Con Hogan. VTD/Josh Larkin

Editor’s note: This is the third in a five-part series profiling members of Gov. Peter Shumlin’s Green Mountain Care Board, a panel tasked with designing a universal health care plan for Vermont.

Con Hogan is an ideas man.

He sees the big picture and knows how things fit together.

Perhaps that’s why so many nonprofit organizations and foundations have sought his insight over the years. And it’s likely why several Vermont governors appointed him to high-profile positions like the chair of the Commission on the Accessibility and Affordability of Health Care and Gov.-Elect Richard Snelling’s Transition Team. It might just be why Gov. Peter Shumlin appointed him to the Green Mountain Care Board.

Con (Cornelius) Hogan, 70, has an extensive history in Vermont politics, that’s too lengthy to summarize here. Most notably, he served as the Vermont secretary of human services from 1991 to 1999 and as commissioner for the Department of Corrections from 1977 to 1979. This year, he is beginning his six-year term as a member of the Green Mountain Care Board.

There is something about Hogan that transcends experience. The former gubernatorial candidate can seem awe-inspiring, especially at first, but as he reminisces about Vermont politics, he takes on a more avuncular air.

Hogan says he’s had three careers. In the 1960s and 1970s, he worked in corrections. Then he took a large company through a Chapter 11 bankruptcy. Health care issues and system reform did not come into his work until the 1990s when Gov. Snelling appointed him secretary of human services.

“I knew nothing of this work for my first two careers,” Hogan said.

He learned one important thing as executive vice president and then president and director of Montpelier-based International Coins & Currency.

“I learned how to count,” Hogan said.

The high cost of chasing money

Sifting through balance sheets and business records, Hogan took to the numbers game. As a member of the Green Mountain Care Board, tasked with the monumental goal of laying the foundation for a universal health care system in the state, Hogan will bring his expertise in financing, human services and research.

Hogan says one of his primary goals is to change the system to reduce the costs of chasing money for doctors.

We spend so much money chasing the money, and that then adds fundamental complexity to a system that does not need to be this complex, this dense.”
- Con Hogan

“A lot of doctors are sick of the paperwork,” Hogan said. By streamlining the payment system to create a “single-pipe” system where all providers are paid through a single entity, Hogan said the state can reduce administrative costs. Limiting the amount of time doctors spend on insurance claims, for example, would reduce costs for the health care system overall and give doctors more time with their patients.

Hogan immersed himself in health care issues in the 1990s as secretary of human services.

Later, he became a consultant, working for nearly a decade in Europe on children’s health issues.

“It gave me a chance to really see and feel health care systems in other parts of the world,” Hogan said.

His experience in countries like the Netherlands, United Kingdom and Northern Ireland inspired him to write three professional books primarily about health care reform.

There is a story Hogan likes to tell about his experience in Northern Ireland, which was part of the United Kingdom health care system. Hogan became ill with a blood infection early on a Sunday morning. He called the emergency number, and they sent him to a clinic 35 minutes away. After three or four days in another hospital, he was discharged. Wanting to settle up financially before leaving, Hogan trolled the hospital looking for a billing office. Finally, he found someone with a title of “director.” He was director of supplies.

Fazed, Hogan asked where he could go to pay his bill.

“Mr. Hogan, you don’t understand,” the man said. “It is not worth it for us to have a billing system for you.”

That was the point, Hogan thought. Every health care system has problems. Ours is wasting time on things like billing and insurance when we should be focusing on providing health care.

“We spend so much money chasing the money, and that then adds fundamental complexity to a system that does not need to be this complex, this dense,” Hogan said.

Evidence and data: top priorities

Hogan is focused on evidence-based decisions. He said when he worked on a book with Dr. Deb Richter in 2005 about the future of health care in Vermont, they vowed to cite every declarative sentence they wrote with some respectable authority.

Hogan says concentrating on evidence and data helps to draw the conversation away from ideological debate and closer to a more pragmatic discussion of how to get things done.

Con Hogan stops to pet one of the horses he and his family board at their Plainfield horse farm. VTD/Josh Larkin

“He’s passionate about the work, but he also has the big picture in mind,” Davis said.

That’s why Davis recruited Hogan for his foundation’s board, and that may be why the governor appointed him to the Green Mountain Care Board.

“He focuses on how it all fits together,” Davis said.

Hogan’s experience and ideas led him to run for governor of Vermont in 2002 as an independent. Hogan lost to Republican Jim Douglas.

Davis said a lot of people liked Hogan because he had a lot of great ideas, but “campaigning was not his forté.”

Helping frame the Hsiao report

While he may have lost the gubernatorial race, Hogan’s progressive ideas remained popular, and he continued to write about health care reform. He was also instrumental in setting the framework for the Hsiao report—a study led by Harvard Professor of Economics William Hsiao that compared three options for health care reform.

Like other members of the Green Mountain Care Board, Hogan has worked on health care reform efforts in the past. He worked on the health care reform effort in the early 1990s in Vermont that paralleled the national campaign.

“We crashed just as badly as they did,” Hogan said.

One thing Hogan learned from that experience, he said, is just how powerful politics are in the world of health care. If there is a state that has a chance to get this done, however, Hogan thinks it is Vermont. He said if the Legislature can relax long enough to let it happen, and if the conversation can be about the actual costs, savings and services instead of an ideological debate, there’s a chance.

He said that government programs in Vermont have covered enough of its residents that the state has a strong foundation.

Also, Hogan says, “we’re small enough to have this conversation.”

Hogan will tackle hospital budget issues as his first task on the board.

Editor’s note: Con Hogan is a former board member of the Vermont Journalism Trust, the parent organization for VTDigger.org.

VTDigger

Recently, the Vermont Community Foundation published a status report on Vermont’s nonprofit sector. In a straightforward, data-driven report, it dispelled certain myths and quantified how significant the sector is in making Vermont work.

As of last year, Vermont had just over 4,000 nonprofits with annual revenues of $4 billion, almost 20 percent of our gross state product. Vermonters volunteer 20 million hours annually to nonprofits — in itself worth almost half a billion dollars — and this does not include civic service like select boards, state and local commissions, and school boards.

Vermonters believe in community. It would be fair to say that if Vermont had to pay for all the volunteer work done at the community and state levels, it would cease functioning.

