Key Vermont policymakers sought public feedback Wednesday as they waded through options to pay for the massive federally required cleanup of Lake Champlain.
Under an agreement with the Environmental Protection Agency, the state must reduce the amount of phosphorus going into the lake by 34 percent over the next 20 years. The total price tag has been pegged at more than $2.5 billion, with the state’s share more than $1.35 billion over two decades.
In 2015, lawmakers passed Act 64 and included a temporary funding source, a 0.02 percentage point increase in the property transfer tax, to begin the cleanup. Phosphorus is blamed as a source for toxic, unsightly blue-green algae blooms that smell, fuel aquatic weeds, and can threaten human and animal health. Sources of phosphorus include agricultural operations, urban and forest runoff, and streambank erosion.
The property transfer tax surcharge, which raises about $5 million a year, was temporary and expires in July 2018. State officials, led by Treasurer Beth Pearce, are required to recommend to lawmakers by the middle of next month ways to permanently fund the cleanup.
Not all of the state’s share, estimated at $68 million a year, will be borne by taxpayers. Municipalities and the private sector will also contribute through projects designed to eliminate runoff that contributes to the pollution. The idea, according to Pearce, is to come up with funding sources that will require contributions from the sectors causing the pollution, including agriculture, which has been identified as the largest source of phosphorus, at 41 percent. Runoff, including from dirt roads and parking lots, is another large source.
Officials emphasized that paying for the cleanup will require an “all-in” approach of shared responsibility.
“This rests with each of us,” said Administration Secretary Trey Martin, who recently left the Department of Environmental Conservation to take the key post in the Shumlin administration. “We’ve all contributed to this problem. If you drive on a road or eat cheese or you go to a mall or live in the state of Vermont, you are contributing to stormwater pollution.”
After starting with more than 60 proposals, Pearce — along with Martin, DEC Commissioner Alyssa Schuren and Andrew Stein of the Tax Department — outlined a narrowed-down list of 30 tax and fee possibilities at a 2½-hour public meeting attended largely by 60 or so environmentalists at the Statehouse.
The money-raising ideas included a fee on each piece of property, a surcharge on the income or rooms and meals tax, an increase in the gas tax, and a sales tax applied to nail salons, the idea being that the chemicals used in the salons contribute to the pollution.
No decisions were made. Pearce said afterward she expects to give the Legislature two or three options to choose from, each containing a package of taxes or fee proposals to raise enough money.
“I don’t want to give them too many to choose from,” she said.
Pearce also emphasized she hopes to reduce the amount needed to be spent, in part by instituting “best practices” that would mean less money required down the road.
Schuren said after the hearing that she was not concerned the election of Republican Donald Trump could stall the cleanup effort. She said her larger concern was possible rollbacks in air and climate change proposals. The lake cleanup agreement is a contract, she said, unlikely to be undone unless it were challenged in court. The cleanup could benefit if Trump’s proposal for a nationwide infrastructure program is undertaken, Schuren and Pearce said.
This week, Gov.-elect Phil Scott said the current EPA guidelines to clean up the lake were necessary, but he suggested the cleanup timeline was perhaps “too stringent.”
The agreement between the EPA and the state came after the Conservation Law Foundation, an environmental advocacy group, sued the EPA. The pact was reached as part of a settlement.
Nothing was ruled out at the meeting.
Public testimony is being sought until Dec. 1 on the proposals. Comments can be emailed to treasurers.office@vermont.gov.
Several of the proposals, including fees on fertilizer and some of the other tax proposals, generated mild opposition. Former Commerce Secretary Pat Moulton warned the panel not to institute taxes that would make Vermont less competitive with other states.
James Ehlers of the group Lake Champlain International encouraged the policymakers to require people who complain about a particular tax to come up with another funding idea.
Pearce said the option of lawmakers doing nothing wouldn’t work, because it would put too big a burden on municipalities and the private sector to pay for the cleanup.
And if enough is not done, Pearce said, the federal government will institute a cleanup plan that would be less palatable. The federal government has said the focus would be on squeezing the phosphorus reductions from sewage treatment plants, which Vermont officials say are a small contributor and not a cost-effective solution.
“The bottom line is we have to find a solution. We have work to do,” Pearce said. “What I’ve found, working together we’re going to have to come up with a shared pain, a shared gain in the process.”
Schuren said the lake should be cleaned up not only for environmental reasons but economic as well, because of the economic activity the lake generates in tourism and recreation.
Even an increase in the property tax was raised, and got a chilly response.
“That was the shortest conversation on property taxes I’ve ever heard,” quipped Pearce.
