Overriding the Budget Veto
It is a sad day for Vermont when the Governor vetoes a budget and calls the Legislature back in session; it is sadder still when the Legislature chooses to override that veto. While the media and various pundits characterized this as a “Showdown in Montpelier,” this does not accurately reflect the seriousness and grief felt by many that this could not have been worked out through negotiation.
Most of us held out until the last minutes, hoping for an agreement between the administrative and legislative leadership. The last day, we heard the closest they had come was to postpone some decision-making. It was time to move forward with the 2010 budget, warts and all, make some corrections with the “Companion Bill” and encourage both leadership teams to begin in earnest to address the challenges in FY2011 and FY2012.
Make no mistake about it. Both the Governor’s proposal and the Legislature’s budget, cut programs, cut spending, used ARRA (Federal Stimulus) funds, raised some revenues, cut some taxes and looked for savings. Both budgets were balanced for FY2010 but faced difficulties in FY2011 and more so in FY2012. The major difference between the budgets had to do with how FY2010 was balanced. The Legislature left future burden on the General Fund while the Governor left the burden on the Education Fund, i.e. property taxes.
I voted to override the veto. When I ran for election, I promised many people that I would work for quality education while also containing our distressingly high property taxes. A vote to sustain the veto would have re-opened the discussion to shift the teachers’ retirement fund to the Education Fund, creating a huge, unfunded, and ongoing cost to property tax payers. In addition, 216 Shelburne homeowners with incomes between $75,000 and $90,000 would have seen an average property tax increase of $944 with some adding more than $7,000 to their yearly property tax bill. Another spreadsheet comparing the effect of the two different budgets on the 265 towns in Vermont showed Shelburne to be one of the towns to suffer the most under the Governor’s budget. Testimony from school board members and superintendents across the state expressed strong opposition to this shift. These issue, along with my concern with Administration’s near elimination of the Vermont Housing Conservation Board led me to vote for the override.
After reading the Governor’s budget, however, some valid concerns came to light. First, the Legislature’s attempt to close some capital gains loopholes would be tough on farmers and loggers. Many of us objected to this so it was corrected in the Companion Bill. Second, Administration wanted to see tax credits for research and development so this was added for FY 2011. Third, the Administration raised concern about the lack of accessibility to college scholarships. The Companion Bill thus transferred $1.5 million out of the Higher Education Trust Fund to the Next Generation Fund, making money available to be split among the Vermont State Colleges, UVM and Vermont Student Assistance Corporation. Fourth, Administration’s concerns about the nearly bankrupt Unemployment Insurance fund resulted in limitations for the near term and creation of a 12-person study committee to work toward a permanent solution for the future. These and others measures were built into the Companion Bill which currently awaits the Governor’s signature.
Although an official compromise was not reached, the outcome last week included remedies for those oversights identified by the Governor while keeping the Education Fund transfer and Vermont Housing Conservation Board off the table. I believe it is not good practice for either a governor or a legislature to go it alone. It is the hope of many of us more moderate Democrats, that sections of the Companion Bill will provide an opening for more collaborative efforts for FY 2011.
I will be around most of the summer and value your input. I am keeping data on calls and emails I receive. Do share your concerns with me. When possible, include your reasons why it is important to you or your suggestions for solution. KLWebb22@mac.com