Andy Pallito, the commissioner of the Department of Finance and Management, made the request in a letter May 30 obtained by Seven Days.
Pallito asked agency secretaries and department commissioners to model what 2 percent, 3 percent and 4 percent in general fund cuts would look like for fiscal year 2018, which starts July 1.
The general fund is the main pot of state money used to pay for the government. The general fund accounts for $1.5 billion of Vermont’s roughly $6 billion annual budget.
Pallito wrote that he made the request in light of a budget shortfall in April, when receipts in the general fund were $3.55 million below projections for the first 10 months of the fiscal year.
Additionally, the fiscal 2018 budget the Legislature passed — which Scott vetoed Tuesday — called for $5 million in administrative savings. Pallito cited the language in that bill, H.518.
The bill, which is not expected to survive the veto, asked the Scott administration to eliminate exempt (non-union) positions, find savings through administrative efficiencies, and make contractual reductions, among other things.
“The administration recognizes that this exercise occurs simultaneously with the work your staff is doing for the FY 2017 year-end close,” the letter says. “However, to maximize savings in FY 2018, (the Department of) Finance and Management will plan meetings with agencies and departments on or around the week of June 19th.”
Pallito did not respond to several requests for comment Tuesday.
Pallito is in his final weeks with the Scott administration. He will leave at the end of June to take an accounting job with the Green Mountain Care Board.
Steve Howard, the executive director of the Vermont State Employees’ Association, said the union welcomes the elimination of exempt positions. He said the number of those positions grew substantially under former Gov. Peter Shumlin.
“We think some of that top-heavy managerial layer can be thinned out, and we would of course support increasing the number of front-line workers who actually have their hands in the mix, so to speak,” Howard said.
He said unionized workers cost an average of $25,000 less per year than exempt workers.
The union is generally always concerned about cuts to front-line workers, Howard said. He said the state needs more of them, such as corrections officers, social workers and psychiatric workers at the Vermont Psychiatric Care Hospital in Berlin.
“Our view is that state government is severely underfunded, that Vermonters need and deserve a state workforce that is adequate to the size of the task, and they deserve a government that can efficiently and effectively deliver the services that they’re counting on,” Howard said.
“We have been starving state government for so long that a lot of these needs have not been met,” he said.
The Legislature is scheduled to craft a new budget during a veto session on June 21 and 22.
