[I]t’s been two and a half weeks since Gov. Peter Shumlin gave his budget address, and holes are already emerging in his plan to fill a $68 million gap in the fiscal year 2017 budget.
The House is in the preliminary stages of its budget review process, but lawmakers are seeing a lot not to like. They are not enthusiastic about Shumlin’s provider tax ($12 million to $13 million). A proposal to cut Medicaid support for pregnant women disappeared from the governor’s budget less than 24 hours after his address ($2.25 million). And a plan to speed up the process for court-ordered medication of mentally ill patients is falling flat ($2.3 million).
All told, the pushback could create a $16.5 million hole in the budget. Not to mention a $4 million to $6 million anticipated cost of living increase for state workers that has yet to be settled in negotiations between the Shumlin administration and the Vermont State Employees Association. (The administration budget includes $4.73 million for “step” increases, based on a state worker’s education level and number of years in state government.)
The hole could be as large $22 million or more, according to figures from House Speaker Shap Smith’s office.
Smith says budget cuts may be necessary to make up the difference, and if lawmakers don’t like the provider tax, they’ll have to find another revenue source.
“At this point in time, nothing is off the table from my perspective,” Smith said. “There are a lot of things I don’t like. But there are a lot of things I don’t like in my household budget, either, but you gotta make choices. If we aren’t doing $15 million in provider revenue, maybe we ought to find $15 million in cuts.”
The options are limited and familiar: a sugar-sweetened beverage tax that could generate roughly $30 million or an increase in the employer assessment that would bring in a small revenue bounce of $5 million or less.
Lawmakers are warming up, however, to the Shumlin administration’s proposed doubling of mutual fund registration fees. An increase from $600 to $1,200 will raise $13.2 million, according to the governor’s office. And as the financial industry hasn’t responded to initial invitations to testify on the matter, House Ways and Means may consider an additional bump in the rate.
The House will be homing in on potential cuts, and possible fee and tax increases, in the next two weeks. The budget committee, House Appropriations, is in information gathering mode again this week, with a full slate of testimony from commissioners and secretaries. House Ways and Means, the tax writing committee, is working through tax and fee scenarios with Shumlin administration officials and the Joint Fiscal Office.
Once the scale of the problem becomes clear, the speaker’s office at that point will pick its battles.
Smith’s early hardline stance on the budget, meanwhile, shouldn’t be interpreted as part of a renewed bid for governor, or lieutenant governor. Buzz has abounded in the Statehouse over the past week that Smith is reconsidering his decision to abandon a race for the Fifth Floor because of his wife’s illness, but Smith says he is focused on taking care of his family and finishing out his last term as speaker.
Paid sick leave saga continues
The Senate will take up paid sick leave, again, on Wednesday, and it’s not clear at this point whether Senate President Pro Tem has the votes to defeat an amendment that would exempt employers with five workers or fewer from the benefits requirement.
The legislation, H.187, will effectively go up for fourth reading because Sen. Bill Doyle, R-Washington, asked to reconsider his vote on the so-called Campion amendment last Thursday. While the reconsideration is allowed under Senate rules, Doyle’s turnabout on the matter caught many in the Green Room by surprise. It turns out, Doyle, 89, was pressured to call for the revote by Pat McDonald, a contender for a Senate seat in his district, and Rep. Patti Komline, R-Dorset.
Sources say the vote is too close to call, and because of the kerfuffle over the behind-the-scenes McDonald and Komline maneuver, senators are likely to keep any other amendments close to the vest until showtime Wednesday.
The Senate will take up the non-controversial budget adjustment act, the state’s proposal for a mid-year financial update, today and Wednesday.
Senate Finance will vote on tax proposals for the marijuana legalization bill later today and a bill that would criminalize threats to state workers is likely to come out of Senate Judiciary this week.
In other news, the trial of Sen. Norm McAllister, R-Franklin, who has been accused of sex crimes, has been delayed until May. That’s good news for timely adjournment in the Senate, as many senators are expected to appear as witnesses in the trial.
