The fate of Vermont’s sweeping data privacy bill hangs in the balance after being vetoed by Republican Gov. Phil Scott on Friday.
The Democrat-led legislature is hoping to mount an override of the veto this week to push the 330-page bill over the line. If so, it would join 18 other states, including Texas, that have comprehensive consumer data privacy laws on the books. The states have acted in the absence of a comprehensive federal privacy law.
The Vermont bill (H. 121) aimed to give Vermonters more control over their online personal data that companies collect, share, and sell. It set strict rules about the collection and use of highly sensitive data, such as social security numbers, and placed guardrails around data collection from children.
Scott, in a veto statement, pointed to the bill’s private right of action as triggering his decent. The provision, modeled after a similar one in California’s data privacy law, would allow individuals to sue companies for violating their privacy.
Allowing a private right of action would “make Vermont a national outlier, and more hostile than any other state to many businesses and nonprofits–a reputation we already hold in a number of other areas,” Scott said. Small businesses were afraid of the bill, he added.
He cautioned that the language pertaining to children is similar to a California law that is being contested. Lawmakers should wait for the outcome or risk a similar lawsuit in Vermont, he said.
“Finally, the bill’s complexity and unique expansive definitions and provisions create big and expensive new burdens and competitive disadvantages for the small and mid-sized businesses Vermont communities rely on,” Scott said.
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