[D]o you feel the drama, the tension, the excitement of the showdown between Republican Gov. Phil Scott and the Democratic-dominated Legislature?
No?
Well, maybe not. Maybe because there hasn’t been all that much drama, tension, and excitement yet. Or maybe it’s because this showdown is mostly about … itself. It’s a showdown about a showdown.
Which is why it could go on for a while, maybe all the way to the end of the fiscal year on June 30. Then you’ll get drama, because if there is no budget by July 1, state government will have no spending authority.
Not that there’s no public policy substance at all to the dispute. Scott wants no tax or fee increases in the budget for the next fiscal year.
None. Not even the tax increases that used to be called local tax increases, not counted by previous governors as a rise in state taxes. But Scott has quite brilliantly altered (distorted?) the terms of the debate.
Or maybe it’s just that the Democrats have quite dimwittedly allowed him to do that.
More about that momentarily. Meanwhile, back to the public policy substance of the debate. Scott says no increase in property tax rates, not a penny. No pennies needed, he says, because there’s all this extra money that can be used to fill the hole in the education budget.
In return, the Democrats say, maybe a few pennies in property tax rates because fiscal responsibility says to use that extra money to pay down some of the state’s pension payment arrears, which is costing it money.
So the public policy substance of the debate is over a few pennies.
But these are not real pennies. These are pennies of tax rate, which is not the same thing as the actual taxes actual people actually pay. Because those actual people mostly voted to increase their school budgets in March, actual taxes in half the towns will go up no matter what the governor and the Legislature do, Peter Griffin of the Office of Legislative Council told lawmakers Thursday.
In other words, the connection between property tax rates and property tax payments isn’t non-existent, but it isn’t one-to-one, either. Meaning this showdown is less about the pennies, the rates, the public policy than it is an old-fashioned duel between the executive and legislative branches of government.
James Madison would have loved it. It’s just what he had in mind.
And political shrewdie that he was, Madison would have understood why this squabble could well last all month: So far, neither Scott nor the legislative leaders is paying much of a political price for the stalemate.
Here the obligatory “one never knows” caveat. It’s politics. Anything can happen. A scandal, a death, a war, a little-known candidate captivating the public.
OK, that’s out of the way. Here’s what we know to a 90-plus-percent certainty about Vermont politics this year: Phil Scott is going to be re-elected. The Democrats are going to maintain large majorities in both houses of the Legislature. Furthermore — perhaps because the drama, tension, excitement has so far been underwhelming — the average citizen doesn’t seem to be paying much attention. Throngs are not flocking to the Statehouse demanding action.
The result is that neither party to the dispute sees any reason to give in to the other party. So far, nobody is being hurt. Why not play it out until the end of the month? If nothing else, the governor and the lawmakers might then be providing some real drama, tension, and excitement, as voters pay attention to see whether the two sides can agree before the government has to shut itself down.
That would be dramatic, because that would pose a political danger. Both Scott and the legislative leaders would look bad if, say, state parks had to be close in their peak season.
But while both sides would pay a price, the governor would in all likelihood pay the bigger one. Not because it would be mostly his fault (though it might be) but just because he’s the governor — the most visible and responsible official. So far as is known, Phil Scott does not keep on his desk a replica of Harry Truman’s sign: “The buck stops here.” But it stops there anyway.
This could explain why some Democrats think they are in the stronger position, that all they have to do is wait until the end of the fiscal year approaches and Scott will agree to a small increase in the property tax rate for non-residential property rather than risk a government shut-down.
Maybe they’re right. But if they are so politically astute, how did they let Scott change the terms of the tax debate with hardly a peep of complaint?
With few exceptions, ever since the current school financing system began under Gov. Howard Dean in the late 1990s, the statewide education property tax has crept up each year as voters approved higher school budgets. Govs. Dean, Jim Douglas, and Peter Shumlin grumbled, but they didn’t make that big a deal of it. These weren’t their tax increases. They were local tax increases.
Every year, Shumlin bragged that he and the Legislature had passed a “balanced budget with no increase in broad-based taxes,” meaning income and sales taxes. In each of those years, the statewide school property tax rose. Like his predecessors, Shumlin claimed no ownership of those taxes.
Scott has, in order to claim credit for not letting them go up. Whether they should be thought of as state taxes is debatable. They end up in the state budget approved by the Legislature and the governor. But they are basically determined by local voters in their school districts.
It’s easy to see why Scott decided to settle that debate in a way that served his political interests. It’s hard to see why the Democrats allowed him to do it. Maybes they weren’t looking.