There are challenges, however, and the obvious ones are detailed in the report — funding, governance and leadership — essentially the same problems evident in the other two sectors, government and business.

The actual differences between the triad sectors are in fact, largely definitional and the lack of strategic planning and dialogue between them constitutes a strategic deficit in and of itself.

From its citizens, government gets highly contentious, mixed messages and mandates to collect taxes and use them to achieve often competing and ill-defined social, economic and environmental ends. The task of the business sector is to strike a profitable and beneficial balance between the enrichment of owners and workers. The nonprofit or “for-mission” sector often becomes the catch-all alleviation of problems ill-addressed by the other two sectors. 

Just as foundations with similar missions have recently joined forces to study and fund durable solutions, it will be important in a state of only 600,000+ people for the three sectors to better integrate their efforts strategically.

Cross-sector partnerships exist between business and government and between government and nonprofits, but much more cross-sector dialogue and strategizing must occur at the triad level to conserve scarce resources and to fund, measure and produce better results.

With our documented commitment to community volunteerism and the scarce financial resources in our pockets, we can do more while spending less, but we need to talk together. 

All three sectors optimized and communicating with one another are vital to Vermont’s future well-being. Who better to convene this dialogue than Gov. Peter Shumlin, the Vermont Community Foundation, and the Vermont Business Roundtable?

As Con Hogan, a veteran of all three sectors, states in the report’s forward, “The first challenge is to understand that things are not the same and they won’t be the same. Having that fundamental insight is an important force that causes people to think more quickly and more strategically about the future.”

VTDigger

CONTACT:
Paul Cillo
Public Assets Institute
paul@publicassets.org
802.223.6677

MONTPELIER – Linda E. Markin, chair of the board of Public Assets Institute, announced that Cornelius “Con” Hogan of Plainfield has joined the board. A non-partisan nonprofit with offices in Montpelier, Public Assets Institute is Vermont’s premier independent state budget and tax research organization and the source for timely and in-depth state fiscal and policy analysis.

“Public Assets Institute is growing, and we’re delighted to have Con and his wealth of knowledge and experience in the public, private, and non-profit sectors on the board to help with that process,” said Markin, who is also CFO of Concept 2 in Morrisville.

Hogan is well-known in Vermont for his work as Secretary of Vermont’s Agency of Human Services from 1991 through 1999.  Prior to that he was Commissioner of the Vermont Department of Corrections.  He was president and CEO of a successful mid-sized corporation during the 1980s.

“Public Assets Institute researches and brings to light the facts about Vermont’s fiscal condition for the benefit of all Vermonters,” Hogan noted. “Good policy requires solid, factual information, and I’m pleased to help out on the board to support this important work.”

Hogan has served as a Senior Fellow with the Center for the Study of Social Policy, a Senior Consultant for the Annie E. Casey Foundation, a faculty member of the National Governor’s Association Center for Best Practice, a Director of Fletcher Allen Health Care, Chair of the National Advisory Committee for the Robert Wood Johnson initiative for Strengthening Families through health care access, a member of the Advisory Committee for the National Center for Children in Poverty, and as a consultant to the Children’s Defense Fund on a health insurance program for all children.

He holds a Master’s Degree in Government Administration from the Wharton School of the University of Pennsylvania. He was awarded an honorary Doctor of Laws degree from the University of Vermont, where he presented the commencement address for the graduating UVM Class of 2000. He is the author or co-author of six books.

Hogan is also currently Chair of the Board of Trustees of the Vermont College of Fine Arts, and a director of the Permanent Fund for the Well Being of Vermont’s Children.

Public Assets Institute’s reports based on its research are available on its website www.publicassets.org at no cost.

VTDigger

Newspaper pile, Stockxchng image

VTDigger.org and The Vermont Journalism Trust have merged.

At a joint meeting of the boards of VTDigger.org and Vermont Journalism Trust, the directors of the two nonprofit organizations decided unanimously to combine operations.

Vermont Journalism Trust will be the umbrella organization for VTDigger.org. The web site will continue to operate under the VTDigger.org moniker.

The online news site VTDigger.org was established by Anne Galloway of East Hardwick and began publishing on Aug. 31, 2009. According to Galloway, its founding editor, the choice to produce in-depth news vital to Vermonters online and via the nonprofit model was dictated by conditions in journalism today.

“The economic model that since the mid-19th century has supported print journalism is in steep decline,” Galloway explained. “Classified and display advertising has migrated to the Web and subscription revenue has been steadily eroded by declining readership and the availability of free news from other media outlets. Investigative journalism and beat reporting have been especially hard hit. We wanted to produce in-depth journalism vital to Vermonters within a sustainable economic model. Our objective is also to fill gaps in the media landscape. We have already begun collaborative arrangements with several news outlets.”

According to Bill Schubart, one of the five founders, of The Vermont Journalism Trust was established to fund in-depth journalism in traditional and emerging media.

“We started with the idea that a free and open press is fundamental to a citizen’s role in the conduct of democratic government,” Schubart said. “Recent declines in the funding and publication of in-depth and investigative journalism constitute a threat to the democratic process. Our model for supporting serious journalism was ProPublica.org. The Trust’s goal is to fund comprehensive reporting within Vermont and to make it available to all existing outlets in print, radio and TV. In the merger, neither our goal nor the goal of VTDigger has changed. We are essentially medium and channel agnostic.”

Galloway explained the online rationale of VTDigger.org. “People often confuse production medium and distribution channel,” Galloway said. “Online news distribution is the only platform on which an editor can produce in text, still image, audio and video. TV, radio and news print are defined largely by their production medium, whereas online news production can mix and match the most effective medium to convey information. Online, we have the technical freedom to use all media to publish news and ideas.”

Clifton said, “VTDigger.org is the ideal platform on which to build out Vermont Journalism Trust’s commitment to expanding quality journalism in all media.”

Doug Clifton, a founding director of The Vermont Journalism Trust and former editor of the Cleveland Plain Dealer and former executive editor and senior vice president of the Miami Herald, said the goal of the merger is to support reporting on matters of public policy.

