that a school funding system has on taxes should be more transparent.

(e)  It is important both to understand what Vermonters expect of their schools (including the expectations that are beyond the provision of traditional academic subjects) and to quantify the cost drivers that are causing increases in school budgets.  It is equally crucial to identify ways for schools to deliver these services more effectively. 

Sec. 2.  [Deleted]

Sec. 3.  [Deleted]

Sec. 4.  16 V.S.A. § 4010(c) is amended to read:

(c)  The commissioner shall determine the weighted long‑term membership for each school district using the long‑term membership from subsection (b) of this section and the following weights for each class:

Grade Level Weight

Elementary 1.0

Secondary 1.25 1.13

* * *

Sec. 5.  Sec. 6.  16 V.S.A. § 4010(h) is added to read:

(h)  The commissioner shall evaluate the accuracy of the weights established in subsection (c) of this section and, at the beginning of each biennium, shall propose to the house and senate committees on education whether the weights should stay the same or be adjusted.

Sec. 6.  SCHOOL DISTRICTS; ANALYSIS AND RECOMMENDATIONS REGARDING HIGH SPENDING

On or before January 15, 2008, the commissioner of education shall explore, analyze, and report to the general assembly regarding the reasons school districts exceed the excess spending threshold defined in 32 V.S.A. § 5401(12) and shall develop recommendations, including criteria, for exempting school districts from the consequences of exceeding the threshold in certain circumstances, including when:

(1)  The district has high costs for special education services, the department has recommended ways to lower the costs, the district has followed the recommendations, and the district still exceeds the threshold; or

(2)  The district has high costs for special education services, the department has been unable to identify ways to lower the costs, and the district still exceeds the threshold; or

(3)  The district pays tuition for all or most of its students to attend one or more schools outside of the district and the commissioner determines that it is not possible for the district to make alternative arrangements that would enable it to stay beneath the high spending threshold.

* * * School Construction * * *

Sec. 7.  16  V.S.A. § 3448(a)(2) is amended to read:

(2)  Approval of preliminary application.

(A)  When reviewing a preliminary application for approval, the commissioner shall consider:

(i)  regional educational opportunities and needs, including school building capacities across school district boundaries, and available infrastructure in neighboring communities;

(ii)  economic efficiencies;

(iii)  the suitability of an existing school building to continue to meet educational needs; and

(iv)  statewide educational initiatives and the strategic plan of the state board of education.

(B)  The commissioner may approve a preliminary application if:

(A)(i)  The project or part of the project fulfills a need occasioned by:

(i)(I)  conditions which threaten the health or safety of students or employees;

(ii)(II)  facilities which are inadequate to provide programs required by state or federal law or regulation;

(iii)(III)  excessive energy use resulting from the design of a building or reliance on fossil fuels or electric space heat; or

(iv)(IV)  deterioration of an existing building;

(B)(ii)  The need addressed by the project cannot reasonably be met by another means; and

(C)(iii)  The proposed type, kind, quality, size, and estimated cost of the project are suitable for the proposed curriculum and meet all legal standards.

* * * Superintendents * * *

Sec. 8.  SUPERINTENDENTS; VACANCIES; COMMISSIONER’S ROLE

On or before July 15, 2007, the commissioner of education and the state board of education shall submit a report to the senate and house committees on education concerning their respective responsibilities under 16 V.S.A. § 241(a), 16 V.S.A. § 261, and state board rules 3220 through 3241, all of which are set forth below.  In particular, the report shall address:

(1)  The protocol followed when the commissioner is notified of a vacancy or impending vacancy in a superintendent’s position.

(2)  The inquiries made by the commissioner or board concerning the process by which the supervisory union advertises for and selects a new superintendent and the qualifications of was selected.

(3)  The independent inquiries made by the commissioner or board concerning the qualifications of the superintendents considered or selected by the supervisory union board.

(4)  The nature and frequency of the “advice” provided pursuant to 16 V.S.A. § 241(a).

* * * Qualifications of Business Managers * * *

Sec. 9.  FINANCIAL MANAGEMENT OF SCHOOL DISTRICTS AND

             SUPERVISORY UNIONS

(a)  The commissioner of education, in consultation with the Vermont superintendents’ association, the Vermont school boards association, and the Vermont association for school business officials shall:

(1)  Examine the systems of financial management currently used by Vermont school districts and supervisory unions.

(2)  Examine the range of training and expertise currently held by persons responsible for the financial management of Vermont school districts and supervisory unions.

(3)  Examine and assess the training or credentials required of financial managers employed by public schools or school districts in other states.

(4)  Develop proposals to ensure that all school districts consistently use uniform, high‑quality financial management practices.

(b)  On or before November 15, 2007, the commissioner shall submit a report to the senate committee on education outlining the results of the examinations required in subdivisions (a)(1)–(3) of this section and recommending proposals to ensure uniform, high quality financial management practices as required in subdivision (a)(4) of this section.  The report shall include both an analysis of the budgetary impact, if any, of the commissioner’s proposals and drafts of any proposed legislation. 

* * * Mandates * * *

Sec. 10.  MANDATES; REPORT

The legislative council and the joint fiscal office, in consultation with the Vermont school boards association, the Vermont superintendents association, the Vermont principals’ association, the Vermont – national education association, the Vermont council for special education administrators, superintendents, principals, school board members, and school personnel shall examine the requirements placed on local school districts resulting from state legislation, board rules, and interagency cost shifts implemented since January 1, 1997.  The examination will identify and quantify associated process requirements, staffing effects, and financial implications.  Legislative council and the joint fiscal office shall prepare a report for submission to the senate and house committees on education on or before December 1, 2007.

* * * Special Education Costs; Study * * *

Sec. 11.  SPECIAL EDUCATION SERVICES PROVISIONS; STUDY

As a continuation of the fine work contained in the Report on the Provision of Special Education Services issued in January 2001, the joint fiscal office, in consultation with the secretary of human services, the commissioner of education, the commissioner of employment and training, the Vermont superintendents’ association, the Vermont school boards association, the Vermont principals’ association, the Vermont – national education association, the Vermont council for special education administrators, the Vermont coalition for disability rights, the Vermont parent information center, and other members of the education community, shall study how the agency of human services, the department of education, and the department of employment and training should provide for special education services for eligible persons under 22 years of age in school or out of school.  They shall also:

(1)  assess the extent to which school districts have absorbed service costs for special needs children that were historically paid by other service providers, including the extent to which:

(A)  children formerly admitted to institutional care are now being provided services through special education;

(B)  costs now found in school budgets historically were part of the budgets of nonschool agencies;

(C)  costs now found in school budgets would be attributable to nonschool agencies; and

(D)  Medicaid funds are being used to provide services;

(2)  examine the interagency agreement regarding coordination of special education services entered into pursuant to 20 U.S.C. § 1412(a)(12) to determine if services are currently provided and paid for in the most appropriate and cost-effective ways;

(3)  prepare an estimate of the number of children with individualized education plans (IEP) who lose health care coverage through Dr. Dynasaur because of nonpayment of a premium and the financial impact on schools because of the disenrollment in Dr. Dynasaur; and

(4)  report its findings and recommendations to the general assembly on or before November 1, 2007.

* * * High Special Education Costs; Departmental Review * * *

Sec. 12.  16 V.S.A. § 2974 is amended to read: 

§ 2974.  SPECIAL EDUCATION PROGRAM; FISCAL REVIEW PANEL

               OF HIGH SPENDING DISTRICTS

(a)  Annually, the commissioner shall report on:

(1)  special education expenditures by school districts;

(2)  the rate of growth or decrease in special education costs, including the identity of high and low spending districts;

(3)  outcomes for special education students;

(4)  the availability of special education staff;

(5)  the consistency of special education program implementation statewide; and

(6)  the status of the education support systems in school districts; and

(7)  a statewide summary of the special education student count, including:

(A)  the percentage of the total average daily membership represented by special education students statewide and by school district;

(B)  the percentage of special education students by disability category; and

(C)  the percentage of special education students by in‑district placement, day placement, and residential placement.

(b)  The commissioner shall review high spending districts to determine Annually, but no later than October 1, based on the previous year’s expenditures, the commissioner shall notify high spending districts that they have been designated as such.  Each designated district shall respond within 60 days with an explanation of its spending to address whether:

(1)  costs could be decreased while still providing needed special education services;

(2)  the district made reasonable efforts to provide, purchase, or contract for goods or services that are the most reasonably priced yet appropriate for its students;

(3)  the district reported special education expenditures appropriately; and

(4)  all expenditures identified as special education expenditures were properly attributed to eligible students and the services for which the expenditures were made were included in the students’ individualized education plans;

(5)  the district’s special education staff‑to‑child count ratios were higher than the state average, including a breakdown of ratios by staffing categories;

(6)  the number of students in more restrictive environments such as day programs and residential placements was above the state average of special education students in those placements and, if so, information about the categories of disabilities for the students in such placements;

(7)  the district was in compliance with section 2901 of this title; and

(8)  if the district’s proportion of its average daily membership who are enrolled in special education exceeds 20 percent of the statewide average, any unusual community characteristics contributed to this condition.

(c)  The commissioner shall review low spending districts to determine the reasons for their spending patterns and whether those districts used cost‑effective strategies appropriate to replicate in other districts.

(d)  For the purposes of this section, a “high spending district” is a school district that, in the previous school year, spent at least 20 percent more than the statewide average of special education eligible costs per average daily membership.  Also for the purposes of this section, a “low spending district” is a school district that, in the previous school year, spent no more than 80 percent of the statewide average of special education eligible costs per average daily membership.

(e)  For the purpose of advising the commissioner and providing technical assistance to school districts, the state board shall appoint a fiscal review panel of seven people who have expertise in the areas of data collection and finance, and in the fields of special education, business or health and human services. The panel, at the request of a district school board, shall work with the department of education to review spending patterns and provision of special education services in the district and provide advice to the school board and staff concerning cost control mechanisms and cost‑effective practices. In addition, the panel shall make recommendations on what types of data to collect for purposes of the annual report required under subsection (a) of this section, and how the data should be analyzed.  If, after a review of a high spending district’s explanation, the commissioner finds that the explanation is not satisfactory, the commissioner shall conduct a performance review to include one or more of the following:

(1)  a review of the district’s special education student count patterns over time;

(2)  a review of the district’s compliance with section 2901 of this title and any unusual community characteristics that exist;

(3)  an on‑site review to examine a sample of special education student records and related financial and business records;

(4)  a review of the district’s compliance with federal and state requirements to provide a free appropriate public education to eligible students; and

(5)  a review of other factors.

(f)  Within 60 days of completing the performance review, the commissioner shall notify the district in writing of his or her findings and whether the results of the performance review are satisfactory or not satisfactory.  If the results of the performance review are not satisfactory to the commissioner, the commissioner and the school district jointly shall develop a remediation plan.  The district shall have two years to make progress on the remediation plan.  At the conclusion of the two years or earlier, the district shall report its progress on the remediation plan. 

(g)  Within 30 days of receipt of the district’s report of progress, the commissioner shall notify the district that its progress is either satisfactory or not satisfactory. 

(1)  If the district has failed to make satisfactory progress by the conclusion of the remediation plan, the commissioner shall notify the district that in the ensuing year the district will be subject to a withholding of up to 10 percent of its special education expenditures reimbursement under section 2963 of this chapter.

(2)  If the district has failed to make satisfactory progress by the end of the year in which a portion of the special education expenditures reimbursement was withheld under subdivision (1) of this subsection, the commissioner shall notify the district that in the ensuing year the district will be subject to a withholding of up to 20 percent of its special education expenditures reimbursement.

(3)  If the district has failed to make satisfactory progress by the end of the year in which a portion of the special education expenditures reimbursement was withheld under subdivision (2) of this subsection, the commissioner shall notify the district that the state board of education will impose a plan of remediation. 

(4)  If the district makes satisfactory progress under any subdivision of this subsection, the commissioner shall release to the district any special education expenditures reimbursement withheld for the prior fiscal year only.

