Budget –The Legislature passed state spending of 5.531 billion dollars, including general fund, education spending, and federally funded programs. Total spending is up 1.1%. Total spending for education is up 2.95% and total general fund spending was up 4.1%. FY 2015 saw revenue downgrades of $40 million dollars. I voted in favor of the budget for a number of reasons, but chiefly because the size of the structural budget problem requires a multi-year solution and I believed the, largely new, appropriations committee has actually committed and begun the process of bringing spending and revenue into alignment. Additionally, this year’s process included multiple transparent opportunities for every Vermont Legislator to provide ideas on cost containment, and for every committee to prioritize the agencies, staffing and initiatives under their subject matter jurisdiction. I’ll be looking for this process to not only continue, but expand next year.
Here is a great easy to read summary on this years final agreed upon budget.
For those who are concerned we are not reducing spending fast enough, you are countered by, and may have even read op-eds from, a vocal group of folks who are actually calling this an “austerity budget” and have urged policymakers to raise more taxes on the highest earners in Vermont. I think we’re somewhere in the middle. Next year Vermont is already projected to have an estimated 70 million dollar budget gap to face, and reductions in a number of federal program funds.
Revenue Bill – This is H. 489, the tax bill that raises 38.2M in funds to pay for the budget. This bill included a lower restaurant fee increase I successfully proposed early on in the session, and raised revenue by removing the itemized deduction for state and local income taxes and caps other deductions at 2.5 times the standard deduction (except medical and charitable), and removing the tax exemption on soft drinks and vending machine items.
This bill DID NOT include a number of proposed tax increases that I had found particularly objectionable including increasing the employer assessment for health care, increasing the meals and rooms tax, adding a room surcharge, elimination of the exemption for candy, satellite tv tax, sugar excise tax, disallowing Vermont companies with a global presence availing themselves of global tax havens.
Again, considering the size of the financial challenges we are facing, I think the final tax proposal was reasonable. However, I did not vote in favor of the final agreement between the House and Senate. The capping of the mortgage interest deduction was a significant concern for our district’s fragile real estate recovery, an important aspect of this district’s jobs and economy.
Economic Development – As a first year member of the House Commerce and economic Development Committee, I was proud to be part of developing the final 173 page Economic Development bill, S.138, that passed the House and Senate. Windham County Freshman Senator Becca Balint was also on the final conference committee charged with reaching an agreement between the House and Senate versions of the bill, a big deal for a freshman! I also had significant opportunity to learn about banking and insurance regulations and a number of emerging consumer protection issues like regulating litigation lenders and online dating services. The most immediate statewide impact pieces of S.138 are the repeal of the cloud tax, increased licensed lending from 75K to 250K, approval of additional one time funds for Vermont to develop an economic development marketing program, and a first time home buyer tax credit paid out over three years.
I was especially pleased to have worked with Rep. Oliver Olsen of Londonderry and Kiah Morris of Bennington and Senator Becca Balint on language to create a Southern Vermont Economic Development Zone and committee. This zone is comprised of the two regions covered by the Bennington and Windham Region Planning Commissions and Development Corps. I’ll be writing more on this topic as the committee is named and begins it’s work over the session, but this is a significant long term opportunity for increasing economic development collaborative action by public, private and non profit entities in Southern Vermont.
Education – Much has already been reported about H.361. As communities begin to try and implement the law, much more will be reported. The two votes on this bill were the most agonizing for me of the session. Ultimately I voted in favor of the bill. I know it may cause significant short term challenges for schools in my district, I know the bill does not address the root cause of the property tax crisis which is the flawed funding mechanism that bases equity on unscaled dollars available to students instead of scaled program available to students.
So why did I vote for it?
Though it wasn’t understood, this bill, particularly the governance consolidation pieces, were a done deal when we arrived in January. There was a literal freight train of education policy makers, boards and associations on the tracks rolling over opposition and alternate views, sometimes in stunning over the top fashion and sometimes just interesting data selection pieces such as the April Fools Day selective data piece published as the House was preparing to vote on H.361.
