Democratic leaders of the Vermont Legislature criticized Republican Gov. Phil Scott on Friday for planning to veto the state budget and the property tax bill because they had not reached a deal on teacher health insurance.
Just hours after they adjourned, the leaders said the veto threat puts the state at risk of a government shutdown on July 1 — if they can’t reach a budget deal by then — because the Vermont Constitution requires the Legislature to pass spending bills in order to run the government.
For the time being, Democratic lawmakers said, they have directed their caucuses to get some rest and take some time off before coming back to negotiate.
Meanwhile, Scott sought to assure Vermonters that he would not allow a shutdown, even if it meant giving in somewhat to lawmakers.
House Speaker Mitzi Johnson, D-South Hero, said she had no immediate plans to get members back to the negotiating table on teacher health insurance. She said members put their personal lives “on hold” while they delayed adjournment twice to negotiate with Scott.
She said the governor was guilty of “petulance.”
“I don’t want to underestimate the effort that all members of the Legislature have been shuffling their lives,” Johnson said. “We’re going to have to catch up on our lives, and we will be back to conversations and back to the negotiating table but as of now we don’t have any plans.”
Senate President Pro Tempore Tim Ashe, D/P-Chittenden, said he has instructed members to take the weekend off and get sleep. He said some members of the Senate could go back to the negotiation table as early as next week.
“Obviously, knowing the governor has said he would veto the property tax bill and the budget, we know we’re coming back for a veto session, so it would be good to have a few days to have people let the emotions settle and come back to the table,” Ashe said.
Lawmakers adjourned shortly after midnight on Friday. Johnson and Ashe were negotiating with Scott into Thursday evening, but they eventually declared they could not reach a late-night deal and had the Legislature adjourn.
Lawmakers scheduled a return for a special session for June 21 and 22.
Scott has vowed to veto the budget bill, H.518, and the education property tax bill, H.509, if lawmakers did not move negotiations for teacher health insurance from the local level to the state level. On Friday, both Johnson and Ashe remained critical of the governor’s negotiating strategy.
“I am really not interested in Washington-style politics up here,” Johnson said. “I think the whole concept of threatening to veto a budget … because he didn’t get what he wanted on a different bill is stooping pretty low.”
Johnson said the legislative budget “did not depend on any new taxes and new fees, nothing. It has for our state funds a 0.7 percent growth rate, and in terms of all funds it’s a 1.3 percent growth rate, so that puts it well below our gross state product of 2percent, and our revenue projections of 3.5 percent.”
Scott told the Legislature he would veto the budget before the ink was even dry. “He hasn’t even looked through it,” Johnson said. “He hasn’t really taken the time to really read it and understand it, and that’s not governing. That’s petulance.”
Steve Klein, the executive director of the Joint Fiscal Office, said government services would not be funded past July 1 without legislative action. That’s because of a section of the Vermont Constitution that says, “No money shall be drawn out of the Treasury, unless first appropriated by act of legislation.”
Klein said there are some technicalities that would allow some funding — such as allowing the treasurer to make bond payments — but the Legislature would still need to pass something to provide government services.
“We don’t want that to happen, and there’s lots of ways you can avoid it. You can pass one-twelfth budgets or one-quarter budgets, or whatever,” Klein said. “I don’t think it’s going to happen.”
On Friday afternoon, about 12 hours after the Legislature adjourned, Scott called a brief press conference where he said first off that he would not allow a government shutdown.
“For those Vermonters who are worried come July, I want to assure everyone we will have a budget on July 1,” Scott told reporters. “This isn’t D.C. and I will not shut down state government over this issue.”
Scott pointed to the broad goals he laid out for his administration when he took office in January — to make Vermont affordable, to grow the economy, and to protect vulnerable people. “I will not jeopardize one issue for another,” he said.
Ashe called it “pretty disturbing” that Scott was holding up the budget bill over teacher health insurance because funding for the program is not in the budget, H.518. Lawmakers nonetheless did put a counterproposal on teacher health care into the education property tax bill, H.509, before passing it Thursday night.
“State government would shut down” without a budget on July 1, Ashe said. “I hope that even before we get there the governor will back off that veto threat because it destabilizes so much,” he said.
Ashe pointed to parts of the budget that increase funding for the Vermont State Colleges and increase pay for mental health workers at quasi-public nonprofit organizations, among other things. “All those things are now in limbo,” Ashe said.
Johnson said negotiations broke down on Thursday evening after the House and Senate agreed to a new step toward a teacher health insurance deal, and Scott turned around and asked for another step in his direction.
“The House and Senate came back and said ‘We can do this; we’re ready,’ and he said he couldn’t,” Johnson said. “We found something that we could agree on and the governor backed down and said ‘no.’”
Scott said he would not comment on the previous 48 hours because he considered it an ongoing negotiation. But he provided reporters with a timeline of how the teacher health insurance issue came about, and said his administration has been negotiating “in good faith” the whole time.
The governor described his negotiating tactics. “My style is just to get whatever we can,” Scott said. “I go in with a thought. I have to believe in what I’m trying to negotiate. And in this case, I’m negotiating on behalf of the taxpayers of Vermont.”
“I think that the merits of this proposal would be beneficial for us and something that I’m not willing to go home without, and I’ve said that numerous times,” Scott said. “I think it’s worth the effort.”