Representative View
There was a public hearing listed on the legislative web site last week on a critical issue for Vermonters: input on whether we need to be raising taxes this year, and if so, what kind. We are, after all, facing at least a $100 million budget shortfall both this year and next after including the federal stimulus money.
It's been bumped (not the hearing, but the prominent notice of it) by the newest crisis of the day: whether we will let any other state beat us out on being the first to legislate the right to the use of the word "marriage" by civil union couples.
I believe in thinking through what we legislate, and I have some thoughts about the muddy water we create by mixing church and state on the issue of discrimination in access to the government interest in stable relationships - the civil contract of marriage - versus the sanctification of that relationship by a couple's church, controlled by the moral standards of that religious belief.
By placing this bill on a fast track, the intent is a simple thumbs up/thumbs down approach that will not provide opportunity for thoughtful discussion. The Judiciary Committees will jointly "listen to the people" at the one hearing on March 18 (6 to 8:30 p.m. in the chambers of the House) with the assumption that the people will all be either pro or con, and this bill can then pop right through.
It is an example of how issues can be addressed when a majority (either party) has total control of the legislature. It isn't so much a question of whether the solution is the best one; it's just distressing when the process of dialogue and testimony can be so easily ditched.
I am grateful, I suppose, that the same tactic is not being used on issues of greater urgency this session, the one being Vermont Yankee, and the other being how we respond to the deep economic recession.
Clearly, some minds are made up about closing down (or keeping open) the nuclear power plant, but time and effort is being put into analysis of reliability and future decommissioning. Note that we are not permitted, under federal preemption, of assessing Vermont Yankee's safety - but a lot can be included under the term, "reliability."
There is a tie to our state's economy either way, depending upon whether the focus is on keeping power rates sustainable or on developing a new economic future through "green" initiatives.
Meanwhile, the federal government is exercising its option to print more money to try to turn the economy around, and economic minds far greater than mine are trying to assess whether that is the best - or perhaps only - possible response.
We don't have that option as a state. No printing press in the
basement. We can cut back spending rather massively, raise new taxes, or do some of both. The House Ways and Means Committee has scheduled hearings for next Tuesday, the 17th, at 2:45 to 4:30 p.m. and 6:30 to 8 p.m., in Room 11 to talk about taxes. It has held one public discussion already on the topic, and my Washington County delegation held a budget forum for input last week. I was not present; I note this specifically by way of an apology. I helped organize the forum, and then failed to mark it on my calendar. Cutting spending seems to be the more prudent approach, on first look, until recognizing how deep the problem is. It is one thing to cut to the bone. When the red ink goes well above the $200 million mark in the general fund and health care, it means eradication of entire programs, such as pharmacy assistance for low income seniors, as proposed by the governor.
We currently spend about 4.3 billion as a state. Of that, 1.3 billion is existing federal match funds that pay for about 60 percent of our health and human services programs.
We raise 28 % of it in the general fund (1.2 billion, through income, sales, and other taxes and fees) and 23 % for the education fund (1 billion, through property, sales, and other taxes, with a little help from lottery proceeds.)
We spend the most on education - 35% of all revenue, or about 1.5 billion, followed by health care - 22%, or almost one billion. Education gets 28% of the general fund to augment its resource base.
All other human services, including corrections, receive 18%; public safety 5.6%; transportation is a wash with its income stream at 5%; and everything else (such as natural resources, the current use program, commerce, higher education, debt service and general government) comes out of the leftovers.
We rank pretty mediocre against other states in our ratio of spending on higher education and corrections, mostly because we run well below average on both counts. We outspend higher ed (7%) by corrections (10%) out of the general fund.
When you start removing from the list the funds that are already legally committed and cannot be touched, and the funds where we would act unconstitutionally if we cut further (bread and water for prisoners is not OK), it starts being clearer why there are such limitations in where the cuts can come from - and therefore, would be more draconian.
In addition, many potential general fund cuts only drive higher future costs. Proposed cuts in home health and hospice supports could change our status as number one in the country at avoiding the far higher cost (and far less preferred outcome) of nursing home care. Cuts in mental health outpatient services drive high cost inpatient hospitalization (we're almost lowest per capita in the nation on that count, as well.) Cuts in Medicare provider reimbursements shift the cost to higher private premiums - and paid back in taxes through public employee insurance.
That's why the governor proposed moving the $40 million teacher's retirement fund obligation from a general fund to an education fund liability.
After counting the freebie federal bailout money, that $40 m shift would still leave $83 m needed in cuts, and his proposals include permanent reductions of $25 m in health care, $5 m in family supports, $4 m in other government, $17 m in 660 state jobs across all departments, plus a one year $9 m cut from the Vermont Housing and Conservation Board.
The Democratic legislative leadership wants to skip the $40 m teacher retirement shift, and close the $100 million gap with extra stimulus money, $28 m in cuts, and $24 m in new taxes. Their plan would save a few state jobs, but only from $17 m to $14 m worth.
The political war with words begins: Doesn't the governor's $40 m shift to the education fund simply mean a property tax increase? He says no, because it should come from a shared responsibility for cuts in education spending, and therefore no resulting tax increases.
That was pretty unrealistic to dump on school boards a month before town meeting.
I think it raises a good point, overall, about sharing the needed cuts in an economic crisis - but that's for next year.
A key issue is the impact of accelerating the job losses already occurring, by cutting state employees, thus accelerating the negative economic (and human) impact of unemployment.
Is that worse than tax increases, at a time when President Obama's tax cuts are beginning to show up in paychecks (or will be by April 1)?
Next Tuesday is your chance to tell the House's tax raising committee what you think about the "whether and how" of such increases. They aren't the Appropriations Committee, and are not taking testimony on cuts; the input for them is about taxes. You can check the details on the hearing under the Ways and Means Committee agenda on the legislative web site, www.leg.state.vt.us.
Please let me know your thoughts as well, on this and any other topics. You can always email at counterp@ tds.net or leave a phone message at 485- 6431. This and past updates are also now accessible on my blog, http://annedonahue.blog spot.com.











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