An act relating to establishing the Farm and Forestry Operations Security Special Fund to provide payments for farm and forestry operation losses due to weather conditions

The earlier passed version established a 'Farm Security Special Fund' covering only farms. The enacted version expanded this to the 'Farm and Forestry Operations Security Special Fund,' adding forestry operations as eligible recipients and including timber-related losses such as lost timber income, logging road repair, and inability to access harvested timber due to flooding.

The Review Board composition changed: the enacted version adds the Commissioner of Forests, Parks and Recreation and two forestry operators (appointed by that Commissioner) to the board, which the earlier farms-only version did not include.

The payment cap formula differs. The earlier version used a flat maximum of $150,000 per farm per year. The enacted version calculates the cap as five percent of undesignated and unreserved funds in the fund at the beginning of each fiscal year, with a $150,000 ceiling per farm or forestry operation per year.

The earlier passed version included a specific $7,500,000 appropriation for fiscal year 2026 and a 'funding intent' section requiring the Secretary to recommend an appropriation amount by December 15, 2025 and the Review Board to submit a recommendation by January 15, 2026. The enacted version replaced this with a 'contingency of funding' provision (Sec. 2a) making implementation contingent on future appropriations from fiscal year 2027 onward.

The effective date changed from July 1, 2025 in the earlier passed version to July 1, 2026 in the enacted version. The Review Board recommendation window also changed from 10 days (earlier) to 15 days (enacted), and the Secretary's award issuance window changed from two weeks (earlier) to 15 days (enacted).

The enacted version requires applicants to submit a list of any State grants or loans received for the farm or forestry operation in the past five years, including amount, source, and purpose. The earlier farms-only version did not require this disclosure.

The enacted version adds a conflict of interest provision allowing the Secretary to appoint an alternate board member when a sitting member has a conflict regarding a particular application. This provision is absent from the earlier passed version.

Application processing changed from continuous ('in the order received') in the earlier version to quarterly batches ('in the order received for each quarter') in the enacted version. The enacted version also explicitly authorizes the Secretary to pay reasonable administrative expenses from the fund, which the earlier version did not address.

A new Section 3 (Funding Intent; Report on Future Appropriations) was added, stating it is the General Assembly's intent that the Fund receive an annual appropriation equal to 50 percent of average documented farm losses from eligible weather conditions. It also sets specific deadlines: the Secretary must recommend an amount to the Review Board by December 15, 2025, and the Review Board must submit a recommended appropriation to legislative committees by January 15, 2026.

A $7,500,000 appropriation from the General Fund for fiscal year 2026 was added to fund implementation of the Farm Security Special Fund.

The Review Board's deadline to recommend whether to issue a grant was shortened from 15 days to 10 days after receiving an administratively complete application. The Secretary's deadline to issue an award after a positive recommendation was changed from 15 days to two weeks.

Board membership criteria in Section 4634(b)(3) were broadened: 'representatives of three agricultural organizations who can demonstrate expertise in dealing with all sizes and types of farms in Vermont, whether through granting funds, offering technical assistance or advocacy and have a proven track record of working with farmers' was replaced with the simpler 'representatives of three organizations or entities with experience granting relief funds or technical assistance to farmers.'

In Section 4632(a)(1), the word 'transferred' was changed to 'appropriated' when describing funds provided by the General Assembly to the Fund.

The annual reporting requirement in old Section 4634(d)(2) - requiring the Board to report to legislative committees the total documented Vermont farm financial losses from eligible weather conditions averaged over the previous three calendar years - was removed. The remaining review and recommendation duty was renumbered as subsection (d)(2).

Finding (2) in Section 1 was expanded to add that existing programs 'are not equitably distributed to small- and medium-scale farmers,' strengthening the stated justification for the Fund.

The fund is renamed from 'Farm Security Special Fund' to 'Farm and Forestry Operations Security Special Fund,' expanding eligibility to include forestry operations in addition to farms. A new definition of 'forestry operation' is added, referencing 10 V.S.A. section 2602.

