Gov. Phil Scott gave his budget address on Tuesday and did as well as he could to put a rosy face on a drab proposal.
What he outlined was a budget that held spending within a 2.36 percent growth rate and sprinkled small sums of dollars over several pilot projects to make it sound as if he were addressing the critical problems Vermont is facing: the opioid addiction crisis; affordable housing; reducing taxes; health care; creating jobs and luring a workforce into the state to fill them, to name a few.
Gov. Scott’s problem wasn’t that he didn’t hit all the touchstone issues, but that he was restricted by a self-imposed handicap: no new taxes or fees to accomplish any major objective.
For example, to address Vermont’s affordable housing concerns, he agreed to add $1 million housing package, which includes: funds to increase investment in downtown and village center tax credits; doubling funding in the Down Payment Assistance Program; and creating $625,000 in incentives to help renovate existing housing stock to, as the governor proudly claimed, help attract “young, working families to communities across the state.” One problem: When you divvy up $1 million into that many pieces of pie, you will have helped a few dozen people in minor ways. Even the $625,000 to help upgrade existing housing stock, is a pittance when you realize the cost of retrofitting an older Vermont home can easily be $150,000 or more. It’s good to help a handful of people, and we applaud the idea behind the initiative, but it’s not going to move the needle.
Or take the governor’s initiative to boost technical and trades education in Vermont, which is critical if we’re going to help the 40 percent of Vermont high school graduates who don’t go on to higher education. Gov. Scott proposed taking $500,000 to purchase training equipment, fit up new space, and expand adult career and technical education across the state. Sounds terrific, but considering the Hannaford Career Center by itself has a $3.4 million annual budget, and the Addison Central Supervisory District (Middlebury and  the other six towns in that district) has a budget of $36.7 million, you can see that half a million dollars isn’t going far on a statewide scale.
That’s the problem with thinking small. It doesn’t change the status quo.
But let’s back up. Small is a relative term. Gov. Scott’s budget calls for an increase of $82 million, from $3.788 billion in this current fiscal year to $3.867 billion in the next fiscal year. That’s not chump change to most of us, and the governor has a point when he presses to keep spending within his stated 2.36 growth rate — a rate that matches the average increase in wages.
But if he’s going to propose a restrained budget, the rhetoric should match.
In his opening comments he proclaimed that his balanced budget “makes strategic investments to grow the economy, make Vermont more affordable and protect the most vulnerable.” It does not in any meaningful way.
What makes Vermont more affordable is expanding early education programs, as the previous administration did, in ways that allow young Vermont families to afford daycare so they can go back to work. (That also helps businesses find the employees they need.) What protects the most vulnerable is reforming health care systems from a fee-based system to a capitated care system as Vermont is in the process of doing to lower costs. What makes Vermont more affordable to workers is a higher minimum wage. And what grows jobs is taking the risks to create new markets, like the solar incentives that jump-started that industry in Vermont almost a decade ago and helped create 17,000 new, high-paying jobs, or the capitated insurance markets that were started decades ago.
In short, it is bold programs or bold steps that move the needle in meaningful ways. Tossing a few dollars to the wind, as if tossing peanuts to an elephant, won’t do much to satisfy the state’s hunger or need.
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That’s not to dismiss the governor’s budget, altogether. Rather, his rhetoric could have simply stated that his effort was to toe the line on state-funded programs, supplement a few with more dollars to boost programs that were working, and add to others to fulfill critical needs.
And then he could have focused on what we think was the central message of his budget address: education reform.
He danced around the edges of this topic toward the end of his address, and even hinted that he understood the state must make substantial public investments to succeed. “We must recognize that investments to grow the economy and make Vermont more affordable are essential to a future where our classrooms are full of kids, and students graduate with greater opportunity,” he said.
Then he hinted that the Brigham decision (the basis of Act. 60 and Act 68) was no longer working.
“It’s time to accept reality. Due to the steady decrease in student population, the current funding mechanism is weakening the very system it was meant to strengthen… We know the challenge. We’re losing, on average, six workers from our work force and three students from our schools, every single day. It’s why the Legislature passed Act 46 (during Gov. Shumlin’s tenure), which — through difficult discussions — has positioned many districts to take the next essential steps. But we must accelerate this work.”
This “work” and those “essential steps,” which he was reluctant to mention directly, referred to consolidation. He then set out four goals for the Legislature to work toward: cut expenses to reduce the $80 million deficit the education budget is facing; change the school funding system; push consolidations forward; and increase the ratio of adult staff to students from 1-to-4 to 1-to-5. That last initiative, the governor said, would save the state $100 million each year once completed.
And that’s how he backed into his game-changing initiative, ending that portion of his speech with his most emphatic statement: “We must have the courage to reform our K-12 education system, and we must act now.”
What’s interesting is whether the governor will take a leadership role on this initiative or, like on most issues last year and as he did in this speech, put the onus on the Legislature to pave the way.
Angelo Lynn