Thanks. So Senate government operations, it is March 25th, Thursday, and we're going to be looking at OPR bill. And there are a couple things that we're going to be looking at here. If you can, that we have the OPR bill which we did a walkthrough of the other day. And then we did. The MMA amendment and then we have Josh Gaines and Michelle Feldman here with us to talk about the issues of our licenses and how they have collateral impact because of the I mean how our, our criminal records have collateral impact on our licensing. And I was stunned when in. I was stunned in judiciary when this was brought up and so we thought we would do it go through it here. So with that, I think that what we should do is start with, we did a walkthrough of the OPR bill. The other day with Hal Folson. And do you have the MMA language for us? Yes. Okay, thanks. Can you. Will you don't go over that with us, Amron. Yes, I would be happy to it is posted on the web page for the record, Amron average LA legislative council. Just so you are aware you may have received two versions we did a few. Yes, very, your feedback or your sound is very odd. Oh, that's the way I can describe it it's like it's got a reverb Brian would have the right name for it. I would but it sounds perfect to me. Oh really. I didn't notice anything. I hear what Allison's hearing it's like a. It sounded bad to me too. Thank you, patient for otherwise. That's, let me try. Oh, I can hear it in mind to hold on maybe my, my things are breaking. I've been too busy. Hold on, let me try unplugging. Is that any better. Yes, yes. Okay, I unplugged and replugged. So, I don't know what the problem was. Okay. You may have seen two versions this morning. I see Gail has a hand up. Yeah, I just wanted to let the committee know that the live stream is actually on the Senate agricultural channel. I tried to log out and re log in but it didn't happen so it will be switched over to Gail, but for anybody who's trying to find us, it is on the Senate Agricultural Committee channel. How would they even hear that if they're, I know, hopefully somebody heard it and will pass the word along I'm letting, I'm letting the tech people know. Oh, you're great. So, what are the versions of this hammering 1.3 1.4. Yes, so 1.3 has almost all of the substance that's in 1.4 I went through a few more changes with director Hibbert and her staff over the lunch break so I have added 1.4 so you have it what I can do is, I would like to go through 1.4 since that is the most recent version and I will just highlight if there's been a change of which it's really just a word here and there to make sure that we're consistent with our usage of words like event versus match. And some clarifying language. I don't highlight any changes for those of you that have been who've already done a read through of 1.3. The substance is primarily the same these should be relatively small changes, but I will make a note of them when we come to them. Right. So, draft number 1.4. This is an amendment to 8289. An act relating to professions and occupations regulated by the Office of Professional Regulation. This would first and I will pause there are a few additional sections in here that were requested by the Office of Professional Regulation. I will pause so that you can hear a little background from Lauren about those before we move into the, the mixed martial arts section which is very large. So the first is a change in section 122 of title three this is in section one of the OPR bill. You'll see that in section 122 this is the Office of Professional Regulation within this first paragraph, you now have a change in the classification of the director from an exempt position to a classified position. And this is the only change from section one as it is in H289. I will let Lauren I actually I should ask the chair how she would like to proceed I don't know if you want to have any input on that before we continue into the mixed martial arts. Yeah, actually let's just as we go through them, make sure that. So this is a good change. I mean this is a change that a correct change. For the record Lauren Hibbert director of the Office of Professional Regulation. Madam chair I do think this is a good change the other directors within the Secretary of State are classified employees. This position should not be a political position, which exempt positions typically are it should be a state employee position. I think this wording is the direct reflection of the qualifications that are in the statute for the state archivist, which I think is a similar type of position at least in my mind. It's treated the same way within the Secretary of State's office with great independence and authority but also as a state position, and a non political position So, I do support this language change I hope it's not controversial. It does obviously directly impact me so I feel relatively uncomfortable talking about it but I do support it and I know that the Secretary of State supports it as well. Does anybody have any questions about that. Senator color just very quickly learn why wasn't it set up this way to begin with. I don't know why it was originally set up as an exempt. What I know is that over the course of time, other directors within the Secretary of State's office have moved to classified. So I could, I could do the research and figure out the answer for you on when the state archivist was made a classified position that used to be exempt, and when the elections director used to be exempt and then it became classified. I believe that that occurred. I think around eight years ago but I can go back through the history with the team and figure out when those changes were made. But it's my understanding that all of these positions were established as exempt and then have transitioned into classified. Interestingly, the elections director is not in statute. That's a position that is not created and defined within the statute. Okay. Any more questions about this section. Okay, Amron do you want to move on I think we're okay with this. Yes. So scrolling down to page two. This is the second instance of amendment, which would be striking out the effective dates section section 15 that is currently an H 289 and then an inserting new sections sections 15161718 and 19. would create a new chapter within title 26. So be a chapter that would cover both boxing and mixed martial arts presently boxing is under title 31, and this would, you'll see later in sections 16 and 17 I believe, of this would create would move boxing from title 31 so that it is in a chapter with mixed martial arts, so the regulation of both of those sort of similarly situated professions are within title 26. This creates chapter 107 boxing and mixed martial arts. There's a space here for where sub chapter one boxing will go sub chapter two is mixed martial arts. Section 6025 outlines definitions to be used in this sub chapter. The changes from version 1.3 into this version was we added the words including an exhibition under the definition of contestant contestant means an individual who competes in a mixed martial arts match, which includes an exhibition. Some important definitions to keep in mind as you walk through the bill there are instances when we're talking about a match and instances when we're talking about an event. So it's important to note that event is defined as a mixed martial arts match meaning you can just be one match, or it could be two or more mixed martial arts matches held at the same location on the same or consecutive dates. Match is defined on page five number five, meaning any occurrence in which a mixed martial arts contestant competes against another mixed martial arts contestant using and then we added the word in this version mixed martial arts. As used in the sub chapter match or mixed martial arts match includes amateur matches, and then we added the words and exhibitions, just to be clear that this does not necessarily need to be a match does not necessarily need to involve competition necessarily and we just involve an exhibition of mixed martial arts skills. In office for this sub chapter means the office of professional regulation. You have participants, which are individuals who participate directly or indirectly in matches including managers referees matchmakers seconds corners and judges. This does not meet this does not include spectators and audience members promoter means any person club corporation or association. Any officer director employee of a corporate promoter stockholder there of who produces arranges or stages any mixed martial arts batch. Section 6026 jurisdiction of the office of professional regulation, the office shall have an exercise. So discretion management control and supervision over all mixed martial arts events taking place within the state. I know mixed martial. I'm going to start saying MMA so I can stop saying mixed martial arts every time. No MMA event shall take place within the state, except in accordance with the provisions of this sub chapter and the rules adopted by the office. Since this is such a long amendment I was planning on hitting the highlights of each section unless Madam chair you would like me to go more word for word. No, I don't think so because I think like the director's powers and duties and stuff are pretty consistent with other professions right. Right, I will hit. Am I on mute. No, you are not. Okay. So I think that. Yeah, if you just hit the things where it directly is different. It affects the MMA because that's, that's what we want to see in here. Okay, thank you. So subdivisions one and two are pretty standard language around powers of the director for licensing. So I think the director in subdivision three to administer the inspection of MMA event facilities and records associated with an event. There are fees and taxes that you will see associated with not only licenses but taxes and bonds associated with events which is specific to MMA, which so this gives the director power to collect those. Moving into page five subsection B. This does set up advisors appointed to assist the director in performance of duties under this sub chapter. Can I ask a question. Sure. Or you are we saving questions till the end. Well, is it a question. Is it a technical question. No, it's not writing. Yeah, it's a question about taxation. I mean, I guess this is only collecting taxes rather than administering them. So I think I've answered my own question. We're not, because we aren't, we don't have the authority to, I mean the state does but this MMA doesn't have the authority to set taxes but it's just collecting taxes. Lauren, do you want to ask why would you have a tax with a sports match. I mean unless you sold a ticket which I guess is taxed of course. So, that's a great question and one that we debated whether we should keep the word tax in the bill or modify it to fee. Tax is used in the boxing sub chapter in the same section so we decided to keep it tax to be uniform but it is not a tax. Like you and I think of taxes, it is a gate fee to be paid to the office of professional regulation, based on the percentage of sales to support the operation of the program. So it's not a tax, meaning it's not going to the Department of Taxes, it is going to the office of professional regulation and it is a fee. And it is called a tax because boxing has a similar structure, and for whatever reason, the statutory construction included it as a tax. And I can say that some other states also refer to this fee based on income from an event as a tax to be paid to the organizing body. And when we sell tickets to anything