“The complementary nature of the two organizations drove the early merger exploration,” Clifton said. “The clear success of VTDigger.org in developing consistent, in-depth reporting on government, economic, business and environmental news for Vermonters realized in part our own mission. VTDigger.org is the ideal platform on which to build out Vermont Journalism Trust’s commitment to expanding quality journalism in all media.”

Con Hogan, a director of VTDigger.org, who will continue on the combined board noted that “the time for competitive scoop journalism in print is past.”

“With broadcast media carving seconds off their delivery of breaking news, the deeper more analytical news that we produce becomes more and more suited to a cooperative model in which traditional news organizations exchange and share in-depth stories,” Hogan said. “VTDigger.org is pioneering some of that sharing now with other news outlets and the combined resources of VTDigger.org and the Vermont Journalism Trust will only enhance this model. If the goal is to better serve Vermont readers with high integrity content, then sharing that content across outlets and platforms makes sense. “

The economic model for the merged entity will combine philanthropy, foundation support, business sponsorship, and a voluntary subscription model akin to the public broadcast model. VTDigger.org has already been recognized by J-Lab and the John S. and James L. Knight Foundation in support of its mission to provide interactive news platforms and to give Vermonters a deeper look at their community.

VTDigger

OCTOBER 28, 2010

CONTACT:

ALEXANDRA MACLEAN

Prominent Republicans Endorse Peter Shumlin

“Party loyalty is unimportant.” Former Speaker Stephan Morse

Burlington, Vt., – Longtime Republicans Stephan Morse of Newfane, Helen Riehle of South Burlington and Cornelius “Con” Hogan of Plainfield today endorsed the candidacy of Democrat Peter Shumlin for governor.

“I am honored that these distinguished Republican leaders have offered me their support,” Shumlin said. “We need to continue the Vermont tradition of working across party lines to get tough things done.”

Stephan Morse has a long and distinguished history in Vermont’s Republican Party having, among many other things, served as Speaker of the House in the 1980s.

“With the economic crisis facing Vermont, party loyalty is unimportant,” Morse said. “We need to hire the best person to lead us out of these trying times. Peter Shumlin is that candidate. Peter has demonstrated as President of the Senate that he is ready for this challenge. We need a Governor who knows the issues and can bring people together to solve our problems. And we need a Governor who has vision. Peter has all these qualities. Vermont needs his skills, knowledge and ability. In my mind, there is not a better candidate than Peter Shumlin for Governor of the State of Vermont.”

Republican Helen Riehle served 18 years in the Vermont Legislature, the last eight as a Chittenden County State Senator. She chaired the Senate Health and Welfare Committee, the Health Access Oversight Committee and the Administrative Rules Committee.

“There are many excellent reasons as a Republican that I support Peter Shumlin,” Riehle said. “Several are directly related to ‘local control.’ My decision about my own reproductive health care is about as local as any decision can be. Peter will protect my right and the right of all Vermont women to make decisions about their own health. Peter also understands the value of local decision making around education. I am proud to strongly support Peter for governor. ”

Appointed by Republican Governor Richard Snelling, and retained by Governor Howard Dean, Con Hogan was Secretary of Vermont’s Agency of Human Services from 1991 through 1999. Prior to that Hogan had a career in Corrections, including being Corrections Commissioner — again appointed by Governor Snelling. Hogan has been outspoken in his support of Peter Shumlin’s proposals for Corrections reform, reforms that Hogan has championed in the past.

“I’m supporting Peter Shumlin because he isn’t afraid to tackle our toughest problems,” Hogan said. “We can’t afford to tread water any longer. From corrections to health care – Peter will tackle Vermont’s challenges and move our state forward.”

###

VTDigger

Sen. Doug Racine

Editor’s note: This is the fifth in a series of profiles of the Democratic primary candidates for governor.

• In Profile: Matt Dunne, a precocious candidate with no shortage of confidence
• In Profile: Markowitz banks on hard work, local network, “women’s vote”
• In Profile: Shumlin, a gubernatorial candidate marked by determination and smarts
• In Profile: Bartlett, the underdog once again — this time in the race for governor

Doug Racine is an introvert in an extrovert’s profession, and in a five-way Democratic primary race for governor, his quiet, understated manner stands out in a field of big personalities. Secretary of State Deb Markowitz has a solid rapport with town officials across the state. Sen. Susan Bartlett has a homespun charm that plays well in forums. Matt Dunne, a Google executive, is never at a loss for words – and seems to relish his time at the podium. Senate President Pro Tem Peter Shumlin is an orator who is more comfortable on the campaign trail than he is cooped up in a committee room reviewing policy.

At this late stage, it’s still anyone’s race to win next Tuesday, according to political experts, and there are more questions than answers for all of the candidates who are scrambling to get their supporters to the polls on Aug. 24. In Racine’s case, the question is, will his reticence hurt his chances with voters, or will his straight-talking, consensus-building approach to politics win the day? Will the large grassroots organization he has built (he has more than 500 volunteers, according to Amy Shollenberger, his campaign manager) get more Vermonters out to the polls in a low turnout year? And finally, will his endorsements from four prominent organizations with thousands of members (the AFL-CIO, Vermont NEA, Vermont State Employees Association and Vermont League of Conservation Voters) translate into victory?

While the particulars of this gubernatorial race are new, Racine is no stranger to the shifting dynamics of campaigning. He has lost three high-profile races and won 10 bids over the course of his career. Losing doesn’t seem to daunt him — in fact it appears to be a strategy for an eventual win. Though he lost his initial bids for state Senate and lieutenant governor, for example, his perseverance has won the day in his second attempts. Racine hopes to repeat that pattern in this, his second race for governor.

Racine has held office for 20 years total, and he’s been in politics since his heady days at Princeton in the early 1970s. He has served off and on as a prominent lawmaker at the Statehouse and then as lieutenant governor in the Howard Dean era. In Chittenden County, he is practically a household name, thanks to his seven elections to the state Senate and his role as a part-owner of the company his father and mother started in the 1960s, Willie Racine’s, Inc., a Jeep dealership.

Though he beat Brian Dubie in the 2000 race for lieutenant governor, he lost to Republican Jim Douglas in a three-way race that included independent Con Hogan in the 2002 election for governor. Now, after six years in the state Senate, Racine is back, fighting in a historic five-way primary. Three former Statehouse colleagues are his opponents in this race.