(h)  Within 10 days after receiving the commissioner’s notice under subdivisions (g)(1), (2), or (3) of this section, the district may challenge the commissioner’s decision by filing a written objection to the state board of education outlining the reasons the district believes it made satisfactory progress on the remediation plan.  The commissioner may file a written response within 10 days after the district’s objection is filed.  The board may give the district and the commissioner an opportunity to be heard.  The board’s decision shall be final.  The state shall withhold no portion of the district’s reimbursement before the state board issues its decision under this subsection.

* * *

* * * Governance * * *

Sec. 13.  EDUCATION GOVERNANCE; COMMISSIONER OF

               EDUCATION; COUNCIL ON EDUCATION GOVERNANCE

(a)  In May 2006, the commissioner of education released a white paper outlining a plan for changing education governance in Vermont and initiating a year of facilitated public discussions throughout the state.  The final discussion session is scheduled for May 2007. 

(b)  On or before December 1, 2007, the commissioner shall submit a report to the house and senate committees on education that describes insights obtained from the recently concluded public engagement process.  The report shall consider other governance models and shall also outline any proposals the commissioner wishes to make for restructuring governance in Vermont.  Any proposed changes should foster increased cooperation and collaboration among public schools and provide support for the new demands and expectations placed on schools by an increasingly technological and global society. 

(c)  The commissioner shall request the following organizations to submit, jointly or independently, recommendations regarding the future governance of school districts:  the Vermont superintendents’ association, the Vermont school boards association, the Vermont principals’ association, and the Vermont national education association.  The commissioner shall include the recommendations in the report to the house and senate committees on education required in subsection (b) of this section.

* * * Small Schools Grants * * *

Sec. 14.  16 V.S.A. § 4015(e) is amended to read:

(e)  In the event that a school or schools which have received a grant under this section merge in any year following receipt of a grant, and the consolidated school is not eligible for a grant under this section or the small school grant for the consolidated school is less than the total amount of grant aid the schools would have received if they had not combined, the consolidated school shall continue to receive a grant for three years following consolidation.  The amount of the annual grant shall be:

(1)  In the first year following consolidation, an amount equal to the amount received by the school or schools in the last year of eligibility.

(2)  In the second year following consolidation, an amount equal to two‑thirds of the amount received in the previous year.

(3)  In the third year following consolidation, an amount equal to one-third of the amount received in the first year following consolidation.

* * * Education Property Tax Implications; Study * * *

Sec. 15.  EDUCATION PROPERTY TAX IMPLICATIONS; STUDY

The commissioner of taxes shall study the impact that the education property tax on homestead and nonresidential property has on various groups of taxpayers.  The commissioner shall design the study and select the groups of taxpayers in consultation with and upon the advice of the department of education and the joint fiscal office.  The commissioner shall submit a written report detailing the results of the study to the general assembly on or before January 15, 2008.    

Sec. 15a.  32 V.S.A. § 5402b is amended to read:

§ 5402b.  STATEWIDE EDUCATION TAX RATE ADJUSTMENTS

(a)  Annually, by December 1, the commissioner of taxes shall recommend to the general assembly, after consultation with the department of education, the secretary of administration and the joint fiscal office, the following adjustments in the statewide education tax rates under subdivisions 5402(a)(1) and (2) of this title:

* * *

(b)  If the commissioner makes a recommendation to the general assembly to adjust the education tax rates under section 5402 of this title, the commissioner shall also recommend a proportional adjustment to the applicable percentage base for homestead income based adjustments under section 6066 of this title, but the applicable percentage base shall not be adjusted below 1.8 percent.

Sec. 16. 16 V.S.A. §562a is added to read:

§ 562a School budget; Douglas supermajority

     Authorization by the electorate pursuant to section 562(8) of this title or a municipal charter shall require approval by sixty percent or more of those voting if the proposed amount of money exceeds 104 percent of the prior year authorization, and the proposed education spending per equalized pupil exceeds 104 percent of the education spending per equalized pupil of the prior year.

Sec. 17. 16 V.S.A. §562a is amended to read:

§ 562a School budget; Douglas supermajority

     Authorization by the electorate pursuant to section 562(8) of this title or a municipal charter shall require approval by sixty percent or more of those voting if the proposed amount of money exceeds 104 103.5 percent of the prior year authorization, and the proposed education spending per equalized pupil exceeds 104 103.5 percent of the education spending per equalized pupil of the prior year.

Sec. 18.  REPEAL

     Section 562a of Title 16 (supermajority vote requirement) is repealed January 1, 2013, effective for budgets for fiscal years 2014 and after.            

Sec. 18a.  VOLUNTARY CONSOLIDATION; TAX BENEFIT

There is created a committee consisting of two members to be appointed by the committee on committees of the senate, two members to be appointed by the speaker of the house of representatives, and four members to be appointed by the governor, and a chair to be jointly chosen by all three leaders to develop a system to provide tax incentives to school districts that voluntarily consolidate.  The chair shall convene the first meeting of the committee on or before July 1, 2007.  The department of education shall provide administrative support to the committee.  The committee shall present a detailed plan to provide tax benefits to consolidating districts to the general assembly on or before December 1, 2007.  Committee members shall receive no financial compensation for service on the committee.

Sec. 19. EFFECTIVE DATES 

(a)  Sec.  4 of this act shall take effect on January 1, 2010, and shall apply to budgets beginning in the 2010–2011 school year.

     (b)  Sec. 12 shall take effect on July 1, 2008, and the commissioner’s annual review shall begin with expenditures made during the 2008-2009 academic year.   

     (c)  Sec. 16 (school budget limit of 104%; supermajority vote) shall take effect upon passage but shall affect budgets for fiscal year 2009 only.

     (d)  Sec. 17 (school budget limit of 103.5%; supermajority vote) shall take effect January 1, 2009, and shall affect budgets for fiscal years 2010, 2011, 2012, and 2013.

(e)  Sec. 15a (no annual adjustment of the 2% "applicable percentage") shall take effect upon passage and shall apply to claims filed in 2008 and after.

(f)  All other sections of this act shall take effect on July 1, 2007.

(For text of House amendments see House Journal 4/3/07– Pp. 488-497)

H. 527

     An act relating to state’s transportation program.

The Senate proposes to the House to amend the bill by striking out all after the enacting clause and inserting in lieu thereof the following:

Sec. 1.    TRANSPORTATION PROGRAM; ADVANCEMENTS,                                       CANCELLATIONS, AND DELAYS

(a)  The state’s proposed fiscal year 2008 transportation program appended to the agency of transportation’s proposed fiscal year 2008 budget, as amended by this act, is adopted to the extent federal, state, and local funds are available. 

(b)  As used in this act, unless otherwise indicated, the term “agency” means the agency of transportation, and the term “secretary” means the secretary of transportation.  As used in this act, the table heading “As Proposed” means the transportation program referenced in subsection (a) of this section; the table heading “As Amended” means the amendments as made by this act; the table heading “Change” means the difference obtained by subtracting the “As Proposed” figure from the “As Amended” figure; and the term “change” or “changes” in the text refers to the project- and program-specific amendments, the aggregate sum of which equals the net “Change” in the applicable table heading.

* * * Program Development – Roadway * * *

Sec. 2.  PROGRAM DEVELOPMENT – ROADWAY

The following modifications are made to the program development – roadway program:

(1)  Authorized spending on the Morristown VT100 project, STP F 029-1(2), is amended to read:

       FY08                        As Proposed    As Amended             Change

          PE                                   50,000             50,000                      0

          ROW                            150,000           550,000           400,000

          Construction                             0                      0                      0

          Other                                        0                      0                      0

          Total                              200,000           600,000           400,000

       Sources of funds                                                                           

          State                                40,880             89,880             49,000

          Federal                          159,120           479,120           320,000

          Toll credits                                0             31,000             31,000

          Total                              200,000           600,000           400,000

(2)  The agency is directed to advance the Springfield TH 3 project, STP 0136(1), as a preventive maintenance project.  The scope of the project shall be determined in consultation between the agency and the town of Springfield. Upon agreement as to the scope of the project, the agency shall develop the project and be prepared to begin construction during state fiscal year 2009. 

(3)  The unspent funds authorized for expenditure for the Waterbury Main Street project, FEGC F‑013-4(13), in fiscal year 2007 shall be brought forward and used in fiscal year 2008 to advance the improvements at the intersection of Park Row and Main Street.

(4)  A new project is added to the SFY 2007 and SFY 2008 development and evaluation section:  Pittsford police academy has received an earmark for a project to provide a driver training pad at the criminal justice and fire service training center in Pittsford.  The pad will facilitate in the training of various protection agencies in the defensive operation of their vehicle and to conduct emergency vehicle operations, fire, rescue training, “stopping vehicle training” and for motorcycle licensing.  The project consists of constructing a 350′ x 125′ bituminous concrete training pad with an 800′ long x 20′ wide bituminous concrete acceleration/approach road to the pad.  The amount of federal funds available from the earmark is $491,964 (100 percent - Federal).  The project shall appear as follows: Pittsford STP SKID(1).

(5)  The Middlebury Cross Street project STP 5900( ) which was inadvertently omitted from the agency’s proposed FY08 transportation program as submitted to the general assembly, shall be included by the agency in its publication of the transportation program as enacted by the general assembly pursuant to 19 V.S.A. § 10g(f).

(6)  The agency shall continue its commitment to the Bennington Bypass South project, NH F 019-1(4), as evidenced by the acquisition of right-of-way during state fiscal year 2007, for removal of material from the northern segment to the southern segment, for use as stage one sites for the Bennington Bypass North project, NH F 019-1(5).  At such time as construction funds are identified for the Bennington Bypass South project NH F 019-1(4), the agency shall advance this project on the development and evaluation (D & E) list.

* * * Bridge Programs * * *

Sec. 3.    INTERSTATE, STATE, AND TOWN HIGHWAY BRIDGE          PROGRAMS

To rectify an agency oversight while developing the proposed transportation capital program, notwithstanding 19 V.S.A. § 10g(n), the agency is authorized to expend development and evaluation funds identified for unnamed candidate projects in the interstate, state, and town highway bridge programs on listed candidate projects in each program according to the priority rating and status of such projects within the project development process.

Sec. 4.  PROGRAM DEVELOPMENT – STATE BRIDGE

The following modifications are made to the program development – state bridge program:

(1)  Authorized spending on the Williamstown BRS 0204(4) project, replacement of BR10 over brook No. 2, is amended to read:

       FY08                        As Proposed    As Amended             Change

          PE                                     1,603               1,603                      0

          ROW                              48,716             48,716                      0

          Construction                  850,000           450,000          -400,000

          Other                                        0                      0                      0

          Total                              900,319           500,319          -400,000

       Sources of funds                                                                           

          State                              180,064           100,064            -80,000

          Federal                          720,255           400,255          -320,000

          Local                                        0                      0                      0

          Total                              900,319           500,319          -400,000

* * * Maintenance * * *

Sec. 5.  MAINTENANCE

(a)  Total authorized spending in the maintenance program is modified as follows:

       FY08                             As Proposed    As Amended             Change

          Personal Services           32,933,303      32,933,303                      0

          Operating Expenses       30,858,345      30,711,345          -147,000

          Grants                                206,500           206,500                      0

          Total                              63,998,148      63,851,148          -147,000

       Sources of funds

          State                              60,174,213      60,027,213          -147,000

          Federal                            3,723,935        3,723,935                      0

          Local                                  100,000           100,000                      0

          Total                              63,998,148      63,851,148          -147,000

(b)  These changes are made:

(1)  To reduce funding for intelligent transportation system (ITS) projects by $347,000 of transportation funds.  The agency shall continue to operate the “511” traveler information service at not less than the same level of service as provided in fiscal year 2007.  Subject to this condition, the agency shall allocate the remaining authorized funds for ITS projects at its discretion.

(2)  To add $100,000 of transportation funds for a small improvement project to construct an underground cattle pass on Vermont Route 100 to serve the so-called Turner Farm.  In fiscal year 2008, the agency shall use the authorized funds for the sole purpose of designing, permitting, and installing an underground cattle pass and associated highway traffic safety features.  The associated work is contingent upon the Turner estate donating any necessary right-of-way outside the existing highway right-of-way.  Moreover, the Turner estate, for itself and its successors-in-interest, must agree to a maintenance and liability agreement satisfactory to the agency.  Once completed, the existing cattle crossing signs and warning signals will be removed by the agency.

