[W]ith only one lawmaker voting nay, the House of Representatives advanced a $5.8 billion state budget package Thursday.
It was a rare moment of tripartisan financial unity as the House OK’d the state finance plan for the next fiscal year, which does not raise any new taxes or fees.
The budget gained preliminary approval on a vote of 143 in favor, one opposed. It’s up for final approval in the House Friday.
Earlier in the day, the House approved the miscellaneous tax bill with 138 votes in favor and no opposition.
According to House Democrats, the fiscal 2018 budget package is one built in the shadow of changes in Washington, D.C.
Many on the left consider the lack of new revenues and minimal expansion of programs in this year’s money bills prudent given the potentially dramatic cuts to federal funding under President Donald Trump’s administration.
House Republicans, however, heralded the restrained budget as a result of Gov. Phil Scott’s leadership. The governor threatened to veto any budget that raised taxes or fees.
The bill constitutes a 1 percent growth in spending over the previous fiscal year, taking into account all funds, including federal and education money sources.
Spending from all state funding sources increases at a rate of 0.8 percent in the House version of the budget. State spending in fiscal 2018 will total $2.5 billion, an increase of about $20 million from the current fiscal year.
After the vote, Scott said the budget is a “positive step.”
The House proposal’s “broad support demonstrates a recognition that Vermonters cannot afford to pay more,” Scott said. “We’ll monitor debate on the floor tomorrow and continue to work with the Legislature to prioritize investments in areas that will support economic growth and affordability for Vermonters.”
The budget the House passed Thursday is substantially different from the proposal Scott put forward in January.
The governor’s budget relied on a mechanism involving the education fund that was soundly rejected by House and Senate lawmakers early in the session.
Instead, members of the House Appropriations Committee used the current level of services as their starting point and toiled to close a $70 million gap between projected revenues and spending in the next fiscal year.
But the at-times contentious process, which saw House Democrats square off with the Scott administration, gave way to broad consensus this week.
During less than an hour of discussion about the budget on the House floor, representatives broached subjects ranging from mental health spending and drug addiction treatment to support for agricultural land.
Rep. Heidi Scheuermann, R-Stowe, rose in support of the budget but questioned a part that would convene a committee to review studies related to education spending. She said there have been many studies of education finance and that it’s time for lawmakers to act.
“Let’s focus, people,” Scheuermann said. “We don’t need another study.”
Rep. James Masland, D-Thetford, said some studies commissioned by the Legislature have been key to future policy shifts.
“While some studies do just gather dust, others have turned out to be very, very useful,” Masland said.
Scheuermann moved to strike the new study from the budget, but the proposal was defeated on a vote of 86 to 42.
The budget cuts $340,000 from a program that provides vouchers for motel rooms to homeless people on cold nights. Vouchers will still be available to some, but others will be directed to shelters instead.
The budget includes a one-time appropriation to help establish shelters in communities that don’t currently have one.
Answering a question about the proposal on the House floor, Rep. Matt Trieber, D-Bellows Falls, said shelters tend to be a better option than motels for serving homeless people.
“The last thing that any member of the Appropriations Committee would be looking for would be for Vermonters to be adversely impacted,” Trieber said. “We are trying to invest money where we are seeing the best outcomes.”
Many Republicans stood on the floor and urged their colleagues to support the financial package.
At a news conference earlier in the day, House Minority Leader Don Turner, R-Milton, flanked by fellow Republican representatives, lauded the budget plan.
Turner said it was “the result of good leadership of the governor” and members of the Republican caucus.
“Single-party rule allowed much greater spending than the state could afford,” Turner said. “And we’re going to start holding that and reining that back, and we are proud to support a budget that starts in that direction.”
However, Turner said the budget does not solve all funding problems.
“This is one year. One year does not fix multiple years of overspending,” Turner said.
The sole nay vote came from Rep. Warren Van Wyck, R-Ferrisburgh, who said the budget does not do enough to cut excess spending.
“We’re overweight,” Van Wyck said. “Even though we haven’t increased it, I think the budget needs to go on a diet.”
After the vote, House Appropriations Chair Kitty Toll, D-Danville, approached Van Wyck. Toll, who has touted the committee’s process in developing the budget as open and collaborative, asked him to come forward with his concerns.
Toll said after the vote that she was “very pleased” with the outcome. The budget made structural changes, kept money in reserve funds and met needs of the state, she said.
“I think that our focus really was setting ourselves up to be in as good as shape as possible when federal reductions hit Vermont,” Toll said.
Earlier in the day, the House approved the miscellaneous tax package with no opposition.
The revenue package raises just shy of $5 million by increasing compliance with existing tax law.
The largest portion of the package, $3.2 million, comes from boosting compliance by working with third-party services, like PayPal, that process payments.
An additional $1.8 million is expected to come from better enforcing state law that requires Vermonters to pay a 6 percent tax on products they buy out of state that they have not already paid taxes on.
Rep. Janet Ancel, D-Calais, said the tax bill was drafted with awareness of potentially substantial cuts in federal funding to the state coming later this year. Tax revenue could be key to managing that impact.
“We are going to need to look to whatever tax capacity we have in this state to make up at least part of the difference,” Ancel said.
Correction: This article originally incorrectly identified the party of Rep. Janet Ancel, D-Calais.
