 This is houseways and means and we're meeting on April 22nd. Welcome to our meeting. And we are going to, unless anyone on the committee has an announcement they want to make before we start, I don't see any. We're going to talk about two bills this morning that will be up for action on the house floor. And one of them is S340, which has to do with inner fund borrowing. It's subject we talked about a week or so ago. And the other is S341, which is a bill that allows the tax department to share information with department of labor to support the PUA, which is the pandemic unemployment assistance program. And that's not a bill that we've looked at before. Neither of these bills are going to come into our committee as far as I know. So we don't have to take formal positions and we're not being asked to report on the floor. But just in case somebody decided they should be in the committee or somebody wanted to know what we think about them and partly for the exercise so that we know if we can do it. I thought we would hear about both bills and take an informal position with a straw vote. And I will do that. However, the committee wants me to, we can do it with a roll call or we can do it with a show of blue hands, whatever, whichever works. And so that will be the first half hour. And then at 1030, we're gonna shift gears. We're gonna hear from Beth Pierce and from Chris Delia on the concept of having the state subsidize the interest rate for short-term borrowing on the part of municipality. It's something that we talked about before. We don't have a proposal to do it, but I knew there were questions that Beth, that the treasurer and the bankers could probably help us with to make us decide if that's a direction that we wanna go. So, and then I've got three or four things at the end of the morning that I wanna go over. So with that, Damien. Good morning, how's everybody? So the bill S341, which is in front of you, it amends 32 VSA 3102 E, which as I'm sure everyone remembers is the discretionary provisions there for the commissioner of taxes to release limited tax return and return information. And currently, if we could scroll down just a little further so we can see number eight, Sorcha, perfect. So currently the commissioner is allowed to release limited information to the commissioner of labor for purposes of establishing the identity and liability of employers for unemployment compensation payments there. So contributions based on their experience. So typically with employees right now for unemployment, we have wage records for them because the employers have been filing quarterly wage records and this is used as sort of an auditing tool. So when an employee puts down that they were employed by someone during their sort of base period for unemployment and it doesn't show up on the wage records, this allows the commissioner of labor to go in and determine if they were receiving wages or income as an independent contractor and so forth. The pandemic unemployment assistance that representative Ansel mentioned is like unemployment insurance, but it's not for employees. It's for self-employed and independent contractors or people who have had too little contact with employment in the last year and a quarter to qualify for unemployment insurance. So it could be that they were self-employed, it could be that they were just starting a job after taking a year off to have a baby or something like that, but they don't have enough wages in there. So normally they wouldn't qualify for unemployment insurance. So what this does is it provides a benefit that's fully federally funded and is the equivalent to unemployment insurance, but for folks who have self-employment income or no wage income anyway or insufficient wage income. And so what this allows them to do is when folks apply for that, they say, this is what I earned last year. It's the 2019 tax year that we're looking at for purposes of determining that benefit. And this allows the department of labor to contact the department of taxes to say, is that accurate? And then the department of taxes will send back basically the line item information for the specific types of income that are considered for unemployment assistance. And so this is just providing them with that limited allowance to provide information to verify the earnings of individuals to determine the benefit amounts. Robin has a question. Okay. Thanks, quick question Damien. When we talk about income, are we talking about Vermont income or federal income? Cause they can be different. We are talking about self-employment income. And when the commissioner of taxes may or may not be on, when he testified before, he mentioned a variety of self-employment schedules that you might be filing under, which are then brought over to your Vermont income tax return for purposes of determining your adjusted gross income and so forth. So I'm not a tax person, unfortunately, but we're basically looking at your self-employment income line items from your tax return. Federal tax return? Or Vermont. Federal and state tax return information. Again, I'm not the person to tell you which line item performed they're on. Okay. But my understanding is, for example, schedule C, that information could be made available here from your 2019 tax return. But yeah, so. Thank you. I'll stop. That's all you need. Thank you. Great. And for a committee, if you wanna hear from Craig Bolio about how this is actually gonna work, I think that's fine. It's not, I can set that up. I don't think I have him coming in today, is that right, Rob, Sorcha? But the question in front in the bill is tax return information gonna be shared with the Department of Labor. So the what of it matters to us, but probably doesn't matter for the purpose of the bill. So, but let me know if you want me to get Craig in here or Doug Farnham. I'm happy to do that. Yeah. I should just note it's important to note that this is not a sharing of the full income tax return for someone who applies for this. It's just the necessary line items to determine that income eligibility. Well, the UI website, it says you have to file your tax return. So the tax department may not be sharing it, but the applicant is strongly is told to do that is told to do that. And if they can't, if they haven't filed, they are told to self-attest. Okay. And it also, if you don't have a tax return from last year. So for example, that instance of the individual I was talking about who say took a year off to have a child and now is returned to the workforce only to find that they were unemployed almost immediately or couldn't start their job. The way it works for them is if you don't have income, you get a minimum benefit, plus the federal benefit. So there is an opportunity to self-attest if you haven't filed yet because they've extended the tax filing date. A lot of people haven't, some people anyway haven't, but it's the way the system is set up. You're expected to give the department your tax return. Yeah. So Peter and Emily. Yep. Thank you. I'm glad Robin's ahead of me. I also heard and saw, as Janet has said, that the DOL is expecting you to submit your whole return. I'm uneasy with that. I really think it ought to be limited to schedule C because as a married filer, I've got to all cut my wife's cutting them, I've got to, anyway. I'm uneasy with that. I'm uneasy. And if this is session law, I understand it will have a self-expiration, but I'm also uneasy that there appears to be no going back, so to say. Thanks. Emily. Hi, Damian. Hi. Does the Department of Labor need permission to also share this information beyond this afterwards for say, auditing purposes or to evaluate the program? Or is it enough to just share it with the Department of Labor? I think it's enough that it's shared with the Department of Labor. It's important to note that the Department of Labor is subject to the same confidentiality requirements as the tax department. So once they get this information, they can't share it, although they internally can go back and audit. And also the unemployment programs are subject to extremely strict confidentiality requirements. So the data stays internal. It's not shared with the broader world. So you're looking at a very limited universe of people who have access to this. It's basically the unemployment processing and the tax department, and they're all subject to extremely strict confidentiality requirements. And this information would be subject to the exact same requirements as the regular unemployment. That's my understanding as it's subject to the same confidentiality requirements. There is cross talk between benefits programs where they share information for purposes of verifying income and eligibility for benefits, but the information doesn't go outside of those very limited circumstances that have been authorized or required by federal law. And so they're allowed to do that cross talk under this program too, without any additional action? It's a good question. My understanding is it's the same as regular unemployment insurance, assuming these people then applied for, say, SNAP benefits or something like that, there could be information sharing in that case. And that's my understanding is that's required pursuant to federal law. So once you've gotten into one system, the other systems can ask that system basically to say, is this an income information valid? Or did you, for example, provide unemployment benefits that should be considered as part of their adjusted gross income? So there's a second section of the bill. I think understand what it does, but maybe you could talk about it as well. Sure. So the second section of the bill is a repealer. So this goes in and repeals all of this language. And then the repealer effective date is January 15th of next year. So it basically is just taking all of this language and taking it off the books. The pandemic unemployment assistance has only been authorized through December 31st at this point. On the off chance that that is extended, I set the repealer for just after the session starts so that we could go in and change the date. You'll notice with the effective dates that there's a retroactive effective date to the date the federal bill passed. I don't know that