A proposal to close the state’s budget gap includes $13 million in cuts on top of the reductions outlined in Gov. Peter Shumlin’s FY2016 budget proposal.
Under the plan, the state would close the Southeast State Correctional Facility in Windsor and reduce Vermont Health Connect expenditures by $5 million. The health care exchange savings would come from the elimination of General Fund money earmarked for the small business insurance exchange.
Rep. Mitzi Johnson, D-South Hero, chair of House Appropriations, presented the plan to a packed room on Friday.
Shumlin’s budget proposal patched a $94 million hole between state revenues and state spending. But about a week later, a revenue downgrade found that the state was still $18.6 million short of breaking even.
Last month, before lawmakers recessed for Town Meeting Day, legislators, the Joint Fiscal Office and members of the administration unveiled a wide-ranging list of suggestions on how the state could find more than $28 million in cuts.
Johnson, working with JFO and with input from the administration, whittled the list down to the proposal she outlined on Friday that almost brings the budget in balance.
“Turns out, it’s very hard to come up with ways to close an $18 million gap, on top of all the ways the $93 million gap was closed, on top of all the other ways the gap has been closed in the last six or eight years,” Johnson told her committee.
Johnson’s proposal, which will serve as a framework for the committee’s budget work, includes a $1 million general fund reduction from the Department of Information and Innovation.
The proposal utilizes about $8 million in one-time funds to close the gap. Of that, $4.8 million would come from a shift in General Fund expenditures for the Vermont Housing and Conservation Board to the Capital Bill. The state would issue bonds to cover the cost.
The budget also includes a $750,000 reduction to VHCB. Funding for Vermont Public Television would be reduced over the next two years.
The proposal also suggests closing the Windsor prison, for a savings of $820,000. The prison houses 100 inmates.
House Appropriations will be soliciting opinions from other committees on line items in the budget that relate to their areas of policy. The committee will not be taking any more testimony on the budget. They held a public hearing yesterday about the cuts in the list of possible budget reductions.
“We cannot keep balancing the budget on the backs of people with disabilities who are some of the poorest people in the state,” Max Barrows, a member of Green Mountain Self-Advocates who identified himself as having autism, told the committee yesterday while testifying about developmental services.
That program was not identified for further reductions under Johnson’s proposed budget.
Johnson’s plan nearly closes the gap, but comes up short by $1.26 million. She said that those funds may become available during the rest of the budget process.
“At some point, when you’re digging this deep, the cuts become really difficult,” Johnson said after the meeting.
Johnson said that she and the committee are trying to keep long-term ramifications of their budget decisions in mind as they proceed. The budget document she presented sketches out possible savings and costs that some reductions would lead to down the line in FY2017 and FY2018.
Concurrent with the release of the new budget, Steve Klein, the director of the Joint Fiscal Office, presented a draft list of suggestions regarding the governor’s proposed $10.8 million reductions in labor and personnel expenditures.
Restrictions on contract negotiations limit the state’s options for personnel savings to the elimination of positions, he said. Yesterday, the administration issued a letter saying that as many as 320 jobs could be cut.
Other suggestions include reductions in overtime allowances and travel budget reductions.
The memo goes on to outline how savings could be sustained over the next few years. According to a JFO memo to the Senate Finance Committee earlier this week, labor reductions this year are likely not to be sustained over the next few years.
Klein presented a list of suggestions on how the Legislature can influence the bargaining process with state employees, including restricting overtime and putting health care payments on a sliding scale.
Rep. Maida Townsend, D-South Burlington, reported that the House Government Operations Committee, which had previously reviewed the document with Klein, largely supported the suggestions.
Correction: An earlier version of this article incorrectly stated that the proposal included reductions to developmental services.
