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State of Vermont

Senate Chamber

Montpelier, Vermont

Joint Senate Resolution

   By Senator Lyons,

     J.R.S. 25.  Joint resolution urging Congress to develop legislation with respect to international trade agreements to protect state environmental and land use laws.

Whereas, the citizens of the State of Vermont, concerned with retaining the state’s attractive, historic and small town character, have placed a premium on retaining a healthy environment; and

Whereas, to preserve the environment of the state, the legislature over the years has regulated the disposal of waste and the preservation of scenic vistas, and has adopted important land use laws, including the following:  Act 250, which regulates large developments and subdivisions from both a state and local perspective; 24  V.S.A. chapter 117, which enables local and regional planning and zoning; and 30 V.S.A. § 248, which requires a determination of public good with respect to facilities that propose to generate electricity within the state; and

Whereas, the state of Vermont welcomes responsible investors, domestic or foreign, on a non-discriminatory basis; and

Whereas, it is possible and desirable to attain the advantages of international trade in a manner that establishes a standard of review pursuant to which international arbiters who are assigned international disputes on these matters are required to defer to reasonable requirements established in state law; and

Whereas, in the absence of deference to reasonable state and local enactments, under investment chapters included in regional trade agreements such as CAFTA and NAFTA that allow corporations to sue nations, plaintiffs in international trade disputes have attacked legitimate traditional exercises of the police power for basic environmental protection purposes, in areas such as:

(1) product bans designed to protect the groundwater from pollutants;

(2) disposal site requirements designed to protect aquifers from contamination;

(3) land reclamation requirements for open pit mining;

(4) bans on certain extractive industries so as to preserve important cultural assets; and

(5) water supply services provided by governmental entities, possibly in competition with private service providers; and

Whereas, in the absence of deference to reasonable state and local enactments, under the General Agreement on Trade in Services (GATS), Vermont’s ability to regulate land use under Act 250, as well as the ability of Vermont’s local governments to regulate land use under Chapter 117, may be subject to attack to the extent that they relate to the regulation of the wholesale or retail sales sectors, or the hotel and restaurant sectors, on the grounds that those regulations may limit the number of service suppliers, the total value of service transactions, the quantity of service output, or the number of natural persons that a business may employ; and

Whereas, in the absence of deference to reasonable state and local enactments, under the General Agreement on Trade in Services (GATS), Vermont’s ability to regulate electricity under section 248 may be subject to attack:

(1)  for not being “objective,” when it requires a regulatory body to make a subjective finding that an applicant’s project would serve the public good;

(2) for containing an “economic needs test” for the construction of any new facility;

(3) for putting foreign suppliers of wholesale services at a disadvantage when it requires electric utilities to meet portfolio standards that require increased use of renewable resources, that are defined to exclude large scale hydroelectric projects;

(4) for limiting the number of service suppliers in a given service territory, for example where a municipality operates an electric system; and

Whereas, an integral part of the state’s environmental regulatory scheme is the role of the state’s courts in evenhandedly and predictably adjudicating cases arising under the environmental statutes; and

Whereas, as illustrated above, under the status quo, the ability of states to take reasonable steps to protect the environment is threatened by provisions on services and investment in a range of trade agreements; and

Whereas, Congress is considering different approaches to updating the President’s trade promotion authority, including the inclusion of provisions ensuring that future trade agreements provide adequate safeguards for the protection of the environment; and

Whereas, in order for any international trade agreement to protect adequately the environment, the federal government should engage in and finance an information sharing process with the states that is designed to inform both the United States trade officials and state trade officials of the impacts certain agreements might have on the states, before an agreement has been entered, a practice not followed in the development of GATS or of international investor agreements; and

Whereas, states will continue to support the expansion of international trade agreements to the extent that the varied interests of the states are considered in an appropriate way; and

Whereas, the continued function of state and federal courts is absolutely essential to the enforcement of democratically agreed-upon environmental protections; and

Whereas, if Congress desires to protect the environment in the context of international trade, it must retain and protect the role of state and local governments in protecting the environment; and to accomplish this, it must retain in itself, the Congress, the ability to fully consider and amend proposed trade agreements that fail to take the actions recommended by this resolution; now therefore be it

Resolved by the Senate and House of Representatives:

That Vermont’s delegation in the Congress is requested to develop trade legislation that provides for the following:

(1) a meaningful consultation process with the state and local government, together with resources to help analyze the likely effects of a particular trade or investment proposal or agreement;

(2) requirements that trade agreements contain provisions that establish a standard of review that requires adjudicatory bodies to defer to legitimate and rational state and local requirements relating to environmental and land use laws, and to other areas similarly addressed by legitimate and rational state and local enactments;

(3) preservation of the role and jurisdiction of state and federal courts, and provisions that prevent state or federal court decisions from being re-litigated in front of international tribunals; and

(4) retention in the Congress of the ability to consider freely and to amend investment agreements that fail to protect the ability of states to protect the environment or that otherwise intrude upon the sovereignty of the states as envisioned by the Constitution of the United States; and be it further

Resolved:  that the Secretary of State be directed to provide a copy of this resolution to Vermont Governor James H. Douglas, the members of Vermont’s Congressional delegation, to the office of the United States Trade Representative, and to the legislatures of the other states.


____________________________              Attested to:

President of the Senate


____________________________              ____________________________

Speaker of the House                                     David A. Gibson

                                                                      Secretary of the Senate



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont