By Joan Lenes and Kate Webb State Representatives
Dear friends and neighbors,
Over the next two weeks this legislative report will briefly summarize some of the issues we, your state representatives, are addressing to date. We face a challenging budget this year and are being asked to make some very difficult choices. Our job as legislators is to make sure our decisions are informed, balanced, and thoughtful. We welcome your thoughts on these and other issues.
Joan and Kate
Each year, the Governor presents a budget proposal that is reviewed and adjusted by the Legislature. For the 7th year in a row, deliberations began with the need to fill a gap. This year, that gap is $67 million.
The Appropriations Committee is evaluating each element in the proposed budget. Many of the dilemmas it presents in mental health services, childcare, IT investments, new revenue, assistance to families transitioning back to work, and housing assistance are even tougher than those we faced at the height of the recession. In the last 6 years, we have reduced state work force, frozen state wages, postponed needed IT projects, and wrestled with difficult cuts. It gets harder and harder to close these gaps, let alone move towards new, innovative and results-based ways of running state government. All the while we wrestle with the loss of federal funding in many, many categories.
The good news: we are on track to pay off our federal unemployment loan 18 months ahead of schedule. This will reduce unemployment insurance rates for Vermont employers. We continue to spend much less than expected in Medicaid and reduced the number of out-of-state prison beds. As always, a balanced budget will emerge. We will continue to do our best to keep Vermont’s economic engine moving forward, meeting basic needs while maintaining our roads, parks, and services for our health, environment, and communities.
Despite the challenges in our budget, Vermont still has some positive economic signs. With the addition of 3,000 jobs in 2012, our unemployment rate is at 5% compared to the national average of 7.8 percent, the lowest in New England. Data from the U.S. Census Bureau shows that Vermont suffered less impact from the national economic downturn than the country at large. Vermont was listed in the top ten of entrepreneurial states in Kaufmann Index of Entrepreneurial Activity. Vermont now ranks fourth in the country for speed of broadband connection. In the last two years broadband has been expanded to 95 percent of locations in Vermont. We are striving to reach 100 percent by year’s end.
Investing in local agriculture — a triple win
The Legislature has received very encouraging updates on our ongoing Farm-to-Plate, school and institution efforts. More high-quality Vermont food is being produced and processed and more folks are eating it, including kids at school, state workers, and private sector employees. This gives Vermont farmers and food lovers the tools they need while simultaneously investing in our health, land, and economy. We have heard testimony about the productive and proactive investments the state has made in endeavors such as the Vermont Sustainable Jobs Fund, the Vermont Housing and Conservation Board, UVM Extension, Farm to Plate, and especially the Working Lands Enterprise Board, which is budgeted to receive $1.5 million in funding for FY14. These efforts are paying dividends and proving integral to a holistic approach to economic development, land stewardship and healthier communities.
Flexible pathways for high school students
Research demonstrates high school students derive many benefits from taking college-level courses for dual-credit. Dual credit enhances college readiness; motivates first-generation students to see college as an option; and reduces the amount of time it takes to complete college. Flexible Pathways legislation would allow eligible students to take up to two courses for both high school and college credit, through a post secondary institution’s dual enrollment program at no cost before graduating.
The future of education funding
When the House approved the FY2014 education property tax rates and base calculation amount, a provision was included to examine our current education funding system to address concerns regarding financing, oversight, and educational outcomes. The House Education, Ways & Means, and Appropriations committees are already taking up this mantle for FY2015 to help contain costs, reduce complexity, and maintain the quality and equity of our schools.
As Vermonters drive less and shift to more fuel-efficient vehicles, state revenues from gas taxes have declined steadily. State fund reductions, federal uncertainties, highway trust funding, and federal transportation reauthorization reduction make it clear that Vermont’s long-term transportation funding stability is seriously at risk.
Vermont’s gap is estimated at more than $240 million per year, each and every year based on estimates to preserve the state’s existing transportation system in a state of good repair. This does not include major road expansion beyond projects already in the pipeline.
The Governor’s $657 million, FY2014 transportation budget assumes the Legislature is able to identify a revenue package that enables Vermont to maximize all its available federal funds. If Vermont is unable to provide its match, then federal formula funds must be returned and projects delayed and/or suspended.
In order to fully fund the FY2014 transportation budget we need $36.53 million. Without action, we place at risk our ability to match all the available federal transportation dollars, $56 million. The House Transportation Committee is hearing testimony and evaluating all options with a goal of passing recommendations to the full House by mid-March.