(3)  To add $100,000 of transportation funds to be used for the acquisition of vehicle-mounted sweeper attachments to aid in the removal of debris from the roadway in support of bicycle and pedestrian activities.

* * * Rest Area Capital Construction * * *

Sec.6.  REST AREAS

The following modifications are made to the rest areas program:

(1)  Authorized spending on the Hartford I-91 rest area sewer line project, IM BLDG(1), is amended to read:

FY08                         As Proposed    As Amended             Change

PE                                   50,000             50,000                      0

ROW                                       0                      0                      0

Construction               2,950,000        3,250,000           300,000

Other                                        0                      0                      0

Total                           3,000,000        3,300,000           300,000

Sources of funds                                                                            

State                              300,000           600,000           300,000

Federal                       2,700,000        2,700,000                      0

Local                                        0                      0                      0

Total                           3,000,000        3,300,000           300,000

* * * Department of Motor Vehicles * * *

Sec. 7.  DEPARTMENT OF MOTOR VEHICLES

(a)  Authorized spending by the department of motor vehicles is amended to read:

       FY08                             As Proposed    As Amended             Change

          Personal Services           17,134,501      17,247,046           112,545

          Operating Expenses         7,629,667        7,629,667                      0

          Grants                                339,000           339,000                      0

          Total                              25,103,168      25,215,713           112,545

       Sources of funds

          State                              23,329,029      23,441,574           112,545

          Federal                            1,774,139        1,774,139                      0

          Local                                             0                      0                      0

          Total                              25,103,168      25,215,713           112,545

(b)  This change is made to add $112,545 in state funds for the DMV computer system upgrade project.

* * * Policy and Planning * * *

Sec. 8.  POLICY AND PLANNING

Authorized spending in policy and planning is amended to read:

       FY08                        As Proposed    As Amended             Change

          Personal Services        4,969,906        4,921,906            -48,000

          Operating Expenses       964,875           964,875                      0

          Grants                         4,690,227        4,690,227                      0

          Total                         10,625,008      10,577,008            -48,000

 

       Sources of funds                                                                           

          State                           2,597,643        2,592,843              -4,800

          Federal                       7,887,365        7,844,165            -43,200

          Other                             140,000           140,000                      0

          Total                         10,625,008      10,577,008            -48,000

* * * Public Transit * * *

Sec. 9.  PUBLIC TRANSIT 

The following modifications are made to the public transit program:

(1)  For the purpose of redirecting capital assets for use in the acquisition of new buses and equipment for public transportation, the secretary of transportation, as agent for the state of Vermont, shall sell, for fair market value, a 2003 MCI 4500D motor coach, owned by the state and purchased with Federal Transit Administration (FTA) funds, to Greyhound Lines, Inc.  Subject to the prior approval of the FTA, the sale proceeds of $215,775.71 shall be applied as soon as practicable to purchase a minimum of three new medium-size rural service delivery, public transit buses, in accordance with the highest priority needs in the agency's capital program.

(2)(A)  Authorized spending in the public transit program is amended to read:

       FY08                             As Proposed    As Amended             Change

          Personal services                948,669           948,669                      0

          Operating expenses               77,517             77,517                      0

          Grants                           16,225,259      16,641,035           415,776

          Other                                             0                      0                      0

          Total                              17,251,445      17,667,221           415,776

       Sources of funds

          State                                5,899,044        6,271,620           372,576

          Federal                          11,352,401      11,395,601             43,200

          Other                                             0                      0                      0

          Total                              17,251,445      17,667,221           415,776

(B)  These changes are made:

(i)  to incorporate the spending of $215,775.71 in transportation funds authorized in subsection (1) of this section;

(ii)  to add $156,800 in transportation funds and $43,200 in federal funds to authorized spending in the public transit elders and persons with disabilities program for critical medical care transportation services.  These funds are authorized on a one-time basis to provide emergency supplemental funding to the elderly and disabled transportation program.  The funds are intended to provide program security by setting aside supplementary elderly and disabled transportation program funds (E&D funds) for critical care transportation appropriated for fiscal year 2008.  In order to maintain program integrity and prevent the revision of allocation and spending patterns based upon the existence of this new supplemental fund, all agencies receiving such funding shall maintain in fiscal year 2008 the funding amounts initially programmed for by the regional elderly and disabled advisory committees in fiscal year 2007.  Further, in an effort to develop a more consistent approach to the use of E&D funds by diverse regional entities, the agency shall provide revised or additional E&D program management guidance, or both, to be followed by all recipients of this funding.  The agency of transportation shall hold these supplemental funds in reserve, and shall disperse these funds to agencies that have grant agreements with the agency for the provision of elderly and disabled transportation services only in the event that a shortfall of E&D funds occurs as a result of unanticipated high demand for non-Medicaid, critical care transportation services which results in a lack of funds available to continue critical care transportation services.

Sec. 10. CRITICAL CARE TRANSPORTATION STUDY COMMITTEE

(a)  A critical care transportation study committee is established, consisting of representatives of the agency of transportation and the agency of human services as designated by the secretaries of the respective agencies; a representative of the Vermont area agencies on aging; a representative of the Vermont center for independent living; a representative of the Vermont association of adult day care services; a representative of the Vermont public transportation association to represent rural public transportation providers; a representative of the Vermont public transportation association to represent urban public transportation providers; a representative of the Vermont kidney foundation; and a representative of the American Cancer Society.  For the purposes of this section, critical care transportation is defined as transportation to and from dialysis and cancer treatment medical services for Vermonters not eligible for Medicaid transportation services.  The committee shall be co-chaired by a representative of the agency of transportation and a representative of the agency of human services as designated by the secretaries of the respective agencies.

(b)  The committee shall review the current service delivery system for critical care transportation, and develop recommendations for program administration approaches that will ensure critical care transportation program stability, and eliminate annual regional fluctuations of need, and make policy recommendations toward the establishment of prudent and predictable funding that is tied to clear policy objectives determined to be reasonable, sustainable, and affordable.  The committee shall consider such issues as program coordination among nonprofit agencies and funding sources, sustainability of funding, ease of administration, compatibility with other programs, need for service, and other issues it deems relevant to determine its recommendations. 

(c)  The agency of human services and agency of transportation shall provide administrative and staff support for the committee.

(d)  The committee shall deliver its report, including any recommendations for proposed legislation, to the house and senate committees on appropriations and transportation, to the house committee on human services, and the senate committee on health and welfare by December 1, 2007. 

* * * Park & Ride Municipal Initiative Program * * *

Sec. 11.  PARK AND RIDE MUNICIPAL INITIATIVE PROGRAM

Authorized spending in the park & ride municipal initiative program is amended to read:

       FY08                             As Proposed    As Amended             Change

          PE                                      200,000           262,000             62,000

          ROW                                            0                      0                      0

          Construction                                  0                      0                      0

          Other                                             0                      0                      0

          Total                                   200,000           262,000             62,000

       Sources of funds

          State                                   200,000           262,000             62,000

          Federal                                          0                      0                      0

          Local                                             0                      0                      0

          Total                                   200,000           262,000             62,000

* * * Town Highway Emergency Fund * * *

Sec. 12.  TOWN HIGHWAY EMERGENCY FUND

Funding of the town highway emergency fund is amended to read:

       FY08                        As Proposed    As Amended             Change

          Personal Services                      0                      0                      0

          Operating Expenses                  0                      0                      0

          Grants                         1,185,893           750,000          -435,893

          Total                           1,185,893           750,000          -435,893

       Sources of funds

          State                           1,185,893           750,000          -435,893

          Federal                                     0                      0                      0

          Local                                        0                      0                      0

          Total                           1,185,893           750,000          -435,893

* * * Town Highway Class 2 Roadway Program * * *

Sec. 13.  TOWN HIGHWAY CLASS 2 ROADWAY

Authorized spending on the town highway class 2 roadway program is amended to read:

       FY08                        As Proposed    As Amended             Change

          Personal Services                      0                      0                      0

          Operating Expenses                  0                      0                      0

          Grants                         4,748,750        5,748,750        1,000,000

          Total                           4,748,750        5,748,750        1,000,000

       Sources of funds                                                                           

          State                           4,748,750        5,748,750        1,000,000

          Federal                                     0                      0                      0

          Local                                        0                      0                      0

          Total                           4,748,750        5,748,750        1,000,000

* * * VT 2A/VT 289 – VT 127 Corridor * * *

Sec. 14.  TRANSPORTATION IMPROVEMENTS ALONG CORRIDOR BETWEEN EXISTING VT 2A/VT 289 INTERCHANGE IN TOWN OF ESSEX AND VT 127 (HEINEBERG DRIVE) IN TOWN OF COLCHESTER

(a)  For purposes of this section, “corridor” means the corridor between the existing VT 2A/VT 289 interchange in the town of Essex and VT 127 (Heineberg Drive) in the town of Colchester.

(b)  The agency, in cooperation with the Chittenden County metropolitan planning organization (CCMPO), shall provide a projected timeline for transportation improvements along the corridor.  The timeline shall address the following:

(1)  Major steps, including environmental reviews;

(2)  The agency’s best current estimate of the time, workforce, and financial resources needed and likely to be available for transportation improvements along the corridor;

(3)  The CCMPO’s best current estimate of its future year-by-year prioritization of transportation improvements along the corridor within the CCMPO’s transportation improvement plan (TIP);

(4)  The agency’s best current estimate of its future year by year prioritization of transportation improvements along the corridor pursuant to the requirements of 19 V.S.A. § 10g(l)-(m) (priority ratings); and

(5)  The projected fiscal year for starting and ending each of the project process steps for transportation improvements along the corridor, with appropriate caveats.    

(c)  The agency shall present the projected timeline to the house and senate committees on transportation by January 15, 2008.

* * * Agency Fleet * * *

Sec. 15.  AGENCY VEHICLE FLEET

Pursuant to 19 V.S.A. § 13(b), the agency is authorized to add one pickup truck with a plow and hopper spreader and one loader to the fleet.

* * * Cancellation of Projects * * *

Sec. 16.  CANCELLATION OF PROJECTS

Pursuant to 19 V.S.A. § 10g(f) (legislative approval for cancellation of projects), the general assembly approves cancellation of the following projects:

(1)  Bike and pedestrian facilities:

(A)  Swanton STP BIKE(29)S (bike/ped path) (town has requested termination); and

(B)  Williston STP WALK(22) (bike/ped path) (town has requested termination);

(2)  Roadway:

(A)  Fairlee SB VT 00(002) (interpretive center) (town has requested termination); and

(B)  Windsor SB VT 00(003) (waypoint interpretive center) (town has requested termination).

* * * Interpretive Signing for Official Byways * * *

Sec. 17.  10 V.S.A. § 489 is amended to read:

§ 489.  ELIGIBILITY FOR OFFICIAL BUSINESS DIRECTIONAL SIGNS

(a)  Lawful businesses and points of interest and cultural, educational, and religious facilities are eligible for official business directional signs, subject to the provisions of this chapter and to rules and regulations promulgated by the travel information council, and subject further to any federal law, rule, or regulation affecting the allocation of federal highway funds or other funds to or for the benefit of this state or any agency or subdivision thereof of the state.

(b)  Notwithstanding any provision of this chapter, brown-and-white official business directional signs as requested by the local byways organization may be allowed for the purpose of directing travelers to interpretive information sites along officially designated state and federal byways only.  An official business directional sign authorized under this subsection shall be located on the same state designated byway as the interpretive information site to which the sign directs attention.

* * * Service of Necessity Petitions * * *

Sec. 18.  19 V.S.A. § 506(a)(1) is amended to read:

(a)  The agency shall prepare a notice of the necessity hearing.  The notice shall include the names of the municipalities in which the lands to be taken or affected are located; the names of all interested persons within the meaning of subdivision 501(2) of this chapter; and a brief statement identifying the proposed project and its location, and the date, time and place of the necessity hearing.  The agency shall make service of copies of the petition, the notice of hearing and the survey (for the purposes of this section, “survey” means a plan, profile, or cross-section of the proposed project) as follows:

(1)  Upon interested persons in accordance with the Vermont Rules of Civil Procedure for service of process, except as stated in subsection (b) of this section and in section 519 of this title or, with respect to interested parties with no known residence or place of business within the state, by certified mail, return receipt requested.  The copy of the survey that is served upon interested persons need include only the particular property in which those persons have an interest.