The difference this time, Racine says, is that he’s not defending Gov. Howard Dean’s record. He said his message in this campaign is more grounded in his own values, record and vision.

Howard Dean

“I think a lot of it is about saying here’s who I am and here’s what I believe,” Racine said. “It’s not about somebody else’s record, it’s about mine. And I’m just being a little more assertive, and I’m being a more aggressive campaigner. Jim Douglas ran a negative campaign, and I chose to let those things go, but I’m not letting those things go by this time.”

Still, some things haven’t changed. Racine, 57, is not a politician’s politician. He isn’t an aggressive campaigner. When he meets with voters, he doesn’t project his own ideas without listening to what they have to say first — his inclination is to let other people start the conversation. On the floor of the Senate, he gives direct, impassioned speeches remarkably free of rhetorical flourishes. Left to his own devices, he tends to shrink, rather than expand, in a room full of people.

In short, Racine is not a “press release” machine, as he puts it. The sound bites don’t come easily for the state senator in part because he often delves into substantive issues that don’t always serve up feel-good talking points. His message tends to be more nuanced and complicated.

Racine may be reticent, even shy, on stage or when he mingles in a crowd, but he isn’t afraid to take unpopular stands on issues. Over the course of the last month or so, he has been talking tough about the state’s budget woes, and he has proposed solutions, such as tapping half of the rainy day funds, a step the other Democratic candidates have treated like the third rail of politics. While Racine says government needs to become more efficient, largely through use of new technology, he has said that essential programs have already been deeply cut, and raising revenues has to be part of the budget equation in order to protect Vermonters who need government assistance, particularly in the down economy.

Racine doesn’t think state revenues will come roaring back anytime soon. That’s why, he says, whoever becomes governor in January will have to dip into the budget stabilization reserve, a.k.a. the rainy day funds. He would propose using as much as $30 million of the roughly $60 million reserve. Racine also believes some targeted taxes – for junk food and Internet sales (the state loses $40 million in revenue as a result of Web merchandising) – may have to be introduced to help make up for the $115 million shortfall, in addition to the $72 million in government restructuring savings the state is banking on. Vermont’s economy, in his view, will only recover once the national economy begins to see gains again. What a governor can do in the meantime, he told reporters this week, is ensure the state is poised to make the most of the recovery when it happens. The best way to do that, he said, is to invest in the state’s small businesses; infrastructure, broadband, roads, bridges and rail; and education, namely pre kindergarten programs and high school and post-secondary job training.

Racine at the Addison County Field Days WCAX debate

In press conferences and debates, Racine has accused his Democratic opponents of making “big promises” that they can’t deliver on because, in his view, the state’s budget gap can’t be filled in a year or two exclusively with revenues generated through economic development initiatives. It will take time, and a multi-pronged approach, which includes some implied shared sacrifice, to pull the state back out of the deficit, according to Racine.

“I want to challenge all the other candidates to tell us exactly how they’re going to deal with this problem,” Racine says. “What I’ve heard back are answers that are not complete. They say, ‘I’ve got a plan to improve the economy.’ Well, so do I, but I’m not going to pretend I’m going to walk into that office in January and 10,000 new jobs are going to appear.”

The revenge of the nerd

Racine, 57, grew up in Burlington. His parents, Willie and Annette, were both French Canadian Catholics. They ran a Texaco gas station, and in his spare time, Doug helped pump gas and wash windshields. Though they hadn’t gone to college themselves, the Racines were determined to make sure their three boys were well educated. In 1967, they launched a car dealership out of their gas station enterprise, Willie Racine, Inc., which sells Jeeps.

At an early age, Doug, the middle son, wanted to be an aeronautical engineer (he was fascinated by the space program), though he was intrigued by politics, too. He remembers staying up late to watch the television coverage of the 1964 Democratic and Republican conventions.

He wouldn’t say whether he wore a pocket protector in high school, but Racine freely admits his favorite subject was math (he was a member of the Burlington High School math club), closely followed by science. “Let’s put it this way, I wasn’t an athlete,” Racine says.

He was, however, something of an academic star. He was a runner-up for a National Merit Scholar award, and through a connection with one of his dad’s customers, he found himself getting into Princeton University, where he planned to study engineering.

A slide-rule career, however, wasn’t in his future. Racine was distracted by humanities classes and soon found a home in the political science department, where he could apply his aptitude for numbers to the accounting side of politics – statistical analysis and polling. He wrote his senior thesis on the demographic changes and voting trends that led to Vermont’s shift in the 1960s and 1970s from a rock-ribbed Republican state to a liberal bastion.

This happy marriage of math and the art of politicking carried Racine through to his first job – campaigning in Democrat Patrick Leahy’s first bid for the U.S. Senate, which had been dubbed “the children’s crusade” (the campaign manager was 26, and the oldest guy in the office was 30;

Sen. Patrick Leahy, D-Vt.

Racine himself was just 21). He was a full-time volunteer for Leahy, and he did the usual intern work – he manned the copy machine, dropped off literature and picked up coffee for the staff – but because of his number crunching skills, he also conducted polls and helped the Chittenden County state’s attorney identify voters.

When Leahy won, he brought Racine along to Washington, where he became part of the senator’s staff. For two years, Racine was Leahy’s eyes and ears on the Armed Services Committee. He prepared briefings, conducted research and suggested questions for hearings. Racine left Washington after a reshuffling of staff responsibilities in Leahy’s office.

Racine was bitten by the political bug in a big way when he returned to Burlington to join the family business. He worked on Democrat Madeleine Kunin’s race for lieutenant governor and, in 1980, set his sights on a vacant Chittenden County Senate seat. He lost in the Democratic primary by 300 votes – and won the Republican nomination, which he declined.

“I don’t get discouraged,” Racine said. “I was a good loser. No one expected me to win that.”

Two years later, he won the state Senate seat. Losing, he said, set the stage for that triumph. “I was in the right place at the right time,” he recalls. “I had established I was a credible candidate and built up name recognition. After I lost, I helped other candidates and got much more actively involved.”