that's actually necessary, but the Senate committee was very concerned about the potential issue of whether there's discussions between labor and tax before the governor signs the bill and asked for effective on passage with retroactive application. My understanding is that they're not ready yet to exchange that information anyway, and they're trying to process the applications and then go back and check to make sure the income is accurate and just adjust later. So I don't know that this is necessary, but the Senate wanted to add it because they were concerned if there's any talk right around that borderline there. And I just picked March 27th as kind of the earliest date that you might wanna be retroactive too. So. So committee, Doug Sorsha has magically produced Doug Farnham. So when we're finished hearing from Damian, Doug is here to answer tax questions. I'm amazed how magic she is. We just wished for somebody to come and they show up. Sam has a question. Damian, I'm not sure if this is a question for you, but is the formula to determine what somebody will get in pandemic unemployment insurance, just what you would have earned in a regular week or your schedule C divided by 52 or something like that? Yeah, so the formula is your self-employment income from 2019, then divided by 52 to get to a weekly average and then about 57% of that up to a maximum of 513. And the minimum I believe is like 130 or 190. And it's basically one half of the weekly unemployment benefit or the average weekly unemployment benefit. So if you earn too little, you just get that minimum floor and then you can earn up to $513 in state benefits. There's a $600 federal enhanced benefit through the end of July that was in the CARES Act stimulus bill. So that's an additional federal benefit so you could get up to 1113 a week. But your base benefit is again determined, take your 2019 self-employment income, divide by 52, then take 57% of that and that's your base benefit. Does that make sense? Yeah, and you could get a full 600 on top of that till July? So the way the federal enhanced benefit works is it applies to both unemployment insurance and unemployment assistance. With unemployment insurance, if you're earning even just $1, you get the $600 federal enhanced benefit on top of it. With the unemployment assistance, if even if you're earning the state minimum, which is like I said, I think it's 130 or 190 something. I can't remember off the top of my head, you get that plus the $600. And that's, it's $600 flat, doesn't matter what your base benefit is. And that's a federal enhanced benefit to try to pump money into the economy. Okay, great. Thank you so much. Appreciate that. Thank you. These benefits date back to what they, I'm sorry, I missed that. Pardon me. Although the program isn't up, aren't people able to apply backdated? Yeah, I believe they're able to back date benefits to March 15th. But yeah, basically the way that works from the Department of Labor perspective is that you'll apply for each of those weeks and they can send you a lump sum check to bring you up to date and then just pay you your weekly benefit going forward after that. Okay. So committee, we have Doug Farnham here. Do you want to, we had some tax questions. Do you want to ask Doug about those? Hi Doug, Robin, you go ahead. I'm out of chair. Thank you. Hi Doug, thanks for magically appearing. So I'll ask the question. I was asking poor Damien to answer when he's not in the tax department. The information that the Department of Labor is gonna need from self-employed and independent contractors, is it from the Vermont tax return or the federal tax return because they're different and this business income and loss seems to show up on the federal but gets mixed in if you're filing jointly on the Vermont. So how is that gonna work? Right. So the data's primarily going to be from the federal return which is attached to the Vermont return because when we're queering in the department that's generally what we have to do. Okay. We consider that Vermont tax return. So it's not federal tax information and our logic there, which has been vetted by the IRS is that because it is attached to a Vermont state tax return is the requirement of the Vermont tax return. It's Vermont tax data and not federal tax information. In the file that the fed send us a year later where they've audited it and it's federal tax information, that is not what we would share. We don't move FTI around unless we have to. So we would be sharing the version of the return that is attached to the initial filing that comes to Vermont and generally that's through modernized e-file and that would be in our tables if it's through modernized e-file. If it's a paper return, there's a little bit more work for the department to verify that. But over 80% of the returns are in our tables at this point. And then some of the information would be from what we think of as the Vermont tax return, the IM111 but mostly for demographics purposes, mostly just lining up the social security number, the name, the address, those type of demographics and to speak to some of the concerns about sharing in scope. For the existing data sharing we have with the Department of Financial Regulation, the Department of Labor, the department will not share any more than is absolutely necessary to complete the task that is being performed. So those confidentiality carve outs that exist, you don't get to ask for every field on the IM111. We push back immediately and we say, what are you using this for? What exactly do you need all these fields? So we do limit it on our end. And I think the committee can attest that sometimes our protectiveness can be frustrating. We err on the side of caution, is what I'm trying to say. Okay. Oh, go ahead, Robin. Sorry, this is a follow-up. Damien said that if people are supposed to file the 2019 self-employed people before they apply and if they haven't filed it yet, they can self attest to the Department of Labor. But let's say somebody has filed, how long electronically filed? How long does it take before you have that information and that it would be shareable with the Department of Labor? So when somebody goes in and they filed two days ago, is it available or is it a week or how does that work? We do receive modern ID file if they file electronically, then it would be, we receive those files, I believe overnight. So, and then those are loaded into our system the next day. A couple of days from when they file, it might be hitting our system. It might have some work list edits and we are working through our returns right now. And we're actually maintaining a really positive percentage of keeping on top of our work list. We just have fewer returns coming in. So we're tending to deal with the more issues. If they file paper, that is challenging because we received a much smaller amount of paper returns this year, but still even smaller for us is thousands of paper returns. So if it's in one of those batches and it hasn't been scanned into the system, there's no reasonable way for us to find someone's return in a stack of documents. We don't go through and index them as they come in that would add an insane amount of overhead to our processes. So if they file paper, that's generally gonna take two or three weeks before it gets in the system. And we can see it depending on the time of year and the mail flow on those particular days. But I think two or three weeks is generally the delay we see from someone filing a paper return. Okay, great. Thank you. So I'm just gonna, I'm gonna support this. We don't formally have the bill anyway, but I do have a concern about a state agency that basically conditions benefits on having a taxpayer provide their tax return because that's basically the way the program's set up. I realize we're in unusual times and so on. I appreciate all the caution that your department has, but basically labor is saying, you get this benefit if you give us your tax return and if you don't have your tax return and you can't self-attest to your income, you're gonna get just the base amount. And so I just lodged that as a concern. I think taxes doing what they're doing properly and I get that we're in a weird world. But it doesn't make me really comfortable. Jim, Peter and Emily. Yeah, Doug, I think you were pretty clear, but when the legislation says uses the word access, if I'm a laborer and I want certain information and I wanna access it, it's really up to you to decide what gets released. And you work through whatever process you do to determine that, which gives me, and I agree with Janet, but I think how you've described the word access is important. Right, I think it's, we don't give anyone actual full access, even if the wording kind of could be read that way. Yeah, I don't think it's in there. Word access, so yeah. Peter and Emily, and then we're gonna move on because we have another bill that we need to deal with as well. I strongly agree with Janet. I understand, and for the purposes of Craig's position in this, it's my feeling that unless the document asked for is directly supportive, reflective of self-employment, it should not be released. And so I don't know how to get at the DOL for asking for your whole return. That really flummoxed me. I think it really focuses on schedule C and that's it. Just to weigh in on that. I mean, the folks you may wanna let know about that are either Interim Commissioner Harrington or Director Cameron Wood, who's the unemployment director. But I was not aware until this morning that their information site says you're going to need to submit your tax documents plural there. So I'm not sure if they actually mean to take the whole return, like that says, or if they're planning to ask for some sort of limited piece but I do think that those would be the people that clarify that or to voice concerns with. Yeah, I think that this legislation doesn't allow them to do that or tell them that they can't. Yeah, this doesn't address their end at all. Yeah, Emily. Doug, are you aware if this is any different for how benefits eligibility works for when people submit tax information for food stamps or long-term care or any of that agency of human services eligibility programs? So it is