* * * Compensation Hearings; Projects Extending into Two

or More Counties * * *

Sec. 19.  19 V.S.A. § 511 is amended to read:

§ 511.  HEARING TO DETERMINE AMOUNT OF COMPENSATION

(a)  Following a determination of the necessity of the taking as above provided, when an owner of land or rights and the agency of transportation are unable to agree on the amount of compensation to be paid, and if the agency of transportation desires to proceed with the taking, the transportation board shall appoint a time and place in the county where the land is situated for examining the premises and hearing parties interested, giving at least 10 days' notice in writing to the person owning the land or having an interest in the land.  At that time and place, a member or members of the transportation board shall hear any person having an interest in the land and desiring to be heard.

(b)  If the land proposed to be acquired extends into two or more counties, the board may hold a single hearing in one of the counties to determine compensation.  In fixing the place for hearing, the transportation board shall take into consideration the needs of the parties. 

* * * Traffic-Control Signals * * *

Sec. 20.  23 V.S.A. § 1022(c) is amended to read:

(c)  Steady red signal.

(1)  Vehicular traffic facing a steady circular red signal alone shall stop at a clearly marked stop line, but if none, shall stop before entering the crosswalk on the near side of the intersection.

(2)  Except when a sign is in place prohibiting a turn, vehicular traffic facing any steady red signal may cautiously enter the intersection to turn right, or to turn left from a one way street into a one way street, after stopping as required by subdivision (c)(1) of this section subsectionSuch vehicular This traffic shall yield the right-of-way to pedestrians lawfully within an adjacent crosswalk and to other traffic lawfully using the intersection.  No motorist shall turn right when facing a red arrow signal indication unless a regulatory sign is present which permits this movement. 

(3)  Unless otherwise directed by a pedestrian-control signal as provided in section 1023 of this title, pedestrians facing a steady red signal alone shall not enter the roadway.

* * * Approval of Real Estate Transaction in Charlotte * * *

Sec. 21.  APPROVAL FOR CONVEYANCE OF REAL ESTATE IN TOWN             OF CHARLOTTE

Subject to the approval of the Federal Transit Administration (FTA), the secretary of transportation, as agent for the state of Vermont, is authorized to convey to the Vermont Electric Power Company, Inc. (VELCO) or an affiliated company, for use as a site for an electrical power substation in connection with the Northwest Reliability Project, for fair market value, part of the land acquired by the state of Vermont in 2000 for a commuter rail station and parking lot, which were part of the Charlotte–Burlington commuter train project.  The conveyance may include an easement over the state’s remaining property for vehicular access to Ferry Road (VT F-5; TH 3).

* * * Agency Cooperation with Regional Planning Commissions * * *

Sec. 22.  19 V.S.A. § 10l is added to read:

§ 10l.   AGENCY COOPERATION WITH REGIONAL PLANNING          COMMISSIONS

(a)  Legislative intent.  The general assembly finds that regional planning commissions possesses a unique expertise that enables the agency to conduct rural transportation planning and local consultation activities that build upon the integration of land use, environmental, and economic development inputs.  To ensure the agency continues to meet its local consultation requirements found in 23 C.F.R. part 250.212, the general assembly requires the following duties of regional planning commissions as part of an annual contract and work preparing the transportation planning initiative (TPI).

(b)  Duties of regional planning commissions.  Regional planning commissions, serving areas of the state not qualifying as a Metropolitan Planning Area under federal regulations, shall implement the transportation planning initiative (TPI) program.  This program provides the mechanism by which the agency coordinates policy development and planning to ensure the involvement by Vermont citizens and rural local officials.  It shall include, but not be limited to:

(1)  Ensuring that local officials and citizens are involved in the

statewide transportation planning process. 

(2)  Providing technical assistance to facilitate local officials and staff in making transportation policy and investment decisions.

(3)  Coordinating town planning and development regulations to meet better state transportation policies and investment priorities.

(4)  Participating in state and national transportation policy and planning development processes to ensure regional and local input.

(5)  Implementing a project evaluation process to prioritize all transportation projects within the regions utilizing state or federal funds to be included in the state transportation program.

(6)  Developing and maintaining a regional, multi-modal transportation plan that clearly details regional and local project, planning, and policy priorities. 

(7)  Maintaining a regional transportation advisory committee (TAC) that reviews and provides input on all major state and federal transportation planning and policy decisions.  In order to facilitate this input, the regional planning commissions, in collaboration with the agency of transportation, shall provide warning and notice of all public meetings regarding transportation plans, projects, and proposals.

* * * Registration for Specialized Fuel-Driven Motor Vehicles * * *

Sec. 23.  23 V.S.A. § 4(22) is amended to read:

(22)  "Nongasoline driven motor vehicle" “Specialized fuel-driven motor vehicle”  shall include all motor vehicles, the power for which is generated otherwise than by gasoline, except diesel driven vehicles using or by diesel "fuel" as defined in section 3002 of this title, excluding steam road rollers, tractors used entirely for work on the farm and vehicles running only upon rails or tracks.

Sec. 24.  23 V.S.A. § 362 is amended to read:

§ 362.  NONGASOLINE AND NONDIESEL SPECIALIZED FUEL MOTOR        VEHICLES AND MOTOR BUSES

The annual fee for the registration of any "nongasoline driven specialized fuel-driven motor vehicle" as defined in section 4 of this title but not including and of motor buses, as defined in section 3002 of this title and registered in this state, shall be one and three quarters three-quarters times the amount of the annual fee provided for a motor vehicle of the classification and weight under the terms of this chapter.

Sec. 25.  REPEAL

23 V.S.A. chapter 8 (bus taxation proration agreement) is repealed.

* * * Development Review Applications; Notice Requirements * * *

Sec. 26.  24 V.S.A. § 4464(a)(1) and (2) are amended to read:  

(a)  Notice procedures.  All development review applications before an appropriate municipal panel under procedures set forth in this chapter shall require notice as follows.

(1)  A warned public hearing shall be required for conditional use review, variances, administrative officer appeals, and final plat review for subdivisions.  Any public notice for a warned public hearing shall be given not less than 15 days prior to the date of the public hearing by all the following:

(A)  Publication of the date, place, and purpose of the hearing in a newspaper of general circulation in the municipality affected.

(B)  Posting of the same information in three or more public places within the municipality in conformance with location requirements of 1 V.S.A. § 312(c)(2), including posting within view from the public right‑of‑way most nearly adjacent to the property for which an application is made.

(C)  Written notification to the applicant and to owners of all properties adjoining the property subject to development, without regard to any public right‑of‑way including the owners of properties which would be contiguous to the property subject to development but for the interposition of a highway or other public right-of-way and, in any situation in which a variance is sought regarding setbacks from a state highway, also including written notification to the secretary of transportation.  The notification shall include a description of the proposed project and shall be accompanied by information that clearly informs the recipient where additional information may be obtained, and that participation in the local proceeding is a prerequisite to the right to take any subsequent appeal.

(2)  Public notice for hearings on all other types of development review, including site plan review, shall be given not less than seven days prior to the date of the public hearing, and shall include at a minimum all the following:

(A)  Posting of the date, place, and purpose of the hearing in three or more public places within the municipality in conformance with the time and location requirements of 1 V.S.A. § 312(c)(2).

(B)  Written notification to the applicant and to the owners of all properties adjoining the property subject to development, without regard to right‑of‑way including the owners of properties which would be contiguous to the property subject to development but for the interposition of a highway or other public right-of-way and, in any situation in which a variance is sought regarding setbacks from a state highway, also including written notification to the secretary of transportation.  The notification shall include a description of the proposed project and shall be accompanied by information that clearly informs the recipient where additional information may be obtained, and that participation in the local proceeding is a prerequisite to the right to take any subsequent appeal.

* * * Transportation State Policy * * *

Sec. 27.  19 V.S.A. § 10b(b) is amended to read:

(b)  Transportation projects shall be designed to 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 to promote economic opportunities for Vermonters and the best use of the state's natural environmental and historic resources, consistent with the planning goals listed in 24 V.S.A. § 4302 as amended by Act No. 200 of the Acts of the 1987 Adj. Sess. (1988) and with appropriate consideration to local, regional and state agency plans.

(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.

 

* * * Repeal * * *

Sec. 28.  REPEAL; STATEMENT OF LEGISLATIVE INTENT

(a)  19 V.S.A. § 10 g(g) (planning meetings) is repealed.

(b)  This repeal does not absolve the agency of transportation from its existing public involvement responsibilities under 23 C.F.R. § 450.212(f), as certified to the Federal Highway Administration and the Federal Transit Administration.  This annual certification outlines the agency’s public involvement responsibilities in three areas:  the transportation planning initiative (TPI); development and adoption of the long-range transportation plan; and development and adoption of the state transportation improvement plan (STIP).

* * * Smugglers Notch * * *

Sec. 29.  23 V.S.A. § 1006b is added to read:

§ 1006b.  SMUGGLERS NOTCH; WINTER CLOSURE OF VERMONT                    ROUTE 108

The agency of transportation may close the Smugglers Notch segment of Vermont Route 108 during periods of winter weather.  Closings shall become effective when signs to inform the traveling public are in place at both closure points.  These signs shall conform to the standards of section 1025 of this title.

* * * Town Highway Structures and Class 2 Roadway Programs * * *

Sec. 30.  19 V.S.A. § 306(e) is amended to read:

(e)  State aid for town highway structures.  There shall be an annual appropriation for grants to municipalities for maintenance, including actions to extend life expectancy, and construction of bridges, culverts, and other structures, including causeways and retaining walls, intended to preserve the integrity of the traveled portion of class 1, 2, and 3 town highways.  Each fiscal year, the agency shall approve qualifying projects with a total estimated state share cost of $3,490,000.00 at a minimum as new grants.  The agency’s proposed appropriation for the program shall take into account the estimated amount of qualifying invoices submitted to the agency with respect to project grants approved in prior years but not yet completed as well as with respect to new project grants to be approved in the fiscal year.  In a given fiscal year, should expenditures in the town highway structures program exceed the amount appropriated, the agency shall advise the governor of the need to request a supplemental appropriation from the general assembly to fund the additional project cost, provided that the agency has previously committed to completing those projects.  Funds received as grants for state aid for town highway structures may be used by a municipality to satisfy a portion of the matching requirements for federal earmarks, subject to subsection 309b(c) of this title.

Sec. 31.  19 V.S.A. § 306(h) is amended to read:

(h)  Class 2 town highway roadway program.  There shall be an annual appropriation for grants to municipalities for resurfacing, rehabilitation, or reconstruction of paved or unpaved class 2 town highways.  Each fiscal year, the agency shall approve qualifying projects with a total estimated state share cost of $4,240,000.00 at a minimum as new grants.  The agency’s proposed appropriation for the program shall take into account the estimated amount of qualifying invoices submitted to the agency with respect to project grants approved in prior years but not yet completed as well as with respect to new project grants to be approved in the fiscal year.  In a given fiscal year, should expenditures in the town highway class 2 roadway program exceed the amount appropriated, the agency shall advise the governor of the need to request a supplemental appropriation from the general assembly to fund the additional project cost, provided that the agency has previously committed to completing those projects.  Funds received as grants for state aid under the class 2 town highway roadway program may be used by a municipality to satisfy a portion of the matching requirements for federal earmarks, subject to subsection 309b(c) of this title.

Sec. 32.  19 V.S.A. § 309b(c) is amended to read:

(c)  Notwithstanding § 309a subsections (a), (b) and (c) of section 309a of this title, a municipality may use a grant awarded under the town highway structures program or the class 2 town highway roadway program to provide the nonfederal matching funds required to draw down a federal earmark.  In all such cases, the grant shall be matched by local funds as provided in this section.  The intended use of a town highway grant as matching funds for a federal earmark shall not entitle a municipal grant applicant to any priority for a grant award in any fiscal year.  When grants awarded under the town highway structures program or the class 2 town highway roadway program are used to satisfy nonfederal matching requirements for federal earmarks, the term “project costs” in subsections (a) and (b) of this section shall refer only to the nonfederal match for the federal earmark. 

