Commentary - Climate Change Demands Action Now 8/3/2018

It is not an exaggeration to say that climate change is one of the greatest challenges facing humanity today.  While there are many who still think that climate change is a hoax, we need only to look at melting polar ice caps, extreme storms with significantly heavier precipitation and flooding, rising global atmospheric temperatures, more frequent and intense heat waves not only in the U.S. but across the globe, and the devastating wildfires in the western U.S. that have increased in both frequency and scope.  This phenomenon will continue to create heavier and heavier economic and social impacts moving forward. We have to ask ourselves what we can do to combat this phenomenon; and to do that we have to consider the cause.

Indeed, there are many who will reluctantly acknowledge that climate change is happening, but attribute it to natural cycles rather than to human influence.  This uninformed view ignores the fact that today's atmospheric CO2 level of 400 parts per million is now 1.3 times higher than the average peak concentrations of about 300 ppm over the last 400,000 years as measured by ice cores. This data is known as the Keeling Curve and is recorded and maintained by the Scripps Oceanographic Institute of the University of California San Diego and can be seen online. This breakout from the historical trend has occurred during the last century as the human race extracted and burned unprecedented amounts of fossil fuels which contain the energy of the sun stored over millions of years.

So, the answer has to be to reduce our dependence on fossil fuels. Renewable energy development since the turn of the century has provided an alternative to traditional sources of energy such as coal, oil and gas. The costs of solar and wind technology, still in their relative infancy, are already on par with oil and coal. In 2011 Vermont set a goal of becoming 90% renewable over all types of energy use by 2050 and to reduce its greenhouse gas (GHG) emissions to 1990 levels by 2025. Two years ago 189 countries, including the U.S., adopted the Paris Climate Agreement to reduce GHG emissions. Unfortunately, President Trump pulled the U.S. out of that agreement and instead has been encouraging more fossil fuel extraction. Vermont, along with hundreds of state and local governments, has resolved to continue working to achieve our own goals and those of the Paris agreement. So, how are we doing?

Sad to say, the Vermont Agency of Natural Resources recently released the 2015 Greenhouse Gas Inventory and the numbers are disheartening. Instead of seeing a reduction of GHG emissions since 2011, the state has exceeded the 1990 baseline by 16%. The full report can be found at the Vermont Department of Environmental Conservation website.  While progress has been made in electrical energy generation, the largest GHG increases came in the transportation and heating fuel use components. The latter two components are where we need to concentrate our efforts going forward.  

Renewable electricity is now the cleanest source of energy in Vermont. Moreover, since no fossil fuel is sourced in Vermont, 80% of the cost of fossil fuels leaves the state.  It makes sense to transition as much of our energy used in transportation and heating to cleaner electric energy as we continue to develop in-state renewable electricity generation. This can be encouraged by factoring into the price of fossil fuels the social and economic costs of climate change. By putting a price on carbon pollution in a revenue-neutral way, Vermonters can actually benefit economically by driving and heating more cleanly. This is not a new idea and has been proposed by conservative leaders like George Schultz, Henry Paulson, and James Baker. In a June 20th op-ed in the New York Times (https://www.nytimes.com/2018/06/20/opinion/climate-change-fee-carbon-dioxide.html), former Senators Trent Lott (Republican) and John Breaux (Democrat) made the case for a climate change fee on carbon-based fuels. And Vermont would not be alone in adopting such a strategy.  In June, the Massachusetts Senate passed a bill requiring the state to implement a carbon-pricing strategy by 2020. In Vermont legislators introduced a carbon-pricing proposal called the Economy Strengthening Strategic Energy EXchange (ESSEX) Plan that would channel revenues raised from the carbon fee to offset electricity costs.  To reduce the impact of the fees for low income and rural Vermonters, those consumers would get a greater share of the revenues.

It is well past the time to tackle this world-changing problem.  It is important to understand that we are not doing it alone and that we need to do our part.