in this state they're taxed. I mean we sell movies they're taxed or performing arts or. So, it would there be an additional tax that an event. Yeah, okay. Yes. Okay. Okay. Yeah. Sure. Subsection be on page five. The director shall appoint advisors and adopt rules necessary to perform the director's duties and shall establish safety standards for the protection of contestants. This is one of the changes from the last version. We inadvertently left up the word contestants protection of contestants participants promoters and the public. The next subdivisions one through nine outline all of the areas where the director must adopt a rule. And so this is for conducting and holding amateur and professional MMA events requirements and qualifications to be eligible for licensure for those involved in these events. Requirements for the collection retention and remission of bonds provided by promoters requirements for promoter reports to the office. This would be including reports following the MMA events and for promoter payment of the event tax. As you'll see there's a section about medical examinations of participants and contestants that need to take place at certain times pre licensure as well as during matches and around any exemptions for certain types of mixed martial arts events. Requirements around the inspection of inspection of facilities of events and associated records. And 6028 outlines who the advisors shall be this would be appointed by the Secretary of State. Both advisors shall be an individual with at least three years experience in MMA as a promoter participant or contestant. The appointees shall serve five staggered, excuse me staggered five year terms and serve at the pleasure of the secretary. And with other advisor setups for professional regulation the director shall seek the advice of the advisors when carrying out the provisions of this chapter should say sub chapter. Every once in a while I catch another error. The advisors shall be entitled to compensation and necessary expenses for attendance at any meeting called by the director this is standard language with other advisors in other regulated professions. Section 6029 covers amateur events. There is an exception for MMA events that are amateur MMA events conducted by a school college or university. The director may buy rules exempt from application MMA events in which there is minimal or no contact between contestants for which there is no remuneration for participation and for which no tickets are sold or admission fees charged. Okay, so far. Yeah, I guess my one sort of like curiosity as we go along is it was this based on another state in in some material way, just like curious as we're leaving it. Lauren. Yes, it was. We looked at several states. We looked at New York and New Jersey particularly but we looked at, I believe Virginia as well. And then we looked at our existing regulation within. Okay, I will say I have everyone minimize so I have this on my big screen so please say something or interrupt because I won't necessarily notice if someone has a question. Section 6030 on page seven is licensing subsection a contestant license. No individual shall participate as a contest contestant and a mixed martial arts event, which we clarified includes just one match without first obtaining a license from the from OPR. The director must be conducted. According to the rules adopted by the director, a fee may be assessed, you'll see further down there is a fees section. The director shall specify by rules how the application for licensure should go that's in subdivision for on the top of page eight licenses shall be renewed every year on a date set by the director. Section B is concerns medical examinations, each contestant shall be examined by a physician who's licensed under chapters 23 or 33 of title 26 at the time in accordance with rules adopted by the director. If no contestant shall be granted a license or permitted to renew a license without first submitting a report from a physician who performed the examination in accordance with rules certifying the contestant is an appropriate physical condition to engage in a mixed martial arts event. The process from an examining physician must be submitted directly to OPR by the examining physician and shall contain information that the that is required by rule. Subdivision three no contestant shall participate in an MMA match unless the contestant has been examined not more than 12 hours before the match by a physician. To perform the examination must certify in writing to the referee of the match that the contestant is in appropriate physical condition to engage in an MMA match. Then subdivision for fees for the pre match examination shall be paid by the promoter of the match. Subdivision to providing the certification to the referee on the day of the event the contestant must also submit the certification of the examining physician to the office to OPR within 48 hours following the match. Subdivision six zero three one promoters. This is similar to the contestant licensure section we just went through no person may hold or conduct an MMA event without first obtaining a license to do so from OPR, or a license to be a promoter I should say. A person who wants to be licensed shall apply in the manner specified by the director in rules. Licenses shall be renewed every two years. In addition to the bond required under the sub chapter a fee, maybe obsessed, maybe assessed for a promoter license. Before any promoter license is granted, the applicant shall file shall execute and file with OPR a bond to the state in the amount of $10,000 to be conditioned upon the faithful performance by the applicant of the provisions of this sub chapter, and the payment of the taxes imposed under the sub chapter. And no promoter license, maybe renewed unless the bond has been renewed and filed with the board. In section B you'll see there's also an event license so that no MMA event, which includes just one match may be held by a promoter, unless the promoter hasn't obtained an event license from OPR to hold the event. And that must be obtained at least two weeks prior to the first day of the event. The form of the application and information required will be established by OPR by rule. And it may be assessed for this match or event license. You'll see we go through 6006033 further down which outlines fees. And no event license shall be granted to any promoter who is not licensed in the state, or whose license is suspended, disciplined or revoked in any other state or jurisdiction, or who is delinquent in paying a tax that has been assessed pursuant to section 6039 of this sub chapter. No event license shall be granted until OPR performs an inspection of the MMA event facilities and inspection of records associated with the event. No event license. Oh, we have an error here. I will take that this should read a separate event license shall be obtained for each event, including for a sole batch. Sorry, this must have been during our revisions over lunch. I fear I may have missed something. Are we all okay up to this point. I just want to make sure so that we don't have to go back over. I can tell I'm astounded at the length. I know I am too I thought this was going to take about five minutes. Yeah, I really apologize here to Josh and then we thought I agree. What did you say it has a lot more to it than we thought. I'm apologizing to Josh and Michelle here because I thought this portion of it would take about really about 10 minutes. So, we'll keep. We'll keep going through it and we'll get to you. But we have other things on our agenda today too so I'm not sure how we'll how we'll manage this but we will figure it out. Okay. All right, Aaron do you want to. Yes, and I apologize I confused myself. This is the one instance when a license may not be renewed. So subdivision five is correctly worded. No event license may be renewed. You need to have a separate event license for each event. Yeah, and that would include a sole match. Section 6032 participants. The rules shall participate either directly or indirectly. In the state without having first obtained a license from OPR. There is subsection be on page 12 a fee may be assessed for participant license. Subsection see every participant licensed shall be subject to the rules adopted by the director. The form and manner of the application shall be specified by the director in rules and subdivision to licenses shall be renewed every two years on a date set by the director. By rule licensees shall be subject to the provisions of this sub chapter and all rules. Section 6033 fees which we have, I have mentioned several times. You can see this outlines various fees for application we have a promoter license fee, an event license fee, a contestant license fee, a participant license fee, and then moving on to page 13 by annual renewal for managers seconds referees and judges by annual renewal for promoters annual renewal for contestants. I don't think there's really any late fees set pursuant to three vsa 127 d one. I have a question real quick. Yeah. Are these fees the same or different for amateur fights versus professional fights. Lauren. The fees are the same. There's not a different situation in the statute. Okay. So we'll have gate fees even for amateur fights. Okay. All right, moving on to section 6034 on page 13 renewal of licenses. General provisions a license C shall apply to renew the license prior to the expiration of the current license. The director is required to send a reminder to licensees prior to the expiration of their licenses. The office may charge in addition to the license fee a late fee to licensees who do not apply until after their license is expired. In terms of deadlines. Subdivision one licenses for participants and promoter shall be renewed every two years upon payment of the required fees. Subdivision two licenses for contestants shall be renewed every year upon payment of the required fees. And that's it for that section on page 14. Section 6035 medical insurance promoters licensed in accordance with the sub chapter shall carry medical insurance covering all contestants who participate in an event. Conducted by the promoter, the cost of the medical insurance including deductibles and premium shall be borne by the promoter. The promoter shall obtain medical insurance coverage in an amount to be determined by the director by rule. And that coverage shall cover the expenses for the treatment of any injuries the contestant may suffer as a result of an MMA event. The medical insurance coverage shall extend for at least six months following the date of the MMA event. The event shall be approved in the state unless the promoter is in full compliance for the requirements of this section concerning medical insurance coverage. We are okay. Okay. Section 6036 at the bottom of page 14 medical exam. The director shall adopt rules for medical examination of contestants and participants, including examinations before during and after a match or event and as a condition of licensure. Section 6037 referees. No MMA event shall take place without a referee present and overseeing the event. The sole arbiter in the ring in a mixed martial arts match shall be the referee licensed as a participant in Vermont who shall govern the match in accordance with rules adopted by the director. The referee shall have the full power to stop the match whenever the referee deems it advisable because of the physical condition of a contestant. When one of the contestants is clearly outclassed by an opponent or for other reasonable cause. Everybody okay with that. I'm glad