Sec. 33.  19 V.S.A. § 309a(d) is added to read:

(d)  In any case of highway or bridge construction in which a municipality bears a share of the project costs, the fair market value of any land, material, or services donated by the municipality and used in the project shall be credited to the municipality’s share of the project costs subject to the provisions of 23 U.S.C. § 323 with respect to a federal aid project, with any surplus being thereafter credited to the remainder of the nonfederal match requirement.

* * * Enhancement Grant Program * * *

Sec. 34.  19 V.S.A. § 38(g) is amended to read:

(g)  Each year, up to $200,000.00 of the grant program or such lesser sum if all eligible applications amount to less than $200,000.00 shall be reserved for municipalities for eligible salt and sand shed projects.  Grant awards for eligible projects shall not exceed $50,000.00 per project.  Regarding the balance of grant program funds, in In evaluating applications for enhancement grants, the transportation enhancement grant committee shall give preferential weighting to projects involving as a primary feature a bicycle or pedestrian facility.  The degree of preferential weighting and the circumstantial factors sufficient to overcome the weighting shall be in the complete discretion of the transportation enhancement grant committee.

* * * Access to State Highway Rights-of-Way;

Appeal to Transportation Board ** *

Sec. 35.  19 V.S.A. § 5(d) is amended to read:

(d)  The board shall:

(1)  hear appeals from agency decisions and rulings regarding measurement, description or reclassification of town highways pursuant to section 305 of this title;

(2)  hear and determine small claims pursuant to section 20 of this title;

(3)  provide appellate review, when requested in writing, of decisions of the secretary of transportation when he or she assumes the powers and duties of a selectboard in highway matters in unorganized towns and gores pursuant to section 16 of this title;

(4)  provide appellate review, when requested in writing, regarding legal disputes in the execution of contracts;

(5)  provide appellate review, when requested in writing, of decisions of the secretary in administering the provisions of Title 24, relating to junkyards;

(6)  provide appellate review when requested in writing, regarding the fairness of rents and fees charged for the occupancy or use of state-owned properties administered by the agency;

(7)  provide appellate review, when requested in writing, of agency decisions and rulings regarding private and commercial access to state highway rights-of-way pursuant to the permit process established in section 1111 of this title;

(7)(8)  in coordination with the agency, hold public hearings for the purpose of obtaining public comment on the development of state transportation policy, the mission of the agency, and state transportation planning, capital programming, and program implementation;

(8)(9)  hear and determine disputes involving the decision of a selectboard under subdivision 302(a)(3)(B) or subsection 310(a) of this title not to plow and make negotiable a class 2 or 3 town highway or section of a highway during the winter or involving discontinuances of class 3 or 4 town highways extending into adjacent towns under the provisions of subsection 771(c) of this title; and

(9)(10)  when requested by the secretary, conduct public hearings on matters of public interest, after which it shall transmit its findings and recommendations to the secretary and the chairs of the senate and house committees on transportation in a report which shall be a public document.

Sec. 36.  LEGISLATIVE APPROVAL FOR PURCHASE OF EQUIPMENT                FOR AMTRAK VERMONT SERVICE 

(a)  Pursuant to Sec. 20 of No. 175 of the Acts of the 2005 Adj. Sess. (2006), the general assembly approves the state of Vermont’s purchase, through the agency, of diesel multiple unit (DMU) equipment for a demonstration project to improve Amtrak passenger train service to Vermont.

(b)  This approval is subject to the following conditions:

(1)  Financing for the demonstration project must be available under the Railroad Rehabilitation & Improvement Financing (RRIF) loan program administered by the Federal Railroad Administration (FRA).

(2)  There must be availability of a grant of $2 million from Amtrak to assist with certain costs related to the demonstration project, including transition costs, maintenance facilities, marketing, engineering oversight, and service improvements to Vermont stations.

(3)  The DMU equipment selected by Amtrak through a competitive procurement process in 2003 must be utilized.

(4)  The purchase contract with the DMU vendor shall include an option to purchase future equipment, with pricing protections.

(5)  The DMU equipment must meet or exceed current Federal Railroad Administration (FRA) structural safety requirements. 

(6)  The DMU equipment must comply with accessibility standards under the Americans with Disabilities Act (ADA).

(7)  The vendor of the DMU equipment must agree, should the state of Vermont determine that the demonstration project is unsuccessful, to act as the state’s agent to sell the DMU equipment at a minimum of 90 percent of the purchase price and, should the DMU equipment not sell within one year, to purchase the DMU equipment back at 90 percent of the purchase price.

(8)  The contract for construction and purchase of the DMU equipment must be approved by the state treasurer and the attorney general as including sufficient guarantees to assure successful manufacture and delivery of the DMU equipment, as well as performance of the vendor’s undertakings to sell or buy back the DMU equipment, should the state determine that the demonstration project is unsuccessful.

(9)  Any agreements between the state of Vermont and Amtrak or the FRA must be flexible enough to permit redeployment of the DMU equipment in the event of the reconfiguration of Amtrak service to Vermont.  

Sec. 37.  PUBLIC TRANSPORTATION; COMPREHENSIVE PLANNING

(a)  The agency shall add staff capacity (either an additional position or a consultant, as determined by the secretary) to develop options for an efficient, well-coordinated public transportation system with emphasis on connectivity adjustments that might be necessary as a result of implementing any options listed under subsection (b) of this section.  The agency shall examine the feasibility of making public transportation in Vermont seamless, efficient, and user-friendly, with usable connections among in-state and out-of-state points.  In conducting research and developing recommendations, the agency shall consult with the University of Vermont and with the state’s congressional delegation.

(b)  The agency shall examine the costs and benefits of various elements of the public transportation system, including, but not limited to, the following:

(1)  Terminating Amtrak’s “Vermonter” service in its entirety;

(2)  Converting Amtrak’s “Vermonter” or “Ethan Allen” service from conventional locomotive-hauled trains to diesel multiple units (DMUs);

(3)  Making White River Junction the northern terminus for Amtrak’s “Vermonter” service, either with conventional locomotive-hauled trains or DMUs; and

(4)  Coordination of all modes of transportation, including intercity bus and other bus systems, park and rides, Amtrak passenger train services, and air travel.  

(c)  On or before January 15, 2008, the agency shall submit a report on public transportation connectivity, with appropriate recommendations, to the house and senate committees on transportation.

* * * Barre Town; Access to Commercial Property * * *

Sec. 38.  AGENCY OF TRANSPORTATION APPROVAL; ACCESS TO      COMMERCIAL PROPERTY NEAR VT 14/63 INTERSECTION

Notwithstanding 19 V.S.A. chapter 17 (limited access facilities), the agency is directed to approve the existing one-way entry to the commercial property located southwesterly of the Vermont Route 14/63 intersection in Barre Town at mile marker 0140, subject to the property owner compensating the state for the current fair market value of the access rights previously acquired by the state.  

* * * Relocation of Dummerston DMV Office * * *

Sec. 39. DEPARTMENT OF MOTOR VEHICLES OFFICE IN

              DUMMERSTON; RELOCATION REPORT

The agency is directed to examine options for improving the facility and parking at the existing department of motor vehicles office in Dummerston versus renting separate space in the vicinity that meets the needs of the public. If a rental solution is found, upon the recommendation of the commissioner of motor vehicles, the chairs of the senate and house committees on transportation may approve proceeding with this option.  If an upgrade to the current facility is recommended, the agency shall report this option to the senate and house committees on transportation by January 15, 2008. 

* * * Bike and Pedestrian Accommodation Activities; Report * * *

Sec. 40. BIKE–PEDESTRIAN ACCOMMODATION ACTIVITIES;

              REPORT

By January 15, 2008, the agency shall provide a report to the senate and house committees on transportation summarizing all calendar year 2007 construction season expenditures in support of bike and pedestrian facilities and accommodations, including, but not limited to, enhancement projects, the bike/ped program, and features for the accommodation of cyclists and pedestrians that are included as part of paving or other projects.

* * * Municipal Indebtedness; Certain Bridge and Roadway Projects * * *

Sec. 41.  24 V.S.A. § 1759(a) is amended to read:

(a)  Any bond issued under this subchapter shall draw interest at a rate not to exceed the rate approved by the voters of the municipal corporation in accordance with section 1758 of this title, or if no rate is specified in the vote under that section, at a rate approved by the legislative branch of the municipal corporation, such interest to be payable semiannually.  Such bonds or bond shall be payable serially, the first payment to be deferred not later than from one to five years after the issuance of the bonds and subsequent payments to be continued annually in equal or diminishing amounts so that the entire debt will be paid in not more than 20 years from the date of issue.  In the case of bonds issued for the purchase or development of a municipal forest, the first payment may be deferred not more than 30 years from the date of issuance thereof. Thereafter such bonds or bond shall be payable annually in equal or diminishing amounts so that the entire debt will be paid in not more than 60 years from the date of issue.  In the case of bonds issued for improvements on public highways that have a useful life of at least 30 years and that involve bridge construction or roadway reconstruction, including a bridge component, the entire debt will be paid in not more than 30 years from the date of issue.

* * * Railroad Farm Crossing; Study Committee * * *

Sec. 42.  RAILROAD FARM CROSSING STUDY COMMITTEE

(a)  Contemporary changes in railroad operations, agricultural practices, land use and development patterns, environmental regulation, and recreational activities across the state require legislative review of state and federal regulations related to railroad grade crossings for agricultural, private, and public purposes.  A study committee is established to examine allowed usages of farm crossings, and shall consist of:  one representative each from the agency of transportation; agriculture, food and markets; and natural resources, appointed by the respective secretaries; one member from the department of banking, insurance, securities, and health care administration, appointed by the governor; one member from the senate committee on transportation appointed by the committee on committees; one member from the house committee on transportation appointed by the speaker; one public member appointed by the governor; and a member of the transportation board appointed by the chair of the board.

(b)  The committee is directed to:

(1)  Clarify the definition of "agricultural use," including a review of potential benefits and adverse impacts that statutory modifications will have in regard to safety, liability, and agricultural land conservation.

(2)  Solicit testimony from agricultural, environmental, and law enforcement organizations, railroads operating in the state, Vermont Operation Lifesaver, Inc., the Federal Railroad Administration, the emergency management division of the department of public safety, and the Vermont league of cities and towns.

(c)  Legislative members shall be compensated in accordance with section 1052 of Title 32.

(d)  The committee is authorized to meet up to four times, and the agency of transportation shall provide administrative and staff support for the committee.

(e)  The committee shall deliver its report to the senate and house committees on transportation, on agriculture, and on natural resources and energy by December 1, 2007.

(For text of House amendments see House Journal 3/22/07 – Pp. 384-385)

For Action Under Rule 52

     H. R. 16

     House resolution urging Congress to continue the federal Essential Air Service subsidy for the Rutland state airport.

(For text see House Journal Friday, April 20, 2007)

NOTICE CALENDAR

Favorable with Amendment

S. 39

An act relating to health insurance plan reimbursement for covered services by naturopathic physicians.

Rep. Milkey of Brattleboro, for the Committee on Health Care, recommends that the House propose to the Senate that the bill be amended by striking all after the enacting clause and inserting in lieu thereof the following:

Sec. 1.  8 V.S.A. § 4088d is added to read:

§ 4088d.  COVERAGE FOR COVERED SERVICES PROVIDED BY

                 NATUROPATHIC PHYSICIANS

(a)  A health insurance plan shall provide coverage for medically necessary health care services covered by the plan when provided by a naturopathic physician licensed in this state for treatment within the scope of practice described in chapter 81 of Title 26.  Health care services provided by naturopathic physicians may be subject to reasonable deductibles, co-payment and co-insurance amounts, fee or benefit limits, practice parameters,

cost-effectiveness and clinical efficacy standards, and utilization review consistent with any applicable regulations published by the department of banking, insurance, securities, and health care administration. Any amounts, limits, standards, and review shall not function to direct treatment in a manner unfairly discriminative against naturopathic care, and collectively shall be no more restrictive than those applicable under the same policy to care or services provided by other health care providers, but may allow for the management of the benefit consistent with variations in practice patterns and treatment modalities among different types of health care providers.  A health insurance plan may require that the naturopathic physician’s services be provided by a licensed naturopathic physician under contract with the insurer or shall be covered in a manner consistent with out-of-network provider reimbursement practices for primary care providers.  Nothing contained herein shall be construed as impeding or preventing either the provision or the coverage of health care services by licensed naturopathic physicians, within the lawful scope of naturopathic practice, in hospital facilities on a staff or employee basis.