Legislative Report 7/11/2018 - Session Epilogue

I hope everyone had a wonderful 4^th of July and successfully survived the record-setting heat wave that accompanied the holiday. My final Legislative Report usually occurs in May. Last year, the veto session led me to write a report in June. This year, because of another budget veto, the special session of the legislature lasted until the last week of June before the budget controversy, which included two vetoes, was resolved. While still disagreeing with the fiscal policy of the legislature, which had been supported by many Republican lawmakers, Governor Scott allowed the final budget passed by the legislature to go into law without his signature. Because the Republican minority chose to uphold the Governor's vetoes rather than stand behind their original support for the budget, the special session required lawmakers on the Appropriations, Ways & Means, and Education committees to try to negotiate a compromise with the administration over several weeks. When those efforts failed in the House, the Senate Finance committee, with the unanimous support of the Senate, drafted language that incorporated essentially what the House had presented on its third attempt at compromise, but which had been again rejected by the administration. With the deadline approaching for a government shutdown on July 1, this version passed both the House and Senate giving the Governor 5 days to make a decision. Fortunately, he decided to let the budget become law without his signature rather than plunge the state into default.

While the legislature ultimately agreed to use about $30M of one-time (windfall) money to keep the residential property tax rate level and hold the non-residential rate to a 4.5 cent increase, the budget keeps Vermont on a fiscally responsible path. Revenue we can count on receiving annually is used to pay for ongoing expenses. Windfalls, like receipts from the recent tobacco settlement, are invested in paying down state debt and building our savings. This protects us from the uncertainty brewing in DC, the possibility of a recession, and ensures we can continue to make the kind of investments that support our working families.

Everyone is aware by now that the price of gasoline has increased about 50 cents/gallon during June and has remained around $3 per gallon since. In one of my reports back in January, I introduced the ESSEX (Economy Strengthening Strategic Energy EXchange) Plan, a proposal to put a price on carbon pollution to reduce dependence on fossil fuels and promote energy transformation. The plan was criticized for placing an additional burden on hard-working Vermonters. That proposal would have raised the price per gallon by 40 cents over 8 years at the rate of about 5 cents per gallon per year. 100% of the revenue raised would be returned to Vermonters as a credit on their electric bills with larger rebates aimed at low income and rural Vermonters. Now, prices have risen in a single month more than the maximum projected carbon tax, and that same amount, 40 cents, leaves the state into the pockets of the oil companies. Higher prices, whatever the cause, will probably reduce consumption. Unfortunately, the current increase will not provide any revenues to help Vermonters insulate their homes, convert to electric vehicles, or take other measures to reduce their dependence on fossil fuels. Perhaps we should send letters of protest to the CEOs of the oil companies. Do you think they would listen? Probably not; but, as always, I can be reached by phone (802-233-5238) or by email (myantachka.dfa@gmail.com)

Legislative Report 5/30/2018 - Missed Opportunities

The legislative process is both deliberate and deliberative. Bills do not get passed without a considerable amount of testimony from stakeholders on every side of an issue and discussion among the members of a committee comprised of Republicans, Democrats, Progressives, and Independents. Bills that are introduced are often modified significantly by the time they are voted out of committee and sent to the floor for consideration by the entire body of either the House or the Senate. Once the bill gets to the other chamber, the process is repeated. So, a lot of thought goes into a bill to ensure that it is a solid piece of legislation that accomplishes the purpose intended.

That is why, after hearing the rhetoric that he wants to protect the most vulnerable Vermonters and improve affordability, it is disappointing that the Governor has decided to veto four bills that address those issues. Two of the bills, S.103 and S.197, would protect Vermonters from misuse of toxic chemicals and hazardous materials. The first would create an Interagency Committee on Chemical Management to evaluate chemical inventories in the state, identify potential risks to human health and the environment, and propose measures to address those risks. It also would require testing for potability of new water sources used for human consumption. The second would require businesses responsible for exposing employees or the public to toxic materials through intentional or unintentional releases to cover the cost of medical monitoring of exposed individuals. The PFOA contamination of the public water supply in the Bennington area demonstrates the need for such legislation to protect the health of Vermonters.

Two other vetoed bills, S.40 and H.196, directly address affordability concerns for low and middle income Vermonters. S.40, the minimum wage bill, would gradually increase the minimum wage in Vermont to $15 per hour over six years. This bill would assist more than 25,000 minimum wage adult, non-farm workers who often have to work more than one job to make ends meet. It would also have the benefit of putting more money into the local economy at the same time. The other bill, H.196, is the paid family leave bill. This bill would create a statewide insurance program that would allow an employee to take up to 12 weeks to care for a child or other family member during critical times of need, including childbirth, prolonged illness, and emergency situations. The program would pay 70% of the employee's average weekly wage and would be financed entirely by a 0.137 percent tax on employee wages. For a full-time, minimum wage worker, this would be 58 cents per week, or about 5.5 cents per week for every dollar per hour. This is a crucial benefit that smaller employers often cannot afford to provide but guarantees that some income is available during times of crisis or family necessity. If we want to make Vermont attractive for working families, raising the minimum wage and addressing flexibility for families to take care of each other is necessary.