we have our own SGO referee here. This is another opportunity for refereeing Brian. Yeah. So, the director comes up with the rules. I'm a little bit. Wouldn't they wouldn't the people that run MMA. That's like, okay. It's an excellent question. I know absolutely nothing about MMA. So it would be shocking if I wrote the rules and isolation. That's not what would happen. The two advisors who are appointed help the office write the rules and then obviously the rules go through the legislative rulemaking process and have lots of opportunities for public comment from the community so the rules are not written by me individually. They are written, always in all of our advisor professions with the advice of the advisors, and then promulgated through making process with opportunities for public comment. Okay, thank you. Good medical assistance. Section 6038 the bottom of page 15. Every promoter shall have an attendance at every MMA match at least one physician. The physician shall perform medical examinations of the contestants not more than 12 hours before the beginning of the match and shall certify in writing to the referee whether or not the contestant is an appropriate physical condition to engage in an MMA match be ambulance every promoter shall have at every MMA match and ambulance containing the standard medical equipment necessary to treat cerebral injuries. The ambulance leaves an event no other MMA match may commence or resume until the ambulance returns. The promoter shall stop or delay a match until an ambulance is present. Subsection C upon the recommendation of the physician present during an MMA event, a contestant shall be required to undergo an ophthalmological and neurological examination after each match in accordance with rules adopted under this sub chapter. That examination shall be borne by the promoter. The physician shall sort of shall provide a certified writing of the examination findings to the referee and the contestant within 48 hours after receiving the examination. The contestant shall submit the physician certified writing to the office. The physician after an examination certifies that the contestant is not in a physical condition to engage in an MMA match. The contestant shall not be permitted to engage in another match until a subsequent examination is conducted. And a certain a physician certifies the contestant is in an appropriate physical condition to engage in an MMA match. The physician providing the subsequent examination does not need to be the same physician who provided the exam at the match. I do have a question about that. Does the physician who does the 12 hour exam have to be the same physician as the one that's actually at the match? They do not have to be the same. Okay. Thank you. I'm actually confused a little bit about the two different exams. Are we doing one the day before? Usually the exams are done the day of. In my experience when we've done it, it's always been the day of. That's when we, usually a couple hours before the fight, we have the physician go down and he checks all the fighters. He checks their eyes, make sure they're not concussed or anything like that before going into the fight. So we have to have two, are you saying we have to have two different examinations? I read this that it's not more than 12 hours before. So it could be the an hour before. Okay. Okay. Yeah, it's just to make sure that they're, that they can fight that they're not hurt injured and yeah. Do I read that right? Lauren and Amron, it's not more than 12 hours. So it could be the just done right there at the right. Okay. Okay. I think that's what the wording says right now. Yes. I was looking for at the wording and trying to unmute at the same time. May I ask a question, Madam chair. Yep. So do we have any other sport in Vermont that requires. This amount of medical attention and an ambulance standing by. I mean, it, this is. I think that motor vehicle racing has similar constraints on what's available at the time of the race. Boxing has some of this within it as well. And then those are regulated sports. I think most team sports do have medical staff on standby, but it's not a regulated activity. So I think that's a good point. I think that's a good point. I think that is regulating this has determined that there is potential for public harm. The intent of the statute is to provide the structure around which the state would feel comfortable with these matches happening. That's the lens in which any regulation should be viewed is this necessary to protect the public. Under chapter 57. Yeah, I suppose we regulate many things that potentially cause harm, driving for one. Well, but this is, this is a profession that's being regulated. And, and when we, I mean, you asked about other sports events and car racing but in. And we don't regulate high school sports that's done by the principal's association, but are the school headmasters association, but most of them, when I have gone to them, they have an athletic trainer or a doctor right there. They don't necessarily always have an ambulance but. I think you're right. Hockey and football normally do have emergency personnel on duty at the field. So, I think it's fine with. Yeah, I'm fine. Okay, all right, let's go on to the tax. The post event report. Right. Section 6039 on page 17 tax post event report by promoter. Every promoter shall not later than seven days after the conclusion of an MMA event, submit a post event report to OPR in accordance with rules adopted by OPR, the report shall include the exact number of tickets to the event sold. The amount of gross receipts from the event and any other facts as the director may require by role. The promoter shall report on tickets sold to an entire event, not to an individual match with an event. Every missing a subsection. Sorry one moment. The promoter shall not later than seven days after the conclusion of an MMA event pay to OPR by certified check attacks of 5% of the gross receipts from the sale of tickets and admission fees, exclusive of any federal tax there on. The promoter shall pay the tax on the gross receipts from the entire event. This tax shall be deposited in the professional regulation fee fund and used to carry out the provisions of this sub chapter. To re designate the following the next section as subsection C not be. If the report required under this section and the accompanying tax are not paid within the seven days required the office may examine or cause to be examined the books and records of the promoter and any corporation on behalf of which the promoter held the event. Moving on to section 6040 on professional conduct. This would require that all persons licensed under this sub chapter are subject to title three chapter five sub chapter three including the unprofessional conduct items established under section 129 of title three. In addition to the items set forth in title three section 129 a it shall be unprofessional conduct for a contestant to do any of the following. First, engage in a an MMA match after a physician certifies following an exam. Following an annual exam or an examination before during or within seven days after a match that the contestant is not in a physical condition to engage in an MMA match. In addition to engage in a an MMA match when suspended and then in this version we added or prohibited from competing in an MMA match by any entity that regulates MMA. Three engage in an MMA match when the contestants license as a contestant promoter or participant is suspended in any other state or jurisdiction. Four engage in an MMA match less than 30 days after competing as a contestant in another MMA match. Five engage in an MMA match less than 60 days after having been knocked out and an MMA match or less than 30 days after having been technically knocked out and an MMA match. And I learned that those terms knocked out and technically knocked out our terms of art that will be described in rule. And six any other activity as that as established by the director in rule. Subsection C is around unprofessional conduct of promoters. It should be unprofessional conduct for promoter to one fail to submit a required report or information to OPR within the required time period. And including the information we added the word taxes in this version, since it was missing taxes and fees required under this sub chapter. To directly or indirectly have any financial interest in an individual competing in an MMA match arranged by the promoter. Three engage a contestant who is suspended or prohibited from competing in an M in MMA matches by any state or jurisdiction to to compete in a match held by the promoter for conducting an MMA match with no ambulance conduct a match with no physician present or conduct a match without a referee present or any other activity as established by the director by rule. Some section D unprofessional conduct of participants. It shall be unprofessional conduct for a participant to do any of the following one for a referee to unreasonably fail to comply with the rules adopted by the director. For the conduct of an MMA match to for a referee matchmaker or judge to directly or indirectly have any financial interest in a person competing in an MMA match. At which the referee matchmaker or judge is acting as a judge matchmaker or referee three any other activity as established by the director by rule. Are we okay with that so far everybody. Okay. In fact, I see a hand. I just have a quick question. It says that you can only be in a match every 30 days. Is that it says he can't engage in a match. 30 days after another match. Yes, that is what it says. The Bible page 18. Yep. I don't know what it says I just find it interesting. I mean, it's pretty normal. It is okay I just surprised I mean it seems like you have a match on Saturday and then you can have another match following Saturday but you can't do that. You need time to recover. Yeah I bet. So back in the old days that's what they used to do you could you would just go to one match after another match after another match but it's pretty common knowledge you don't fight for at least 30 days no matter if you took no injuries or not. You need that 30 days for your body after you've been in a fight camp, just to completely recover. So there's more to the just being punched as the whole going through the fight camp. So you need that 30 days. Okay, I mean I was just surprised, but it's fine. Okay, inspections. Did I lose somebody. Oh, you lost me. I'm sorry I was muted. Section 6041 on page 20 inspections the director or designee may inspect facilities including the ring where an MMA matches to be held before or during a match or event. And the records required for each licensee and the event or match in accordance with this sub chapter and rules adopted by the office. The designee may suspend an event license immediately for failure to comply with this sub chapter or any applicable rules. Now I have a new section. I don't see any questions we are almost finished with this MMA section actually section 6042 age, no individual under 18 years of age shall engage in a mixed martial arts event, including a soul match in which money, a prize or purse or other form of monetary compensation is offered or given to any contestant. And. Okay. And section 6043 injunction, the director may in addition to other remedies available under law, bring an action in a court of this state to enjoin a person from continuing any violation of this sub chapter, or doing any action further instead of and for any other relief that the court deems appropriate. All right, so I think we're done with MMA. And this. We're all okay with it. The only thing I think it's super expensive I think there's a lot of fees and taxes it's going to be, it's going to be really expensive for a promoter to put on a show because our venues are super small up here. You know, I've got one of the bigger venues but the only other one is down in Rutland the Spartan arena.  