When the Vermont Legislature adjourned last May, lawmakers set Oct. 18 as the date for a possible special session on the consequences of federal budget cuts on the state’s finances. The special congressional committee established in the agreement to raise the federal debt ceiling will not report until November, so the extent of federal budget cuts impacting Vermont will not be known until early next year.
Several lawmakers, representing all parties, have asked the legislative leadership to use the Oct. 18 date for a one-day special session on the effects of Tropical Storm Irene on the state’s finances. While no legislation would be passed in the special session, it would provide an opportunity for lawmakers to talk with each other and the administration about critical issues that will need to be addressed in the regular session starting in January. A one-day session in October would give legislative committees and the Shumlin administration more than two months to prepare for the post-Irene decisions that will need to be made early next year.
By mid-October, policymakers should have reasonably good estimates of the damage to state and municipal infrastructure caused by Irene. The cost of repairing state roads and buildings alone will almost certainly exceed $100 million, possibly several times over. The cost to cities and towns of repairing roads, buildings and water systems will also be very large. The federal government, through the Federal Emergency Management Agency (FEMA), will reimburse some, but not all, of the cost of these repairs, leaving state and municipal budgets to cover the balance.
One important issue for legislators to consider is whether the damaged state office complex in Waterbury should be repaired, or whether the departments based in Waterbury should be relocated to other facilities. Much of the Waterbury office complex was built in the late 19th and early 20th centuries, when those buildings were the Vermont State Hospital, which at one time housed more than 1,700 patients. Since the 1960s, as state government expanded and as community care replaced institutional care for those with mental illnesses, the hospital buildings were renovated into office space for the agencies of Human Services, Natural Resources and Public Safety. Before Irene, more than 1,500 state employees worked in Waterbury.
The Waterbury buildings experienced severe flood damage. Is it worth repairing and renovating these buildings, some of which are a century old? Does the state need an “administrative capital” in one location where most major departments have their headquarters? Or should state offices be distributed in a more decentralized way around Vermont, using a combination of existing and new space? These are the sorts of questions that could be discussed at a special legislative session, as the administration starts to prepare next year’s budget.
Lawmakers could also consider the impacts of storm damage on municipal budgets. This damage was concentrated in towns in the central and southern parts of the state, while other towns were not affected in any significant way by Irene.
Can the towns with damaged infrastructure cover the costs that FEMA will not reimburse from their one local revenue source, which is the property tax? Or should the Legislature establish a special state fund that would reimburse municipalities for rebuilding from Irene? If a state fund is established, should it be financed from existing budget reserves, from new appropriations, or from a bond issue?
The future of the Waterbury complex, and the impacts of Irene on municipal finances, are both sufficiently important issues that an October special session focusing on them would be a productive use of legislators’ time.
Eric L. Davis is professor emeritus of political science at Middlebury College.