Lawmakers debate H.167 funding route for Vermont Food Bank; focus on agency oversight, administrative cap and reporting

Lawmakers at a committee markup discussed H.167, a proposed measure to direct $2,000,000 through the Agency of Agriculture to the Vermont Food Bank for purchases of local food and subgrants, focusing on constitutional risk, the agency’s administrative workload, and reporting responsibilities.

The conversation matters because the bill would establish a statutory relationship between the state and the Food Bank — similar to the existing working-lands statute — potentially making the funding an ongoing item in the agency’s base budget and affecting how much money reaches farms and food shelves.

Mike O'Grady, Legislative Council, told the committee he had flagged a potential dormant-commerce-clause concern when he first reviewed the bill but said a constitutional-law expert contacted at his request concluded the bill is not likely unconstitutional. "I flagged a potential constitutional issue with the dormant commerce clause and whether or not the bill is discriminatory," O'Grady said, adding that the expert characterized H.167 as "more like a direct subsidy by the state for a local interest" and therefore likely permissible.

Committee members then debated how much of the appropriation the Agency of Agriculture should be allowed to use for administrative purposes. O'Grady and members discussed common approaches — a capped dollar amount, a percentage, or authorizing up to a fractional full-time equivalent for administration. The transcript records several benchmark figures raised during the discussion: a full-time position budgeted at about $125,000; suggested administrative caps including 10 percent, 5 percent, or a specific amount near $70,000; and one reference to an "up to an FTE" figure described as about $67,500.

Representatives weighed two practical options: (1) passing funds through the agency so the state retains fiduciary oversight and auditing capacity, or (2) sending funds directly to the Food Bank and minimizing agency workload. O'Grady noted advantages of routing money through the agency, including auditability and the possibility that the program becomes an ongoing budget line similar to the working-lands program. "Moving money through the agency ... serves that purpose of the fiduciary responsibility," he said.

John Sales, of the Vermont Food Bank, said the Food Bank regularly negotiates state grant agreements and is accustomed to providing reporting information to agencies. "When we negotiate the grant agreements, the agency asks us to do the reporting," Sales said. He told lawmakers the initial year would likely require more agency and Food Bank time while the grant agreement is negotiated, and that subsequent years would be smoother.

Committee members discussed assigning the Food Bank responsibility for drafting the report to the legislature while giving the agency authority to require additional information or sign off. O'Grady said the agency would still need to retain records and include conditions in the initial grant agreement to satisfy auditing requirements.

Members and presenters also discussed the bill’s definition of "local food" and whether the statutory language should be written to include smaller farms and farm stands. Several speakers emphasized that the intent is not to exclude small producers and proposed language to ensure flexibility so small farms can participate.

No formal vote on H.167 is recorded in the transcript. Committee directions recorded in the discussion include asking Legislative Council to draft statutory language changes: (a) clarify administrative-cost authority with a specific cap or percentage (a draft change around "up to $67,000" was proposed for confirmation with the agency), (b) add clarifying language to ensure smaller farms can participate, and (c) permit the Food Bank to draft the required report with consultation or sign-off by the agency. The committee agreed to continue the conversation and confirm figures with the Agency of Agriculture before the next markup.

Next steps noted in the discussion: Legislative Council will prepare bill language reflecting the committee’s tentative direction and confirm administrative cap figures and reporting language with the Agency of Agriculture; the Food Bank indicated willingness to negotiate reporting terms as part of the grant agreement.