Thank you.
It’s an honor to continue to represent you in the Vermont House of Representatives. The 2021-2022 session is in “virtual mode” with 180 legislators “Zooming in” from their homes to meetings of committees and the General Assembly. Though we are able to mimic the in-person experience and constructively deliberate policies and funding priorities, we are not able to replicate the personal interactions that are the hallmark of a legislative process. It’s good enough for now, and it has to be, but it’s not great.
Of the 470 bills that have been introduced so far this session, about 100 will be passed by both the House and Senate and sent to the Governor for his signature. Here is a highlight of the bills of substance that are likely to pass this year:
Appropriations Bills:
Budget Adjustment Act. H. 138 is a mid-fiscal year adjustment to the state’s spending based on actual revenues received. Tax receipts far exceeded the state’s estimates from August, resulting in substantial funds to allocate to programs that had been scaled back and to fund COVID19 recovery efforts.
Covid Relief Act - $79 Million – The House just passed the COVID Relief Act, which further allocates excess General Fund Revenue and remaining CARES Act funding with some major initiatives. The bill is now in the Senate and we are hoping for a speedy passage to get funds immediately to work.
$10 million - businesses who have suffered economic loss and have not received any federal or state recovery grants
$700k to help New American and immigrant communities navigate COVID impacts and recovery efforts.
$5.3 million in housing and community supports for Vermonters struggling with mental health issues
$1.3 million in one-time stimulus checks for the poorest Vermonters on Reach Up.
$1.4 million to the Vermont Food Bank for the VT Farmers to Families Food Box program
$15 million - Improving the indoor air quality of k-12 school buildings.
$ 10 million to VHCB to create new housing and support those vulnerable to becoming homeless.
Increased data collection to track disparities and improve health equity
$20 million - Investment in pensions system for state employees and teachers.
$10 million - Grants to fund community outdoor recreation projects and improve recreational infrastructure and access to public lands.
$3 million - Grants to support working lands enterprises – agricultural and forestry businesses.
$3.2 million – Expand broadband through line extension and CUDs.
FY22 Budget – The $6.8 billion recommended spending recommended by the Governor is being vetted by the Appropriations committees working in close concert with the policy committees. The Governor has recommended establishing a Technology Modernization Fund of $53 million to support computer system upgrades in many departments of state government.
More Federal Funds: With the $1.9 trillion American Rescue Plan being debated in Congress, Vermont may receive another $1 billion in funds to allocate to the most pressing needs, which may extend the legislative session again in 2021.
Agritourism. H. 89 was passed, limiting the liability for agritourism operators, to reduce insurance costs for struggling agricultural operations as they try to diversify their revenue streams.
Economic Development Omnibus bill: H. 159 combines many initiatives to sustain and grow the economy, including support for rural towns, including the Better Places Program and Project Based TIFs. The MicroBusiness Development Program, helping businesses with fewer than 5 employees, is a priority in the House a way to lift people out of poverty. So too are the Advancement Grants and other financial supports for individuals to get more training and skills to qualify them for better paying jobs. Two pieces that will be hotly debated are the Worker Relocation Program and the establishment of a permanent funding mechanism for tourism promotion. Still in development are several pieces around workforce development, particularly the coordination of secondary and post secondary credentialling programs delivered through the Career and Technical Education Centers and the Vermont State Colleges.
The Capital Bill: The $123 million, 2-year capital budget funds building and infrastructure projects across state departments through the allocation of bonded dollars each biennium. This omnibus bill includes state dollars for municipalities to initiate projects, stimulate growth and address local needs, as well as addressing the significant challenge of changing the culture at the Chittenden Women’s Correctional Facility and other facilities throughout the state.
State Aid for School Construction: Suspended since 2007, state aid is being considered again to help address the $564 million in projects around the state. The Education Committee’s bill (DR 21-0782) proposes three things:
Doing a comprehensive assessment of all school buildings in Vermont to determine the need.
Establish a funding mechanism to pay for the school construction.
Establish a system to prioritize which school projects will be funded first based on the conditions of the buildings and overall need.
Vermont is currently the only state in New England without a school construction funding program, except for emergency projects.