Okay, we can. This isn't, we will be doing OPR again. Next week I believe it is and so we can just debate whether those are the right fees at that time. No worries. Yeah, no I think that that's a good observation. And our, can I just ask if the rest of this is technical, the boxing section. The boxing section, the two sections you'll see them here this is all of the boxing sections on the bottom of this page is just redesignation and conforming changes. And then I will say there is an additional section 18 on page 22, which slightly amends the uniform process for endorsement from other states. This was a separate request from OPR that adds. And then on page 22, it adds it within subdivision a notwithstanding any statute or ruled the contrary, and accept as provided in subdivision be all professions attached the office shall have an endorsement process that requires not more than three years of practice and good standing and another jurisdiction of the United States. And that is the only other. This isn't. This isn't just for MMA. This is no. Okay. This was something as you likely remember madam chair that came out of the legislation that we did last year. Yeah, on streamlining less than sure. The uniform endorsement process that we didn't expressly in the language, add something like the notwithstanding any statute rule so as we're going through the implementation, getting ready to activate this for April. First, we are realizing that there are statutes that prescribed seven years of practice in another state. And without this addition. It's a, it's a barrier to legally to enacting uniform endorsement standard so that's why we're asking for this language to be included to state that the intent of the legislature is to overrule, for lack of a better word, any other statute rule that's in effect in any profession under. Okay, that's what I thought thank you. So any questions on on this. So what I would suggest is that maybe if Lauren and Rex if you can talk between now and the next time we take this up and just to make sure that we, we get the right fees in there but we the fees aren't so high that we eliminate maybe smaller events because of the smallness of our state. And then I have, I'm going to tell you when I'm thinking about putting this on again. No, I'm not because I don't have it down here. So I, I'm not going to. But it won't be. I don't think it will be next week will be the next week. Okay. So any questions about time. That'll give us some time. Thank you. Thank you. I want to be fair. I mean, obviously we need to have a commission and it has to be paid for there's got to be fees to pay for it.  Okay, yep. All right, so what I'm going to suggest committee is that. Help me figure this out here we have. We had on our list we had looking at each 10 at 330 s 50 at four and a 73 at 430 I don't think that any of those will necessarily take half an hour to do a walk through. And I don't think age 10 well I know we have some people who want to testify on each 10 and s 50 would just be a brief walk through but we can always come back to that next week. I'm wondering here because we have Joshua and Michelle who joined us and I would like us to. So if this is okay with everybody out there in the. I see we have Kate and we have a representative Ganon with us on these on the other issues representative Ganon. Are you here on which one. I'm here on each 10. Okay. So, I'm going to suggest that we and Kate you are to right. Okay, so what I'm going to suggest is that we have the presentation from Josh and Michelle first, while we have OPR here and because this is this is a really interesting presentation and then we'll do more work on it afterwards is that okay with everybody. What how long is your presentation it was about 15 minutes or so I think when you did it in in judiciary. Am I right. I think it was much longer than that but we we've certainly made an effort to trim it down for you today. Yeah, yeah, it'll be under 15 minutes. We're in sweet and we can. And which bill are you presenting. We are looking at my thought I explained this before we're looking at OPR bill. I mean we're looking at can use on the OPR bill okay I'm sorry. I thought you, given your discussion of the others I thought we were shifting but we're still. going to put off the others for a few minutes so that we can hear this presentation, and it isn't on this bill itself but it is about OPR and how our, well I'm not going to explain it that just takes more time because I'll let Josh and Michelle and then we know we have to do that this is going to take more work that this isn't just a slam dunk that's going to be done in one bill but it will set the stage for us to be working on this so if you'd like to take it away the two of you. I can start and thank you so much Senator White for having us here and it's great to talk to everyone and I'm Michelle Feldman I'm a program director at Council for State Governments Justice Center. Your name says we're a member organization of state governments across the country. And this is really, I hope a starting point on access to professional licenses for justice impacted people. And I know you were hearing, you know, about a slightly different issue related to licensing. But you know it's related to the overall topic of occupational licensing which can be, you know, a pathway to a good paying career for many people but unfortunately people with criminal records that were long into their past can still be impacted and that could be a roadblock for them to move on and you know, obtain economic mobility. And just to give you a little context. So occupational licensing in general is a big issue that Council for State Governments has addressed in 2017. We staffed an occupational licensing consortium that the Department of Labor really was behind, bringing together 16 states and Vermont was among them and the goal was to have states come together to talk about, you know, ways to ease restrictions and ensure access to work while at the same time, you know, protecting professionalism and safety, you know, in the licensing process. And, you know, one of the areas was about people with criminal records they were identified as one of the groups that was hardest hit by unclear or outdated licensing restrictions and then fast forward to today. The Justice Center is leading a national initiative to help states as they grapple with the economic challenges of the pandemic on different economic mobility issues and specifically fair trans licensing for people with criminal records. We have, you know, done an assessment of every state's laws as they pertain to occupational licensing access for people who have convictions and in so many states, there's really a roadblock for people who have a criminal past and even when a person, you know, has served their time, even if the offense had nothing to do with the occupation that they're seeking, even if they've gone through the education and training, just having that criminal record alone can be a basis either to deter them from taking the next step or for them to be denied by the boards because the boards, you know, they also need guidance and clarity about how to assess a criminal record. And over half the states in the country today have adopted a set of best practices to improve consistent consistency and clarity of how boards should consider criminal convictions and ensuring that they're not just looking at that record. They're looking at the individual as a whole, you know, what have they done to rehabilitate themselves, you know, have they had subsequent convictions, you know, kind of really looking at the full picture of the person, and Vermont has adopted some best practices. There is a statute that allows people to get a pre application determination. So before they go through the whole process of getting education and training they will know if their conviction disqualifies them. And OPR actually has a great policy that provides guidance. But the problem is OPR there's still some professions that it doesn't provide licenses to and just codifying those best practices away is a way to ensure that, you know, when there's change in the agency, you know, best practices will remain in place. So really adopting best practices and looking at what some other states have done is a way to get people back to work and get the economy moving and also ensuring that it's an inclusive economic recovery because you know people of color are disproportionately impacted by the criminal justice system and then that perpetuates, you know, when their records are then used to deny them economic opportunities and also employment is shown to reduce recidivism, strengthen public safety and save public money that's spent on incarceration so it's really, you know, a win-win for everybody to take a close look at this. And Josh Gaines is, you know, the expert on all states licensing regulations and I will turn it over to him to get into some of the details. Thank you, Senator Clarkson. Yeah, I just want to say that all of us are subject to our Attorney General's favorite mantra, speaking of mantras today, which is the best public safety is a good paying job. So all of us have heard TJ say that 88 times. So we're pretty clear. That's great. Very consistent with what this goal is. Thank you. So, Josh. Yeah, and thank you, Michelle. Thank you to the chairperson and the committee for inviting us here today. As the chairperson mentioned, this is kind of a continuation of a conversation that we began in the Judiciary Committee and I kind of went through, you know, the bed with the best practices are in the states and sort of where Vermont lands and I think the feedback I got which is consistent with what, you know, was able to see from the outside, looking into Vermont is that Vermont is doing very well on these issues and, and, you know, that OPR director Hibbert is doing a lot of the stuff that we say that every state should be doing and when I say that every state should be doing I should clarify we're not advocates we consider ourselves, you know, a resource for the states and we, you know, speak in terms of best practices, you know what what we're seeing the states incorporated into their laws and as far as practice goes Vermont seems very much to be in line. In statutes, there seems to be a disconnect between what is codified, and what is actually taking place in the department when people's criminal convictions are being considered. So I just want to preface it by that I know when I spoke to this in judiciary and maybe seemed a little bit shocking because it seemed like this stuff was already being done but just as a matter of statute I'd like to walk through through what's there. The first thing is that licensing bodies are given under section 129 a which was referenced as in professional conduct touchpoint in that MMA amendment. They're given broad authority denied to deny applicants with convictions that are related to the practice of the profession, or for any felony regardless of its relation to the practice of the profession and no time limits on that. There's no exceptions for minor offenses, anything like that. And although the department may not actually be right, you know, expansively using that discretionary authority to deny people. And