Editor’s note: Jon Margolis is VTDigger’s political columnist.
[S]o is there going to be a budget bill veto after all, followed as the night follows the day by a special session of the Legislature in June?
Or are the assertions and protestations of Gov. Phil Scott on one side and the legislative leaders on the other merely long-distance negotiation?
The world will have to wait until early (or maybe even mid-) May for the answers. But at the outset of what was supposed to be the third-to-the-last week of the legislative session, both sides were sticking to their own positions on school spending and the statewide property tax.
Two days after House Speaker Mitzi Johnson, D-South Hero, called Scott’s plan to use “one-time money” to fill the budget hole “short-sighted,” Senate President Pro Tem Tim Ashe, P/D-Chittenden, said Scott didn’t even have his numbers right.
Ashe said he asked the Legislature’s Joint Fiscal Office how much would be needed to avoid an increase in the statewide school property tax. The answer he said, was $58.2 million.
Last week, Scott suggested using $40 million in “one-time money” to prevent any tax hike in the state budget if lawmakers agreed to take steps to hold down school spending in the future.
Top legislators think they’ve already done that. They have, but not enough for the governor, who also seems determined to get through another year without raising any tax or fee.
Right now, though, the state has some tens of millions of dollars less to spend on the schools than the schools have budgeted. Whether that shortage is closer to $40 million or $58.2 million is uncertain. Ashe said he asked for his estimate “assuming full funding of the reserve.”
That’s the Educational Fund Stabilization Reserve, which by custom (though not law) is “funded to 5 percent of prior-year appropriations,” according to a report of the Joint Fiscal Office. Scott and the Legislature dipped into that reserve last year for some of the “one-time money” that papered over the previous budget gap.
Either way, Ashe said, finding those funds would not be easy.
“I haven’t found the tree to shake” to find that much money in the budget, he said, adding that even if it could be found, it might be better spent elsewhere. Using $58.2 million to pay down some of the state’s retirement, health care, or capital spending obligations, he said, would save far more money over the next several years than could be saved by plugging this year’s school spending gap.
But Scott wants that gap closed now, without even a small increase in the statewide school property tax. He seems to think that holding firm on this position is good politics, and he’s probably at least half right. Property tax increases are unpopular.
By rejecting Scott’s “one-time money” plan, Democrats are making themselves vulnerable to being attacked as “pro-tax.”
“He’s already calling us that,” Ashe said, indicating that Democrats are prepared to accept a small property tax increase to finance the schools.
“Using some one-time money as part of a negotiation if the governor wants to avoid a veto is one thing,” Ashe said. But he rejected what he called “creating an alternate reality to keep a one-term campaign pledge.”
Both sides, then, appear to be on a path toward impasse, veto, and special session, which could be disagreeable. If the House Republican minority holds firm, Democrats cannot override a Scott veto. But the state needs a budget. At some point, the two sides will have to agree.
But everything everyone is saying right now can also be viewed as part of the standard end-of-session negotiating process. The antagonists need not be in the same room (yet) to communicate, and then to assess how their communications are being judged by allies, opponents and the public.
Recent events have given Scott added incentive to hang tough. He enraged part of his conservative base by signing gun control bills. Fighting tax increases – and not incidentally annoying the education establishment – could appeal to some of those same voters.
Scott’s political risk is that unsettling the public school system isn’t popular, either, which is probably why he came up with his “one-time money” idea in the first place, as an alternative to forcing schools to adjust budgets already approved by the voters.
And voters don’t like forcing schools to make deep budget cuts, which perhaps helps explain why the governor wants the Legislature to make the difficult decisions on just how and where to cut.
This is hardly unusual. It makes good political sense for governors (and presidents) to proclaim general themes, leaving the difficult (and politically unpopular) details to their legislative branches, especially if those branches are controlled by the other party.
The most specific spending reduction proposal the Scott administration is now pushing calls for increasing the staff-to-student ratio in public schools.
How?
Well, as was evident in its presentation to the House Education Committee Wednesday, the administration doesn’t have the foggiest idea. Commissioner of Finance and Management Adam Greshin and Brad James of the Agency of Education told lawmakers that there were now 5.15 students for every education employee, and if the ratio were raised to 5.5 the state could save about $35 million.
Except that James acknowledged that his data was based on several assumptions and exclusions, and Greshin interjected that what was being presented was tentative and “not a proposal,” and it turned out that much of the money would be saved by getting rid of para-professionals, who as Rep. Kathryn Webb, D-Shelburne, noted, would have to be replaced by a smaller number of better-paid professionals, meaning (as the administration officials did not dispute) not much money would be saved at all.
And one way to save money in this plan would be to penalize districts who failed to get their staff-to-student ratio high enough by increasing the taxes in those districts.
In other words, the way to cut property taxes in this plan is to raise property taxes.
It needs work.
