Public Service Department details special-fund budget, federal grants and IT upgrade to appropriations panel

The Vermont Department of Public Service briefed the House Appropriations Committee on Feb. 18 on its FY26 budget, federal funding exposure and an IT upgrade to its case-management system.

Deputy Commissioner Britney Wilson said the department is primarily funded by special funds — largely the gross receipts tax — and is not reliant on general fund appropriations. "The department is not reliant on general funds," Wilson said, describing the department’s mix of special funds, federal grants, interdepartmental transfers and the Clean Energy Development Fund.

Patricia (Patty) LaRose, the department’s financial manager, summarized line-item changes and said the department is preparing a risk assessment of one-time federal grant awards to determine program timing and whether state dollars would be needed if federal funding becomes unavailable. "Some are as high as, 20% can be used for administrative costs. Some are as low as 5%," LaRose said, describing how federal awards differ on allowable administrative charges.

Budget totals presented to the committee included a requested special-fund spending authority figure of about $12.1 million and an all-in total budget near $15.4 million. Committee discussion focused on specific items in the department’s "ups and downs" summary, vacant positions (including three clean-heat positions), and a planned upgrade to the EPSD case-management database used for utility dockets and rate cases. Committee members asked whether the EPSD upgrade is a planning expense or a contractual implementation cost; the department said it expects to enter a contract in FY26 and budgeted approximately $830,000 for the EPSD upgrade in the packet.

Why it matters: the department administers energy, telecommunications, water, wastewater and regulated-utility matters and manages federal grant programs and state-funded initiatives. The committee raised questions about timing and program risk for large federal awards and sought follow-up on how much of those funds are reimbursable to the department for administrative costs.

The department said some employees are funded in part by federal program dollars and that administrative rates vary by award. Committee members also asked about vacancy assumptions in the budget; the department said vacancy savings reflect several unfilled positions, including three clean-heat positions that were included in prior budgets but are not currently funded in the FY26 request.

Ending: Committee members asked the department to provide additional detail on the EPSD upgrade timeline, the composition of federal grants and the contingency plan if federal funding decisions change. Rep. John Kosenska will serve as liaison for follow-up questions, and the department said staff would supply the requested follow-up materials.