different. We're actually a little bit hamstrung with those programs because we don't have a sharing agreement with AHS. So AHS does receive its own federal tax information that it can use for verification but sometimes there's a timeliness issue there because proper federal tax information has a year-long lag in it. But when AHS calls our taxpayer services division and says, hey, we got a tax return for this person, is this right? We're actually, we cannot say whether or not that is actually their tax return or not. So we can't share with those particular programs, unfortunately. Thank you and your understanding is that they request full tax returns as well. I was going to mention that, yes, my experience has been that when another agency wants to get at even one particular piece of information that's buried in the tax return, they generally ask for the entire tax return because trying to explain to people, we need this line from this schedule is much more work and much more challenging to get people to understand just to pull out this one page buried in the federal return than it is to just ask for the entire return. And they also do need to make sure that that information flows into the federal term properly but they didn't just mock up that one schedule. And I think that to speak to the chair's concern earlier about taking a return that may or may not have been submitted, I can see why you would be a little bit concerned there because you can prepare a return and it could look like it had been submitted but you have no evidence that that return was actually submitted. Thank you. Peter, were you jumping back in or did you just not lower your hand? Your hand's still raised, so we'll lower it. There you go. Great, I think we're good. Any other comments that I'm looking around here? Oh, there you are, Doug. Lost you in my screen, all shifted around. Any other thing that you wanna add to the conversation? I would just say that the department has been supportive of this provision and would approach it with especially caution to speak to Peter's concerns. We would not share any more than is necessary to expedite the approval of these claims. It'd be similar to what we're already doing with the verification for the employers for unemployment insurance. We would only share exactly what is necessary for that. So committee, are people ready to, again, we don't have the bill formally, probably we should have, but it didn't matter. Are people ready to take a position on the bill? Anybody wanna move that we support it? And this is not voting it out, this is just the motion to support it. I'll move that we support the bill. All right, that was formal, I like it. Okay, I'll second. All right, so we've got a bunch of people on my screen who are not members of the committee and given that the little hand raising things gonna be a little bit challenging. So I think what I'm gonna do if it's okay with people is have Robin call the roll understanding that this is a straw vote, this is not a formal vote. Is that agreeable with everybody? Okay, so Robin, why don't you go ahead and call the roll? Okay, Representative Anthony. Yeah, unmute. Yes. Okay, thank you. We're alphabetical just so everybody remembers you can get ready for who's next. Representative Beck. Yes. Representative Brennan. Yes. Representative Donovan. Yes. Representative Kornheiser. Yes. Representative Maslin. Yes. Representative Shai is a yes. Representative Till. Yes. Representative Young. Yes. Representative Canfield. Yes. Representative Ansel. Yes. 11-0-0. Okay, so if anybody ever cares what we think we can tell them that we were unanimous. So that's good. You know, this is gonna be one of those bills that is gonna come up on our first floor action and it's hard to know exactly how that's all gonna proceed, but if we get a chance to weigh in, we will. And thank you, everyone. Thank you, Damian, for being available and Doug has dropped off, I think. Robin. Yeah. Very welcome. No, he's here. Oh, he's here, Damian. Yeah, I'm sorry. Go ahead. Who is listening in? This is H-1. This is S-340. Yes, 340. Oh, thank you. Yeah, no, it's S-341. 341. S-341. So the other bill that we are gonna do a similar straw vote on is S-340 and that bill is the Interfund Bowering Bill. I don't have witnesses scheduled for that because we did hear from Beth Pierce about it earlier. We could get it up on the screen, sources and just look at it. And if people don't feel ready to take a position will Beth is coming on a different issue. We can talk to her and then take a position. So I'll go with whatever the committee builds it needs. So I've got to pull it up on my screen here, hold on. Oh, Becky, Austerman, you're here, aren't you? Yes. Yes, I'm here if you need me to jump on. Yeah, Becky, why don't you just quickly run through it for us since I don't think we've had the bill itself presented to us. Sure, so. This is S-340. So as you mentioned, you did see the language before, but this is now in a committee bill format. So this bill is extending some authority that the Treasurer already has to do Interfund Bowering. And that authority is found in 32 BSA 436. The difference between what this bill is doing and what is already in statute is that this is specific to just FY 2020. And Sorsha, if you can scroll down a little. The authority in statute gives the treasure, the authority to do Interfund Bowering two times a year. And that is in a 15 day period that starts before the end of the fiscal year and then ends 15 days after the end of the fiscal year. And then again, there's another period that runs from about mid-December to mid-January. So this bill is simply just for FY 2020, extending the Bowering Authority period for the end of the fiscal year. It's not talking about the December authority. And it's extending it from a 15 day time period on both ends of the start of the fiscal year to 45 days. All right, let me see if committee members have questions about it. Curiously, I just got a text from Sorsha that this bill is gonna come to us. So we do have a formal position on it, but everything is sort of a surprise to me as I'm working my way through this. So we'll take what we're gonna do because we don't have the bill is that we're gonna do a straw vote just the way we did with S341. When we get possession of the bill, if we do, we will reconvene and do a formal vote. We can't formally vote it if we don't have it. So it would get referred to us today if it does come into us. And I've just got a note that makes me think that it might come in here. So with all that, are there questions for Rebecca, from anyone? Bill. Yes, thank you. Where it says, would the approval of the governor, the treasurer may well respond. Is this every time? Is this in this a safeguard? So every time the treasurer wants to move some of this money, she has to have the approval of the governor. Yeah, so current law requires the approval of the governor for when the treasurer wants to use this authority. So this language is also requiring approval of the governor. Thank you. And it's just two times a year. So it would only be two times that the treasurer could seek this authority. And it would be like a plan for borrowing from different funds, I assume. Right, and the language isn't up now, but there's also a payback requirement by the end of that period that the treasurer has. So in this instance, for FY20, it's 45 days from the end of the fiscal year. So June 30th, the treasurer would then have to pay it back at the end of that period with any interest that the treasurer determines. Right, yeah. Other questions that committee members have? I see that Beth Pierce is with us now. So if you have questions you wanted to ask the treasurer, you could also do that. Robin. Thanks. What happens if there isn't enough money to pay back? I'm gonna do my fund borrowing. Yeah, go ahead Beth. Thank you very much. So there are two back stops. So I think you need to introduce yourself for the record. Oh, thank you very much. For the record, Beth Pierce, the stake treasurer. And the first line of defense in terms of, again, we believe that we are going to be able to get through the year without having to borrow even the end of fund borrowing. That said, we do have some dips in our peaks and valleys and our cash projections and we wanna have backup for the valleys. If the end of fund borrowing, if we were not able to pay that back, if we got into that position, which I don't believe we will, we have a plan B and a plan C after that plan A. The first being a line of credit and that would be to, for instance, a local bank. We could set that up and do that. And also the statute with the approval of the governor allows a treasurer to issue short-term debt if that was needed. We have not done so since 2003 and four. That would also require the approval of the governor, but we have that authority. So we have a plan A, a plan B and a plan C to get us through if borrowing is necessary. Thank you. And you don't need any additional authority to do the line of credit and the short-term borrowing. That's under current law. Is that right? That is correct. That is correct. And what we're talking about here, part of the reason we're having this conversation is because there is a fair amount of revenue that's been postponed from one fiscal year to the next is that part of why we're needing to create these plans? Yeah. Yes, because typically in this period of time we have a peak as opposed to a valley in terms of our cash position. It does get a little tighter in that May period in any given year, but our cash positions are pretty solid at this time of year. Given the, just as you said, Madam Chair, pushing out the income tax and the failed tax has created a little bit more of a valley than we typically, a lot more of a valley than we typically have. That said, we do believe that we can manage with improved cash, but it gets a little tight so you might have a day or two where you need to do this and this provides that backup. Other questions for either Becky or Beth Pierce? Are people ready to take a position on the bill understanding that this is maybe step one in terms of having a committee position? Somebody wanna, oh, George, go ahead. Yeah, I'd move that we take a committee