November 15, 2000
The Vermont Civil Union Review Commission met on Wednesday, November 15, 2000, beginning at 10:00 a.m. in Room 10 of the State House in Montpelier, Vermont.
The following members were present:
Stephen Reynes, Chair
Mary P. Kehoe, Vice Chair
Sen. John H. Bloomer, Jr.
Rep. William J. Lippert, Jr.
Hon. Francis McCaffrey
Annette Cappy
Martha Csala
Harvey Golubock
Wendy Z. YoderStaff Present:
Michele Childs Counsel to the Committee
Demis K. Martin Committee Assistant
Jo Ellen Pirie Committee AssistantThe commission heard testimony from representatives of state government regarding their agency’s activities with respect to the civil union law.
Lee Suskin, Court Administrator, and Sally Fox, Director of Family Court Operations, reported they expect little impact on the courts this year and the future is speculative. The court received one out-of-state call regarding the procedure for dissolution. There is a six-month residency requirement and civil unions cannot be dissolved in other states. Anticipating future impact on the courts is difficult, but Mr. Suskin believes it is reasonable to expect the civil union dissolution rate to mirror that of divorce in the state within 20 years. The divorce rate in Vermont is 50 percent. There have been no dissolutions to date. Mr. Suskin reported a challenge to Act 91 (Brady v. State) was dismissed in superior court and that he expects future challenges to focus on insurance coverage. The Court Administrator’s Office is in the process of redesigning forms on divorce and annulment to incorporate civil union.
Janet Ancel, Commissioner, Department of Taxes, distributed a draft chart listing the eight areas of tax law affected by civil unions, and how the income tax benefits available to spouses compare with those available to civil union partners.
George Phillips, Policy Analyst, Department of Taxes, distributed a draft of the new W-4 Vermont Employee’s Withholding Allowance Certificate and Bulletin. The Department worked with the Green Mountain Payroll Association, an association of payroll officers in the state, and identified issues which employers will confront in determining withholding tax in 2001. The department will be publishing an informational bulletin to employers regarding employees in civil unions. The Tax Department informs employers of law changes at this time of year, and the bulletin will be included in this mailing. The Chair requested the commission receive a copy of the bulletin for inclusion in the report of the commission.
The department also worked with the Department of Banking, Insurance, Securities, and Health Care Administration on a publication covering tax and insurance relating to Act 91. Topics considered include tax treatment of an employer’s contribution to spouse coverage, medical flexible savings accounts, exemption from property transfer tax, the holding period for land gains tax purposes, and the "innocent spouse" rule in setoff debt collection.
Jeff Johnson, Esq., Primmer & Piper, representing the Vermont Association of Property and Casualty Insurers and State Farm Insurance, spoke on insurance issues as they relate to civil unions. He said BISHCA did a great job and appreciated their explanation of how the new regulations will work. Federal interface is still a question as there are over 1,000 federal laws regarding “spouse”. He distributed a draft final proposal of Regulation 2000-01-1H Civil Unions. He is working with insurance companies to develop guidelines. The group is concerned about three specific types of policies which could be problematic: variable universal life, universal life, and annuities. He discussed the IRS code and recommended the State obtain a ruling on taxable income from the federal government so insurance companies can calculate possible adverse effects prior to beneficiaries buying a product from which they will not benefit. A ruling could take from six to nine months.
Ann Metayer, Assistant General General, Department of Banking, Insurance, Securities, and Health Care Administration (BISHCA), answered questions on annuities and special spousal benefits. BISHCA will be working with insurance companies on how to implement the new rules. They are still receiving comments on civil unions and will be publishing a pamphlet for town clerks for distribution to civil union partners on “frequently asked questions” by 1/1/01. Ms. Metayer hopes to file a final proposed rule today (11/15/00) with the Administrative Rules Committee. Ms. Metayer discussed some of Mr. Johnson’s concerns, and helped the commission understand the types of life insurance products and the Internal Revenue Code provisions that are implied. The concern is that if a change is made at the state level to include civil union partners as spouses for the purpose of certain products, it may jeopardize the products’ tax-exempt status for all policy holders.