(b)  As used in this section, “health insurance plan” means any individual or group health insurance policy, any hospital or medical service corporation or health maintenance organization subscriber contract, or any other health benefit plan offered, issued, or renewed for any person in this state by a health insurer, as defined by 18 V.S.A. § 9402.  The term shall not include benefit plans providing coverage for specific disease or other limited benefit coverage.

Sec. 2.  EFFECTIVE DATE

This act shall be effective on October 1, 2007.

(Committee vote: 9-1-1)

(For Senate amendments see Senate Journal 3/21/07-Pages 272-273

Senate Proposal of Amendment

H. 405

     An act relating to capital construction and state bonding.

     The Senate proposes to the House to amend the bill by striking out all after the enacting clause and inserting in lieu thereof:

* * * Capital Appropriations * * *

Sec. 1.  STATE BUILDINGS

The sum of $11,592,381 is appropriated to the department of buildings and general services, and the commissioner is authorized to direct funds appropriated in this section to the projects contained in this section; however, no project shall be canceled unless the chairs of the house and senate committees on institutions are notified before that action is taken.  The individual appropriations in this section are estimates only.

(1)  Montpelier, design and construction of a state office and parking facility at the so‑called triangle site adjacent to the Dog River Road.  The funds shall be used to remove the ledges on the site, begin construction of facilities to house the state archives, build a parking lot, and develop plans for the location of the department of motor vehicles and the emergency operations center on the site:                                                                                                                 (1,700,000)

(2)  Montpelier, 120 State Street, exterior caulking:                                                                                                                                                          (350,000)

(3)  Statewide major maintenance:                                                (7,000,000)

(4)  Burlington, 32 Cherry Street, design and repairs:                                                                                                                                            (150,000)

(5)  Statewide, building reuse:                                                         (170,000)

(6)  Statewide, contingency fund:                                                    (500,000)

(7)  Statewide, planning:                                                                    (25,000)

(8)  Statewide, Americans with Disabilities Act (ADA):

(A)  Robert H. Wood, Jr., Academy and Lee Emerson Courthouse:                                                                                                                (160,000)

(B)  Women’s shelters, phase II:                                                  (50,000)

(9)  Waterbury State Complex, fire alarm system:                                                                                                                                                              (200,000)

(10)  Springfield state office building, retaining wall, phase II, design and construction of a garage:                                                  (145,000)

(11)  State House flag conservation, phase II:                                   (20,000)

(12)  Renewable energy, wind project, Ed Weed fish culture station:                                                                                                                                   (25,000)

(13)  Middlesex, renewable energy, solar project:                            (30,000)

(14)  Bennington courthouse and state office building, either for work that will enable state employees and the public to reoccupy the building or to seek a new site for the facility.  Funds shall not be expended until the house and senate committees on institutions have reviewed diagnostic tests and approved a plan for spending the funds by majority vote of those present and voting at a joint meeting called by the chairs of the two committees for the purpose:                                                                                       (1,000,000)

(15)  Montpelier, State House, reconstruction of the fire escape leading from the 2nd and 3rd floor annex:                                           60,000

(16)  Montpelier, State House, renovation of the Robert H. Gibson Senate Cloak Room:                                                                          7,381

(Total appropriation – Section 1                                                         $11,592,381)

Sec. 2.  TAXES

The sum of $100,000 is appropriated to the department of taxes as the fourth appropriation in an ongoing project to update statewide quadrangle maps through digital orthophotographic quadrangle mapping.

(Total appropriation – Section 2                     $100,000)

Sec. 3.  HEALTH AND PUBLIC SAFETY LABORATORIES/BUILDING 617 IN ESSEX

The sum of $7,500,000 is appropriated to the department of buildings and general services for construction and renovation of building 617 in Essex, including co-location of the department of health and department of public safety forensics laboratories.

(Total appropriation - Section 3                                                           7,500,000)

Sec. 4.  HUMAN SERVICES

The sum of $1,100,000 is appropriated to the department of buildings and general services for the agency of human services for the projects described in this section.

(1)  Site acquisition for corrections work camps:                           (100,000)

(2)  Vermont state hospital, renovations:                                       (100,000)

(3)  St. Albans, Northwest state correctional facility, sewage treatment:                                                                                                              (150,000)

(4)  Windsor, Southeast state correctional facility:

(A)  dam inspection and repair:                                               (100,000)

(B)  access road repairs:                                                         (300,000)

(5)  Woodside Juvenile Rehabilitation Center, conversion of the underused racquetball court into classrooms:                       (300,000)

(6)  Chittenden Regional Correctional Facility, installation of cameras, replacing security windows in the “F” unit, providing four new security doors in the “A2” unit, painting, and carpet replacements:                             (50,000)

(Total appropriation – Section 4                                                        $1,100,000)

Sec. 5.  JUDICIARY

(a)  The sum of $270,000 is appropriated to the department of buildings and general services for security at the Barre district court building, including security cameras to be mounted on the outside of the building.  The commissioner of buildings and general services and the district court administrator shall work with the Barre City Council to determine placement of the cameras.

(b)  The amount of $45,000 is appropriated to the department of buildings and general services for replacement of windows with energy efficient windows, and replacement of shelving and file cabnets to increase the storage space in the vaults of the Grand Isle County Courthouse.

(Total appropriation – Section 5                                                            $315,000)

Sec. 6.  BUILDING COMMUNITIES GRANTS

The following sums are appropriated for building community grants:

(1)  To the agency of commerce and community development, division for historic preservation, for the historic preservation grant program established in Sec. 4(a) of No. 90 of the Acts of 1987:                                200,000

(2)  To the agency of commerce and community development, division for historic preservation, for the historic barns preservation grant program established in Sec. 4(b)(2) of No. 93 of the Acts of 1991:                           200,000

(3)  To the agency of commerce and community development, division for historic preservation, for the cultural facilities competitive grant program, to be administered by the Vermont Arts Council and made available on a one‑for-one matching basis with funds raised from nonstate sources.  No grant shall be available for a project receiving funding from any other appropriation of this act.  No portion of this appropriation shall be used to pay salaries.  The appropriation shall be awarded on a competitive basis.  In recommending grant awards, a review panel shall give priority consideration to applicants who demonstrate greater financial need or are in underserved areas of the state: 

                                                                                                   200,000

(4)  To the department of buildings and general services for the recreational and educational facilities grant program established in Sec. 34 of No. 43 of the Acts of 2005:                                                                            200,000

(5)  To the Vermont telecommunications authority established by the general assembly in 2007 for broadband development grants.  However, if no Vermont telecommunications authority is created by the general assembly in the 2007 legislative session, these funds shall be appropriated to the department of information and innovation for a broadband development grant program established in Sec. 35 of No. 43 of the Acts of 2005:          200,000

(6)  To the department of buildings and general services for the human services grant program established in Sec. 36 of No. 43 of the Acts of 2005:                                                                                                                                           200,000

(7)  To the department of agriculture, food and markets for emergency funding for farm capital needs resulting from the February 2007 blizzard.  The funds shall be used according to a plan determined by the secretary of the agency of agriculture, food and markets.                                                 200,000

(Total appropriation – Section 6                                                       $1,400,000)

Sec. 7.  COMMERCE AND COMMUNITY DEVELOPMENT

(a)  The sum of $250,000 is appropriated to the department of buildings and general services for the agency of commerce and community development for major maintenance at historic sites statewide; provided, the maintenance shall be under the supervision of the department of buildings and general services.

(b)  The sum of $100,000 is appropriated to the department of buildings and general services for the agency of commerce and community development for the design for an addition to the visitors’ center at the President Calvin Coolidge State Historic Site.

(c)  The sum of $50,000 is appropriated to the agency of commerce and community development for underwater preserves. 

(d)  The sum of $15,000 is appropriated to the agency of commerce and community development for roadside historic site markers.

(e)  The sum of $50,000 is appropriated to the agency of commerce and community development for protecting, preserving, moving, or re-interring human remains discovered in unmarked burial sites.

(Total appropriation – Section 7                                                             $465,000)

Sec. 8.  EDUCATION

(a)  The sum of $9,082,738 is appropriated to the department of education for state aid for school construction projects pursuant to section 3448 of Title 16.  Of this amount:

(1)  $1,800,000 shall be used to fund emergency projects under 16 V.S.A. § 3448(a)(3)(A).

(2)  $1,550,000 shall be used for partial payment of the state share of the purchase of biomass heating systems pursuant to 16 V.S.A. § 3448(a)(3)(B) as follows:

(A)  Mount Abraham Union High School District        448,447

(B)  Burlington School District                                                427,338

(C)  Mount Anthony Union High School District                     504,935

(D)  Williamstown School District                               169,280

(3)  $5,448,217 shall be for partial payment of the final school construction awards pursuant to 16 V.S.A. § 3448 as follows:

(A)  Brattleboro Union High School District                            $2,179,945

(B)  Dresden School District                                       $1,031,529

(C)  Williamstown School District                                           $   579,098

(D)  Rockingham School District for Saxtons River Elementary School                                                                                         $   552,250

(E)  Rockingham School District for Bellows Falls Central Elementary School                                                           $   552,250

(F)  Waterbury-Duxbury Union School District                       $   553,145

(4)  $242,000 shall be for the state share of energy performance contracts entered into pursuant to section 3448f of Title 16.

(b)  The sum of $1,000,000 is appropriated to the department of education for construction at regional technical centers as follows: 

(1)  For completion of construction at the Patricia Hannaford Career Center in Middlebury, up to the amount of $48,610. 

(2)  The remainder shall be used for construction at the Windham Regional Career Center in Brattleboro.

(c)  The sum of $20,000 is appropriated to the department of education to reimburse school districts for costs incurred to install wiring harnesses capable of being connected to emergency electrical power generators during emergencies when schools are used as community shelters or operation centers, or both.

(d)  The sum of $22,521 is appropriated to the department of education to pay the Williamstown school district for 25 percent of the approved costs of   replacement of a roof at the Williamstown elementary school. 

(Total appropriation – Section 8                                                         $10,082,738)

Sec. 9.  UNIVERSITY OF VERMONT

The sum of $1,500,000 is appropriated to the University of Vermont for construction, renovation, or maintenance projects.  The university shall file with the general assembly an annual report, on or before January 15, that details the status of capital projects funded in whole or in part by state capital appropriations.

(Total appropriation – Section 9                                                          $ 1,500,000)

Sec. 10.  VERMONT STATE COLLEGES

The sum of $1,500,000 is appropriated to the Vermont State Colleges for major facility maintenance.  The state colleges shall file with the general assembly an annual report, on or before January 15, that details the status of capital projects funded in whole or in part by state capital appropriations.

(Total appropriation – Section 10                                                         $1,500,000)

Sec. 11.  NATURAL RESOURCES 

(a)  The sum of $3,950,000 is appropriated to the agency of natural resources for water pollution control projects.  Of this amount:

(1)  $1,700,000 shall be for the state match for the pollution control and clean water state revolving fund administered in accordance with chapter 55 of Title 10 and chapter 120 of Title 24;

(2)  $300,000 shall be for completion of pollution control projects on a list prepared by the agency of natural resources, dated May 20, 2003 entitled “Wastewater Project Phase-In List from the Capital Bill Conference Committee 2003; Legislative Session” and referenced in Sec. 55 of No. 63 of the Acts of 2003; and

(3)  $1,950,000 shall be for construction of the wastewater facilities project in Pownal and interest paid on funds borrowed for the project.

(b)  The sum of $1,900,000 is appropriated to the agency of natural resources for the drinking water program.  Of this amount:

(1)  $1,650,000 shall be used for the state match for the federal FY07 capitalization grant; and

(2)  $250,000 shall be for the drinking water state revolving fund loan program.

