In January, I talked about how those of us in the State House need to focus on the fundamentals; to consider the impact and the cost of every decision we make on the families and places that need our help most; and to prioritize communities that have been left behind for far too long.
And as I said then, thanks to all the federal recovery money and state surpluses, we have a once-in-a-lifetime opportunity to do just that: increase economic equity from region to region, which will benefit our communities and families all across the state.
This team behind me, and their teams behind them, worked for months building this budget with these goals in mind, putting together policies and making strategic investments so that all the pieces work together, in order to put us in better financial shape for decades to come.
The budget we presented to the Legislature in January prioritized low- and moderate-income Vermonters with tax relief, historic childcare subsidies, increased dental care, permanent homes for the homeless, more housing for middle-income families, upgrades to water and sewer in mobile home parks, weatherizing homes, funding for career training, and more.
Next, we focused on revitalizing communities with a plan to bring back employers to rural parts of the state, cleaning up contaminated industrial sites, and focusing on small business development, housing, growing the workforce, and supporting community-led public safety.
We also made sure there was State money to leverage federal funding for the next three to four years so we can help communities by upgrading roads, bridges, water, sewer, stormwater, and more.
But unfortunately, the budget coming out of House Appropriations cuts or removes almost every single initiative I just talked about.
Not only that, but they also increased the State General Fund budget over last year by 12 percent. Twelve percent!
They did that by spending over $60 million more than I proposed in ongoing base expenditures.
They also put a lot of pressure on future budgets by doing things like only paying for one third of the startup costs of their paid leave program, leaving $74 million unfunded over the next two years.
They’re banking on – or hoping – these unprecedented fiscal times, fueled by federal dollars and state surpluses, will continue, when in fact their own economist says the opposite is true.
And it’s not just the startup costs for their generous new programs, it’s ongoing money from tax increases for the benefits that come along with it. Not to mention the very real financial harm to Vermonters caused by the clean heat standard that the House has yet to take up.
Three initiatives alone could add a half a billion dollars in costs on Vermonters every single year.
What’s also been lost is we’re already moving forward with a voluntary paid family and medical leave plan. We bargained it with state employees, and it will open up to businesses and individuals over the next two years – and it will be voluntary, without having to add over 60 new state positions we’ll struggle to hire.
And I’ve also proposed $56 million in our budget, to increase childcare subsidies. This has been done without raising taxes and fees at a time when economic anxiety and inflation is already high.
To put it simply: we can achieve shared goals – which I truly share – without putting us on an unsustainable economic path.
I believe one of the reasons I was elected was to bring balance, common sense and pragmatism to the table. And I think I’ve proven over the years that I’m not an alarmist.
But I have to say I’m very concerned with the direction we’re heading in. And it’s not because some of my proposals have been cut. I understand the process, and neither side gets everything they want, that’s how it works. But this year feels different.
I’m truly worried about the seniors on fixed income, the working families who can’t afford to pay more, and the communities who need our help. And I worry about how we will possibly pay for all of this as we look towards an uncertain economic future.
In my opinion, if this budget were to pass, with all the big-ticket initiatives that come all at once, it has the potential to hurt Vermont in both the short and long run. So, I hope Vermonters are paying attention.
Our budget proposal was built through a collaborative thoughtful process where we weighed priorities and focused on those who need our help most. It was balanced, and we fully funded new initiatives. It invested in future expenses to make sure we could ride out the economic downturn that’s coming, and we did all of it without raising taxes or fees.
I’m sorry to say the House budget does not meet these same principles.
To make room for the $50-plus million in increased spending in the BAA – which by the way, I warned against – they had to siphon off from every bucket they possibly could. They also had to increase taxes and fees, including on those who can least afford it.
And the reality is, this budget and the half-a-billion-dollars in new taxes, fees and penalties, could eventually pass – even if I veto it – because they have a supermajority.
If that happens, we’ll not only have squandered this once in a lifetime opportunity, but we’ll have turned it into a liability.
So, from my perspective, this is not business as usual in this building. And it’s more important than ever for Vermonters to know what decisions are being made, and make their voices heard by calling their legislators.
- Governor Phil Scott, March 29, 2023 (click here to view the Governor's press conference on the House budget)