Steven Patterson, Deputy Secretary, Agency of Commerce & Community Development, reported tourism numbers are on track with projections for the summer and fall of 2000. Rooms and meals taxes are within the projected range, and occupancy rates for June through August are higher than expected. The agency has received calls from out-of-state both in support and opposition to Act 91. Mary Kehoe commented that, with 1,200 civil unions performed, multiplied by two, plus family members, there must be a positive monetary benefit to the State. Rep. Bill Lippert asked that the Agency calculate the monetary impact (as they would a convention) and forward that information to the commission.
Linda Spence, President, Vermont Municipal Clerks & Treasurers Association, testified by phone as to her experience with civil unions as town clerk in Manchester where 44 licenses were issued. Her experience has been that the partners have been very appreciative. She has had only one report from a couple seeking a civil union who felt as though they had been treated poorly by a town clerk and justices of the peace in a particular town (Weston). She has a list of justices in her area which she uses and steers partners to these four justices whom she knows are supportive. She is not aware of any licenses having been denied by town clerks. Mary Kehoe reported a problem in Colchester where a justice of the peace denied a license based on residency. Ms. Spence had no explanation other than to say the clerk should have been aware that residency is not a requirement. Ms. Spence added that her own personal experience as both a justice of the peace and town clerk has been nothing but positive, and finds Act 91 to be “one of the most moving and emotional pieces of legislation I have ever seen”. Rep. Bill Lippert expressed his personal thanks to all town clerks throughout Vermont who have been so gracious and accommodating when issuing civil union licenses.
Christopher G. Barbieri, President, Vermont Chamber of Commerce, submitted a letter stating that the Vermont Chamber has no position on the issue of civil unions. They monitored any impact the passage of Act 91 might have on employee benefit programs and the impact on employers. They have conducted no research or studies of their members of the economic impact of Act 91. It is the opinion of the Chamber, to date, that the passage of Act 91 has had no significant impact on employee benefit plans or the Vermont economy in general.
The minutes of the October 4, 2000 meeting were reviewed and approved.
Commission Discussion - Michele Childs reviewed her November 8 memo to the Commission with attachments for inclusion in the index. Next, she distributed a draft outline of the 2001 Report of the Commission and discussed the time frame for issuance of the report. It is her intent to send a draft of the report to the Commission by November 29. She would like the Commission to either meet or submit comments by December 11; final draft will be sent out to members on December 20 and the final report will be issued Monday, January 15. She suggested the Commission may want to schedule a press conference following the issuance of the report.
It was the consensus of the Commission to follow Ms. Childs’ format and time frame. They did not see the need for another meeting prior to the issuance of the report. Discussion followed on the specific content of the report.
Martha Csala suggested a statement that the Commission had only met twice but based on information to date, no serious problems have been noted by any reporting State agency. Sen. John Bloomer suggested this statement appear in the Findings rather than Recommendations. He suggested the first report be informational only; not make recommendations at this point to maintain the credibility of the Commission.
It was the consensus of the Commission that the initial report will be a resource document. Ms. Childs will solicit input on the draft by e-mail.
Discussion followed on whether or not to include health department statistic comparisons between civil unions and marriage or just include the statistics themselves. It was the consensus of the Commission to include the statistics only.
Harvey Golubock distributed a summary of the public accommodation provisions of Vermont’s Fair Housing and Public Accommodations Act. Discussion followed on re-wording; Mr. Golubock will revise the draft and resubmit the memo to the Commission.
Ms. Childs reported that former Governor Kunin is teaching a course at Middlebury on civil unions and Bill Russell, Chief Legislative Counsel, is using civil unions as a case study in his legislative process class at Vermont Law School. The Vermont Bar Association is developing a CLE class on civil unions for the Internet and the Fall edition of the Vermont Law Review is entirely on civil unions. Copies of the law review are ordered for the Commission members.
The next meeting of the Commission was scheduled for January 18 at 1:00 in Room 10 and there will be one-half hour allowed for public comment.
Respectfully submitted,
Michele Childs
Legislative Counsel