He was in the Vermont Senate for 10 years, and became the President Pro Tem in 1989. Throughout this period, he continued to take care of the administrative and accounting side of the family business. In 1992, he left his seat and became co-chair of Leahy’s re-election campaign; one of his jobs was to go to forums that the senator couldn’t attend. “I was debating Jim Douglas who was running against Pat Leahy that year,” Racine said, explaining his stand-in role. “It’s a small state. You keep bumping into the same people.”

In 1994, Racine ran against Barbara Snelling, the Republican lieutenant governor and wife of popular former Republican Gov. Richard Snelling. Racine lost, but two years later took the seat. The pivotal issue in 1996 was equalized education funding and property tax reform. Gov. Dean adamantly opposed an income tax provision in the law. In his role as lieutenant governor, Racine said he worked closely with the Senate to develop the income sensitivity component of Act 60, which gave low-income property owners a break on their property taxes. In the end, the provision helped the bill reach passage.

Racine says he worked full-time as lieutenant governor and worked inside the legislative process; he says Republican Lt. Gov. Brian Dubie, who he beat in the lite gov race in 2000, works outside the Senate, preferring instead to be the unofficial Vermont ambassador to Canada, Cuba and China.

Lieutenant governor Brian Dubie, left, and Gov. James Douglas

“The lieutenant governor is a legislative official,” Racine said. “I felt I had a strong role to play.” He said he organized a conference on early child education, chaired the Vermont Child Poverty Council, led an earlier iteration of a government efficiency and restructuring initiative and helped state employees work out a dispute between Dean and the Vermont State Employees Association over contracted services.

“I was pretty active, but pretty quiet,” Racine said. “The only time the press paid attention to me was when I disagreed with the governor.”

In 2002, Racine ran for governor, on the heels of Dean’s 10-year reign on the Fifth Floor. His opponents were Republican Jim Douglas, who had served as Secretary of State and State Treasurer, and Con Hogan, an independent who had served as the secretary of the Agency of Human Services for eight years.

Racine’s polling showed that Hogan siphoned off more votes from him than from Douglas, in part because both candidates had a strong interest in human services. Both Hogan and Douglas were critical of the Dean administration, and yet Dean made no bones about his preference for Hogan, according to Garrison Nelson, a political science professor at the University of Vermont.

Con Hogan

“I was put in the role of defending more,” Racine said. “I always felt I was outnumbered. In the end there are a lot of factors. There were factors beyond my control, and yet things in my control.”

One of the things he could control, he decided, was his message. In the last round, Racine said, he didn’t run on his own record, and he wasn’t aggressive enough as a campaigner. This time, he said, he is making a point of spelling out his stances on the budget, taxation and economic development.

A natural legislator

At a recent fundraiser in Burlington, Racine chitchatted and warmly greeted supporters, but he didn’t stand out in the crowd. If you hadn’t known he was a candidate for governor, you might have mistaken him for one of the members of the audience. Though Racine stood at the podium and gave a short speech, the real star of the show that night at the Burlington Country Club was Joe Trippi, who is credited with giving Dean a shot at the presidency in 2004. The fundraiser, which was scheduled a few weeks after Racine made a fourth-place showing in the July campaign finance reporting period, was an attempt to regain fund-raising momentum. Fewer than 40 people attended the event, however — even with Trippi present as the draw.

As a result of his low fund-raising numbers, Racine is the last of the five candidates to put up television advertising. Shumlin has had ads up since early July.

Is Racine’s bashfulness a liability? UVM professor Garrison Nelson says it is. “Doug’s natural shyness has caused his campaign to lag, and it has created an opening for Shumlin,” Nelson said.

He adds: “There are politicians who are natural legislators and legislators who are natural politicians. Doug is a natural legislator. He is good at working with people coming up with common solutions, and the Legislature is his natural milieu.”

Garrison Nelson, UVM political science professor

Nelson said, however, those aren’t necessarily the right qualities for a governor. An executive, he said, makes decisions and takes heat for decisions. “There is no question that Shumlin relishes that prospect,” Nelson said.

A number of Racine’s compatriots in the Legislature disagree with Nelson’s assessment. They say the senator’s self-effacement is part of what makes him an effective leader.

Rep. Johannah Donovan, D-Chittenden, who is chair of the House Education Committee, said Racine’s understated, quiet manner is too often cited as a flaw. “It’s a mistake to hold that against him, because he is a bright and powerful guy who will do well (as governor),” Donovan said. “He’ll be a steady hand at the wheel.”

Rep. Sandy Haas, P-Rochester, who has worked with Racine on human services issues, says, “Racine’s sincerity and fundamental decency make him best able to beat Brian Dubie — as he has done before.”

Addressing the shyness issue himself, Racine asks: “Am I going to be a Bernie Sanders-style politician? No, that’s not me. We all have our own individual styles. … In anything you do, you deal with those sorts of issues, and you fix them. I don’t think people who meet me say I’m shy; maybe quiet, yes. I’ve always had a passion about issues – kids, education health care – but people didn’t always see it. What I’m doing in this campaign is saying that this is what I care about and people are noticing.”

Health care, human services and the budget

As chair of the Senate Health and Human Welfare Committee, Racine’s signature piece of legislation in the last session was a controversial health care bill, which calls for the Legislature to review three system reform designs that are supposed to reduce health care costs and provide universal coverage to all Vermonters. It took Racine the entire session to maneuver the bill through the Senate and House, and even after it passed, Douglas threatened to veto it. Racine quietly pushed and pulled and managed to get it passed. Some of his detractors, most prominently Dr. Deb Richter, a proponent of single payer health care, give the credit for the bill’s passage to Senate President Pro Tem Peter Shumlin, one of Racine’s foes in the primary.

Sen. Randy Brock

Sen. Randy Brock, R-Franklin-Grand Isle, is unhappy about the health care reform bill because, he said, federal rules will make it difficult for the state to implement new policies until 2017. “I beg the question: Was this a wise use of several hundred thousand dollars when we’re cutting critical programs?” Proponents of the reform plan, including Racine, want to wring savings out of health care through a better service, billing and administrative system.

Racine has also been a powerful advocate for low-income Vermonters. In the last session, he fought to protect the designated mental health agencies and programs for the physically disabled from cuts suggested by the Douglas administration.

