[T]he Senate Appropriations Committee approved a budget package Friday afternoon that includes funding for state colleges, childcare, the mental health system and more.
Two related bills — related to general and education fund revenues — are expected to be voted out of the Senate Finance Committee Monday.
The seven-member Appropriations panel approved the fiscal year 2018 budget bill with unanimous support. It is expected to come up for a vote on the Senate floor early next week.
The Senate’s budget proposal is similar to the state finance package that passed the House last month in that it does not raise new taxes or fees for the general fund. However, the latest version of the budget includes $13.5 million in expenditures that are different from the bill that passed the House with near-unanimous support last month.
To cover the costs of the additional initiatives in the Senate version of the budget, the panel looked to several sources — including shifting the cost of retirement benefits for teachers who are currently employed to the education fund. Currently, that expense is covered by the general fund.
The move will free up almost $8 million in the general fund.
Sen. Jane Kitchel, D-Caledonia, the committee chair, said the panel decided that paying into retirement benefits for currently employed teachers is “a legitimate education fund expenditure.”
The construct has been proposed in the past, but lawmakers have been hesitant.
“People have been very reluctant,” Kitchel said.
However, she said that the education fund demands on the general fund have been growing significantly in recent years and have diverted general fund revenues toward education-related initiatives.
Sen. Ann Cummings, D-Washington, chair of the Senate Finance Committee, said education fund demands have squeezed general fund expenditures.
“We have been starving all levels of state government,” Cummings said.
Gov. Phil Scott, in his budget proposal, shifted the annual payment toward teachers’ retirement obligations to the Education Fund. He used the savings to increase subsidies for childcare and higher education. Both Cummings and Kitchel said that the Senate’s proposal to shift some general fund cost to the education fund is much narrower in scope than the proposal the governor put forward.
The Senate is transferring the cost for maintaining retirement benefits for currently employed teachers to the Education Fund. The shift will increase property taxes slightly, Cummings said. She said she is not certain how the panel will act on the issue.
The Finance Committee will meet Monday afternoon to further discuss the proposal.
The panel will also finalize the tax bill, which does not have significant changes from the version that passed the House last month. The Senate Finance Committee agreed to raise $5 million from increased compliance with existing tax laws.
The Senate Appropriations Committee budget
To pay for a childcare initiative the Senate Appropriations Committee moved $3 million in available Medicaid receipts to pay for children’s integrated services, a Department for Children and Families program that offers health and support services to families with young kids.
The shift will free up $3 million from the general fund, which will go to supporting childcare programs for infants and to support childcare programs that have a high percentage of children on subsidies.
The budget also utilizes $400,000 from the Green Mountain Care Board, some of which is savings from work the board did not undertake already, according to Kitchel.
Another $2 million in the budget comes from a $4.2 million settlement the state received from Volkswagen in a case claiming that the company violated Vermont’s clean air laws. Most of the settlement money is going into an environmental contingency fund.
The committee decided not to include $1 million in the budget for a bond to develop affordable housing in the state, which Scott proposed in his budget.
Other changes:
• $4 million in funding for the Vermont State Colleges;
• Restoration of a cut made in the House budget to a program that provides motel vouchers for homeless people on cold nights;
• Repurposes a prison in Windsor as a reentry facility;
• $2.1 million for the state’s mental health system;
• $5 million in management savings across the government
• Cuts a section of the House budget that required the Agency of Human services to cut $1.3 million in grants.
Lawmakers added language in the bill related to federal funding levels for Vermont’s only secure residential facility for children.
Last fall, the federal government determined that Woodside Juvenile Rehabilitation Center did not meet qualifications for Medicaid funding. The decision cast the future of the already dated facility into question, because federal funding was a major support for the facility. The state has been in negotiations with the federal government in an attempt to restore that funding.
The budget includes language that would require the agency to put together a plan for how to respond if the federal government does not agree to restore funding to Woodside.
That plan could involve closing the facility, said Sen. Dick Sears, D-Bennington, who supported the language in the budget.