position in favor of the bill as written. Okay. Second. So it's moved and seconded that we support S340 and this, like the previous vote will be an informal vote because we don't have possession of the bill, but we'll do it with a roll call because I can't figure out where all the hands are. So if there isn't any further discussion, Rob, and would you call the roll? Sure. Okay, Representative Anthony. Yes. Representative Beck. Yes. Representative Brennan. Yes. Representative Dunnevin. Yes. Representative Kornheiser. Yes. Representative Maslin. Yep. Representative Shy is yes. Representative Till. Yes. Representative Young. Yes. Representative Canfield. Yes. Representative Ansel. Yes. We are on a roll, 11-0-0. We are, we are. Okay, thank you. So that was our, that was the work we had to accomplish today, so that's good. And now we're gonna move to a sort of more general discussion about the issue that we touched on, I think it was last week when we were looking at the question, Karen Horn was with us. And I think she might be on this here again. Good. Hi, Karen. The issue being the weather, whether the state or the municipalities is gonna do short-term borrowing to deal with the money that needs to go to schools and to the education fund. And one of the things that we looked at was whether if the municipality was in a position where in order to make the payment they're required to make under the statute, they needed to do short-term borrowing if there was a way that we could, at the state level, subsidize the interest rates and make sure the reason Kristelia is joining us is we also wanna be sure that the money is there to be borrowed, that we don't put towns in the position of saying short-term borrowing is one of your strategies, but we, you know, there's no money. So we wanna be sure that the money is there and that the interest rate is either low or no interest rate. And I haven't had a conversation recently with Beth Pierce about what the interest rate might be and how that would work, but she has kindly joined us to help walk us through that question. And this really is this whole issue about the penalties that would otherwise apply to a municipality that didn't turn over the money that they're required to under the statute. And I know I can speak for everybody on the committee that while we might not wanna remove the 8% penalty, we certainly don't want it to apply to anybody. What we would much rather do is create a situation where towns can access the money without incurring costs or keeping the costs minimal in any event. So, Beth. All right, well, thank you very much, Madam Chair. There is a PowerPoint, it is only eight slides. I've learned to be a little more economic on the slides as we move forward in this process. So, but it, I don't know if it's up on the screen. It is, okay. And so we'll walk through that. So this is, so if you go right to page two, it's almost what we just talked about and it's a starting point for how do we frame the municipal argument. So you just voted out the bill on Interfund Borrowing and we've talked a little bit about this at a previous meeting. And again, first I wanna say thank you for voting out that bill. It's extraordinarily important and we appreciate that. But you see that continuum of Interfund Borrowing again as we talked about it being the most efficient way to do it. Then align the credit that provides some flexibility as you have some cash needs a little more costly to set up. And given that the other one is basically zero, any cost would be an increase. And additional costs that you draw down money gets a little more complex when you have to do a longer term or a borrowing through the markets, whether that's through any types of formal borrowing for revenue anticipation note or tax anticipation note or the like. Let's go to the next page. As I said, municipal options are similar but yet different as we go through this. So for the municipalities, what they have available to themselves right now is a short-term credit facility that they could do to local banks. Banks have had a wonderful history of working with us on this, I remember. And I don't know if Chris is in the room but there we go. I wanna thank the bankers for working with us during Irene and other disasters when we had the May floods and the like. They stepped up to the plate and we're able to assist municipalities with short-term financing. And I think that was a very tough period of time for not all municipalities across the state, but many. I remember the town of Halifax, I think they had about a population of about 400. I believe their budget back then was about 800,000. I think it's over a million now. And they had $4 million worth of damage. And so working that through, they were able to access credit with their local banks. They have a relationship with the entities. The banks have a relationship with the municipalities that they serve and the help is available right now. There is a federal municipal liquidity facility that theoretically you could borrow. The state would have to borrow on their behalf because the only eligible entity to borrow on the municipal liquidity facility would be the state. This is one of the pieces out of the federal government in response to COVID-19. The opinion of every group from the National Governors Association, I presume the league, as well as treasurers and all across the board is that when you set up something like this and say that this is available and being flexible and then the next comment is that to qualify as a municipality, you have to have a population of over 1 million on the kind of limits who can do this across the country on their own. There is a mechanism theoretically for the state to do to borrow on behalf of the municipalities. There's a lot of issues with that that they have not resolved and the facility is not yet operational. We'll talk a little bit more about that in the next slide. But getting to your point, Madam Chair, about the interest and related costs for short-term borrowing may be possible. I'm hedging my bets there. I think it is that the reimbursement under COVID-19 and under the CARES Act would be reimbursable. The interest would be reimbursable. So if a town was to access the local bank mechanisms and those facilities that they typically borrow when they need it, we believe that the interest would be reimbursable as well as any cost associated with issuance. My reason for saying that is that there was a conversation between NASBO, the National Association of Budget Officers, I believe, and the NGA with the White House and the Treasury on these issues. And my understanding from reading the notes from those meetings is that this question was specifically asked and the answer was that these would be reimbursable. But again, I want to make sure that I'm confident. I want to make sure that we circle around this and make sure that we cover all issues with it. So while municipalities can issue debt on their own, they do, if they needed to do longer term, they typically use the bond bank with a few exceptions. Burlington being one of them in the past that has not used the bond bank in all cases, more recently they have. But the bond bank is really more for infrastructure, what I call the bricks and mortar and projects and not for short term or revenue borrowing, such as rands or tans. And historically, while I think that you could make the case in statute, they can do that. Historically, they've never used those dollars or anything but physical infrastructure projects. Their policy is to do that. And I don't believe they're really equipped at this point in time to make that turn, nor do I believe it's necessary to do that. I think that going down the road, after you've had that short term borrowing, if you were to need a little longer term borrowing, and I think this program would be a really good fit given its description. Under FEMA, the community disaster loans are available for municipalities. This is once a presidential disaster has been declared as it has been for Vermont. You are eligible for loans. It's a five year maturity, renewable up to 10 years. There's a path towards forgiveness and we're gonna go over this in a little more detail in another slide. It does require coordination with the state. We need to understand that a little better. FEMA typically deals with disasters that are localized. Hurricane or tropical storm Irene, hurricane Sandy, some floods out North Dakota at one point. I think under our May floods in May of 11, we had some areas declared. So this is a nationwide disaster. Just about every state has had a disaster declared. And so I think that there may be some capacity issues in terms of FEMA. So I just wanted to point out that I don't think it's available in prime time today because it's gonna take a little while to gear up. But it is an option and it's specifically designed to assist towns with revenue losses. And so it's right in the area, the ballpark that we need for this, for intermediate borrowing. I'm gonna go, I think Chris will talk a little bit more about the local banks and what they're able to do. But again, if the interest and the related short-term borrowing costs can be reimbursed, I think that this is a good fit. And I think this is, I believe that's where you were heading with your thoughts, Madam Chair, from what you were. Just stop me for a second. You caught my interest. You said given a couple of things, you think this is a good fit. And I'm not sure what you were referring to when you said this. I think the short-term borrowing through the local banks with the presumed option that we would be able to pay the interest in related costs, either a whole or apart through the COVID-19 dollars is a good fit. So not what I'm looking at on the slide when you said this, you were talking about this general idea about having municipalities do short-term borrowing through local banks and having the state subsidize the interest. And then get that reimbursed by through COVID-19. That would be the recommendation. Again, there's some dotting of the eyes and crossing of the keys, but I think it's something that's doable. Okay, all right. I got distracted by the slides and I wasn't sure if you were referring to something