Editor’s note: This commentary is by Don Keelan, a certified public accountant and resident of Arlington. The piece first appeared in the Bennington Banner. This is the 300th column he has written for the Banner since 2003.
The board of trustees of the Vermont Veterans’ Home is comprised of 21 dedicated, committed and honest Vermonters, most of whom are themselves veterans of the military.
On Dec. 17, the board voted to reduce the number of certified beds at the home from 171 to 130 (there was one vote against the motion). The action they took was a huge mistake.
The month before, the board was given a report authored by Jeb Spaulding, who at the time was the Secretary of Administration (he left office on Dec. 31). The report, Review of the Vermont Veterans’ Home in Response to 2014 Act 179, was prepared for the Joint Fiscal Committee of the Legislature.
The crux of the 20-page report was to find ways that would absolve the Legislature from having to use General Fund monies to subsidize the home’s $20 million operating budget. In the recent past this would have amounted to $1 million to $3 million annually to bridge the gap at the 130-year-old state institution.
In part, the home’s budget woes stem from having an occupied bed census that has fallen 10-15 percent below what would have been break-even.
The Spaulding report’s recommendations were to look into using gambling snap-off tickets, renting excess space to commercial users and eliminating 41 certified beds.
The tax is one of the most convoluted, senseless and misapplied taxes I’ve experienced. Why not move to have the tax vacated — not drop the number of beds?
The outcry over the idea of using gambling tickets was enough to remove this suggestion from further consideration. However, the justification given to the board to reduce the number of beds was bizarre.
The home, not unlike hospitals and nursing homes, has to pay an annual “bed tax.” It amounts to approximately, $5,000 per certified bed. The home’s fiscal year 2014 budget had provided $840,000 to meet this state tax obligation. Let’s not lose sight of the fact that the home is a state-owned institution.
The board was under severe pressure to reduce cost and by delisting the number of certified beds by 41, an annual savings of about $200,000 could be realized — in addition to some minimal savings by not having to staff for the higher number of certified beds.
The tax is one of the most convoluted, senseless and misapplied taxes I’ve experienced. Why not move to have the tax vacated — not drop the number of beds?
However, where the board erred was not taking into consideration another state-mandated report, The Pulling Report of Aug. 8, 2013.
This report was done in response to a number of issues that arose from the home’s operation that nearly caused the home to lose its Medicare/Medicaid funding.
Deep inside the report (pages 14-19) was a detailed analysis of the future need for nursing home beds for Vermont veterans. The basis for the analysis was supported by empirical data (not found in the Spaulding Report).
The Pulling Report disclosed that by 2023, Vermont will need in excess of 700 beds to service its veteran population (excluding beds for spouses of veterans and Gold Star Mothers).
Mary Morrissey, Bennington’s representative to the Legislature, recently, made the following comment to the board: “Why are you acting so quickly: The Spaulding Report was sent to the Legislature which will not be meeting until next year?”
The board acted out of fear. Their concern was that somehow the Legislature would not come through with the additional funding and that is unfortunate. Fear extracted a huge price. Never has a state of Vermont institution, with so much potential to do well, for so many of its deserving citizens, been so marginalized.
