This past week, I attended several of the meetings that are part of my "regular" job as editor of Counterpoint. The discussions at them underscore some of the problems we face in addressing our budget in a time of major recession of the economy.

I covered a meeting of the Vermont State Hospital's governing body, the Community Advisory Group at the Second Spring residential recovery program in Williamstown, and the Fletcher Allen Health Care Program Quality Committee.

The state hospital was declared unfit for appropriate care by the legislature's Health Access Oversight Committee in 2002 - a year before the federal Centers for Medicare and Medicaid Services decertified it, and the effort to develop psychiatric inpatient alternates took center stage.

Since these are persons in the custody of the state because of serious illness but unwillingness or inability to accept treatment, the state has an obligation to provide appropriate treatment. Besides the issue of providing care in a facility that is beyond repair for hospital use, there is also a lot of money involved: about $15 million a year in lost federal funds as a result of lack of certification.

When we hear about new, $30 million revenue downgrades affecting our budget - half of that gap would be closed if we weren't losing that $15 million to operate VSH.

The progress to develop replacements has been slowed by everything from politics to federal regulatory barriers to differences of opinion about "best practices" to the challenges of finding general hospitals able and willing to expand their own services to meet the needs of these patients.

It has been five years now, and the only real progress has been the program in Williamstown, which is a residence for 14 persons who no longer need inpatient care, but still need significant transitional support before returning to more independent living. No program with this level of support existed before, so these folks would have been staying on at VSH just for lack of an appropriate community program.

In theory, the jammed-tocapacity census at VSH would have dropped by at least 10 as patients transitioned to the Second Spring program after it opened in 2007. At first, it did.

Community hospitals have also become more and more involved in providing the initial phase of emergency care and stabilization. Until last year, they were actually admitting 60 percent of the patients who would once have gone directly to VSH.

Vermont has the lowest percentage of its population of any state in a state hospital, because of its strong community service network, which is essential to keep the number of VSH replacement inpatient beds low. (It costs about $1 million per bed for any hospital construction, and $1,000 per day for inpatient care.)

That progress in reducing the daily census has now reversed itself. The numbers have crept back up over the past two years, and now again frequently reach capacity. Staff are being burned out by mandatory overtime shifts and tension is high, as nerves fray in compressed space inadequate for the number of patients.

More patients are being admitted to VSH directly now than are admitted by community hospitals. Pressure is being put on Williamstown to accept patients from VSH who may not be ready...and to discharge current clients who are staying "too long."

Why? There is a reverse bottleneck that occurs when community services are cut back and housing resources are inadequate. Patients cannot be discharged when there is no place for them to go. Community hospitals cannot risk admitting patients who may end up staying long past their inpatient need, and long past what insurance will authorize or reimburse.

VSH is re-expanding, in the midst of trying to close.

This situation is simply a microcosm of many programs in our Agency of Human Services. It just happens to be one I know a lot about and can describe in detail. When we cut costs more deeply - in this case, in community mental health services - we end up paying more in nonoptional costs.

It isn't just theory. It happens that way. And our largest "safety net," the one place that we guarantee a place for if there are not enough substance abuse treatment beds, or hospital beds, or case workers for kids who don't have safe homes, is the corrections system.

When the size of our Agency of Human Services budget is referenced, it is important to know that in Vermont, unlike most states, the agency includes the Department of Corrections. The biggest driver in the increases in the human services budget has been the expansion of the number of people we are putting in prison.

When we talk about cutting the cost of government, there are only two pieces that are big enough so that when five percent is cut, the actual cash savings is really significant: human services and education.

So that's half the problem. Many of the "opportunities" to cut - particularly if we slash and burn, rather than think through efficiencies - are actually likely to cost us more within a very short time frame.

The other half the problem is that we do not have the money to sustain what Vermont does as a state today.

It isn't just the recession and lost revenues. That only brought us to a bigger precipice faster, but our reckoning was already overdue through years of building budgets that moved money to hide holes and always relied upon last minute revenue increases.