The Review Board composition was expanded to include the Commissioner of Forests, Parks and Recreation (or designee) and two forestry operators appointed by that Commissioner. The three agricultural organization representatives now must demonstrate expertise with all sizes and types of Vermont farms and a proven track record working with farmers.

The specific $7,500,000 appropriation for fiscal year 2026 was removed. In its place, a new 'Contingency of Funding' section makes implementation contingent on an appropriation in fiscal year 2027 or later. The old funding intent formula (50 percent of average documented losses) and specific recommendation deadlines were also removed.

The per-award cap now has two layers: a dynamic cap of five percent of the undesignated and unreserved fund balance at the start of each fiscal year, with a hard ceiling of $150,000 per qualified applicant farm or forestry operation per year. Previously it was simply $150,000 total per year per farm.

A new provision allows the Secretary to pay reasonable administrative expenses from the Fund for purposes of administering the subchapter's requirements.

The requirement that the Secretary establish award criteria based on annual net income relative to the median net income of all Vermont farms was removed, eliminating an income-based tiering mechanism.

New reimbursable losses specific to forestry: timber in lost income replacement, repair of washed out or damaged logging roads, and inability to access harvested timber due to flooding or other weather conditions. The fire-related eligible weather condition was changed from 'widespread fire event' to 'a forest fire or wild fire event.'

The application now requires a list of any State grants or loans received for the farm or forestry operation in the past five years (amount, source, and purpose). The specific reference to Schedule F of IRS Form 1040 was removed, replaced with a general 'year-end report of farm or forestry operation income and expenses.'

The effective date changed from July 1, 2025 to July 1, 2026. Applications are now processed in the order received for each quarter (previously just in order received). The Review Board recommendation window changed from 10 days to 15 days, and the Secretary's issuance window was standardized to 15 days.

A new conflict of interest provision allows the Secretary to appoint an alternate board member if a sitting member has a conflict regarding a specific application, to maintain quorum for that review.

Throughout the findings and operative text, 'climate-fueled disasters' was changed to 'weather-based disasters,' 'climate emergencies and extreme weather' to 'weather-based emergencies,' and 'grants' to 'payments.' The language accessibility provision (interpretation and translation services) was retained.

Section 3 (Funding Intent; Report on Future Appropriations) was entirely removed. This section had stated it was the General Assembly's intent that the Fund receive an annual appropriation equal to 50 percent of average documented farm losses from eligible weather conditions, and required the Secretary to recommend an appropriation amount by December 15, 2025, and the Review Board to submit a recommended appropriation to legislative committees by January 15, 2026. Removing this eliminates the specific funding formula and timeline for future budget requests.

In Section 4632(a)(1), the language 'funds appropriated by the General Assembly' was changed to 'funds transferred by the General Assembly.' This may reflect a different budgetary mechanism or accounting treatment for how money enters the Fund.

The criteria for Review Board members representing agricultural organizations (Section 4634(b)(3)) were broadened. The original required 'organizations or entities with experience granting relief funds or technical assistance to farmers.' The Senate version requires 'agricultural organizations who can demonstrate expertise in dealing with all sizes and types of farms in Vermont, whether through granting funds, offering technical assistance or advocacy and have a proven track record of working with farmers.' This adds advocacy as a qualifying activity and emphasizes experience across all farm sizes and types.

The Review Board's deadline to recommend whether to issue a grant was extended from 10 days to 15 days after receiving an administratively complete application (Section 4633(e)). The Secretary's deadline to issue the award after a positive recommendation was also changed from 'within two weeks' to 'within 15 days following the date of the Review Board's recommendation.'

A new reporting requirement was added in Section 4634(d)(2): the Review Board must annually report to the House Committee on Agriculture, Food Resiliency, and Forestry and the Senate Committee on Agriculture the total documented Vermont farm financial losses from eligible weather conditions averaged over the previous three calendar years. This creates a recurring data reporting obligation that did not exist in the introduced version.

The statutory citation for advisory body meetings in Section 4634(f) was corrected from '1 V.S.A. chapter 1, subchapter 2' to '1 V.S.A. chapter 5, subchapter 2.' A typo in Section 4633(a)(3) was also fixed: 'satellite date or models' became 'satellite data or models.'