on the slide. That's okay. Okay. I tend to put too much on a, I've got less slides this time, but I still put too much on a page. Okay. No, that's fine. You know, there's been a lot of talk about the something called the municipal liquidity facility. And that's slide four. And again, what that did is it was trying to do two things. It was one stabilizing the market because the municipal borrowing market has been kind of choppy. Rates have gone up, rates have gone down. It's an issue that I talked a little bit about in my last presentation. So I won't, you know, we go over the entire piece on that, but it did in fact help stabilize the market. So that's a good thing. It provides that all states are eligible. And as I said, municipalities are the population of at least one million residents. So I think that leaves out Vermont. But you could, the state theoretically could borrow money on behalf of the municipalities through this facility. But there are a number of problems with it. It does provide some options for the state. Should we need to get into that? And it does provide for a two year borrowing that could be used in other things that are needed outside of the short-term borrowing needs that we're talking about today. So I'm going to slide. I'm going to interrupt again just to be, just so that I won't get confused by the details. The, we have an immediate fiscal 20 problem with the plans having due dates that, you know, for either giving the money to the Ed fund or giving the money to the schools. And it's, tell me if I'm misunderstanding this, but it sounds to me as though one option would be for the municipalities to do short-term borrowing with their local banks having the interest rate subsidized by the state reimbursed by COVID-19. We then have continuing problems, I am sure, in fiscal 21. I think we're, we need to be sort of preparing for those. And it sounds to me from what you're saying as though these other tools like the municipal liquidity facility and the FEMA money may be fiscal 21 resources more than they are in 20. Is that, is that right? Absolutely correct, Madam Chair. I think you could do this presentation for me. No, I'm just trying to understand. I was so out of my league when I talk about a liquidity facility that I just want to, I want to put it in as something that I can understand only out of my league. I don't think so on that, but you are right on in the analysis. So I do believe that the municipal liquidity facility might be something that, you know, we could go out and do borrowing and we may in fact decide that that would be the root if we were talking about a structural deficit that could not be resolved. And, you know, if there are structural deficits, we're still going to have to have some conversation on what that does with the rating agencies and in terms of our credit. But I think there's a tad more flexibility this year. It's open for discussion. We've got some more work to do on it. But I think that the liquidity facility would be something that I would recommend for review for state borrowing with respect to that, perhaps the Ed fund is, depending on where we are with the Ed fund, where we are with the facility and what our other options might be. I don't think it's necessarily a good fit for municipal borrowing at this point in time. And if you go to page five, the reasons are there. What the current alleged building levels, you know, lack community, lack direct access to funding. Theoretically again, they could borrow through the state. There are a lot of pieces that haven't been addressed with that. And frankly, the facility is not up and running. What we hear from various sources is it would take, it's about three to six weeks out from having guidance. And I don't know what happens in terms of implementation period of time. There is a fact portal that's going on we can put in questions. They're probably likely to come out with some type of sheet in the next two weeks, but it's not quite ready for prime time is I guess what I'm saying there. And there are a number of questions. You know, who's gonna manage this program? What are the pricing terms that the appropriate vehicles, that you could use? I did not write in here, but disclosure requirements that might be there. A potential need for Vermont statutory changes, but we haven't seen the guidance yet to help us with that. Is this a state credit or a municipal credit? In other words, are we assuming the obligation for the municipal debt under this model? What are the credit implications for the state and its bonding capacity? There's an intercept program. How does that work? And how does that interact with the current intercept program for the bond bank? You know, is this the best vehicle if you're talking about structural deficits and it's cost versus a bank line of credit? Although again, it looks like we can have an option where those costs are picked up by the state as we discussed earlier. So I don't think that this would be the intermediate step to deal with revenue losses and any structural deficits that a municipality might have. Again, as you pointed out, not in fiscal year 20, but fiscal year 21. However, I do believe that the community disaster loan program would provide that opportunity. As well as municipality could go out and do bonding on its own. The problem with that is that most of the municipalities do not have their own credit ratings and they rely on the bond bank. And again, this is outside of what would be the area of the business model of the bond bank. But the community disaster loan, there's authorizing language already in statute. I won't go through that here. That's slide six, but it is something that's already in statute that would allow us to do this program. So I wanted to make that clear, wouldn't require a statutory change. And if you go to page seven, this is a little bit about what the details of the program. It provides for operation of funding for governments that have had a substantial revenue loss caused by disaster. I think that all that one sentence fits in entirely to what we are facing now in terms of the virus and its impacts on local and state revenues. This program would be for municipalities that would not be for the state itself. Local governments can apply if there's a presidential declared disaster area. So we've reached that substantial loss of revenue that is greater than or equal to 5%. And again, we can't, I can't assess where that would be at this point, but if you did have more than 5% of a revenue loss, this would be a program that you would be, municipality would be eligible for. It affects both the current and the subsequent fiscal year. So it would, you would be able to take a look in terms of the current year. So fiscal year 20 as well as 21 or eligibility for that program and to address the revenue needs. The amount can be up to 25% of the annual operating budget, but no more than 5 million. The term is generally five years, but you can extend it to 10 years. And this is the part that I really like about it. The next bullet, if you, the municipality had a three year operating budget cumulative three year operating deficit, you could apply to the CDL, to FEMA to have all of part of the loan qualify for cancellation. And so forgiveness of a loan is an option here, which is not available in other options as we're moving through the spectrum of opportunities in for borrowing. Interest only accrues on a portion that is drawn down by the applicant. It's a little like the line of credit. I do need to clarify that a little bit with the folks at FEMA. And there is a fact sheet and there's a link to that. The process going to page eight is outlined there in terms of determining eligibility. So FEMA would send a staff person to talk or have a staff person available to talk with the municipality. In 2011, we brought an individual from FEMA to reach out to communities on this. Ultimately, communities had a thanks to your efforts in the general assembly and the administration had an option that was more beneficial to communities. So they did not opt in this direction, but they would have an evaluation of the, looking at the audit statements, looking at the revenue of projections. They go through that process. They submit an application. The government does have some state needs to have an authorized representative to work with FEMA. While the treasurer's office has been putting together the materials on this particular option, we would see that another department of the administration, a department of the administration were not, we are a separate constitutional office, but would be the lead on that, although we would wanna sign off on the loan applications in terms of a financial review and its implications for the state. It does have to have a state sign off. And again, I think it's a viable option for that taking out that short-term debt. So I think the banks would be available for that short-term debt. And Chris can talk about capacity there and some of the specifics. But, and then eventually you'd wanna take that short-term loan out and this would provide a intermediate to a longer-term solution for the municipalities to soften the blow and to essentially smooth out those revenue problems over a five-year period or presumably longer with some option for forgiveness. I will stop there and answer any questions that the committee may have. All righty. Maybe before I go to questions, we'll hear from Chris Delia so that we've got some idea about the capacity of the local banks. But the question I'm gonna ask you is if we, if this is a path that we decide and to pursue, do we need legislation? And if we do, what would that look like? So that just be prepared with that. Chris, Delia can thank you for joining us. Good morning, Madam Chair. Thank you for the opportunity to visit with you. Chris Delia, President of the Vermont Bankers Association. I wanna thank Treasurer Pierce for doing a great job of outlining those various resources. I'll just comment on one of them. We had higher hopes for the municipal lending facility or liquidity facility that was announced by the feds. It's very disappointing that they did not take into consideration the context of a small state. It's also a bit disappointing