That is why relying on the federal bailout money (the stimulus funds) to fill in where we are short doesn't work. It is meant as investment money to rebuild, and to help meet increased human services needs during the economic crisis, not to pay for existing programs. The budget the legislature passed simply deferred the worst of the crisis for a year.

The general fund budget is still balanced through shifting. A few examples: almost $2 million in engineering costs were moved from the general fund to the capital fund. They may belong there, but it didn't "save" money to move them.

The $5 million in reduced hospital payments will come out of health insurance premiums, include those we pay for our state employees and teachers, which always become big budget drivers.

One cut was hidden because the $2 million was broken up into little pieces from many departments: the funding for the new responses under the sexual offender bill. Is that what public priorities were demanding?

The tax package doesn't reflect sharing of the crisis when one of the largest sources of new revenue is the further increase in the cigarette tax. Who pays that? Overwhelmingly, it is poorer people, and nearly 50 percent of cigarettes smoked (as a result of the number per person, not just the rate) are smoked by persons with serious mental illnesses. That is because nicotine interacts with some of the same brain chemicals involved in mental illness.

A person quitting has been getting symptom relief from nicotine, and must have medications adjusted as a result. That can't be done alone. Yet of all those millions raised by cigarette taxes, virtually nothing is provided to give that kind of medical support. We are making a profit by keeping people addicted.

The true bottom line is that there are few among us who can afford to pay more taxes - regardless of where they are imposed and end up being rerouted. I support the concept that we need to take a harder look at our student-teacher ratios and include education cuts along with some of the others we are reluctantly being forced to make.

Without repairing our education funding system, however, we still have not created a way that allows taxpayers to be involved in funding decisions about their schools. The common level of appraisal (CLA) thwarts the relationship.

You can be incredibly thrifty, and still be hit with property tax increases. So reducing what the state pays out, or adding to what the education fund is responsible for in order to relieve the general fund, will worsen the uneven and unfair impact.

We cannot sustain an annual budget that spends more than it takes in. But I do not think we have a bloated government with excessive benefits. Belt-tightening is already causing some areas of damage.

I also do not think we have a deep well of untapped resources we can keep returning to, and the current budget keeps tax increases from being outrageous only because it does so little to actually address the multi-year problem.

We also make trade-offs that we don't want to pay the trade on: beautiful untainted mountainsides preserved by relieving them of taxes; wonderfully aggressive protection of our environment that sometimes rigidly obstructing both new economic growth and new alternative energy sources.

We want to close Vermont Yankee, but not to pay more for our power, or to use less, or to let a wind tower on our hills or hydro to block our trout.

It all comes down to not wanting to make choices. It's tough, because individuals all have different priorities in their own choices; individuals must turn those choices over through the democratic election process to a group of non-experts like me to try to balance among the priorities.

I wish that the legislative leadership had paid more attention, before and during this session, to two pretty level-headed elected officials who have fiscal expertise to share: our auditor, Tom Salmon, and our treasurer, Jeb Spaulding.

Salmon sent a letter from Iraq that I only saw a few weeks ago. He urged that we put virtually all of our efforts this session into working on the structures underneath the numbers, not just tallying up columns and trying to balance them. He warned them how much worse the situation was going to get. [A Democrat, he nonetheless also specifically suggested that gay marriage be addressed in 2010.]

It's too late to restart the session. We didn't do any of the hard work, and now we'll have to live for at least this year with trying to just balance numbers that may not reflect how we could better address our long term needs and priorities.

I, for one, hope that Salmon's offer to try to mediate the budget struggle will be accepted by the Senate and House leaders, as it has been by the Governor. It may, at least, bring a result that will mitigate harm.

Do keep in touch about your own priorities and the issues that concern you. I'll try to do at least one final update that summarizes some of the issues we handled in the final few weeks of this session, other than sharing thoughts on the budget debate. If you have questions about bills I haven't discussed, or about how I voted on them, please ask. Messages can be left at 485-6431 or via

counterp@tds.net; or write to me at 48 Donahue Drive in Northfield.