(c)  The sum of $2,100,000 is appropriated to the agency of natural resources for the clean and clear program to accelerate the reduction of phosphorus discharges into Lake Champlain and other waters of the state, as follows:

(1)  Wetlands restoration and protection:  $250,000

(2)  Stream stabilization grants:  $1,250,000.  Of this amount, $100,000 shall be used for long‑term flood mitigation along the Dog River in Roxbury

(3)  $600,000 for wastewater phosphorus treatment at municipal wastewater treatment plants as follows:

(A)  Hardwick                                                                       100,000

(B)  Proctor                                                                             50,000

(C)  Ludlow                                                                             30,000

(D)  Milton                                                                             270,000

(E)  Richmond                                                                          50,000

(F)  Springfield                                                                       100,000

(d)  The sum of $300,000 is appropriated to the agency of natural resources for maintenance and repair of state-owned dams.

(e)  The sum of $800,000 is appropriated to the agency of natural resources for the department of forests, parks and recreation for rehabilitation of aging state park infrastructure.

(f)  The sum of $50,000 is appropriated to the agency of natural resources for the Green Mountain Club, Inc. for the procurement, in fee simple or by easement, of properties along the Long Trail. 

(g)  The sum of $50,000 is appropriated to the agency of natural resources for the Lake Champlain Walleye Association, Inc. as follows:

(1)  To purchase weed mats for three ponds in Franklin County:    21,150

(2)  To build an advanced fry system at the Bald Hill hatchery.  The Walleye association shall give the fry system to the department of fish and wildlife:                                                                                                                  28,850

(h)  The sum of $300,000 is appropriated to the agency of natural resources for the department of fish and wildlife to carry out phase II of renovations to the Bennington fish culture station.

(Total appropriation – Section 11                                                        $9,450,000)

Sec. 12.  MILITARY

The sum of $200,000 is appropriated to the department of the military for major maintenance, to investigate the cost-effectiveness of potential energy efficiency upgrades, and to design improvements to make the armories ADA compliant.

(Total appropriation – Section 12                                                           $200,000)

Sec. 13.  PUBLIC SAFETY AND FIRE SERVICE TRAINING COUNCILS

(a)  The sum of $30,000 is appropriated to the department of buildings and general services for the department of public safety to install monitoring equipment on underground storage tanks at various state police offices.

(b)  The sum of $200,000 is appropriated to the department of buildings and general services for programming and design to relocate the Williston public safety barracks and E911 to building 617 in Essex.

(c)  The sum of $50,000 is appropriated to the department of buildings and general services for the department of public safety for a feasibility study for a new public safety field station to serve southeastern Vermont.

(d)  The sum of $70,000 is appropriated to the department of buildings and general services to make improvements to the existing parking lot and loading dock at the Vermont fire service training council facility in Pittsford.

(Total appropriation – Section 13                                                          $350,000)

Sec. 14.  CRIMINAL JUSTICE

(a)  The sum of $125,000 is appropriated to the department of buildings and general services to improve the firing range at the Vermont criminal justice training council in Pittsford. 

(b)  The sum of $42,000 is appropriated to the department of buildings and general services to construct new kennel facilities at the Vermont criminal justice training council in Pittsford. 

(Total appropriation – Section 14                                                      $167,000)

Sec. 15.  AGRICULTURE, FOOD AND MARKETS

(a)  The sum of $1,800,000 is appropriated to the agency of agriculture, food and markets, best management practice implementation cost share program, for agricultural nonpoint source pollution reduction.  Farmers participating in this program may receive a maximum of 80 percent of state aid when no federal dollars are available.

(b)  The sum of $200,000 is appropriated to the agency of agriculture, food and markets for the competitive grants program for agricultural fair capital projects.  No single entity shall be awarded more than ten percent of this appropriation.

(c)  The sum of $100,000 is appropriated to the agency of agriculture, food and markets to assist with the construction of an underground cattle pass on Vermont Route 100 to serve the Turner farm in Waitsfield.  In fiscal year 2008, the agency shall use the funds to design, permit, and install the pass and associated highway traffic safety features.  The associated work is contingent upon the Turner estate donating any necessary right-of-way outside the existing highway right-of-way and entering into an agreement binding the Turner estate and its successors-in-interest to a maintenance and liability agreement satisfactory to the agency of transportation.

(Total appropriation – Section 15                                                         $2,100,000)

Sec. 16.  VERMONT PUBLIC TELEVISION

The sum of $250,000 is appropriated to Vermont Public Television for continued work on the federally mandated conversion of Vermont Public Television’s transmission sites to digital broadcasting format. 

(Total appropriation – Section 16                                                            $250,000)

Sec. 17.  VERMONT INTERACTIVE TELEVISION

The sum of $120,000 is appropriated to Vermont Interactive Television for audio upgrade of the system. 

(Total appropriation – Section 17                                                           $120,000)

Sec. 18.  VERMONT RURAL FIRE PROTECTION

The sum of $100,000 is appropriated to Vermont rural fire protection for the Vermont rural fire protection task force to continue the dry hydrant program.

(Total appropriation – Section 18                                                            $100,000)

Sec. 19.  VERMONT VETERANS HOME

The sum of $1,000,000 is appropriated to the department of buildings and general services for the Vermont Veterans Home for phase II of geothermal HVAC renovations.

(Total appropriation – Section 19                                                                $1,000,000)

* * * Financing This Act * * *

Sec. 20.  REALLOCATION OF FUNDS

The following are reallocated to the department of buildings and general services to defray expenditures authorized in Sec. 1 of this act:

(1)  $2,404 of the amount appropriated in Sec. 8 of No. 29 of the Acts of 1999 (Battle of the Wilderness Civil War monument).

(2)  $50,000 of the amount appropriated in Sec. 4 of No. 43 of the Acts of 2005 (Rutland courthouse).

(3)  $1,350 of the amount appropriated by Sec. 14 of No. 63 of the Acts of 2003 (Heat project at 116 State St.).

(4)  $8,260 of the amount appropriated by Sec. 3 of No. 121 of the Acts of the 2003 Adj. Sess. (2004) (renovations to the Dale Correctional facility).

(4)  $105 of the amount appropriated by Sec. 14 of No. 121 of the Acts of the 2003 Adj. Sess. (2004) (firefighter equipment).

(Total reallocation– Section 21                                                                 $62,119)

Sec. 21.  GENERAL OBLIGATION BONDS

The state treasurer is authorized to issue general obligation bonds in the amount of $49,200,000 for the purpose of funding the appropriations of this act.  The state treasurer, with the approval of the governor, shall determine the appropriate form and maturity of the bonds authorized by this section consistent with the underlying nature of the appropriation to be funded.  The state treasurer shall allocate the estimated cost of bond issuance, or issuances, to the entities to which funds are appropriated pursuant to this section and for which bonding is required as the source of funds, pursuant to 32 V.S.A. § 954.

(Total bonding – Section 22                                                               $49,200,000)

Sec. 22.  FUNDS FROM SALE OF LAND

Proceeds from the sale of a portion of state land located on Swift Street at the Chittenden regional correctional facility to the city of South Burlington shall be used to defray expenditures authorized in this act.               

(Total funds from sale of land - Section 22                                             $30,000)

* * * Managing This Act * * *

Sec. 23.  REALLOCATION; TRANSFER OF FUNDS

The secretary of natural resources, with the approval of the secretary of administration, may transfer any unexpended project balances among projects authorized in Sec. 11 of this act.

Sec. 24.  ACCEPTANCE OF GRANTS AND OTHER FUNDS

(a)  Notwithstanding section 5 of Title 32 (acceptance of grants):

(1)  The commissioner of environmental conservation, with the approval of the secretary of natural resources, may accept federal grants made available through the federal Clean Water Act and the federal Drinking Water Act in accordance with chapter 120 of Title 24.  Acceptance of this grant money is hereby approved, provided all notifications are made under subsection 4760(a) of Title 24.

(2)  The commissioner of corrections, with the approval of the secretary of human services, may accept federal grants made available through federal crime bill legislation. 

(3)  The commissioner of buildings and general services may accept grants of funds, equipment, and services from any source, including federal appropriations, for the installation, operation, implementation, or maintenance of energy conservation measures or improvements at state buildings.

(4)  The commissioner of buildings and general services may accept federal grant funds in connection with the state health and forensic laboratories.  These funds may be used to defray or supplement costs in Sec. 3 of this act.

(b)  Each receipt of a grant or gift authorized by this section shall be reported by the commissioner of the department receiving the funds to the chairs of the house and senate committees on institutions and to the joint fiscal committee. 

* * * Buildings and General Services; State Buildings * * *

Sec. 25.  PROJECTS FUNDED IN PRIOR YEARS

(a)  Except as provided in subsection (b) of this section, the commissioner of buildings and general services is authorized to use funds appropriated under this act for capital projects requiring additional support that were funded with capital or general appropriations made in prior years.

(b)  Funds appropriated in Sec. 5(c) No. 147 of the Acts of the 2005 Adj. Sess. (2006) shall be used only for improvements to the Bennington District and Family Court as directed by that act.         

Sec. 26.  PROPERTY TRANSACTIONS; MISCELLANEOUS

The commissioner of buildings and general services is authorized, with the approval of the secretary of administration, to sell the properties listed in this section pursuant to 29 V.S.A. § 166.  Up to $700,000 of proceeds from the sales shall be reserved by the department of buildings and general services for renovations to the third floor offices of the attorney general at 109 State Street in Montpelier. 

(1)  Brandon.  Notwithstanding the provisions of Sec. 1(b) of No. 59 of the Acts of 1993, all remaining parcels of land and buildings owned by the state of Vermont that once constituted the Brandon training school may be sold without approval from the emergency board. 

(2)  Newport.  All remaining condominium units in the Hebard state office building. 

(3)  Duxbury.  The 37-acre parcel of state land on route 100 next to Harwood Union High School. 

Sec. 27.  29 V.S.A. § 44a(a) is amended to read:

(a)  The commissioner shall:

* * *

(7)  Ensure that early in the building design phase, the architect will discuss the placement and form of artwork with the selected artist, and that bid specifications will inform potential contractors of the artwork to be installed in the building or facility.

Sec. 28.  29 V.S.A. § 45 is amended to read:

§ 45.  DUTIES OF CONTRACTING AGENCY

Upon selection of an architect for any project, the contracting agency shall:

(1)  notify the architect of the provisions of this chapter; and

(2)  notify the commissioner and the council of the selection of the architect and the details of the project; and

(3)  ensure that the architect discusses the form and placement of the artwork with the artist early in the planning and design phase of the building.

Sec. 29.  29 V.S.A. § 48 is amended to read:

§ 48.  POWERS AND DUTIES OF COUNCIL

(a)  The council shall facilitate a process which will result in a recommendation of an artist or artist team for each project selected for installation of artwork.  The artist or artist team shall collaborate with the project architect or design team during the initial design phase of the project.

(b)  Following design of the project, the council shall:

(1)  appoint persons to serve on the art selection panel;

(2)  establish contract procedures for contracting with artists for works of art and with architects for services related to the planning for the acquisition of works of art;

(3)  on the advice of the art selection panel, arrange contracts with artists and order payments from the art acquisition fund for such works of art;

(4)  review the final installation and placement of works of art.  In the case of works to be commissioned, the art selection panel shall review the design, the final execution and the placement of the commissioned work;

(5)  assist occupant and contracting agencies in locating insurance when it deems such insurance is necessary for the protection of the works of art which are purchased.

(b)(c)  Without further appropriation, the council may expend funds transferred to it for administration of this chapter. 

Sec. 30.  29 V.S.A. § 152(c) is amended to read:

(c)  Notwithstanding any other provision of law, the commissioner of buildings and general services is authorized to:

(1)  Implement a “Motorist Aid Refreshment Program” at state rest areas and information centers.  The commissioner is authorized to accept, without active solicitation, donations for the services and associated supplies, and may use surplus funds to pay for the information center program.

(2)  Permit nonprofit organizations and contracted information center operators to provide free refreshments to motorists.  Nonprofits and contracted information center operators may accept voluntary donations, without active solicitation, from motorists.

(3)  Adopt rules governing the provision of refreshments in accordance with this subsection.

Sec. 31.  29 V.S.A. § 152(a)(30) is added to read:

(30)  Provide services to the traveling public, lease space, sell products, and conduct any other activities within limits set forth in the federal Surface Transportation Act and Randolph-Sheppard Act and rules promulgated thereunder, to administer the information and welcome centers; and use funds generated in the centers to supplement funds for maintaining and operating the centers.