As always, I can be reached by phone (802-233-5238) or by email (myantachka.dfa@gmail.com).

Legislative Report /Word in the House 5/16/2018 - Not Quite the End of the Session

The last two weeks of a legislative session are a whirlwind of activity. Dozens of bills that have been worked on during the previous 16 weeks of the session in both the House and the Senate reached final stages of passage. Most traveled back and forth between the two bodies as amendments were made to reflect the different concerns of the responsible committees. Twenty-eight bills this year required a conference committee made up of three representatives and three senators to resolve disagreements in language that couldn't be settled by amendments. 

The budget is the final bill passed in a session. Any bill that was still outstanding when the budget passed would be dead. As the session ended just after midnight Sunday morning, we managed to complete all of those bills as well as many more. The bills included raising the minimum wage, providing paid family leave, establishing toxic materials responsibility, protecting sexual harassment victims, funding clean water efforts, setting appliance efficiency standards, helping Vermont manufacturers improve energy efficiency and productivity, providing free tuition for National Guard members, several consumer protection and economic development bills, and an income tax reform and education funding bill as well as the budget.

Our legislative agenda reflected in the bills we passed promote a caring economy that makes Vermont more affordable for lower and middle income families, protects all Vermonters from various social and environmental impacts, and provides opportunities for economic growth. While we did not adopt the Governor's proposal for using one-time money to keep our education property taxes from increasing, the funding changes made by the legislature will hold the residential property tax rate increase to two cents in a sustainable way that avoids the need to find one-time money again next year. One-time money is just that. There’s no guarantee that it will be there next year, which just defers a tax increase. Instead, this year's one-time money will be used to pay for one-time expenses like fully funding our reserves and paying down the teachers' retirement fund obligation saving Vermont taxpayers $100M in future budgets. Our income tax changes will return $30M in extra tax revenue generated by the federal income tax changes back to Vermonters by lowering the income tax rates for everyone. Overall state spending increased less than 1 percent, significantly lower than the rate of inflation. Here are links to the details of the tax changes and to the budget.

Unfortunately, the Governor has stated that he plans to veto the budget as well as several other bills that address affordability and the health and welfare of Vermonters. The budget passed with a tri-partisan vote of 117 – 14. If he does carry out his veto promise, he will have to call the legislature back into session. There have been plenty of opportunities for the administration to engage with the legislature to work out a compromise, but that didn't happen. Now we are faced with the additional expense of an extended session.

Finally, I would like to make a correction. It was called to my attention that in my previous article about the minimum wage bill, I reference some total wage numbers that seemed to be based on different assumptions. The $15/hour total should have been $31,200 based on the same 40 hours/week and 52 weeks/year used for $10.50/hour.

As always, I can be reached by phone (802-233-5238) or by email (myantachka.dfa@gmail.com).

Legislative Report 5/2/2018 - A Case for Raising the Minimum Wage

We are now in the last weeks of the 2018 legislative session. Barring any surprise demands by the Governor or legislators, like the call for passing a taxing and regulating marijuana sales that occurred last week, we should be finished by mid-May. There are a number of important bills that we continue to deal with before we pass the budget and adjourn. One of these bills is the Minimum Wage bill (S.40), which was passed by the Senate and has been studied for several weeks by the House General, Housing & Military Affairs Committee.

The current Vermont minimum wage is $10.50/hour which became effective on January 1, 2018. The bill under consideration would continue increasing the minimum wage to $15/hour by 2024, about a 75 cent increase per year on average, starting at 60 cents in 2019. The minimum wage exemptions would remain the same, including for students under age 18, agricultural workers, nannies/babysitters, newspaper deliverers, and employees of nonprofits that receive state funds. The bill would also adjust state child care subsidies to account for the minimum wage increases in order to maintain those benefits for low wage workers with children.