Because he believes state government has already taken a big hit, he took a stand against the budget in the last legislative session. He objected to what he called a $38 million “hole” in the appropriations bill — the amount booked for the Challenges for Change government restructuring plan. Racine maintained then, and now, that the targets set for the reorganization are unrealistic. He floated an amendment that would have tied the Challenges to $20 million out of roughly $60 million in budget stabilization funds, if the savings sought through more government efficiencies weren’t found. So far, his prediction seems to have been borne out: The state has not been able to identify $10 million in spending reductions through the Challenges without making significant cuts, suggested by the administration, to programs.

Brock, a supporter of Republican candidate Dubie who is running on an anti-tax platform, is concerned about Racine’s stance on taxes. In 2009, he said, five senators voted against $26 million in capital gains and estate tax increases because the bill didn’t raise taxes enough. “Doug Racine was one of them, and therein lies some contrast,” Brock said.

Racine counters that he does not want to raise broad-based income or sales taxes to solve the $115 million budget deficit in fiscal year 2012. “What I’m talking about first is finding more efficiencies,” Racine said.

He said he wants to avoid cuts in services by aggressively improving state government’s information technology system, tapping as much as $30 million of the $60 million in budget stabilization funds, and extending the 6 percent sales tax to Internet merchandise and junk food. He said the Internet tax would raise $40 million; he doesn’t know how much the tax on junk food would generate.

“Some of my opponents are saying that I propose simply to raise taxes, which is a gross distortion of what I say,” Racine said. “I know that, based on what I’ve seen in the budgets, if you think you’re going to cut your way out of it, you can’t.”

VTDigger

Stockxchng image

The Vermont Attorney General’s office has dismissed a complaint calling for House Speaker Shap Smith to rescind his appointment of former state Sen. Jim Leddy to the state’s health care reform commission.

Leddy and Con Hogan, both veterans of past health care reform efforts, were named to the commission last week. Smith chose Leddy; Senate President Pro Tem Peter Shumlin selected Hogan.

Dr. Deb Richter questioned Leddy’s appointment last weekend in an e-mail to members of Vermont Health Care for All, a nonprofit group that advocates for state-funded health care.

Leddy serves in a voluntary capacity as president of the Vermont chapter of AARP, the national organization for seniors, which markets health insurance benefits under its name to members. He also holds a seat on the National Policy Council, which makes public policy recommendations to the national AARP board.

On Monday, Richter filed a formal complaint with the attorney general on behalf of Vermont Health Care for All on the grounds that the former state senator’s relationship to AARP is a conflict of interest and violates state statute.

Vermont’s new health care reform law was written to ensure that members of the commission are not beholden to industry interests. It states that the two nonvoting members of the commission shall not have “any official relation” or “in any manner be connected” to an insurer.

Bill Griffin, chief assistant attorney general, ruled Tuesday that the Vermont Health Care for All complaint was baseless on. AARP contracts with insurers to provide insurance, he said, but AARP itself is not an insurer, therefore the appointment of Leddy does not violate state statute.

“Our understanding was (AARP) does not sell insurance,” Griffin said in an interview. “The insurance products are offered by insurance companies, and the insurance companies pay AARP royalties for their part in it.”

According to a Washington Post report, AARP, a not-for-profit organization for seniors, “heavily markets” health insurance policies to its 40 million members. The policies are sold through a broker, United Health Group, under the AARP brand identity. From 2007 to 2008, AARP earned $400 million, or 63 percent of its revenues, through royalties for AARP Medigap policies, which provide supplemental coverage for Medicare patients, Post reporter Dan Eggen wrote on Oct. 27, 2009. During the national health care reform debate, questions were raised about AARP’s lobbying support for proposals that would drive up demand for the Medigap policies, Eggen reported.

Richter said she is disappointed with the AG’s ruling. Leddy’s appointment, in her view, may be technically legal but violates the spirit of the law.

“I want to make very clear, I have respect for Jim Leddy and his service to Vermont,” Richter said. “He has worked tirelessly on health care reform – that is not the issue. … Unfortunately, he is president of an organization that lobbies against publicly financed health care. … AARP worked against single payer at the national level, and it’s understandable why. If we eliminate the private insurance industry from health care, they would lose a good deal of money.”

More than 150 members of Vermont Health Care for All have sent e-mails to the commission this week objecting to Leddy’s appointment, Richter said. The Vermont Workers Center issued a statement saying the appointment undermines “public confidence.” The center urges Smith to “rescind this appointment and make a choice that does not cast any doubt whatsoever on the process.”

Leddy, the well-respected former chair of the Senate Health and Welfare Committee who oversaw the state’s 2006 health care reform legislation, sees Richter’s complaint with the AG’s office as a personal affront. He said she should have called him to talk about her concerns before taking the matter public.

“The accusations and allegations were baseless from the beginning,” Leddy said. “I’m not a voting member. I’m being attacked for taking a volunteer job for which I have a voice but not a vote, and I’m not sure what it was all about in the first place.”

House Speaker Smith defended his pick for the commission: “I believe that Jim’s primary mission is to make sure all Vermonters have health care, and I think that goal is consistent with the goal of Dr. Richter.”

Doug Racine, a Democratic candidate for governor who led the charge for passage of S.88, the health care reform bill, supports Leddy’s appointment.

“Jim’s a man of high integrity,” Racine said. “I don’t think he’ll be looking out for the interests of the insurance industry.”

Leddy said a publicly funded option needs to be considered. The difficulty for the state, he said, is figuring out how Vermont can integrate its progressive health care initiatives with the changes being implemented on the federal level. “That’s the key, and that’s the challenge,” Leddy said. “We can’t succeed unless we have a partner in the federal government.”

The commission, which also includes eight members of the Legislature and two gubernatorial appointees, is authorized to recommend a consultant to evaluate three health care designs for the state of Vermont, including a single payer system. The Joint Fiscal Committee will hire the firm, which will present its findings to the Legislature in January.

The state has sent out requests for proposals, and the commission will review bids on June 28.

Conflict of interest language from S.88, page 10

(b)(1) Members of the commission shall include four representatives appointed by the speaker of the house, four senators appointed by the committee on committees, and two nonvoting members appointed by the governor, one nonvoting member with experience in health care appointed by the speaker of the house, and one nonvoting member with experience in health care appointed by the president pro tempore of the senate.

