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Scott vetoes state budget citing spending levels, concerns over new taxes and fees

 A man in a suit speaks at a wooden podium. Behind him is a landscape painting and an American flag and a Vermont flag.
Bob Kinzel
Vermont Public
Gov. Phil Scott said at a news conference May 26 that he would likely veto the state budget.

Gov. Phil Scott on Saturday vetoed the Legislature's state budget, saying the plan's $8.5 billion price tag is too high and new taxes and fees in the plan will burden Vermonters.

"Here’s the bottom line: I cannot support a budget that relies on new and regressive taxes and fees, combined with the overall increase in base spending that is far beyond our ability to sustain, especially because there is a way to achieve our shared policy goals without them," Scott said in his veto message. "The risk to Vermonters is too great."

Scott said Friday that state revenues have exploded over the past few years because Vermont has received more than $2 billion in federal recovery funds. But he said most of this money is now gone. And this month's revenue report showed that some key indicators, including the personal income tax, have not met their targets for several months.

"It just makes sense that we're not going to be able to live by the same standard we've been living by over the past few years, two or three years," Scott said Friday. "It's going to come in full view that our revenues will decline."

Lawmakers are due back in Montpelier on June 20 to try to override the governor's veto of the $8.5 billion spending plan.

In a statement released Saturday, Senate President Pro Tem Phil Baruth said lawmakers' budget and Scott's proposal are not that far apart.

"The Legislature's budget and the Governor's differ by about three percent -- with nearly all of that difference flowing to mental health, adult-days and other critical service providers," Baruth said. "But more crucially, this veto also freezes expanded emergency funding to municipalities and agencies being asked to provide the actual transition plans for those exiting the General Assistance housing program." 

The state budget relies on a 13% increase in general fund spending to support, among other things, 68 new positions in state government, and a $100 million funding boost for mental health agencies, long-term care providers and other medical services.

Though Democrats and Progressives hold a supermajority in both chambers of the Legislature, it's unclear whether they will hold together to override the governor's veto.

The House passed the budget by a vote of 90-53 — 10 short of the 100 votes that would be needed to override a veto.

Many of those no votes came from Democratic and Progressive lawmakers who withheld their support due to lack of continued funding for the emergency motel housing program, which is scheduled to end in the coming weeks.

Have questions, comments or tips? Send us a message.

Bob Kinzel has been covering the Vermont Statehouse since 1981 — longer than any continuously serving member of the Legislature. With his wealth of institutional knowledge, he answers your questions on our series, "Ask Bob."
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