Legislative Review: House panel refines state budget

Diane Lanpher, D-Vergennes, is member of the House Appropriations Committee
The first day of spring produced a sighting missing since Jan. 28 — a balanced budget! “All in” truly is the theme this year. A great deal of heavy lifting by all committees achieved this goal.
House Appropriations worked with Committees of Jurisdiction and at a pace uncommonly intense, even for Appropriations. Please keep in mind that returning structural sustainability to Vermont’s finances is the most critical step we can take for Vermont’s future. Without financial stability, there is no ability to plan, implement vision, prioritize resources or make smart, long-term investments.
What happened?
First, understanding the causes of the gap: As a former chair of House Appropriations recently wrote, “The shortfall going forward is a structural hole. It isn’t something that we’re going to solve with one-time savings or Band-aid decisions … roughly $90 million or the lion’s share of that gap can be grouped into four areas: Medicaid, teachers and state employee salary and benefit issues, General Fund contribution to the Education Fund and school spending, and our use of one-time savings/non-sustainable funding sources.” Since the recession began, we’ve solved gaps with short-term solutions, waiting for revenues to return to former 5 percent growth rates. Like many states, we’re out of short-term fixes and finally coming to terms with a new normal.
Second, a $94 million gap became a $113 million gap just a few days after the governor’s budget presentation, requiring the House to cut $18.6 million out of the governor’s recommend. We did this while keeping an eye on the future to not exacerbate the problem.
The budget contains intent language (unusual for the budget) that lays out a multi-year plan to bring sustainability to our budgeting:
•  Reduce the reliance on one-time funding.
•  Bend the rate of spending growth.
•  Institute a plan to review new programs for multi-year cost impacts.
•  Move towards appropriating less than 100 percent of forecasted revenue to reduce the volatility of our progressive tax structure and reliance on federal funds.
•  Explore moving to a two-year budget, as the capital bill did a few years ago.
Third, the House balanced the FY 2016 budget in the following way:
Closing the gap with long term cuts = $52.8 million
Closing the gap with revenue = $35 million
Closing the gap with earnings = $1.7 million (renting corrections beds to feds)
Closing the gap with one-time funding = $23.8 million (spendable reserves, capital bill, etc.)
Total = $113.3 million
Some of the highlights include:
Funding the General Fund Transfer to the Education Fund at the statutory level. (the governor’s budget shorted the Education Fund transfer by $3 million).
Full funding the veteran’s home for FY16 to give a new working group time to create a plan to wean off General Fund supplements by 2018.
The Community High School of Vermont gets a 6 percent (rather than 50 percent) reduction, and commits to take on some of the work contracted out by Corrections to save $250,000 in the General Fund. Thanks for the excellent work of the Corrections/Institutions and Education committees and creating language that builds a path forward for their mission.
PSAPs (public safety answering points) are still funded through the fall and a work group formed to review and recommend changes or funding sources.
Judiciary cuts are restored — some on a one-time basis — in order for all judicial partners to find better cost saving ideas and makes them accountable to the newly broadened “Criminal Justice Oversight Committee” (formerly the Corrections Oversight Committee).
Windsor prison is to be closed by 2017, with a plan that includes moving no additional prisoners out of state by investing in housing and community supports.
Tourism and Marketing is largely funded at the governor’s recommend.
Thank you, and you can contact me at (802) 877-2230, (802) 828-2228 at the Statehouse or [email protected]

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