Education Funding – Pupil Weighting: The Senate has been taking testimony on the December 2019 report (Study of Pupil Weights in Vermont’s Education Funding Formula) that revealed that the manner in which the state calculates the cost of educating certain categories of students (including low-income, English language learners, secondary and preK, and rural students) is outdated and inaccurate. Adjusting the calculations will have significant budgetary impacts on education tax rates throughout the state. It is important, necessary work, but the significant budget impacts require careful consideration.
Vermont State Colleges: The Select Committee on the Future of Public Higher Education, created in 2020, commissioned a detailed study from the National Center for Higher Education Management Systems (NCHEMS) to help chart a path for the Vermont State Colleges that is financially sustainable and meets the educational and workforce development needs of the state. The second report to the legislature urges the legislature to “act with urgency” in providing sufficient funding over the next six years to stabilize VSC while it enacts a far-reaching restructuring plan. The report recommends maintaining Community College of Vermont as a separate entity focused on sub-baccalaureate and workforce-relevant training, while consolidating Vermont Tech, Castleton and Northern Vermont University under a single accreditation. The FY22 budget request is for $50 million more than its base appropriation of $30 million.
Broadband: Supporting Rural Buildout The committee’s comprehensive bill (DR 21-0185) looks to invest $50 million to accelerate community broadband deployment throughout Vermont by:
Funding pre-construction expenses.
Expanding grants expanded grants and loans for building broadband infrastructure in unserved and underserved areas
Creating a program to train individuals to do the technical construction work necessary.
Protecting privacy and unrestricted access to the Internet.
Proposed is a new Vermont Community Broadband Authority to coordinate and fund broadband buildout, to support Vermont’s regional communications union districts (CUDs) and their partners, and to advocate at the federal level for programs and policies that will accelerate the deployment of universal broadband in rural Vermont.
Public School Employee – Health Care Bargaining.
The statewide contract for school employee’s health care benefits enacted in 2018 did not allow for different premium shares and out-of-pocket expenses to be different for support staff, teachers and administrators. H. 81, passed by the House, adjusts that, giving the employees an opportunity to negotiate a less onerous contribution requirement for the staff members least able to afford it.
Pensions: Solving the Unfunded Liability: The defined benefit plan (pension) for state employees; teachers and municipal workers is underfunded by $4.5 billion. The legislature is contributing $389 million towards that deficit in FY21, but it is doubtful the state can continue to make those contributions every year. The viability of these funds is a vital concern for the Legislature. The State Treasurer’s report in January recommended changes to address the gap, including increasing employee contributions, or reducing cost-of-living adjustments for future retirees. But this is just a starting point for discussions. It is imperative that more concrete steps be taken this year to solve this very real financial debt.
Solutions for Healthcare Workforce Crisis Roughly 5,000 nursing-related positions were needed prior to the pandemic and it has been increasingly difficult to fill those positions. The House will be considering the establishment of scholarships and loan forgiveness for healthcare providers, tax incentives to retain newly graduated nurses, and modifying professional requirements so more nurses can be trained.
A New Bottle Bill: The current Bottle Bill was enacted in 1973 to address roadside litter and increase recycling. This bill expands the containers affected (i.e. wine bottles, hard citer, non-carbonated drinks (not milk)) and increases the deposit from $.05 to $.10 to help reimburse the vendors for their work.
Transportation Budget Bill: Elements of the Transportation Modernization Act of 2021 (climate change goals, free fare transportation for those in need, expansion of EV use and infrastructure) will be rolled into the Transportation Budget Bill, widely considered one of the four “must pass” bills in any legislative session (Appropriations, Capital, Tax, Transportation). The detailed transportation budget prioritizes major and minor transportation projects throughout the state.
Statewide Education Tax – no increase anticipated for FY22. The yield bill that was passed out of the Ways and Means committee (H.152) will likely keep property taxes close to flat across the state.
Corporate Income Tax Changes Proposed:H.189 intends to shift the tax burden away from corporations with a significant physical presence in Vermont by (1) changing to a “single sales factor,” a switch many neighboring states have made as our national economy moves towards a higher proportion of service-based corporate income; (2) changing methodologies to determine how to apportion profits and (3) changing how to consider any corporate sales not taxed in any other state when assessing total and apportionable sales. Our intent is for the corporate tax burden, in general, to continue a shift to out-of-state corporations and support our Vermont employers.