(2) The two nonvoting members with experience in health care shall not:

(A) be in the employ of or holding any official relation to any health care provider or insurer or be engaged in the management of a health care provider or insurer;

(B) own stock, bonds, or other securities of a health care provider or insurer, unless the stock, bond, or other security is purchased by or through a mutual fund, blind trust, or other mechanism where a person other than the member chooses the stock, bond, or security;

(C) in any manner, be connected with the operation of a health care provider or insurer; or

(D) render professional health care services or make or perform any business contract with any health care provider or insurer if such service or contract relates to the business of the health care provider or insurer, except contracts made as an individual or family in the regular course of obtaining
health care services.

VTDigger

Tom Davis was Vermont's Human Services secretary in the 1970s

The state is putting dollars ahead of people. That was the message delivered by Public Assets Institute, a nonpartisan think tank that specializes in fiscal analyses of state government.

Senior analyst Jack Hoffman presented a report,

Budget 2011: Cutting the Commitment to Vermonters

which details how the Vermont Legislature and the Douglas administration have used budget cutting as the primary tool for resolving the state’s fiscal crisis. Vermont’s tax revenues have declined because of the recession, and this year the state faces a $154 million shortfall and an additional $100 million gap next year.

Over the last three years, the Agency of Human Services has been hardest hit, according to Hoffman. He said the House budget bill this year appropriates 16 percent less, nearly $80 million less, for human services than the Legislature did in 2008 (the beginning of the recession).

Meanwhile, demand for assistance programs has gone up. There has been a 20 percent increase, for example, in the number of households receiving aid through Reach Up programs, Hoffman writes.

Hoffman said the Snelling administration raised taxes and used rainy day funds to help bring the state out of a recession 20 years ago. The same tack, he suggested, could be taken now.

The report was unveiled at a press conference at the Vermont Statehouse on Wednesday and included three former Agency of Human Services secretaries: Con Hogan, Tom Davis and Cheryl Mitchell.

Cheryl Mitchell was head of the Agency of Human Services under Howard Dean

Hogan called the Challenges for Change proposal an “unconsidered, fundamental change in policy.” The Challenges, a government restructuring plan enacted into law in February, was initially a list of targeted outcomes paired with $38 million in savings in key services the state funds — education, human services, corrections, contracts, economic development and natural resources. The Legislature asked the Douglas administration to come up with plans for executing the Challenges targets. Last week, the Douglas administration released a progress report on the Challenges that included very little detail about its plans to significantly change government programs. The report also came up millions of dollars short of the target number.

Hogan said the Douglas administration is disregarding the state’s obligation to the needy. He predicted that the Challenges mask as much as $200 million in cuts in state and federal funding over the next several fiscal years.

The Challenges proposals are “a rush to the bottom in a blind frenzy to cut budgets,” Hogan said.

The Legislature has given the administration carte blanche to make those cuts, Hogan said, and he deemed this decision “unprecedented and unwise.”

“It seems calculated to avoid responsibility,” he said.

Because policy is set through the budgeting process, Hogan said, he advised the Legislature to make prioritized line item cuts under the $38 million Challenges proposal that would detail the effects of the reductions on programs. At the same time, it should move ahead with the broader scope of the Challenges, and as savings are realized under the restructuring, these monies could offset budget cuts in priority order. This would, he said, put the entire budget on the table.

VTDigger

The State of Vermont is witnessing and participating in an unraveling of the capacities of its governments at all levels. And much of the problem could have been avoided.

Lost opportunity is grossly wasteful. This is because it is accumulative. Major opportunity lost at one point in time repeats itself in every subsequent year, until the accumulation becomes a serious threat to financial stability. This has happened in Vermont roughly over the last 15 years, and now government and the people it serves, are paying the price.

Let’s take a quick look at several lost opportunities, that if realized at the time of the opportunity could have made a significant and even major impact on our current fiscal mess.

Sometime in the mid 1990s, after we had climbed out of the 1990-1991 recession, the Legislature and the administration embarked on a budgeting technique known as “waterfall spending.” In short form, it simply meant that revenue in excess of the amount budgeted for government that was realized during the fiscal year in question, would be spent on a list of projects and programs until the excess revenue was spent. Assuming an average of $5 million of excess revenue spent for about 10 years until health care, corrections, and other programs began to eat up the excess, I estimate about $50 million could have been avoided and used to take some of the pressure off future spending needs. That is major league lost opportunity.

In 2004, the Zuccaro Corrections Overcrowding Commission recommended finding and paying for ways to supervise about 400 people in our prisons who are non-violent in our communities using enhanced field supervision and GPS monitoring technology which is used in other states and countries around the world, and at the same time, bringing back an equivalent number of 400 prisoners and avoid the cost of housing these people in out of state facilities, netting about $10 million of avoided cost per year (not to mention the economic multiplier effect in Vermont). If enacted, that would be another accumulation of dollar cost avoided of about $60 million. And now, in 2010, a new report from the Minnesota Public Strategies Group consulting firm, commissioned by the Legislature to find $38 million in governmental efficiency, recommends essentially the same thing, six years later (for about 600 prisoners in out-of-state facilities). Another example of large lost opportunity.

A third example is the prospect of reducing the administrative costs in our educational system. This discussion, in one form or another, has been going on for about 15 years in Vermont. Assuming a very modest avoided cost of about $5 million a year — a mere 4/10th of 1 percent on a $1.3 billion budget — this represents an accumulated avoidable cost of about $50 million if we had acted just 10 years ago.

These areas of lost budget savings represent about $180 million total in 2010 and 2011, roughly equivalent to the General Fund deficits we face this year.

These three areas of lost opportunity loosely represent about $160 million of avoided cost by the current year 2010, with an additional avoided cost of $20 million in 2011. These numbers are roughly equivalent to the General Fund deficits we are facing this year. Yes, the current recession would have caused government to significantly tighten its belt, but the level of ripping and tearing of capacity and services for people could have been largely avoided.

