State revenues may be outpacing expectations this year, but the leaders of the House and Senate say growing demand for services could complicate the budget process during the 2019 legislative session.
On Wednesday morning, lawmakers return to the Vermont Statehouse for the beginning of the legislative session. House Speaker Mitzi Johnson says for the first time in a long time, it doesn’t look like elected officials will have to deal with a structural deficit in next year’s budget.
"Many years we’ve sort of walked into this point of the session framing a large budget gap,” Johnson says. “This year we’re in a really different position.”
Johnson, however, says the state’s strong financial position stems in part from years of underfunding some critical sectors.
“Things like childcare, community mental health, our state college system,” Johnson says.
And Senate President Pro Tem Tim Ashe says elected officials are going to have to think long and hard about whether the budget is large enough to fulfill its obligation to the citizens, and businesses, that fund it.
“Raising taxes is not the first instinct. I mean, we should always try to do best job we can with the existing resources, so this is not a plea for raising 100 new taxes, but rather, there has to be an acknowledgement of what we want to do better, and I think there are a number of areas where we have much improvement ahead,” Ashe says.
The legislature derives most of its power from controlling the budget. But lawmakers in the Democratically controlled House and Senate will try to exercise influence in other policy arenas as well.
Paid Family Leave and $15 Minimum Wage
Vermonters can expect to see the return of two bills - paid family leave and a $15 minimum wage - that Republican Gov. Phil Scott vetoed last year.
But Johnson says there’s no guarantee that they’ll be carbon copies of the bills lawmakers passed last year.
“I can’t tell you exactly what they’re going to say and look like,” Johnson says. “We have a brand new biennium with a brand new group of legislators.”
Ashe says the Senate too will “go in open minded about whether they’ll look exactly the same or not."
Ashe says lawmakers hope to find consensus with Scott, thereby avoiding the need to try to override a gubernatorial veto. But he says it may be difficult to find common ground.
“Where there’s just a pure philosophical conflict, it’s hard to know where you would begin to move the dial of compromise.”
Scott has said he’ll support a paid family leave program funded by voluntary payroll deductions. But the bill passed by the Legislature last year called for a mandatory contribution from nearly all employees in the state. Ashe says he doesn’t think lawmakers will come around to Scott’s position.
“I know some governors around the country, Republican governors in particular, will say, ‘Oh, I’m all for it as long as it’s voluntary.’ But it’s pretty widely acknowledged that that would not work, so it’s not a program at all.”
Guns
Another topic lawmakers are poised to revisit in 2019 is guns. Last year, legislators and the governor teamed up to pass the most sweeping gun legislation in state history. And Vermont not only banned the sale of high-capacity magazines, it raised the legal age to purchase a firearm to 21.
Up for debate next, according to Ashe, is a waiting period for gun purchases.
Supporters of the proposal say it’s an effective tool for suicide prevention.
“Members of the senate have been talking about the waiting period as the most significant next step, if there’s going to be one, so I believe there will be a discussion about that,” Ashe says. “I don’t know what the disposition of the Senate ultimately will be.”
Education
Lawmakers will have to decide how to respond to lawsuits, filed by local school districts, challenging the state’s authority to force them to merge.
And while Scott has said he doesn’t plan to propose any passive overhauls of the state’s k-through-12 education system - as he did during each of his first two years in office - the Republican governor will likely renew his push to curb the rate of growth in education spending.
Johnson says she plans to focus on early childhood education, specifically a 2014 law that sought to expand pre-kindergarten services across the state. Many childcare providers say new requirements established as part of that law have forced them to go out of business. And many regions of the state are now dealing with a shortage of childcare services.
“That’s been a pretty sticky wicket, trying to make sure that we’re encouraging both sustainable business models and good service delivery in childcare centers , and making sure that our public schools are strong and providing a good learning environment to grow the next generation of Vermonters,” Johnson says.
Permit Reform
A proposal to overhaul Act 250 will resurface long-running tensions between land development and environmental protection.
“The Act 250 Commission has really reignited discussions amongst environmental groups, the development community, municipalities, to wonder how our permitting system is doing,” Ashe says, referencing a panel that delivered a report last month with proposed revisions to Act 250.
Ashe says the conversation about permit reform will be guided by several key questions:
“How do we make this process work better. How does it become more predictable? Are there things we can streamline so that the process is not unnecessarily lengthy or costly?”
Clean Water Funding
Vermont will have to spend an estimated $2 billion over the next 20 years to clean polluted waterways. Lawmakers allocated about $25 million to clean water funding last year. But many of the revenue sources they used to generate that money are set to expire after the current fiscal year.
“This is a great challenge … Coming up with a long-term funding source has now eluded six years’ worth of dedicated attempts,” Ashe says. “In part, it’s the politicization of the raising of the money for it. And so I hope that working with the governor we can come up with a longer-term funding strategy.”
Johnson too says she thinks the Legislature needs a permanent funding plan in place before the end of the two-year biennium, even if it’s unclear at this point where that money will come from.
“Lawmakers know that we can’t get to a place where we say, ‘Sorry, we couldn’t come up with a solution. The money’s gone,’” Johnson says. “We all know that it’s not an option to go back to constituents, go back to businesses that depend on the lake … and say, ‘Sorry we didn’t do it.’”
Constitutional Amendments
In an unusual turn for Vermont, both chambers are expected to consider a slew of constitutional amendments.
Senate lawmakers are already drafting language for an abortion-rights amendment, an equal rights amendment, and an amendment that would extend the governor’s term from two years to four years. They’ll also propose an amendment that would eliminate any references to slavery in Chapter 1 of the Vermont Constitution.
Workforce Development
Both Ashe and Johnson say they want to keep a steady focus on the issue of workforce development.
“I believe that the lack of preparation for young people for going out in the world is one of our primary problems,” Ashe says.
Johnson says the lack of qualified young adults entering the Vermont workforce is one of the biggest economic challenges facing the state. And she says she’ll devote much of the next few months looking for ways to fill the training gap.
“Looking at how to deal with, for example, the 16 to 24 year old crowd that tends to have a much higher rate of unemployment,” Johnson says.
Ashe says he’s contemplating a proposal that would get more teenagers into a real-world job experience before they graduate high school.
