-A +A

Budget battle: No end in sight

Submitted by tim on

NO END IN SIGHT

Leonine Public AffairsThe second week of the special session of the Vermont General Assembly came to a closeon Fridaywith the governor and legislative leaders still at an impasse over education finance and budget matters. See statements made Friday by Governor Phil Scott's communication's director and Speaker Mitzi Johnson below.

Last Friday Governor Scott officially vetoed (CLICK HERE) the budget bill (H.924) and the tax bill (H.911) that the General Assembly passed in the regular session because the bills raise property taxes. The key disagreement is whether $34.5 million in surplus revenues should be used to buy down property tax rates or reduce teacher retirement obligations.

This week the House Appropriations Committee advanced a new budget bill, H.13, that is similar to the budget bill passed in the regular session except it removes the provisions the Governor finds objectionable, adds some non-controversial income tax provisions from the vetoed tax bill (H.911) and adds a “default” non-residential property tax rate. Their intent is that the House could pass a budget bill that everyone agrees to so that a government shutdown can be averted and the “controversial” issues can be addressed in a separate bill.

This new budget bill quickly ran into a brick wall in the House Republican caucus and with Governor Scott because the “default” non-residential rate could raise property taxes. The Republicans would also lose a lot of leverage to negotiate on the second bill if it were to pass. The governor has said he will veto H.13, the new budget bill, according to Republican Minority Leader Don Turner, R-Milton.

The House gave preliminary approval to H.13 by a 86-44 voteon Fridayand will come back on Tuesday, June 5th to give final approval to the bill. The House Republicans may offer an amendment to the billon Tuesdaybut at this point there is no clear path forward.

It’s difficult to know how closely Vermonters are paying attention to these dynamics. It’s the start of summer and many Vermonters are more focused on the nice weather than what is happening in Montpelier. For those that are following this closely they are witnessing one of the most contentious political debates in recent history.

There are accusations and charges being levied by Governor Scott and his staff at Democratic leaders and many members of the Democratic and Progressive caucuses and visa versa. The debate and disagreements are more charged than ever and with social media being such a critical component of political dialogue these days, many of the more nuanced fights are occurring in an arena that everyone can follow blow-by-blow.

The Senate doesn’t plan to reconvene until the House passes a budget. We will provide a full report of the Special Session when it ends.

Source: Leonine Public Affairs, Montpelier, Special Session 2 Report. 6.1.2018.leoninepublicaffairs.com.Through a special arrangement with Leonine, Vermont Business Magazine republishes Leonine's weekly legislative report on vermontbiz.com.leoninepublicaffairs.com

Governor Phil Scott’s Communications Director Rebecca Kelley Friday issued the following statement:

“The Governor is open to a newly-proposed budget if legislative leaders keep their commitment to remove all ‘major points of dispute’ related to property tax rates. Unfortunately, they did not do what they said they would do.

“Earlier this week, Speaker Mitzi Johnson and Senate Pro Tem Tim Ashe made a commitment to their fellow legislators, the Governor and Vermonters to pass a budget that ‘exclude[s] any major points of dispute’ to provide some certainty that the state would have a budget onJuly 1, while continuing negotiations to keep statewide property tax rates level in a year we have a budget surplus.

“Today, the Speaker and majority party in the House went back on that commitment, voting down two amendments – including one offered by a bipartisan group of lawmakers – that appeared to remove the one remaining point of dispute from their current budget. Without such an amendment, the majority party is poised to submit yet another budget that increases non-homestead property tax rates by $23 million onJuly 1.

“This makes it abundantly clear to Vermonters that the majority leaders will use every trick in the book to impose a property tax hike on Vermonters in a year we have $160 million more than the previous year, and a revenue surplus of at least $44 million – which is expected to grow.

“There is simply no reason to raise statewide property tax rates this year, and despite this latest maneuver, the Governor remains committed to preventing it while fully funding school budgets, as well as implementing reforms that stabilize tax rates and direct more of our dollars to educational opportunities for kids.”

For more on the Administration’s response to the Legislature’s new budget,click here.

Statement from House Speaker Mitzi Johnson on the House’s vote onH.13Friday:

“The Vermont House today voted 86-44 keep our state government open by giving preliminary approval to H.13. This bill raises no property taxes and reduces income taxes by $30 million. It takes the threat ofa government shutdown off the table and ensures that Vermonters will continue to receive vital public services while we continue working on the remaining areas of disagreement with the Governor. Preventing government shutdown is the right thing to do. DC-style politics that put Vermont families and the state’s livelihood at risk are not the Vermont way.”