It is naïve to believe that these avoided costs would have automatically dropped to the bottom line. But in part, they could have reduced our taxation burden, and/or, given government and its agencies some cushion that would have been there when we needed it. Constant opportunity analysis is the kind of efficiency seeking behavior that business regularly undertakes. It is an even-handed way to avoid the boom or bust cycles that Vermont government has increasingly shown its inability to manage.

And there are more examples of ideas ignored. Mary Powell, of Green Mountain Power and David Coates the highly respected financial analyst, in 1995 in their citizen commission report recommended clear and present opportunities for governmental belt tightening which were mostly ignored. Report after report over the last 10 years, having to do with the severely mentally ill in Vermont, recommended changes that could avoid millions of dollars a year and at the same time improve services substantially to that troubled population. They have also not been acted on. And the recent years of balancing the state’s budget with $9 million a year with fictional State Hospital receipts only adds to the lack of budget credibility.

Even if the budget as presented for 2011 were adopted in whole, the pain has not yet been fully exposed. Some are estimating an additional $30 million in specific cuts beyond much of the soft targets outlined in the budget will be needed to overcome the inachievability of reductions outlined in the Challenges for Change consultant’s reports and other unrealistic cuts in Corrections and other agencies that cannot be achieved in mere months.

This is a story of Vermont government’s chronic mismanagement, by both the executive and legislative branches and the leadership of both parties over many years.

So, what are the opportunities available to us today that if not dealt with will only exacerbate our problems going forward? Interestingly, they are similar and sometimes the same as outlined above. It is never too late to act decisively. Plus there is the opportunity to redesign our health care mess to begin to avoid about half of the roughly 30 cents on every dollar spent on health care that has nothing to do with our care. The numbers are big.

Knowing that our overall health care spending in Vermont is breaking the $5 billion mark this year (up from over $2 billion in 2001), the avoidable annual overhead costs of health care today is in the order of magnitude $250 million. Action taken early in the last decade could have avoided cost in the order of magnitude of well over $1 billion. Avoiding this wasteful cost would have a salutary impact on not only our government’s budget, but the budgets of families, towns and cities, businesses, hospitals, school districts, and even workmen’s compensation.

But there is a mega opportunity even beyond these lofty numbers, and that is to put government spending on a more sustainable rhythm and cycle. Gov. Richard Snelling understood how to do just that, and how to engage both the Legislature and our citizenry in the process. I recall vividly his prime time presentation on WCAX in the teeth of the 1990-1991 recession when he graphically showed how government can arrange its financial affairs to be efficient and save substantially in the good times so that the capacity to take care of those in need was available in the bad times. This included the ability to carefully raise revenue on a temporary basis when needed.

We have no choice now. We must think boldly and bigger if we are going to upright ourselves from the corrosive and accumulative cost of past lost opportunity, and we must regain our ability to think and plan around full economic cycles.

VTDigger

Con Hogan, former longtime Secretary of Human Services

Con Hogan, former longtime secretary of the Vermont Agency of Human Services, conveyed a sobering message to lawmakers on Wednesday: If the state cuts $70 million from the Agency of Human Services this year, and $29 million in fiscal year 2012, he estimates Vermont will lose an additional $150 million in matching federal funds for key programs for Vermont’s most vulnerable citizens.

The agency provides aid to needy children and families, long-term care for the elderly, medical care for the poor and psychiatric care for mentally ill Vermonters.

“This will mean a reduction in services to people in an order of magnitude of a quarter of a billion dollars,” Hogan told a joint House and Senate human services committee hearing. “The Agency of Human services might be responsible for prolonging the recession. It is that big, and I don’t think that’s sunk in yet to any of us at this stage in the game.”

Doug Racine, Senate Health and Human Welfare Committee chairman, quietly retorted, “Perhaps some have figured it out.”

The Douglas administration is proposing to cut $53 million in services and $17 million through the “Challenges for Change” plan in fiscal year 2011 and $29 million in fiscal year 2012.

Hogan’s analysis didn’t come as a shock to members of the Senate committee and the House Human Services Committee. In fact, several members openly concurred with the former secretary’s assessment. Ann Pugh, chairwoman of the House committee, piled on to Racine’s remark. “It’s always good to say what someone else is thinking,” she said.

Racine asked Hogan about how difficult it would be to create a single portal for Vermonters to access services. This “client-centric intake and care management” system was developed under the “Challenges for Change” proposal by lawmakers, members of the administration and the consulting firm, Public Strategies Group.

“It’s a huge undertaking,” Hogan said.

“Can it be done in 18 months?” Racine asked. “No,” Hogan replied. “Six months?” Racine asked. “No,” Hogan said again. Another member of the committee asked, “How about four weeks?” A ripple of laughter went through Room 10, one of the larger committee rooms in the Statehouse.

“It can be done,” Hogan assured the joint committee. “The technology has gotten easier to deal with, but it’s a major investment, and those kinds of investments have to be staged over a period of time.”

He said the agency tried a single portal project for three districts during his tenure as agency secretary in the mid-1990s that failed because the agency wasn’t able to make an adequate investment in technology and other infrastructure changes.

“It takes time, and it takes a culture change, and cultures in big organizations and even small organizations don’t change overnight,” Hogan said.

“To me, some of the stuff in this report just covers a cut, and they’re going to make the cut, and they have to make the cut,” he said. “But it’s not going to be achieved in this kind of timeframe.”

Hogan pointed out that the committee doesn’t need to reinvent the wheel in order to create outcomes under the new “challenges” plan proposed by the Joint Legislative Government Accountability Committee. He suggested that lawmakers look at the set of results-oriented outcomes written into law in the mid-1990s that the administration and lawmakers subsequently ignored.

These outcomes are based on aspirations for individuals within the larger state community, such as thriving children and well-cared-for elderly.

He said the committee could use the outcomes listed in the “Challenges for Change” report as indicators for desired results in human services.

In general, since the mid-1990s, the state has lost some important opportunities to save money and provide better services, Hogan said. One example he cited was the 1994 Zuccaro Commission report. That report stated that Vermont could immediately save $10 million in General Fund monies for incarceration costs through electronic supervision of nonviolent offenders and detentioners.

“That got put on the shelf and (Public Strategies Group is) recommending the same thing,” Hogan said. “If this body and the administration had acted in 1994, there (would be) $60 million on your plate you wouldn’t have to be scrambling for now.”

VTDigger