So, why do we need to keep raising the minimum wage since Vermont has one of the highest minimum wages in the northeast? The simple answer is that for a large number of people, it is simply not enough to live on. Governor Scott has talked repeatedly about making Vermont more affordable and protecting the most vulnerable. For the approximately 25,000 Vermonters who work one or more minimum wage jobs, it is still too hard to pay for the basic necessities of supporting their families. For single parents making minimum wage, there are repercussions for their children as well. According to the Economic Policy Institute (EPI) of all minimum wage earners in Vermont, 62% work full time, 88% are at least 20 years old with an average age of 38, 56% are women, and 22% have children. On average, those with families earn 55% of their family's total income. A person working 40 hours per week at the current minimum wage makes about $21,840/year, slightly above the federal poverty level for a three person family. However, according to the EPI study, a modest but adequate standard of living in Vermont for one adult without children costs about $32,000/ year, including housing, food, transportation, taxes and health care. With children, necessitating child care, the costs are even higher. At $15/hour, the 2024 target, a full-time minimum wage job would pay $31,200*, which would no longer be a poverty-level wage.

Objections to raising the minimum wage revolve around the increased costs to business, the potential loss of jobs, and economic impacts. Most minimum jobs are in the service sector of the economy. In the first year, a full-time employee's earnings would increase $1250, a cost to the employer. This cost would presumably be passed on to consumers. However, the increased income would also be spent, thereby injecting more money into the local economy. The impact on jobs would be minimal compared to the increase in wages. Moreover, the high turnover rate seen in minimum wage jobs may be reduced thereby saving employers training costs. The EPI study estimates that while 2% of low wage jobs would be lost, 98% of low wage workers would benefit. Overall, the economy would benefit from raising the minimum wage gradually over several years while improving the affordability factor for those who need it most.

As always, I can be reached by phone (802-233-5238) or by email (myantachka.dfa@gmail.com).

*Note: The original publication of this article incorrectly had $26,500 as the annual income at $15/hour for a full time job.

Legislative Report 4/18/2018 - A Profile in Courage

n 1957, three years before he was elected President, Senator John F. Kennedy wrote his best-selling book Profiles in Courage. In it he described events in the lives of eight U.S. Senators who bravely cast votes in defiance of their party and public opinion, thereby jeopardizing their chances for re-election. These were acts of personal integrity that they believed were the responsible thing to do in those circumstances. I was privileged to witness a similar act of courage on the front steps of the Vermont Statehouse this past Wednesday. At 2:00 in the afternoon, Governor Scott, accompanied by his wife, stood at a podium with news cameras, legislators and members of the public both in support and against the action he was about to take: signing three bills that would impose regulations on gun sales, prohibit certain gun accessories, and provide law enforcement with the authority to confiscate guns when responding to domestic violence incidents and under court order from individuals who pose a threat to themselves or others.

The scene in front of the statehouse was alive with tension as opponents dressed in hunter orange and carrying signs that read “One term Governor”, “Traitor” and “See you in court” vied with signs saying “Thank you Governor Scott” and “March for our Lives.” As the Governor stood at the podium, he was greeted with chants of “Traitor! Traitor!” which were countered by chants of “Thank you! Thank you!” He began his speech over the shouting, speaking carefully, deliberately and directly to those in front of him. He endured constant interruption by opponents yelling their disagreement almost continuously during his speech while supporters clapped enthusiastically when he made points supporting his decision to sign the bills. At one point Governor Scott said, “I understand I may lose support over my decision to sign these bills today, but those are consequences I'm prepared to live with.” As I stood behind the Governor with dozens of my colleagues and members of the Governor's staff, I felt I was witnessing history in the making and an event that was clearly a profile in courage.

My positions on many issues differ from those of Governor Scott. We have different perspectives on issues like raising the minimum wage, finding a way to pay for cleaning up the waters of our state, and looking for a way to price in the true costs of fossil fuels while incentivizing conversion to renewable energy sources. On other issues, like the opioid crisis or helping businesses use energy more efficiently, the Governor and the legislature have been able to work collaboratively toward a common goal. It is my hope that differences can be overcome to achieve results that benefit Vermont and Vermonters. Governor Scott is correct in saying that “public safety is the top priority of any government.” He should not become a one-term Governor simply because he did the right thing to improve the safety of Vermont citizens.

As always, I can be reached by phone (802-233-5238) or by email (myantachka.dfa@gmail.com).