Weatherization bill faces hurdles, funding still up in the air

MIDDLEBURY — The Vermont House has moved along a bill that promotes the weatherization of citizens’ homes, but it remains unclear whether lawmakers will be able to assemble the necessary funding to help pay for the initiative.
The House last week voted 109-27 in favor of sending bill H.520 along to the Senate. That bill sets the state on a path to weatherize 80,000 Vermont homes by the year 2020, acknowledging that many abodes are porous and are losing costly heating resources to the outdoors.
Supporters had hoped to subsidize the weatherization effort next year to the tune of around $17 million, but lawmakers and Gov. Peter Shumlin have not be able to agree on where to find that money in what is a tough budget year already marked by some unpopular tax increases. Shumlin had proposed to raise the $17 million through a 10-percent surcharge on producers of break-open lottery tickets, but that suggestion has proved very unpopular among the civic groups that sell them for charitable causes. Legislators remain skeptical as to whether the surcharge would even raise the $17 million.
H.520 was among several Statehouse issues discussed at a legislative breakfast held at the American Legion hall in Middlebury on Monday.
Fran Putnam, a leader of the Weybridge Energy Committee, said weatherization could save the average homeowner $1,500 annually in heating fuel costs, money that could be pumped into the economy.
“It’s a permanent solution, so each year you are saving that money,” she said. “This is not just something that deals with climate change, it is an economic issue.”
Putnam and other people at Monday’s breakfast questioned the wisdom of pouring costly government fuel subsidies into homes with little or no insulation.
Rep. Betty Nuovo, D-Middlebury, said Vermont could better stretch its federal Low-Income Heating Energy Assistance Program (LIHEAP) dollars if homes were better insulated. Nuovo is a member of the House Natural Resources and Energy Committee that took a lot of testimony on H.520.
While most local lawmakers said they supported the intent of H.520, not all could bring themselves to vote in favor of the measure. Among those voting “no” was Rep. Harvey Smith, R-New Haven.
“(H.520) has some really great things in it, things that we should be working toward,” Smith said. “But I find it very difficult to support programs that we don’t have funding for this year.”
Smith said weatherization will be a long-term financial commitment for the state and he believes the money is not there yet to launch the initiative.
“It is difficult for me to support an increase in taxes at a time when most of my constituents are really struggling financially, and a lot of the folks that will be paying for these programs are the ones who can least afford it,” he said.
In the meantime, he said the people most in need could tap into the state’s current weatherization program and NeighborWorks, a nonprofit that helps people make their homes weather-tight.
But Rep. Mike Fisher, D-Lincoln, said the current demand for weatherization far exceeds the assistance available.
He spoke of assisting a Starksboro family this past fall in applying for fuel assistance and weatherization benefits in order to stay warm during the winter. The family was able to secure fuel assistance and skirting to go around the bottom of their mobile home (thanks to local clergy), but could not get weatherization help, as there is a one-year waiting list for that program.
As a result, a lot of the benefit of the fuel subsidies escaped the home through the uninsulated floor and roof.
“Does this make sense to anybody?” Fisher asked rhetorically.
Indeed, lawmakers are wrestling with a lot of tough funding decisions in the context of a projected fiscal year 2014 general fund revenue shortfall that was placed at $50 million. Adding to that pain: A looming federal sequestration process that could cost the state another $15 million in revenues.
Rep. David Sharpe, D-Bristol, a member of the House Ways and Means Committee, said his panel last week recommended raising $23.3 million in new taxes during fiscal year 2014, and an additional $4 million that will go to the state’s education fund to finance pre-K initiatives in public schools. He believes it will mean $3.3 million for thermal and electric energy efficiency assistance.
Sharpe said the Ways and Means Committee passed a tax bill that eliminates a variety of tax exemptions, deductions and credits as a way of increasing revenue. Among several changes in that tax bill, the committee removed the current sales tax exemption for soft drinks, candy, bottled water, clothing purchases over $110, dietary supplements and vending machine sales. The committee did this as an alternative to a House Health Care Committee recommendation of a penny-per-ounce excise tax on sugar-sweetened beverages.
Sharpe described other steps his committee took in an effort to raise revenues to backfill federal aid reductions and finance some — but not nearly all — of the Shumlin administration’s new priorities.
“We capped the itemized deductions at two-and-a-half times the standard deduction for the income tax,” Sharpe added. “That is certainly not getting rid of all of the deductions, but it is reducing the deductions available for the income tax.”
House Ways and Means also recommended raising the meals tax by 0.5 percent for one year only.
On the other hand, Sharpe noted the Ways and Means Committee has proposed eliminating the state’s current health care assessment on employers, a move he said would save businesses a combined total of $15 million.
Some of the revenue adjustments recently endorsed by the House Appropriations Committee, according to Fisher, included:
•  A $10.6 million increase in state Medicaid reimbursement levels to help medical providers keep pace with inflation. Medicaid subsidies have notoriously not kept pace with actual costs of providing medical services, thereby resulting in a cost-shift to people who can afford private health insurance.
•  $4.5 million to help lower-income people transition from Catamount Health to Vermont’s soon-to-be-established health care exchange under the federal Affordable Care Act.
•  $6 million for LIHEAP (fuel assistance).
•  $2.5 million for additional higher-ed tuition assistance for Vermont students.
•  $2 million for the state’s Clean Energy Development Fund (down from a proposed $5 million).
•  $1.3 million to help fill a funding gap for the state veterans’ home in Bennington.
Fisher said the Appropriations Committee was also able to “squirrel away” around $5.4 million as an insurance policy against expected cuts resulting from the impending federal sequestration.
Participants at Monday’s breakfast voiced concern about the toll the various new taxes could take on Vermonters.
Addison resident Paul Boivin said he was concerned about the proposed imposition of sales tax on sweetened products, like soda and candy, and the potential of the tax to be extended to agricultural products with natural sugars, such as strawberries, maple syrup and watermelon.
“What about the maple sugar growers?” he asked, referring to one of Vermont’s most pristine and iconic natural products. “Are they going to be exempt?
“I think it’s a slippery slope, when you start taxing a food by way of someone else’s definition of a food they think is a harmful substance,” Boivin added. “By whose definition is it?”
Reporter John Flowers is at [email protected].

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