they have a real deterrent effect on people who are considering licensure who may have a criminal past. And what we hear, you know, universally we were talking to people or I was, I was talking to some folks in Utah and their director today is that people are always surprised when they tell them that they can get licensure with a conviction. And these broad sort of, you know, expansive statutory authorizations to disqualify people are out there that really, really, you know, tends to tends to tamp down on on workers seeking these opportunities and pursuing them. And I'll note, of course, Michelle mentioned and I'm sure you're familiar with the pre qualification the pre eligibility determination that was enacted last year and that's obviously you know a great step in that direction. But it's still somewhat of a black box in Vermont. You know, you can fill out that application you can get that determination. But before you fill it out, you generally don't know where you stand right so there's no kind of, you know, I'm probably good or I'm not or it's worth doing or it's not worth doing. A lot of states spell things out like this they say, fundamentally, every licensing body has to make a determination about whether your specific conviction is directly related to the license tactic, which is something that Vermont lacks it has a grants authority to disqualify when it is right but there's no prohibition disqualifying when it's not. And the question becomes how do you make that determination. And Vermont 13 vsa section 808 this was enacted long ago as part of the collateral consequences of Conviction Act I'm not sure if you're familiar with that. But, you know, says you can't disqualify somebody from anything due to a conviction without giving them individualized consideration so that exists in Vermont but but what that looks like is is un clarified. And I think the department based on you know what I've seen and I guess the informal policy says that they give everyone individualized consideration and they do it consistently that's really important and that's what most states have done they say you have to consider things like the nature of the events time since conviction, age of the person, and then most importantly evidence of rehabilitation or treatment that they've sought, right. So it's really about creating a standard and then creating guidance in the statute that ensures consistency transparency, and that arms the applicant or the perspective licensee or the worker or however you want to look at it with the information to make informed decisions, you know, about how they can proceed, and ultimately expand, you know, access to work through doing that. So, having said that I think those are you know kind of the big, big statutory gaps that we've, you know, looked at in terms of best practices. There are a few more that I'll address that we don't see in Vermont, and I'll do this really quickly. That we see in other states. Limiting consideration of low level or older convictions there are many states that either create a presumption of rehabilitation after seven years or takes, you know, certain offenses out of consideration. After a number of years, I use seven just as an example that's, you know, tends to be where things hover and other states. Limitation on consideration of low level offenses there are many states that say we're taking nonviolent misdemeanors off the table. For example, a lot of states require that there be a written explanation of the reasons why a conviction was disqualifying provided to the applicant. It's great because it, you know, is almost an enforcement mechanism and ensures accountability from the licensing bodies right you can't write that written explanation unless you go through the you know analysis required by the statute which it sounds like the office is already doing. But a lot of states do it in the way what you get that notice it's it's not a denial it's an intent to deny.  Listing disqualifying offenses, which is pretty simple conceptually but in practice could be more difficult right. So this is you know a lot of states have said you have to you know each board says, you know the offenses we're going to consider you know a violation of section 22 a or 22 be and everything else is off the table right obviously you know getting that list together and that's not a hard right disqualification that's just if you don't have one of these offenses, we don't care if you do we're going to walk through this analysis and give you individualized consideration. You know the advantages of that that we've heard from for many licensing bodies is, and really to a lot of these limitations on you know lookbacks in terms of number of years and lower level offenses is it's less that the licensing bodies have to deal with they don't have to look at every criminal conviction they don't have to consider it if it's not within those categories. It's a non issue so you know from an efficiency perspective that's good but it also you know increases access. And I think you know the last thing I really want to point out is public safety I know we're talking about increasing access and that's big motivator here, but public safety is the touchstone of all of this and it's really it's not about giving them access regardless of the risk they may pose. It's about making sure that you're codifying the standards that allow regulators to make those important public safety determinations, because they're not, and please forgive me, but criminologists and those are tough decisions to make right and doing them consistently and doing them with confidence can be very difficult and can have a chilling effect if not in Vermont certainly, certainly in other states. So that's, that's kind of the general breakdown of how we look at it and and if we have any time I'd love to answer any questions or hear any feedback you might have. Does anybody have any questions right now. I think I, I invited them to come because when we had the presentation the numbers that were presented to us were stunning I just I almost fell off my chair.  And so I thought I didn't know if there were any. I mean, the numbers of the numbers like there are 97 places in the statute. That that that kind of thing that that either don't put any kind of a time limit on it, or that are discretionary. And so I started thinking about it and wondering if there were any kind of things that we could do as part of the OPR bill this year and I do that. Clearly we're not going to get there today but if there are overall things that we can do to move in this direction and I know Lauren has been very clear and Colin before her very clear about making sure that we don't deny licenses when we don't need to so. But we, we also don't know who the next director might be and the when discretion is allowed. That could be scary for people so Senator Rom. Yeah and Lauren might want to say something too so this is a question to her anyway, you know I'm very sympathetic to this issue and and would like to see it advance. This is another area where I feel like it would be really good if OPR isn't already collecting demographic data to see who is being denied a license now, you know who if we make this change would be more likely to receive a license. I'm hoping that we, I think that also helps challenge any future concerns that get raised that we're letting dangerous people engage in, you know, professions that sketch people out or whatever so I would just really like to hear how we're tracking, you know, a lot of demographics to know that this could make a difference. Hi, thank you so much. This is an issue that I feel extremely passionate about and extremely proud of what we've already done through the consortium work and personally very passionate about so I'm open to the conversation. Certainly, I do want to make sure that folks know that we have a written determination, we call it a pre denial, then applicant is given and then they have a full hearing with due process and that that denial of a license is a call to the Supreme Court so there's a robust due process right to the denial of a license it's not done per se and within all of our applications we have soon to be 50 professions with the addition of well drillers. In all of our professions we ask for both the convictions but also any mitigating evidence or evidence of rehabilitation that's built into our application now. I do hear the concern that it's not openly on our website and not reflected in our statutes and that's something that I'm open to explore. In terms of demographic area, demographic information we have taken the position, whether it's right or wrong I don't know of not collecting data about race or gender. So we don't ask those questions we don't ask race gender sex in our application process. In part, it's not, we have not seen it as relevant to our determination of whether or not somebody's qualified for licensure and sex and gender can change and is fluid so we have really taken the position to that we don't collect either of those data points we collect age we collect social if you have one we collect education but we have not taken that data point. Again it's something that we could talk about whether we should change. I will say that for all of our health care professionals, they have to do a survey through the Department of Health, called the health care provider survey and that does collect that data, and that gave us some. Because we're not the primary collector of demographic data in the state, we felt comfortable not making that that part of our application. I am a little confused as to why, why it would be helpful to have that data on your application because we're talking about people who actually don't either don't apply or get denied because of a criminal conviction and that that should be regardless of race or gender if somebody is denied because they have a felony in. I mean I guess I guess I'm not sure why how we would collect that data or how we would use it because we're talking about people who either don't apply. I feel they can't apply, and we wouldn't know who who they are. Well, I mean, right right now we don't because we haven't tried to collect that data before to see if there's a significant see change when these changes are made, and you see if you have them, you know, more diverse group of people who end up getting the licensure than those, you know then previously so you can't compare to past years when you haven't made these changes. But I would also just say, you know, we ran into this with Department of Labor we don't want to mix you know someone's identity information with a determination about their, you know, their employee, whether or not they receive unemployment benefits. I would really challenge that you know I think it's really important to collect demographic information their ways to do it, you know, post submission, etc so that it's really clear it's not required and that it's for demographic de identified purposes. But I think it's really valuable information for the state to have them for decision makers to have. I can't disagree with you. I am barred in three states so I, I'm a licensee. And one of the states that I am barred in sends a demographic survey with my renewal every year, and it, it talks about what type of place I work, sexuality, gender identification, certainly race class. It's, it's very interesting to fill out. And from a data perspective I think it does make sense it's just something that we haven't done, particularly because the, again, the Department of Health does that for all of our healthcare providers provides that