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Lake cleanup to result in tax increases

WEYBRIDGE — Addison County lawmakers on Monday converged on the Weybridge Congregational Church to continue a debate that has been reverberating in the Statehouse: How to pay the state’s share of the estimated $2.3 billion cost of cleaning up Lake Champlain and its tributaries.
The discussion centered on Act 64, aka the Clean Water Act, a massive cleanup effort that involves municipal sewer plants, farmers, and the many impermeable surfaces — including roads and parking lots — over which water can travel on its way to the lake.
Vermont Treasurer Beth Pearce has estimated the state will need to come up with $25 million annually during the next 20 years to pay its share. She suggested this money be raised in part through a per-parcel fee assessed to property owners, which could be based on the amount of impermeable surface on their land. The Legislature, meanwhile, has been considering a variety of other potential revenue sources — including a tax on coffee, or a bump in the rooms and meals tax — amid concerns the state’s share of the cleanup could rise if federal assistance is cut back.
Gov. Phil Scott has already voiced concerns about state government instituting any new taxes this year.
Rep. Fred Baser, R-Bristol, is a member of the House Ways and Means Committee, which drafts tax policy for the state. At Monday’s breakfast he said roughly $1 billion in various revenue sources have already been set aside for lake cleanup. He believes state officials will be able to give Vermonters a clearer picture on cleanup funding within the next nine months.
“We are still quite short,” Baser said of Act 64 financing. “I think it is premature to speak to exactly what methods we’ll use, but I am certainly committed to raising money to fulfill the Clean Water Act. And speaking with the governor, I’m pretty certain he is committed to it.”
Baser believes it will take increases in one or two of the state’s broad-based taxes to raise the needed revenues.
“I’d be shocked if we didn’t come up with a formula,” Baser said.
“It could be a sales tax, it could be a rooms and meals tax, or it could be a property tax.”
The state has a little bit of breathing room before it needs to implement any Act 64-related taxes, according to Rep. Amy Sheldon, D-Middlebury. The House-passed capital bill budgets $25 million in each of the next two fiscal years for Vermont’s share of the lake cleanup efforts, according to Sheldon. Those capital funds, she said, will be used to help communities improve their sewer infrastructure to help prevent future wastewater spills.
Meanwhile, Addison County Sens. Claire Ayer, D-Addison, and Chris Bray, D-New Haven, have drafted a separate bill that would fine municipalities, on a per-gallon basis, when there are sewer system overflows during major storm events.
Addison resident Paul Boivin suggested that the state put more pressure — such as a development moratorium — on cities that have been complacent in correcting sewage system flaws that have resulted in wastewater discharge into the lake. He noted that by contrast, residents in rural communities are now forced to make expensive upgrades to on-site septic systems or they won’t get permission to develop the parcel.
“We seem to have a double standard in this state,” Boivin said.
When it comes to cleaning the lake, Bray said he believes all Vermonters should be involved and share in the expense.
“Water is an essential element for all of us, so we all have a stake in making sure we figure out how to do it,” Bray said.
Some lawmakers, though, are not keen on seeing Act 64 funded through the property tax — already a source of financial pain for many Vermonters.
“The so-called per-parcel fee is just another property tax,” said Rep. Dave Sharpe, D-Bristol, who chairs the House Education Committee and previously served many years on House Ways & Means. “Somehow, the media and the public have allowed the Legislature and the governor’s office to get away with raising property taxes without raising so-called broad-based taxes. I think that’s unfortunate.”
Sharpe said lawmakers are already listening to plans that would tap property taxes to the tune of $350 million annually to help pay for more pre-K services. A group is also lobbying the Legislature to dip into the state’s education fund to expand funding for Vermont’s colleges and the University of Vermont.
“These are your property taxes and mine that are being expanded to pay for education,” said Sharpe, who has historically advocated for other funding mechanisms for public education.
Other discussion at Monday’s breakfast focused on:
•  Adjournment. Lawmakers are targeting a May 6 end to the 2017 legislative session. That would result in a 17-week session, which would be one week less than the 18 that were budgeted, according to Bray. Lawmakers have raised the possibility of reconvening for a week this fall after the federal budget has been passed. That federal spending plan could retroactively affect some of the financial decisions state lawmakers will have made during the past four months.
•  S.51, a bill filed by Bray that would require the state to lay out specific plans to meet Vermont’s goal of satisfying 90 percent of its energy needs through renewable sources by 2050. While the bill did not make a key deadline for bills to cross over between the House and Senate, Bray believes there’s a good chance the initiative could be tacked on to another bill that is still alive this session.
Bray likened the Earth to a “heavy smoker” when it comes to fumes from burning fossil fuels. He believes S.51, if passed, would help the planet kick the habit.
Rep. Warren Van Wyck, R-Ferrisburgh, said he is concerned the call for a quick conversion to renewables could result in a surge in the overall cost of electricity. He said he’d urge the state to expand its hydro-electricity purchases with Hydro-Quebec.
Reporter John Flowers is at [email protected].

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