Vermont State Budget of 2018

Just before the 2018 legislative session ended at 11:45 p.m. on Saturday, May 12th, the Vermont House concurred with the Senate, which had adjourned several hours earlier, to pass H.924, the state budget, on a vote of 117 to 14.  Back in January Governor Scott stated that he would not let state spending rise more than the growth in the state's economy.  He also said that he wants to improve affordability, protect the most vulnerable Vermonters, and grow the economy of Vermont. Although the budget that was passed by the House and Senate meets those criteria, the Governor has stated that he intends to veto it anyway.

The Legislature has the responsibility to create a budget that maintains all the services provided by state government to keep our society and infrastructure strong.  These services include the goals voiced by the Governor as well as providing a high quality and efficient educational system. The 176 page budget itself contains not only the appropriated amounts for every agency and department in the executive, legislative and judicial branches of state government, but also directions on how certain appropriations are to be spent to support all of the laws and legislation that was passed during the current session. 

Total spending includes revenues raised by the state (38%) and federal funds, which contribute about half of the money spent on Vermont governance. While the entire budget increased 0.8%, less than half the rate of inflation, the increase in state spending accounted for just a 0.5% increase.  This is well within the parameters set by the Governor. The legislature, through its standing committees, also addressed the social goals of protecting vulnerable Vermonters, improving affordability, developing our workforce and economy and improving Vermont's fiscal health.  Instead of using the $58M of one-time money for ongoing expenses as proposed by the Governor, the legislature targeted it to one-time expenses that achieve more than $100M in future savings for Vermont taxpayers. Listed below are initiatives in the budget that support these goals.

Protecting Vulnerable Vermonters
·        Reverses the Administration's proposed cuts to programs that help workers improve their skills;
·        Reverses the Administration's cuts to programs for the elderly, persons with severe disabilities, and home health services like the VNA, Meals on Wheels, etc.;
·        Provides funding for the PFOA cleanup and monitoring in the Bennington area;
·        Provides funding for strategic reform in the handling of child welfare cases, especially in response to the opioid epidemic;
·        Reverses the Administration's cuts to primary care doctors and community health clinics;
·        Increases the number of mental health beds at the Brattleboro Retreat;
·        Provides medication assisted treatment for addicted inmates in corrections facilities and help for their re-entry to society after incarceration; and
  • Provides $1M for tobacco control programs with special focus on pregnant women.

Affordability Initiatives
·        Reverses the proposed elimination of the loan repayment program that makes it attractive for medical professionals to practice in Vermont;
·        Maintains cost sharing assistance for health insurance deductibles and out of pocket costs for 6,100 working families;
·        Supports child care assistance for working families by increased provider reimbursements, by grant programs for providers with a high volume of subsidized children, and by updated eligibility standards linked to the Federal Poverty Levels; and
  • Increases funding for Individual Development Accounts for low-income workers.

Economic and Workforce Development
·        Increases compensation for staff at mental health clinics and other direct service agencies and increase the number of mental health workers;
·        Increases funding to the Vermont Youth Conservation Corps to serve more out of school youth;
·        Provides funding for the Micro-Business Development Support program;
·        Provides interest buy-down assistance for Vermont dairy farms with VEDA loans and premium assistance under the new Federal Margin Protection Program;
·        Funds full tuition at the State College rate (or at UVM) for National Guard members attending public or private colleges;
·        Provides financial assistance to Vermont students pursuing health-related careers at UVM;
·        Increases funding for the Working Lands program which has a historical 4:1 Return On Investment;
·        Authorizes the Treasurer to use $5M of revolving state funds to expand home weatherization loans;
·        Funds assistance and training to Vermont employers to support workplace requirements compliance; and
·        Provides funding for an additional year of state marketing efforts and the Vermont Outdoor Recreation initiative.

Improving Vermont's Fiscal Health
The budget uses the $58M of one-time money for the following purposes:
·        Pays down the retired teachers' pension liability by $34M which will earn Vermont taxpayers over $100M in interest that is currently lost by underfunding;
·        Pays off the Vermont Life Magazine Enterprise fund deficit and obligations due to the termination of the magazine by the Administration;
·        Strengthens Vermont's fiscal reserves as required by law by
Ø fully funding the Caseload, Rainy Day, 27/53 Payroll, and Education reserve funds and
Ø consolidating disparate reserve funds to improve visibility to rating agencies and improve usefulness to the state (high ratings reduce interest rates Vermont has to pay on bonds it issues);
·        Restructures and simplifies the Education and General funds by eliminating the General fund transfer to the Education Fund and reallocating revenues and expenditures.