survey. In terms of who we're not receiving applications for, I think we're in our beta stages but through the grant through the federal Department of Labor grant the consortium. We do have a web page specific to individuals with criminal backgrounds we're trying to flesh that out. We're also able to have a video on our website about our process for specifically people were foreign trained people with criminal backgrounds and military spouses and families as further outreach but we're doing our best to be open to all and trying to encourage people to apply whenever we can. What do you mean by class, you said, socio economic class. And how, how do we. Everyone, there's questions about on the Colorado bar survey there's questions about your annual salary. I assume they're doing an analysis of where what type of practice area you are what your annual salary is and your race class. I think that's very interesting because how I. I mean my my salary, my yearly salary is so low that I would fall in a poverty class. But I don't consider myself right somebody who is who has come from or or came from but who right currently lives in poverty. But so I believe the questions are, are related to income and are you the first gender first generation to go to graduate school college. So, I don't, they didn't know. So interesting Allison. So class and income are two different issues. I mean they're completely different. I'm glad you anticipated my question, Lauren, because my question was, what are we doing about outreach and educating the population we want to affect. And that we need to do two things clearly we need to fix our statutes in the areas we need to fix them and I think we're all supportive of that. I think we also need to do education and outreach big time, because we can't necessarily wait for them to come to us or to your website. How would they, but so it was great that you mentioned that. Thank you. Thank you, Josh and Michelle for giving us this charge. You know just when we think we're doing pretty well we're always reminded we have more to do. Yes, and I just wanted to add there are a number of states that require data collection on how many people apply for licenses that have criminal records and how many are denied. And I think it's a great opportunity to share some of that with you. I think it's been helpful for states to see, you know, what the reality has been with, you know, once they've passed best practices, how that's played out. And I'll just, if I can quickly say on that point that one of the things that becomes apparent when we talk about deterrence and talk about data collection right you don't know who's not applying. They're never in the system. And that can be a problem and lots of times when we ask, or not when we ask but when we get you know data on denials from states, they're very few denials. And that's probably, yeah it looks like the case in Vermont. And still there are all of these people walking around if they can't get a license because they have a conviction so the website that's currently up there is fantastic and I've used that you know as a model. When talking to other states and their states that kind of by statute, if this is anything of interest actually require that such information be posted online. I think the larger context is about meeting people where they are to say hey you can. You can do this there's there's nothing necessarily stopping you regardless, you know. So, I think that we were talking about people with convictions here, though, a couple places to start and make sure we are doing outreach is in the Department of Corrections probation and parole, and our community justice centers around, because that's where people with records are found. And that's where we need to be doing outreach to people, I think, but Lauren. One thing that I've really enjoyed about the consortium because we've been working very closely with the Department of Labor, the Vermont Department of Labor on apprenticeships and talking about new Americans and less so people with criminal backgrounds but obviously that's been touched on and also, and we've talked about military families to an extent with Fort Drum because they do a lot of outreach with them. That's a new conversation for OPR I think OPR does a lot of amazing things sometimes in a vacuum with ourselves, and we wait for people to come to us so I do believe that we need to integrate better into the other state agencies. The other state agencies need to be educated about what we do and how we do it.  It's not complicated and it seems at first breath but it's something that is definitely a long term project. So what I would suggest is that if there are, if there are things that you think statutorily that we can do this year to move continue to move forward on this that we. We need to figure those out and perhaps incorporate them into H 289 and if, and knowing that it's a long term process project that we wouldn't, but if there are some kind of overarching things around the best practices that we could do. Does that make sense committee to everybody to do that and to be great. And then to come back the week of the sixth and see if there's anything that we want to try and put in here or not. Or if we want to just continue the conversation and get something that we can work on next in January. That makes sense. Yeah. That's great. I'm sending an email right now to Michelle and to Joshua, I'm asking for the best practices so that I can, because I didn't have your email and I just want to say thank you gale for giving me the emails. And I will email you and ask for best practices you can start to engage in a conversation and if there's easy things that we can do this session we can add them. Good. That's great. Thank you for looking forward to it. Thank you so much. I'll keep trying to keep my job from now on. And we're doing this, you know, to do serious doing this also with the justice reinvestment and with expungements and I think this is where this originally came into the conversation was around the expungements. But I don't even remember because, but so we're constantly working on this. They kind of go hand in glove. Madam Chair, if we're at a national breaking point I have kind of an economic development committee really commitment that either Allison and I would need to go to. And I case if you'd be willing to do it that would be great. Okay, yeah, I do want to, it's 410 now we're right away behind ourselves. All right, man. Yes, excuse myself for one sec for a loop break, because I have been sitting here since one. Does anybody else want to let Allison have a loop break. Can we vote on that. Okay, we'll take a four minute break. Okay. Thank you for your time committee. Thank you very much. Thanks, Josh. Thanks Michelle. Thanks.


So now it's the time for questions and ask comments from the audience. We'll take a few comments first and then let Tauvel and Mika ask when then we see How are we doing in terms of time? So the two questions here at the front. Thank you very much Okay, so I am Nora Lustig Michael You probably have heard of our work which tries to have a holistic approach to the Incidence analysis with all the caveats that you mentioned and I cannot agree more with you that's the approach Joel mentioned that's important talk about tax systems I really think we need to talk about tax and spending systems and I want to venture An explanation. I think of why people are so reluctant to actually accept the policies that recommend getting rid of Exemptions or using the VAT and then redistribute later because for a long time The later was not part of the equation The redistribution part, you know the the fund for many years was advising countries to give rid of exemptions Punto right and In Mexico in particular for a long time The only thing that the government was saying is the exemptions relatively, you know They're progressive if you in if they're in a quality reducing because but but they benefit relatively more the the rich But they didn't accompany the proposal of trying to get rid of the exemptions with a clear Indication that those resources would be used to compensate the poor That's one of the things that there's been a loss of credibility for good reasons I would say unfortunately, but but you have to fight that because I think the proposal is correct But why is the resistance one is that the second reason why the problem is there is because The subsidies or the exemptions actually are addressing a group of the poor that is very hard for Governments to reach which are the urban poor Okay, and Mexico is actually struggling with that right now in which they you know Then great strides in making progress with the now called Prospera I just changed its name opportunities and progress a third name But they can't really make it work in urban settings because very hard to target So there what are they trying to do? You know they're now they're going back to discussion about using minimum wages And that's where that's where the issue of what you do instead becomes much more difficult. So I am you know Interest, I mean I had forgotten that the snap had this Tax exemption embedded in it, but but there is I haven't read it and I was going to ask you this idea of having a personalized VAT, you know Which means somehow what you have here in snap that you actually in Embed the Benefit as a tax credit so to speak to people who are already part of your Poor population, but particularly think about the urban areas if you do not come with a solution for that then politicians are going to resist it for good reasons because the urban poor are much higher in the Dessal scale that probably fourth fifth the cell to get upset if you can if you take away that substance So you have to think about a way in which that group gets to be benefited also by the reforms Okay, thank you Andrea Cornia. I'm Andrea Cornia from the University of Florence I have one question I mean one common question to enjoy and I think that optimal taxation theory Perhaps needs to be expanded so as to consider and when you deal with the so-called efficiency cost of taxation Well, another approach to look at it is to say well, okay I have to pay higher taxes, but then I will get a lot in return from the government and this is the West European approach People are more willing to pay taxes because they have a fairly good healthcare system They're basically free and high quality education then there are minimum pension guaranteed to everybody So so the the efficiency cost of taxation that there will be lower lower labor supply or MSN I Think there are all these new theories of fiscal exchange you give me this and I give you that I mean I have to pay your taxes, but then I get a lot in return I live five years in Finland and here people the tax rates are quite high and people do grumble like they Grumble everywhere else, but they I mean tax compliance is fairly high So the fact is not very high and then the second point is that when when are these efficiency cost? Kicking in I mean in Uruguay the income tax in during the Conservative government have been completely abolished the personal income tax then they this has been in Reintroduced with reasonable rates. I think the maximum was be twenty twenty five percent And then one of my PhD is done is that this showing that the reintroduction has not generated any Diminution any decline in labor supply. So I think that the Perhaps the optimal taxation has to be As to evolve also a little bit in this direction. The second point is for Michael Keane Many many years ago Francis Stuart and I we did an article called two errors