* * * Education * * *

Sec. 32.  16 V.S.A. § 3448(a)(3)(B) is amended to read:

(B)  Second priority is given to construction projects in excess of $10,000.00 which address a need occasioned by deterioration of an existing building or equipment pursuant to subdivision (2)(A) of this subsection, and which extend the useful life of the building but which do not make extensive additions or extensive alterations to existing school facilities in which students are provided services.  Examples of projects given priority under this subdivision are replacement, addition, or repair to utilities,; projects which address environmental quality issues,; repair of a roof,; replacement of an existing space-heating, water-heating space-heating, water-heating, cooling, or refrigeration system that uses fossil fuels with a system for the same purpose that uses, or primarily relies upon, biomass, a geothermal/ground source, wind, or solar energy, or replacement of a system with a more efficient fossil fuel system that reduces fuel use by 10 percent or more or utilizes new technologies such as microturbines, cogeneration, fuel cells, or distributed generation, or; and replacement or upgrading of mechanical equipment.

Sec. 33.  16 V.S.A. § 3448(a)(4)(C) is amended to read:

(C)  the cost of projects to extend the life of a building which the board has approved but not yet reimbursed due to insufficient funds, as well as the estimated cost of those which might be approved by the state board in the coming fiscal year under subdivision (3)(B) of this subsection.  The legislature shall not approve an amount for this line item which exceeds more than five percent of the annual capital budget approved under subdivisions (A) and (B) of this subdivision (4).

Sec. 34.  16 V.S.A. § 3448(a)(7) is amended to read:

(7)  Award of construction aid.

(A)  The Except as provided in other subdivisions of this subdivision (7) and elsewhere in law, the amount of an award shall be 30 percent of the approved cost of the project.

(B)  The amount of an award for the incremental costs associated with the installation of a space heating, water heating, cooling, or refrigeration system that uses biomass, a geothermal/ground source, wind, or solar energy as the primary heating or cooling source shall be 75 percent of the approved cost of those elements of the project specifically related to the renewable fuel source being used; provided that those elements:

(i)  may include the costs of necessary equipment, a chimney, air quality technology, and additional square footage necessary to house the heating unit and fuel; and further provided that those elements

(ii)  shall not include the costs of staff areas, site improvements relating to fuel delivery, and other ancillary costs as determined by the commissioner; and

(iii)  will realize savings which are life-cycle cost-effective as determined by the commissioner.

(C)  The amount of an award shall be 50 percent of the approved cost of a project or applicable portion of a project which results in consolidation of two or more school buildings and which will serve the educational needs of students in a more cost-effective and educationally appropriate manner as compared to individual projects constructed separately.  A decision of the commissioner as to eligibility for aid under this subdivision (C) shall be final.  This subdivision (C) shall apply only to a project which has received preliminary approval by June 30, 2010.

Sec. 35.  16 V.S.A. § 3448f(f)(2) and (4) are amended to read:

(2)  Approval of application.  The commissioner may approve an application for state aid under this section if the commissioner finds that the potential energy and operational cost-savings are likely to be equal to or greater than the cost of the project by the end of the contract period.  After consultation with the department of buildings and general services and any other expert resources that may be available, including Efficiency Vermont and the school energy management program of the Vermont superintendents association, the commissioner may approve a complete application.

(4)  Award of state aid.  A district shall not be reimbursed for debt incurred due to borrowing funds in anticipation of aid under this section.  The total amount of an award shall be 20 percent of the approved total cost of the project, provided the total award shall not exceed the total payment that would be due from the district, less interest.  The general assembly shall not approve an amount for this line item which exceeds five percent of the capital budget allocated for school construction projects in that year.

Sec. 36.  16  V.S.A. § 4028(b) is amended to read:

(b)  Payments made for special education under chapter 101 of this title, for technical education, including educational program equipment for regional technical education centers and comprehensive high schools under chapter 37 of this title, and for other aid and categorical grants paid for support of education shall also be from the education fund.

Sec. 37.  STATE SCHOOL CONSTRUCTION AID; FINDINGS

The general assembly finds that:

(1)  The capital debt affordability advisory committee has recommended that the state issue general obligation bonds in the amount of no more than $49,200,000 in fiscal year 2008.

(2)  This act commits $10,082,738 of the $49,200,000 to state aid for school construction but is unable to meet the actual state obligation for school construction aid of  $33,333,264.

(3)  The 1996 general assembly set up a procedure by which school districts may proceed with urgently needed school construction projects and not be delayed by the state's inability to have its share of state aid to school construction aid available as needed.

Sec. 37a.  24 V.S.A. § 1758(b)(3) is amended and (4) is added to read:

(3) The warning and ballot shall contain the following set forth in bold-faced type:

State funds may not be available at the time this project is otherwise eligible to receive state school construction aid. The commissioner of education estimates that this project may not receive state aid for        years.  The district is responsible for all costs incurred in connection with any borrowing done in anticipation of state school construction aid.

(4)  Each September, the commissioner of education shall estimate the number of years likely to elapse prior to each of priority 1, 2, and 3 school construction projects receiving a first payment under 16 V.S.A. chapter 123.  The commissioner shall make these figures available so that a school board may enter them into the ballot language required for a bond vote pursuant to subdivision (3) of this subsection.

Sec. 38.  COMMISSIONER OF EDUCATION; REPORT

On or before January 1, 2008, the commissioner of education shall report to the general assembly on options considered and specific recommendations to address the needs and pressures of school construction, including recommendations for a funding mechanism for state school construction aid and revisions to criteria for school construction project approval.

Sec. 39.  REPEAL

Sec. 49 of No. 68 of the Acts of 2003 and amended by Sec. 54 of No. 121 of the Acts of 2004, relating to construction aid for school consolidation is repealed.

* * * State Colleges * * *

Sec. 40.  SPENDING AND BONDING AUTHORIZATION; VERMONT STATE COLLEGES

Pursuant to subsection 2171(e) of Title 16, the Vermont State Colleges is authorized to expend up to $1,000,000 of its self-generated revenues established for the purpose of capital improvements on housing, dining, and general purpose facilities.

Sec. 41.  16 V.S.A. § 2171(e) is amended to read:

(e)  The corporation may make expenditures for capital improvements provided those capital improvements receive the specific prior approval of the general assembly.  Upon receiving approval, the.  The corporation is authorized to borrow money for building purposes, to give security therefor as may be required, to execute necessary or proper instruments in connection therewith, and is also authorized to accept, use, and administer such funds as may be made available to it for any of its corporate purposes by the United States or any of its agencies, and to agree to any terms and conditions with reference thereto which may be required thereby not inconsistent with its corporate purposes.

* * * Agency of Natural Resources * * *

Sec. 42.  10 V.S.A. § 1626a(c) is amended to read:

(c)  Additional state assistance eligibility.

(1)  Grants.  A proposed wastewater treatment plant which is eligible for a loan under subsection (b) of this section, and a wastewater treatment plant with a design hydraulic capacity of 250,000 or more gallons per day which is being refurbished, shall in addition be eligible for a grant of up to 50 percent of the cost of that portion of the plant to be used to treat septage, or septage and sludge in combination, if the commissioner of environmental conservation finds that the proposed plant capacity will be sufficient to receive, treat and dispose of septage alone in a quantity equivalent to the ratio of 4,000 gallons or more of such septage per day for each 1,000,000 gallons per day of plant design hydraulic capacity.  The portion of the plant used for processing septage, or septage and sludge in combination, shall include facilities for receiving septage and for the storage, treatment, transfer, and disposal of both septage and sludge.

* * *

Sec. 43.  24 V.S.A. § 4753(d) is amended to read:

(d)  Funds from the Vermont environmental protection agency pollution control fund and the Vermont pollution control revolving fund, established by subdivisions (a)(1) and (2) of subsection (a) of this section, may be awarded for:

(1)  the refurbishment or construction of a new or an enlarged wastewater treatment plant with a resulting total capacity of 250,000 gallons or more per day in accordance with the provisions of this chapter and section 1626a of Title 10; or

* * *

Sec. 44.  Sec. 8(a)(2) of No. 52 of the Acts of 1989, as amended by Sec. 18 of No. 276 of the Acts of the 1988 Adj. Sess. (1989) and Sec. 32 of No. 29 of the Acts of 1999, is amended to read:

(2)  That this conveyance shall be completed within 20 30 years of the effective date of this act.

Sec. 45.  24 V.S.A. § 4751 is amended to read:

§ 4751.  DECLARATION OF POLICY

It is hereby declared to be in the public interest to foster and promote timely expenditures by municipalities for water supply, water pollution control and solid waste management, each of which is declared to be an essential governmental function when undertaken and implemented by a municipality.  It is also declared to be in the public interest to promote expenditures for certain existing privately-owned public water systems and certain privately-owned wastewater and potable water supply systems to bring those systems into compliance with federal and state standards and to protect public health.

Sec. 46.  24 V.S.A. § 4753(a) is amended to read:

(a)  There is hereby established a series of special funds to be known as:

(1)  The Vermont environmental protection agency (EPA) pollution control revolving fund which shall be used to provide loans to municipalities, state agencies, and the Vermont housing finance agency, for planning sewage systems and sewage treatment or disposal plants as defined in sections 3501(6) and 3601 of this title, for constructing publicly-owned sewage systems and sewage treatment or disposal plants as defined in sections 3501(6) and 3601 of this title, for planning or construction of certain privately-owned wastewater systems, and for implementing related management programs.

(2)  The Vermont pollution control revolving fund which shall be used to provide loans to municipalities, state agencies, and the Vermont housing finance agency, for planning pollution control facilities and, for constructing publicly-owned pollution control facilities, and for constructing certain privately-owned wastewater systems and potable water supply systems.

* * *

Sec. 47.  24 V.S.A. § 4753a is amended to read:

§ 4753a.  AWARDS FROM REVOLVING LOAN FUNDS

(a)  Pollution control.  The general assembly shall approve all categories of awards made from the special funds established by section 4753 of this title for water pollution control facility construction, in order to assure that such awards conform with state policy on water quality and pollution abatement, and with the state policy that, except as provided in subsection (c) of this section, municipal entities shall receive first priority in the award of public monies for such construction, including monies returned to the revolving funds from previous awards.  To facilitate this legislative oversight, the secretary of natural resources shall annually no later than January 15 report to the house and senate committees on institutions and on natural resources and energy on all awards made from the relevant special funds during the prior and current fiscal years, and shall report on and seek legislative approval of all the types of projects for which awards are proposed to be made from the relevant special funds during the current or any subsequent fiscal year.  Where feasible, the specific projects shall be listed.

(b)  Water supply.  The secretary of natural resources shall no later than January 15, 2000 recommend to the house and senate committees on institutions and on natural resources and energy a procedure for reporting to and seeking the concurrence of the legislature with regard to the special funds established by section 4753 of this title for water supply facility construction.

(c)  Notwithstanding other priorities established in law, the secretary may award up to $500,000.00 of the funds from the Vermont environmental protection agency control fund and the Vermont pollution control revolving fund, combined, to a state agency, the Vermont housing finance agency, or a municipality for the administration of loans to households with income equal to or less than 200 percent of the state average median household income for the repair or replacement of failed wastewater systems and failed potable water supplies, as those terms are defined in section 1972 of Title 10.  Upon award of funds under this section, the state agency, Vermont housing finance agency, or municipality shall agree, pursuant to a memorandum of understanding with the secretary of natural resources, to repay the funds awarded to the special fund from which they were drawn.

* * * Effective Dates * * *

Sec. 48.  EFFECTIVE DATES

This act shall take effect on passage.  The sums appropriated and the spending authority authorized by this act shall be continuing and shall not revert at the end of the fiscal year.

(For House amendments see House Journal 3/1/07-Pages 289-292

Ordered to Lie

S. 78

An act relating to having the cost of picking up and hauling milk paid by the purchaser.

Pending Action: Third Reading of the Bill.

PUBLIC HEARINGS

     Tuesday, April 24, 2007 – Room 11 – 6:30 PM – 9:00 PM – House Committee on Health Care – Senate Committee on Health and Welfare

Thursday, April 26, 2007 – Room 11 – 2:00 PM – 6:00 PM – House Committee on Education – H. 526  Education Quality and Cost Control



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us