Thursday of last week Governor Scott vetoed the budget proposed in H.13. This budget was virtually the same budget that a tri-partisan majority of senators and representatives approved during the regular session in H.911, but removed the items under contention between Governor Scott and the Vermont Legislature – namely how to spend unanticipated revenues from one time tax changes, tobacco and other settlements and – good news – growth in receipts from a recovering economy.
The legislature refused to negotiate the “tax bill” H.4 until the governor signed the budget. The governor refused to sign the budget until the legislature agreed to use those funds to artificially lower all property taxes so that there would be no increase on property taxes for a second year in a row. The legislature won’t agree to artificially lowering this year’s property tax rates because it sets up a significant property tax increase next year. The governor won’t move from his position because he believes Vermonters are with him, school-boards have issued a call to override the governor because they believe acquiescing supports a false narrative about how education property rates are determined and sets up a negative chain of events for next year.
We are at a stalemate.
On Friday I attended a day long series of hearings between the legislature’s relevant committees – appropriations, ways and means and education – and members of the administration, the Vermont State Treasurer and the Joint Fiscal Office. Pretty much all agree that doing what the governor has requested – artificially zeroing out property tax rates – is going to cause a very significant property tax increase next year regardless of what locals decide to vote at next year’s Town Meeting. We could return those funds in some other less precarious way to Vermonters by paying down future debt, or even as straight up refunds, but the governor is insistent they have to be returned through the property tax. That’s a problem. And it’s bad policy.
With some limited movement from the legislature and even less movement from the administration, at this point I’m voting to support the school boards and communities working to change the system. I can’t support the governor’s current position and will vote to override.
Governor Scott has successfully applied downward pressure on increasing taxes and fees. I think many Vermonters, like me, thought we needed a pause to catch our breath from the rapidly increasing – and costly – new nation leading programming we were implementing year another year, and that – more then any other reason – is why our moderate Phil Scott is governor.
However it is important for all to remember that at the same time Governor Scott was elected, Vermont was also beginning to undergo massive education transformation through Act 46. Last year and this year we have pushed forward additional MAJOR reforms in special ed, weighting and considerations for teachers healthcare being negotiated at the state level. These are significant, difficult and cost containing state policy changes being implemented at the local level. As a planner, I know these processes take years to be fully realized. With our distributed governance system – we are on the locals timeline. I can not willingly vote to undermine the work going on by communities and school districts by supporting a built in tax increase next year that will have absolutely nothing to do with educating Vermonts students.
I support the goal of returning excess funds to Vermonters. I do not support the largely false narrative that we control property tax rates in Montpelier and that we should not “raise” rates, because it just isn’t true.
We are approaching unchartered territory with the reality of a potential government shutdown needing to be acknowledged by all responsible parties.
The vote tomorrow will be close and regardless of whether or not the governor is sustained there will be ongoing negotiations. It is my sincere hope that during those negotiations House Speaker Mitzi Johnson and Senate Pro Tem Tim Ashe will not only work to return as much excess revenue as possible to Vermonters, but that they will steadfastly defend Vermont’s students and the integrity of our rapidly changing education governance and finance system to ensure Vermonters future access to high quality education throughout our state. I hope Governor Scott will agree to moderate his position on this issue and commit to those same goals. And that all will respect and encourage the ongoing and extremely difficult work going on in our communities. If these goals are shared we will quickly finish our business, pass a budget, provide unexpected additional tax relief and let the rest of Vermont get on with their lives.