of targeting and we compared basically the errors Of including the say the rich through subsidies to generalize subsidies and then there was that you Have when you do transfer income when Transferring income, I mean there is a major problem with identifying the poor and so so when we summed up I mean I thought that the traditional problem was that Normally that in those days the bank That's why not the fun the bank basically was suggesting is okay No cares top generalized subsidies and replace them with the income transfers now normally If you if you impose very restrictive identification criteria, then you exclude a lot of the poor and You exclude exclude a lot of the people so what it turned out in and we examined about ten ten country case studies Sri Lanka India and don't remember the others which basically if you value only the inclusion error You obtain that this program has appeared to the other if you include inclusion Inclusion exclusion ever then you come up that in some cases generalized price some see it might have been superior Particularly if generalized price subsidies are the same like in India with the PDS in which you do have Subsidized broken rice rather than rice Okay in the interest of time, please keep try to keep your comments Relatively short so we take a couple of more and then we let these speakers to ask for Francois Okay, no Thank you very much Francois Bourguignon. Thank you very much for two very nice presentations on on the first one Would it be possible? I mean could you tell us a little more about the elasticity's of the tax basis to the Income tax rate. I know that you've done very much work in particular with Emmanuel says on on this I'm not sure that I remember well the Figures that you you're rich. I mean there's a range of estimates that that's rich but if I'm not mistaken when Trying to apply this kind of French to an optimal taxation framework then having the optimal top income tax rate at 60% was not at all completely illusory So is it true or not? I mean what is a kind of? Well, the orders of magnitude that that we that we can think of and on the next presentation See that your argument about food subsidies is very very strong. I remember a couple of years from now I was trying to do exactly the same kind of argument in Egypt and Presumably is a bank was taught really very effective in in getting these results. You're absolutely right to To insist on the political economy aspect, which as a matter of fact is also present in the UK and also present in France but I Think another aspect in the developing countries and maybe also in the in developed countries in the fact that We are not always I mean it is not always okay that a channel to transfer cash is available and If in the case of Egypt, it would well it would be possible to say look We will be reducing the food subsidy But at the same time these cash benefits that you are getting will be increasing by so much Something which would be possible in Mexico something which would possible in Brazil then things might be completely different because people could immediately see That they would be losing on the one hand, but they will be gaining on the other hand Okay, and then one final question proves No gentleman at the back Bruce probably University of New South Wales I mean this on the same question of the the price subsidies. I mean, I think Keep political issue is a question of commitment to the compensation. I mean many countries Governments can credibly commit to making a say a cash transfer compensation in the immediate aftermath of an indirect tax change But of course typically cash transfers at payments that get adjusted from time to time And so there's a question about whether people can believe that in the in the course of many adjustments over many years that Additional payment will stick As a pop perhaps in countries like say Australia and the UK perhaps one solution is to think of institutional frameworks So for example some sort of especially designated cash transfer which Which responds to this and we just set up with price indexation and so on as part of its some defaults formulation Okay, thanks so much. We now let the speakers to respond so Joel you like to go first hmm So let me respond to two of the questions first about theory of fiscal exchange There's no question in my mind that if you look across countries and across cultures and try to explain The extent of tax evasion concepts like fiscal exchange matter a lot But the policy issue is not whether we can change Italy into Finland We are in most cases when we're thinking about policy reforms We're sort of stuck with the attitude people have toward government whether they find credible and reasonable to Think about I give you this you give me that and if we're talking about Policy the response to policy for a given attitude toward fiscal exchange I think the evidence is overwhelming that deterrence type theories explain Evasion better than any other theory. I I don't mean to say non deterrence theories like duty and trust don't matter at all but deterrence theories are over overwhelmingly explain I think The determinants of tax evasion penalties probability of Detection matter if we're talking about for a given set of attitudes toward government To the question about the elasticity of taxable income It is true that the manual sighs and I wrote a survey paper where we talk about the estimates But we give a range of estimates and the two of us might be on the On the two bounds of the range, but I will answer your question. So I think the the literature suggests the elasticity of taxable income is between Point two and point four if you get start thinking about point four You can easily get to an optimal tax rate. That's up near sixty percent But I'll stress a couple things first of all we don't the margin of error is still pretty high It's not easy to measure the elasticity of taxable income Second that there's I think there's no question that the elasticity is different for different income classes And in particular, I think it's higher for the high-income classes Because they have not only the ability to make real responses, but they have available to them a much wider range of avoidance In particular responses, but also evasion responses. So You know, I am not Convinced that what we know about the elasticity of taxable income is enough for me to go to a government and say You know to move the top income tax rate to sixty percent and don't worry about the behavioral response. I personally I'm not there Okay, Nick Thank you. Yes, no, maybe just to to respond to The comments I've managed to write down and reasonably neat handwriting I think Nora's point about that the difficulty of the kind of Inadequacies of past advice I think is is a fair comment and I think that's certainly something I think the funders Recognized for a few years. I think it has been a problem that we send just from our narrow perspective that you know We've sent a mission on the tax side that would say You know get rid of these exemptions and you can look up to them on the spending side The authorities then say well, okay, thank you. How do we do it? And then we say well, we'll send another mission to talk about that or that's not actually us That's the World Bank or so I think that's true. And I think it's certainly something we're We're trying to be better on it's actually very very difficult to do actually so we've had a few goes at that but just just in terms of Putting together packages, it's it's very it's very hard to do maybe just to Pick up a couple of the things here. I think on the The point about fiscal exchange and trust in government when I agree with Joel Joe said I think that's also why you know, I think another link. We haven't made well is that I just touched on briefly is the link between reforms in Tax and spending and reforms and actually the management of expenditure because that's also You know it clearly is a big issue in many countries and it's simply that they don't trust the money is going to be spent in any Kind of reasonable way and I think we've really we've barely scratched the surface. I think in terms of actually Marrying again those two areas of work. I think Both people like us and countries themselves need to Need to work work harder on I think just to pick up a couple of just general issues on the on the subsidies thing Which as we all know is is not a is not a new issue I Remember Ravi Kanba at a conference once Somebody presented a paper on subsidies and energy subsidies and he said well We've we've all written this paper at least once in the last 30 years The numbers change that's it the paper is the same but the numbers change we kind of and I think that that's true But I guess there are a number of distinct issues there one is kind of the availability of instruments to reach these these various groups Which we can we can talk about that. I mean are there I think I'm always quite impressed by this Iran example where this was just such an expensive thing It was worth investing in setting up these atm's networks getting people bank accounts making the thing work So if we don't have these instruments clearly in many cases that you know They doing it is going to be pays for themselves many times over and I think you know we see these We do see these things even in Egypt. I guess is also largely an urban issue But you know I think the the availability of instruments You know we shouldn't take as well clearly we don't take as exogenous and I think there are things We can see countries doing I'm just sort of not completely sure that's That's going to be a whole solution. I do think technology is helpful here as I mentioned with biometric cars You know pole subs it is a very simple things to do and again. This is this is what as a day This is what what Iran basically did but that leads into the second issue, which is the commitment issue, which I very much agree about and I think that was partly what I was getting up when I talked about earmarking was the idea that well Are there ways we can tie our hands that that people will credibly believe And I think the issue the again that the issue there is well that means typically It has it has pros and cons which I was trying to get to it can be very constraining for your spending Why would you like if you say well, we're going to fund health care through the VAT? There's no necessary reason why what you want to spend on health care should depend on what you raise from the VAT If your VAT revenue collapses you're going to find money from some other source to finance it in which case you're not really earmarking stuff at all You're basically, you know, you're either overly constraining spending or you're basically lying to people about what you're doing with that with their money And you know, we do see countries the work that have extensive earmarking Where it becomes a real it becomes a real budgetary macro issue the extent which funds get earmarked Having said that of course we should recognize, you know, we do earmark stuff Social contributions are basically an example of earmarking and certainly before I joined the fund I had an academic paper saying that earmarking was a jolly good thing Which I've reconsidered a little bit But I do think, you know commitment is commitment is a I Don't I really don't have a really don't have a very strong ass, but I totally entirely agree that so That's an issue. Did I miss anything? Though the person has VAT. Well, I mean, I think of that, you know, as I understand it This is basically just saying well, let's compensate people in terms of what we think