because we were hopeful they may create some type of secondary market mechanism, if you will, that if loans were initiated, we could potentially sell those loans into the secondary market. It is possible on the PPP program, but I haven't heard really anything on the municipal side. I will share with you, I was on a call on Monday where we are expecting to see some new guidance being released by Treasury later this week that would speak to state and municipalities being able to use COVID funds. There was no more detail on that, but it looks like there may be some greater opportunity to access that first tranche of COVID funds that was released very early in the crisis and again, guidance coming out hopefully soon. And Treasurer Peirce is right on with the guidance from the Federal Reserve on the MLF program at this point. It's a bit frustrating. Although we applaud their efforts, it's a bit frustrating when you have a program that's announced and you don't have all the infrastructure behind the scenes to actually get it off the ground. That said, municipal lending in Vermont. So you'll recall, and again, Treasurer alluded to it during Tropical Storm Irene. We were very involved with municipalities on the short-term lending side. In that case, it was to help them rebuild infrastructure quickly. So we worked with municipalities to get funding to help build those roads and bridges and culverts and so on. Knowing at that time that the long-term piece of the financing would be dealt with by the bond banks. So we provided the short-term access to capital and then the bond bank stepped in it at a later date and took that short-term mechanism out and provided the long-term financing. So we're used to this model, if you will, but the context is obviously quite different. We're not talking about infrastructure. We're talking about property taxes and the scale of it is statewide versus the municipalities that were impacted by Tropical Storm Irene. That said, I've been in communication with my membership on a daily basis. We've talked about municipalities on several occasions and I can tell you that our banks are either having conversations as we speak or had conversations and are open to having conversations with municipalities around the state to discuss their short-term lending needs. The issue with municipal lending is a bit different in the fact that you've got an entity that has taxing capacity, which makes it a bit easier, if you will, in those lending discussions. You have banks and municipalities that have long-established relationships, not only on the lending side, but just on everyday transactional accounts that they're used to working with. So there's no doubt in my mind, having talked with my membership, that they will be there to work with the municipalities. It will be on a case-by-case basis based on the unique circumstances of the needs of that municipality. And I only have one institution that has said they will not be participating because they don't have a municipal lending portfolio. They don't have a municipal lender on staff, otherwise they would. So that's good news. And I think, as you know, we have 23 members in our association, and so that's 22 out of 23 that have expressed positive interest in working with the municipalities. My ad, an example given to me last night, I won't mention the town, but it is down in your freshman to your committee, Emily Kornheiser's district, regarding a community that has just set up financial relationship and loan with a local institution down there. So it's happening, it's going to happen. And I feel confident that our folks will be able to meet those short-term needs. As far as the capacity to do it, that's something that is in the back of my mind right now because as you've heard the news, the capacity of putting a billion dollars out the door for PPP lending is one that is just absolutely incredible. That's all bank funds that have gone out the door. So now we find ourselves in a position of having to find vehicles that we can borrow from so that we can continue to do these loans. In the case of PPP, it's going to be a Federal Reserve program that they've got up and running. We're also looking at what the Federal Home Loan Bank might make available to us. But regardless, we'll figure out a way to access capital to make sure that the needs of our monitors are met. And this is not just municipal needs, it's not just PPP. It's also all of the other financial relief, if you will, or adjustments that have been made for individuals and businesses ever since the crisis began. So I'll stop there, happy to answer any questions. Thank you very much. Peter and Vinnie. Thank you very much. I wanted to thank Chris. He said it right on, that is to say, it has to be a market to re-inject, so to say, some liquidity into the local banks in order for them to do what I know Chris wants them to do and we want them to do, which is cover short-term municipal loans. But my question as it came up was really to Beth Pierce back in the slide that talked about the FEMA municipal disaster loans that generally are multiple year loans. And my ears perked up when Treasurer Pierce mentioned that if a municipality would run a deficit in excess of 5% for more than three years, there was a forgiveness stipulation. And as I think my colleagues have pointed out in another context, school districts in Vermont are municipalities. And I'm just wondering if that isn't an opportunity to get around the dilemma for FY21 we're facing, namely unless Congress allows, we cannot backfill lost revenues, nor can schools. And I'm just wondering if a statewide strategy to try to utilize that FEMA on the understanding that there's a certain risk because we'd be asking school districts to purposely run a deficit in the expectation that whatever loan they took out to fill that gap would be forgiven after three or four years. Whatever Secretary Pierce like she could shine on that as to whether I'm going down a dead end or it's a useful inquiry. Thank you. Your response. Maybe it's something that Pierce, are you there? Yes I am, but I had put it on mute during Chris's conversation. So I'm back, my apologies there. That's okay. Technology is a wonderful thing. But what I would say is that while it's a good question, I think that the idea of running a purposeful deficit and then asking the Fed to essentially forgive the loan would probably not be an option if that's the question, if I'm interpreting that correctly, sir. My understanding is unless we undertake extraordinary measures in FY 21, the Ed fund will run a deficit and it's not intentional. Yeah, no, I understand at our level, but I guess what I'm saying in terms of the municipality in terms of its receipts coming in, and I agree with you. I think that the municipal loan liquidity fund would be the way to address potential deficits and structural deficits for the state. And the CDL, the community disaster loan would be the option for municipalities. The forgiveness would be at their level, whether or not they've had, in addition to Ed funds and other property tax that they experienced a three-year cumulative operating deficit. And forgive me for misunderstanding the question. Well, what you just said actually is helpful to me because I keep trying to categorize things. So we've got the fiscal 20 problem and I don't wanna lose sight of that because that's why we're here. And we've got two paths as I'm understanding the conversation for fiscal 21. One is the municipal liquidity fund facility which you say would be a state path. And the other is the FEMA money which you're describing as a potential path for municipalities. We don't need to decide those now because we're not gonna take any action on them right now. We do need to, but then tell me if I think I've understood that that's what you were describing. But I wanna be sure that we go back to fiscal 20 and make sure that we have a plan for getting through what we know is going to be extremely challenging for municipalities, for taxpayers and for the state going, setting us up for additional problems in fiscal 21. Jim Maslin. Thank you. Beth, I'm exceedingly impressed with the breadth and width of the things that may be available. It's astounding really, how we get to them. Those are good questions. Peter's questions are good questions and I'm sure there are many around the room but I'm astounded, very, very pleased. Thank you. Yeah, yeah, it's encouraging to know that there are gonna be some choices even though we don't, they may not have guidance on them yet. We may not fully understand exactly where they're gonna be most useful and how to access them but it is very encouraging. Emily. Thanks, I have two very separate questions. One, I'm curious with the FEMA funds, normally we don't have a national disaster that covers the whole nation. And so I'm curious if there's the opportunity or the potential for money to run out in that fund in a way that's very different from how it would with a much smaller or a more localized disaster. And then if I could ask the other question after that. Okay, so we are looking at that right now and there was some more money that was sent to FEMA through some of these acts. We need to take a look at that. We agree, I mean, there was a, I think I mentioned the last time there was an article in Governing magazine said, with respect to the virus, the hurricane experienced across the country. So that is one consideration. We are taking a look at that. I haven't heard anything from the representatives that we have talked to at FEMA that this would be an issue. I think the bigger issue for us is capacity for the number of staff they have to address the problem. And for me, getting someone out here to work with us which was the model in 2011 is going to be much exceedingly difficult this time. And which is why those short-term loans through the bank, the lines of credit would be very advantageous because it gives you a continuum of opportunity. So we would work through those CDL issues why the short-term borrowing is short-term lines of credit are available. If this is not an option, getting to the chair's point, we're looking ahead into 21, we certainly can continue to look at other options as well. We