[A] working group that was supposed to find long-term funding to stem Vermont’s water pollution says the state can put off raising money — in part because nobody knows yet how to make use of it.
When new funding is warranted, the group says, the best mechanism might be a per-parcel fee. That suggestion is the closest the group came to fulfilling its mandate to recommend legislation.
“The Act 73 Working Group found that existing revenues are generally adequate to address clean water needs through (fiscal year 2021),” says the final draft of the report the group will deliver Wednesday, the day it’s due.
State Treasurer Beth Pearce has estimated it will cost Vermonters $1.3 billion over 20 years to meet federal water quality standards in Lake Champlain alone. Last year she said the state could meet its statutory clean-water obligations through 2019 without new fees or taxes. But she said it’s imperative to have a permanent, long-term funding source in place by then.
The working group, created this year under legislation called Act 73 to find such a source, goes further and recommends no new revenue through 2021.
It’s not that the need for long-term funding has diminished or become less urgent, say those behind the report. But it isn’t possible to begin paying those costs for several more years, they say.
That’s in large part because the Agency of Agriculture, Food and Markets hasn’t completed the assessments that will identify where to spend it, said Natural Resources Secretary Julie Moore, who chairs the Act 73 Working Group.
Those assessments will identify what projects need to be done at Vermont’s roughly 700 small farms to reduce the phosphorus pollution they send into state waters, Moore said. About half the cattle in the state live on small farms, she said. Those are defined as having fewer than 200 head of cattle, for instance, or 25,000 hens, or 3,000 sheep.
Agriculture Secretary Anson Tebbetts said he didn’t know when his agency would have the assessments wrapped up, nor would he estimate the costs associated with reducing pollution at small farms.
“We’re inspecting those now,” Tebbetts said. “Somewhere along the way we’ll figure out how much the need is in terms of dollars.”
Even if Tebbetts’ agency had the money, Moore said, officials wouldn’t know what to do with it.
“Even if the resources were available, we haven’t completed the assessments to do that work,” she said.
Tebbetts would not say whether that’s an accurate statement. “We have enough money now to do what we need to do on the ground,” he said.
Tebbetts’ predecessor said this approach will saddle Vermonters with much larger pollution payments in the future.
The report omits funding that’s currently needed to slow pollution from Vermont farms and defers those costs until later, said Chuck Ross, former secretary of the Agency of Agriculture, Food and Markets.
That approach, Ross said, will lead to a backlash against farmers once the public figures out those costs have been simply delayed. He said that farmers, for their part, have already contributed “more than (their) fair share of the solution.”
“I worry that’s like a balloon payment nobody’s talking about out there in the future that needs to be identified now,” he said.
The Legislature also needs to figure out how costs are split between the state and other entities before anyone can figure out the best way to pay for Vermont’s water pollution problem, Moore said.
Further, some regulations that will impose new costs for which the long-term funding is needed won’t kick in until 2023 or later. Moore said the funding associated with those regulations isn’t usable until they take effect.
The working group has six members. Besides Moore and Tebbetts, it includes Tax Commissioner Kaj Samsom and the director of Vermont’s geographic information agency, John Adams. The group has held 10 meetings since June.
Listed under the group’s “powers and duties” in Act 73 is a single item: “Recommend to the General Assembly draft legislation to establish equitable and effective long-term funding methods to support clean water efforts in Vermont.”
In its report, the working group does not propose any legislation.
The first recommendation in the report states that Vermont should “utilize existing state revenues and financial instruments to fund clean water through (fiscal year 2021).”
The third recommendation says further work is needed before long-term funding for the pollution problem can be found.
“New revenues will likely be needed to support clean water work,” the report states. “The most equitable and effective long-term funding method is likely to be a fee based in part on the amount of runoff from a parcel.”
The report doesn’t describe that fee further.
It’s still unclear whether the per-parcel fee is actually a good long-term solution, Moore said, because it’s unclear what entity or agency should raise the money.
The Tax Department said it would cost at least $4 million to administer if the department were to do it, and municipalities have made similar estimates, she said. That’s a lot of money compared with the $20 million or so that Pearce estimated needs to be raised every year, Moore said.
Even that funding estimate hinges on assumptions about cost-sharing that the Legislature still needs to resolve, Moore said. These are public policy decisions that lie outside the working group’s bailiwick, she said.
As a result, it wasn’t possible to write the draft legislation that was the group’s sole duty, Moore said.
Pearce said the working group made a meaningful contribution to an ongoing process.
“I still have concerns” over particulars of the group’s short-term funding scheme, Pearce said, “but the most important part for me is, we’re not talking ‘if,’ we’re talking ‘how.’ There is no question we’re passing ‘if.’ We’re going to do this. We should see this as a process that has moved forward.”
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