their VAT payments would have been Which is the which is the way that the IDB people present it Which is really just a special case of some of the things I've been thinking about. I don't think it's Okay, thank you very much both We still have time for one or two questions. Oh, we have quite many so The two here at me in the front, so let's start from those please keep it short and please also identify yourself I'm Nicholas and get I would like to ask Joel about the possibility of linking Tax data to survey data for more comprehensive analysis and I also wanted to direct a question to Michael about the how he thinks that the big informal sector in developing countries will affect the possibility of Emulating the British case for for for developing countries especially of Africa and compounded with corruption and the difficulty of even targeting the right beneficiaries. Thank you Thank you so much Finn, please Thank you very much. My name is Finn tab First of all, thank you very much for two brilliant presentations. That's very much appreciated To jail. I mean thanks for the messages from the tax community development community Let's try and see whether we cannot come up with a series of messages from the development community And Make I am and maybe Joel you might want to comment on that also I'm gonna have a couple of observations based on two country experiences Most in vegan Tanzania in particular, but I'm particularly going to refer to Tanzania The first is out of also being on the so-called Danish external appropriation committee in other words I'm on that committee which basically signs off and all the need a programs Just a couple of weeks ago. I was sitting in the meeting and then one of the trans conditions is Getting the tax share up and then sort of as of course I sort of sit there and reflect. Well, but Is that in all cases a good thing? I Mean, you know and then basically the response when I asked the question Well, why that specifically is well, that's because the IMF tells us that And and I'm not saying that's right. I'm not saying that's right But but where does that sort of kind of thinking come from and and why are we so kind of crude? Now I'm as you know I'm also living in in Finland and the present Development minister of Finland is sort of in the same area and he's right now reflecting on a policy where he would Allocate aid in the following way if countries increase their tax share Then he will give the aid he will tie the aid to that. I Wonder whether you had some reflections on that Okay, thank you Another question here in the front And gentlemen with the watcher My name is a Subramanian. This is for professor keen I think you will agree that the choice between targeting and universalization would be very much a case specific Choice But I think it is worth pointing out especially in the context of our country says India from which I come That the general disposition and favor of targeting Has not always necessarily been particularly healthy With specific reference to the public distribution system for food for instance There is first of all the massive cost of dismantling the public distribution system and replacing it with a system of targeted transfers Now even assuming that the objective of collecting information is to dispel ignorance nothing more than that The my biometric Identification program in India has cost an absolute packet. I mean it's been a hugely expensive endeavor Which does not reckon yet with the fact that when when a government has discretion or when there are agents of the government who have the discretion to To offer Selective to confer selective favors on people. There's also the problem of corruption and bribery So you might have all the information that you need at your disposal and yet be guilty of deliberate mis-targeting of resources and in addition, I think one should also be somewhat sensitive to the To the fact that biometric identification is very often a thinly employed disguise for Targeting illegal immigrants. So there's a lot of intrusive surveillance, which which happens under the guise of Targeting Secondly, this is this is a this is a gentle question Which either of you could to respond to it might seem needlessly controversial, but I assured you that it's genuinely meant and asked in the spirit of genuine inquiry Which is that if the objective of a tax-come-transfer system is to eliminate acute poverty Then I think for most countries of the world and certainly at the international level The aggregate burden of redistributive taxation is very small That's the aggregate poverty deficit say as a ratio of taxable income All the implementation of some sort of lexicographic maximum principle of taxation would result in very small proportions of the population being taxed and relatively small proportions of their incomes being taxed in relation to the huge benefits which are to be obtained from eradicating mass poverty, which is after all a massive model shame as well now This is a reflection a little bit on our profession. Are we pretending to go along? With with governments which refuse to get on with a job of actually eradicating this problem by getting a little too subtle and exquisite with the design of Rather fine-tuned incentive-compatible systems when perhaps what we ought to be reiterating again and again is to say get on with a job It's not such a such a hugely difficult one as it's often made out Okay, I hate to Try to finish this this discussion on there's such a wonderful topic as taxation We're running out of time and I do need to keep to have the floor is still Well, I sense that I got the easier of the questions I Think there was one directed toward me about the possibility of a linking tax return data to survey data The answer to that question really depends on what country you're talking about the rules about The privacy of tax return data are very different in different countries Not only about linking to other data, but what making The tax return data in some form publicly available More and more in more and more countries that's becoming possible for researchers to get access to some kind of sample of tax returns date tax return data, which So which is encouraging But there's no general answer to whether that can also be linked to survey data But I will say that I think making tax return data Available to researchers in some form is a very important thing for democracy because it allows private non-government people to think about tax policy to come to independent judgments using the the data that comes from From tax returns and other government sources Well, thank you. No, they're very very good very very very hard questions. I don't have anything terribly Smart to say and any of them. I think the first there was first issue about Informality Which I think we could probably have a whole separate session on because I think you know The first thing I would say was all what do we actually mean by informality? And I think you know for in many respects when we think about the tax system You know, it we're really talking about compliance and non-compliance and which comes under some of the issues that Joel was talking about about For example, where you where you draw thresholds for people who are in that in we should be in the system I think many of the smaller traders are standard standard view would be that many of us small Micro-type traders just shouldn't be in the tax system at all and there should be you know We have a typically we tend to have a fairly generous VAT threshold and they're sort of out of the system But I know I'm not giving you a very full answer because I think that would really take actually a full Full hour and I can send you a paper on that actually On on raising tax ratio. Well, I guess obviously I don't want to comment on particular countries But I think as a you know as a general rule. I think it was a general impression I think certainly our sense is that many low-income countries Typically will need to raise more revenue in order to meet their development goals We know that aid budgets are coming under under pressure They've done a generally a you know a good job in terms of building strong fiscal but fiscal buffers So certainly I think the raising the tax ratio in in many countries You know, we would think is is something to aim at but having said that I mean, I think certainly we're also At least as conscious at The importance of the structure of the tax system, so I think there are a number of countries for example that have Less so in recent years, but you know if we look back to since the early 90s or something There are a lot of countries that haven't done much in terms of the overall tax ratio But I've actually done a lot in terms of changing the tax structure in terms of where the revenue comes from which we might Disagreed well we would tend to say is it is a good thing others might disagree for example But the reduction in countries that have managed to reduce tariff revenue Replace it from other sources. We would tend to think have actually done quite a good quite a good job So I think we do we do think the structure of the of the of the tax system matters At least as much and I think I think the point you were making about the notion that age should be conditional on some stronger effort in in domestic resource mobilization that mean that is That that's certainly an idea that's around and I think is is going to gain traction I mean we there is and it was you know an empirical literature on what aid does to does to Domestic revenue mobilization which people have different different views on But you know there are certainly people who believe that particular types of aid actually have debilitated efforts to strengthen domestic tax systems and of course strengthening domestic tax systems doesn't just mean You know the VAT it actually also means developing a proper income tax So, you know, I think certainly when we when we think about Advising countries, we're often thinking not just or even mainly of the overall revenue ratio But of some structural measures towards what we'd think of us. It was tax systems better suited to meeting macro and and and fairness and efficiency objectives I Thought I was interested I was interested in your remarks about the experience of biometric Cards and Indian. I'd certainly don't claim to be an expert and I'd be keen to learn more. I think I'm largely going by assessments that were done at Center for Global Development and they were there actually they took a rather different line their view was actually these things been really rather cheap but I haven't I mean I think I but I think it's an important issue because you know The mere fact of identification Let alone linking with other data sources is but you know, if you can get it, right does seem to be potentially Really quite powerful. I mean if you can just be able to pay a poll subsidy with a reasonable chance that it works is Is a huge strengthening of instruments? I like your phrase about needlessly controversial I wrote that down But I was in I'm always in favor of people who needlessly controversial But I think in a way your point was also answering that the point raised here in some sense that actually You know a lot of a lot of these things don't don't take that much money and Just go on and do it. Which is also true. Of course of the wider aid debate, right? I mean It's not we're not talking about much money in many of these in many of these poverty relief areas But I saw I don't know if that got anywhere close to hmm Okay, thank you so much. Thank you once again Joel me for this excellent talk