think that this is viable, but again, as you pointed out, it's a changing environment. Getting back to the chair's comment in 2020 as we're looking at the availability of a borrowing facility for localities. It exists. And if we can address the issue of the interest payments which I believe we can. And I think that there's an option that gets us to the point where we can get into those transitional to longer-term models or longer-term facilities for municipalities. Emily, go ahead. Thanks. And my dog chose this moment to get worried about something. So if that gets loud, I'm sorry. My other question is about the cost of borrowing for towns versus the cost of borrowing for the state and how much more expensive it is for towns to borrow, even if we're the, how much we'd be spending paying the cost of their interest compared to if we were borrowing. Does that make sense? Well, certainly it does. If we were to be borrowing, it's very difficult with trying to understand what that municipal facility would look like. And they have not given us any such indication on pricing. They have said that the rating that a state has would be a factor in this. But they have not given us what the disclosure in the underwriting requirements would be. So working with an investment bank, for instance, with those costs, the, you know, when we go out and we do borrowing, there's a significant cost of issuance and, you know, we would have to presumably continue to have those. I can't tell you what the pricing versus the bank. I will tell you that back in 2011, the banks gave very low interest rates to assist communities. It sounds like a very high interest rate today, but back in 2011, I remember one bank down in the Southern part of the state on the New Hampshire border was giving, you know, 1% loans for a year. And at that point, there was an extraordinarily competitive rate, not so much today, but as you're working through these things. But I think the banks have shown that they're not, that they're working with their communities and giving a decent price. Right now, without having the model for the municipal facility or an answer to those questions about pricing, and I will tell you that the various groups that represent the investment community have asked for those without having that, it would be impossible to fully answer that question. But it is something we're all asking. And there's a very NABL, the National Association of Bond Lawyers. I was gonna say there's a very clear letter, which is something that you don't see usually with bond councils across the country. But there's a very clear letter with a clear ask and that's one of the asks that they have as well as the associations I'm involved with. Thank you. I'll just add to that, Emily, that I'll try and get some rough ideas for you and the committee as to what pricing might look like. I actually just sent an email to a municipal lender. So maybe before we get off, I'll be able to give you just a rough ballpark, but I'll see if I can come up with something for you. Did I understand the earlier testimony though that the interest would be reimbursable under the CARES Act? This is Beth. Yes, this is Beth Pierce. Yes, that is our understanding. And it's the understanding that we have based on conversations with the NGA and NASBO with the White House and the Treasury Department. So... Not that that money is unlimited, but just... And there may be other sources I know they're working on another bill. So it's possible that there would be another source, but it's a good question, but we need to factor in how much of it we can recoup as well. So if there are other other questions for Chris Delia or Beth Pierce at the moment. So I'm gonna give you a chance to weigh in if you want to, Karen, but just because I don't wanna forget to say this, I'm gonna, first of all, ask if I guess it would be you, I guess it would be you, Beth, could work with whoever you need to work with on our staff and with the banks and so on to let us know what you would need for legislation to do this and give us some framework for it because I don't know if legislation is needed, but if it is, I'd like to see what it is. This is understanding that we haven't taken a position on it, but I would like to have it in front of us so that we could take a position if we decided that we wanted to pursue this. Karen, I wanna give you a minute to, I know you've been listening, I know you weren't on the schedule to testify, but if you wanted to say a few words, I wanted to give you a chance to do that. Thank you, Karen Horn with the Vermont League of Cities and Towns and thank you, Treasurer Pierce for that information. We are a little bit concerned about the community disaster loan. It has not been used in Vermont before and FEMA tends to have a lot of strings attached to their financing so that sometimes it's not actually workable for local government, so that's one concern that we have there. I am, I also wanted to mention, and I don't have a response from my attorneys yet, but my understanding is that towns under the statute are not allowed to carry deficits forward year over year, so I will get the statutory reference for that and that might be one thing that we would need to address. And then I am curious as to what was the lending alternative that was available to towns in 2011? I'm afraid my brain cells don't go back that far right now. So it would be helpful to know what that looks like. And I think right now, Madam Chair. I'm sorry? I think that's all I have right now. No, that's fine. And I've got a couple other things that I wanna deal with before noon, so we're not gonna get all the way through this. I think the next step is to look at something so that we're not talking in a vacuum. So I just would ask if people could do that. I didn't know, Beth, were you wanting to answer Karen's question? Yes, if that's okay, Madam Chair. Of course. Well, I think that the takeout last time was the bond bank so that you did short-term loans and then the bond bank stepped into longer-term loans with residual after the FEMA reimbursement. The difference here is that the bond bank's role has been infrastructure as opposed to revenue dealing with revenue shortfalls and it's a very different situation. So we don't see the bond bank as the primary option here. Again, we believe that the banks can provide that short-term and then we can work with you to come up with that intermediate option. And I agree with you that the CDL is a little complicated but we're gonna stand there with you and work that through. And I'm committed to working with the General Assembly this committee in particular to make that work. So I just sort of made this general request to have folks work on a proposal. Is that something that you can help us with, Beth? Absolutely, absolutely. I just wanted to be sure I close the loop somehow. One last question, Peter, I've got to move on but I see you have a hand up. Absolutely, I just want to be clear. I thank you very much for reminding me and the committee that we have the immediate problem of FY20 and the help for the towns, oftentimes people use descriptors. I've heard two versions of help. One is that the state essentially absorb any and all interest that otherwise the towns would incur owing to late property tax payments. The other version is because the state can borrow more advantageously competitively, we should offer the towns essentially the state rate while they are working internally to solve their problems vis-a-vis submission of property tax funds to the state of Vermont. So which are we on? And I want to be clear that we do identify which of those two variations when we try to refine this strategy. Thank you. Do you want me to respond to that, Madam Chair? Sure. So I think that the model that I would see as the most viable would to be used to local banks, they would do the loan. There would be an interest costs associated with that that would be reimbursed by the state. We don't know what the interest costs would be under the municipal facility, municipal liquidity facility. If in fact it's a viable option and we do know that us bonding with our facility and then reimbursing to the towns create some other issues that I would have to look at that are much more complex. So I think that the most viable option frankly is the banks with our providing some interest related support. And I would trust that the banks are gonna do a competitive, I mean a very reasonable rate. They've done that in the past. They've been good partners. And I think that they will continue to be good partners. And again, I wanna thank you representative for this question and the other questions. I think that it reflects a lot of thoughtfulness on your part as well as the entire committee on these issues. And I love having conversations like this that are so informed. And I thank you Madam Chair for giving us this forum. So we're gonna shift gears, but can you let Sorsha know when we can expect a proposal to review and then I'll work with her on setting up some sort of a review process with you. Okay, we'll do that. Thank you very much. Chris is nice to see you. Thank you. I've got just this is for, I don't have witnessed it. Well, maybe I do. I don't think I've witnesses on these things. I just wanted to touch on a few things that are perking around. One is we had the joint meeting with house education on what I call the unadopted budgets, which is the 20 budgets, some of which were defeated and some of which, oops, sorry. Okay, I apologize for that. Some of which were defeated and some of which had never been proposed. And there's, some of us have been working on a proposal which incorporates what the Senate bill did, but expands on it. It's really gonna be a committee bill coming out of house education, but when it's, and they're the ones who are doing the bulk of the work on it, but when it's ready, I will either have another joint meeting or it will get presented to this committee as well. Like a lot of these things, I'm not sure whether we'll have possession of the bill, but we will wanna take a position on it. And I thought the meeting that we had jointly with them was a good meeting and wanted to try to build on that. So just know that that's