Fiscal office briefs committee on three main budget effects of agriculture bill; hemp‑fee revenue uncertain

Joint Fiscal Office staff briefed the Agriculture, Food Resiliency, & Forestry Committee on the fiscal impacts of a pending agriculture bill, identifying three primary effects: a potential loss of Act 250 permit revenue, a small change to pesticide examination fees, and uncertain new fees for hemp processors and hemp‑derived products.

"Overall in the bill, we're seeing three fiscal impacts," the Joint Fiscal Office staff member said, outlining the areas of change and the uncertainty around their size and timing. The fiscal office recommended legislators consult the fiscal note tab on the General Assembly website for bill‑specific fiscal documents and to contact JFO if they think a bill should have a fiscal note but none is posted.

Why it matters: the committee is weighing policy choices that shift which activities require Act 250 review, alter regulatory fee timing, and add product fees in a market that may change rapidly if federal rules permit interstate commerce.

Act 250 exemption: The bill would broaden an Act 250 exemption for accessory on‑site businesses that prepare or process qualifying products when the value of off‑farm product sales does not exceed $250,000 a year. JFO said that expansion would likely reduce the number of Act 250 permits; those permit fees finance the land use review board’s staff. "Fewer of them would need to get Act 250 permits," the staff member said, and "we don't know ultimately what that impact would be because it depends on who would have applied under current law compared to what would happen if the bill were enacted."

Pesticide fees: The bill moves a $25 pesticide examination fee to earlier in the exam sequence (the first exam rather than the second or third). JFO described that effect as de minimis for the pesticide monitoring special fund: "at $25 a pop for the first [exam], it's not going to be large."

Hemp processors and product fees: JFO flagged this as the most uncertain revenue stream. Under current federal and state rules — where interstate commerce of certain hemp‑derived products is restricted — the office expects minimal revenue from new hemp product fees because sales would primarily be limited to Vermont producers. The presenter gave a high‑end scenario under a different regulatory assumption (if federal law or interstate commerce changed) and described an upper‑bound estimate on the order of tens of thousands of dollars per year to the cannabis regulation fund, while stressing the figure is not a firm projection.

Grant eligibility and other effects: The bill also raises the dollar threshold that triggers required agricultural practices for water quality, which would reduce the number of farmers eligible for a particular farm agronomic practices grant program even though the fiscal year appropriation (about $9,000,000 transferred to the agricultural water quality special fund this year) would not change.

Legislative process guidance: JFO staff advised members that if they are considering floor amendments that may have fiscal effects they should involve legislative counsel and JFO early. The office can provide preliminary estimates on short notice but cannot guarantee full fiscal notes for every last‑minute amendment.

Next steps: Committee members requested more testimony next week on remaining sections of the bill (including the accessory exemption), and asked the Department of Health and the state toxicologist to provide background on PFAS issues raised during earlier meetings.

Sources: Remarks and estimates provided orally by the Joint Fiscal Office staff member to the committee during the public briefing.