I voted for it in return for getting changes that I believed would somewhat diminish the impacts to our districts students and taxpayers being driven by the premise bigger is cheaper and provides higher quality.
As a freshman, I was able to highlight the very significant impacts the legislation will have on small schools and created a small schools caucus. The legislation allows for consideration of capacity at neighboring schools and quality of program to be determinations for maintaining small schools grants, and I was able to get a 300K adequacy study, proposed by a Warren area community effort led by Heidi Spear in response Speaker Shap Smith’s request for proposals, included in the final bill.
NONE of the governance legislation is going to produce structurally sustainable statewide property tax relief. At least in the next five-ten years. The other freight train most legislators understood was on the tracks was voter demand for property tax relief. So some measure that specifically addressed property taxes was going to be included. In the final days of the session, the cost containment piece that was being proposed was a very significant reduction in the excess spending threshold. This would have almost exclusively impacted the 5% of schools and statewide budgets attributed to small schools. The final cost containment piece that was included, a variable 2% cap that CAN be surpassed with penalty, hits all schools including those large and extra large schools responsible for 60% percent of the students and the costs.
Sen. Sears I believe correctly classified efforts like mine and others as “attempts to make a bad bill better”. This was the strategy I employed on H.361 rather then just voting no. There are some meritorious items in the legislation that districts should pay attention to like incentive opportunities for some districts who are ready to consolidate governance or buildings. For some districts in the state, this legislation will also provide a very compelling reason to have long term strategic discussions about how to maintain quality education in their rural communities. Those are very very important discussions which will greatly impact the future of Vermont.
The Agency of Education, the State Board of Education, Vermont School Boards Association and others are all participating in planning for further implementation and providing districts with more assistance and guidance on the final 144 page bill which can be found here. As opportunities are put forward I’ll be communicating those out to the district.
Healthcare – The healthcare legislation that passed is most noteworthy in how small in scope, scale and cost it is. Significant legislation to expand premium subsidies and medicaid payments to doctors was proposed early in the session, but a host of tax proposals to pay for it were unsellable to legislators. These included the Governor’s proposed payroll tax, increasing the employer assessment on businesses that don’t provide healthcare, a sugar excise tax, an increase in the room and meals tax and a lodging fee. The final legislation was paid for by an increase in the cigarette tax. I voted for the final, extremely modest, proposal.
The expansion of medicaid eligibility under the federal affordable care has, as intended, increased the number of Vermonters on medicaid. There has been no corresponding revenue raised and we are expected to meet a 40 million dollar shortfall in January.
Other significant healthcare bill included S.108 Preserving End of Life Choices – the bill that passed, effectively said that Vermont will leave its existing law and protections in place. I voted in favor of this bill. Finally H.98 Reportable Disease Registries and Data included a repeal of the vaccine philosophical exemption for students attending public schools. I voted in favor of this legislation, and shared my own experiences as a parent who questioned vaccine schedules here.
As a new Independent Legislator, representing our district well and with integrity is an honor and tremendous responsibility that I didn’t and don’t take lightly. Many have asked if serving in the Vermont Legislature was what I expected. Yes and No. This was an especially contentious, challenging and adversity filled year starting with the 113 million dollar budget gap, the Legislative vote for Governor, the protests over single payer, the session long education reform debates, gun debate, and the arrest of Senator Mcallister.
I didn’t expect quite that volume of contentiousness. Unlike a number of Legislators, I also need to maintain year round employment, and I got a new (and thankfully, flexible) boss just before the session started. My sense is I had a unique opportunity to gain significant experience having navigated those numerous unique challenges this first year.
I also didn’t expect, and was so pleased to find, so many others working with integrity and doing their best to represent their constituents and Vermont – even though I didn’t agree on policy with them all. That discovery was the most hopeful to me. I’m looking forward to next year and using all of the knowledge I gained this session.
Please don’t hesitate to contact me about the session, challenges you are facing or ideas you have. The best times to call me are in the evening after work,or on the weekends at 348-7131. Email can be sent anytime to firstname.lastname@example.org.