coming. There aren't questions on that. The other couple of things I wanted to mention, Tom Kovett is going to speak to, we're gonna have a joint meeting with house appropriations next week to get an update on revenue. This is not a new revenue forecast. They're not able to make one at this point, but it's an update. We've been getting kind of, he's been doing them sort of daily or weekly, but that a point where things have, a few things have gelled enough to actually have something that I think we ought to present to the committee. And I'm losing track of the dates that we're doing things because of the house floor actions moved us around. So I think Sorsha, our meetings next week are, what day are they? You cut out a little bit, Janet. You mean the joint meeting tomorrow? It's okay. Are we talking about that? No, I'm talking about our meeting times for next week. Well, we have the joint hearing with house appropriations at 9 a.m. on Wednesday at 29th. On the 29th? Okay. And what day of the week is that? That's Wednesday. Wednesday. Okay. All right. But the floor times haven't come out yet. So we don't have to schedule for next week yet. I think you got them. I just got them. Okay. So anyway, so that's one thing we're gonna do next week. I just wanted to flag for people. I'm sorry that my connection's bad, so my apologies. The other two things that are happening, Senate government operations has voted out a bill that would allow towns to waive penalties and interest for property tax payments, including education tax payments in fiscal 20. Those are the ones that are imminently due. And Senate finance is looking at that proposal. They have some concerns about it. I have some concerns about it. Just know that that may come, that will come in the committee because it is important if it deals with the education tax that it come in here. And they're one of the reasons for having this discussion this morning is to see if we can come up with an alternative that will actually protect the Ed fund, which means protecting property tax payers as much as we can and try to avoid the worst issues in 21, trying to at least ameliorate some of what we see coming in 21, because it doesn't look good. It was interesting. I actually listened to their meeting. I kept sort of sitting there saying, I wanted to jump in and I couldn't, I was just observing, so I had to keep my mouth shut. It was hard. The other piece is the joint fiscal committee document. And do you have that sort of to post? I wanna just run through it with the committee, so people know what it's being proposed. Am I still cutting out all the time? Not too bad. Okay, Robin says I'm okay. So this is a document. So the joint fiscal committee has met twice now on this, how we're gonna deal with the CRF. CRF is what I call the CARES grant, but it's the CRF grant to Vermont. The 1.25 billion has arrived and it's in a bank. Now, and it's, I'm getting moved around, I guess Steve Pine should be giving this presentation, not me, but I'll try to remember what he said. So that's in, that's here. And because it's a grant, it's the joint fiscal committee that accepts the grant that's under our current statute. And what we are proposing to do, and this has not been approved by the full committee, but the concept has been discussed by the committee is to accept the grant with these conditions that are in this document that I'm posted here. And that's what it really does. And I apologize, we just got it this morning and we got sign off from leadership on it. It basically says that there's a certain amount of money in the grant that has already been spent or needs to be available to the administration to spend quickly. And we don't wanna tie the administration's hands, particularly when health and safety are at issue. It has to be something like paying for ventilators or paying for test kits or something PPE. There may be other things as well. And the amount of money that we're suggesting gets set aside for that category is up to $60 million. It's a lot of money. But we know the administration has committed, has already spent some of that money. So some of it we're approving retroactively. If you can move up a little bit, Sorsha. Sorry, yeah, then the next. And for that pocket of money, the committee would be informed through regular reporting of the use and expenditure of that money. And it would be posted on the Joint Fiscal Committee website so that people would be aware of it. There's another category of money, which are items that needs, where the money needs to be allocated and spent before we can get a budget passed. We're still, hopefully tomorrow, we'll approve remote voting, but we haven't done that yet. And the budget isn't been developed because we don't have a good revenue forecast. So we're still in a position where we're operating under the original fiscal 20 budget. And so for the time sensitive critical needs that can't wait for the appropriations process, there is another 150 million up to another 150 million that needs prior Joint Fiscal Committee approval. And those expenditures would be, they'd happen quickly because that's the nature of the situation that we're in. But we're working on that. But we're working on a way to notify, certainly the chairs of the relevant policy committees, but I think probably every member, as soon as those requests come in. And then the so people, so the relevant committee would have very short timeframe, but would have an opportunity to weigh in. And the money can't, the way this is structured, the money couldn't be spent without the Joint Fiscal Committee approval. And then the rest of the money, which is the great bulk of it, will go through the appropriations process, which is what we're used to. We all get to vote on it. We all get to see it ahead of time. And that's where I do the math quickly, but that's a little over a billion dollars. We'll go through that regular appropriation process. So I wanted, because we're a money committee, even though we're not the budget committee, I wanted to be sure that committee members knew what the Joint Fiscal Committee was looking at and considering and sort of how the structure is recommended that it flow. So this has not been voted on by the committee, but it would be the Joint Fiscal Committee that would ultimately agree to this or change it and agree to it or whatever. And they've seen, they have a general idea. I mean, we had a meeting where we went over this, because this didn't have a language in front of us. So Robin. Thanks, this is really helpful, Janet, to know what's happening here. I'm just wondering if you have any examples of what you think would be that 150 million for time-sensitive critical needs that can't go through the appropriation process. Was there- And so I'm the only one that's popping in my head, and I don't know if it's the right example, but the $1,200 checks that went out to everybody, for example. I think that's UI monies, so maybe it's not COVID money anyway. But that really short timeframe that could have gone through that kind of process. That probably a whole lot of others that I'm not thinking of. And what we really wanted is, we wanted to be sure that we gave the administration the flexibility to be able to act really quickly. But where we felt we could build in a period of time where they needed to have a legislative review and approval, even though it's a committee, we wanted to be able, wanted to do that. So yeah. Okay, thank you. Others may have better ideas, but. Yes, yeah. Peter. I just have one other example. I'm willing to bet that some of the time-sensitive needs arise from the lost revenue from hospitals and the fact that some of them are literally on the cash flow basis. But to the other point, you chose in the intermediate 150 million, and then in the first instance, right away, the other lower figure, was there some showing by the administration which satisfied you that those are the right numbers, that they shouldn't be lower or higher? You know, they're up to in both cases. We've had conversations with the administration. I don't remember if we had these exact figures the last time we had a conversation with them. But we wanted it to be high enough to be able to accommodate what we envisioned happening. But at the same time, if only a hundred million has been committed and they come in with something that we think belongs in the budget, then we say no to it. So I think there's enough flexibility around the edges that it will work, but it's an informed guess. Okay, thanks. Any other questions anyone has? Anything else anybody wants to ask about or weigh in on? We are gonna meet Friday. And I think one of the things, we may know more about this bill that Senate government operations voted out by then, that might be on the agenda. And if not, I may ask, make it an update on a couple of the Ed Fund issues and so on. That's my biggest worry, obviously, George. Speaking of the Ed Fund, did I understand properly from the Joint Fiscal Office note last evening that instead of 89 million of lost revenue, it's 69 million for the reels and rooms and the sales tax? Yes. Yeah, there was a calculation error, as I was told. I kept thinking, oh, maybe it's good news, right? Everything is much better than we think, but no, but yes, so it's slightly better. But remember, it assumes that all the money comes in, all the property tax money for fiscal 20 and so on. So, but yes, it is slightly improved. Yeah, I'll take a $20 million I'll create any time. Exactly. Although I wish it was the better economy. That was what I was hoping for, but anyway, Robin. Yeah, was that an email that we got that I've missed, possibly? Where that came from? I don't remember. I know it went out. Sorsha, if... It was an email that I... It was an email that I look... I don't know about the rest of you, but I get so many at this point. Yes, good. And all the Zoom meetings, I'm learning to delete them as I have them so that I don't get them confused. I invited everybody on Joint Fiscal to a meeting that didn't exist by mistake. The nice thing is they kept saying yes. I had my own little private Joint Fiscal party. So anything else anyone has? Thank you all. Nice to see you. Okay, I'm gonna end the live stream now.