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The Vermont House approved a budget that will fund state government for the first quarter of the upcoming fiscal year, buying lawmakers and the governor time to craft a complete budget — which is expected to come with Covid-19 related cuts — over the summer.
The House’s budget, which passed in a vote of 142-5, reverses a 2% budget cut that Gov. Phil Scott had proposed for the first quarter of fiscal year 2021, which begins July 1.
Rep. Kitty Toll, D-Danville, said the administration did not come to the Appropriations Committee with specific recommendations for cutting spending. Instead, the cuts would have been made at the sole discretion of state agencies and the Scott administration. Â
Lawmakers wanted to be able to weigh in on potential spending cuts, and have time to hold hearings so that members of the public could provide feedback on proposed budgetary reductions.
Toll said legislators also wanted to wait to make major spending decisions until they have a better understanding of how state revenues are being impacted by the pandemic. Revenues are expected to plummet because of the economic downturn caused by the pandemic.Â
“And so making decisions without hearing from Vermonters, and without having a clear picture and a consensus revenue forecast that has been adopted would not be a responsible approach,” Toll said on the House floor Friday.
Rep. Cynthia Browning, D-Arlington, raised concerns that the bill only contains funding for July-September, but spends more than a quarter of the budget lawmakers approved for the current year.
That’s because the slated budget expenditure includes the full amount the state must pay toward retirement systems and debt obligations next year, Toll said. The bill includes $120 million to cover the retired state employee pension and benefit obligations.Â
“This was critical to send this signal to Wall Street that we will pay our debt and pay our obligations,” Toll said.
The bill also allows some departments, such as the Agency of Natural Resources and the Agency of Transportation, to spend more than 25% of their current budgets, because most of their projects and programmatic spending occurs during summer months.
It also authorizes the state to spend 100% of what it did on education in the current year (about $1.7 billion), in the upcoming fiscal year.
Overall, the first quarter budget allows the state to spend up to $3.3 billion. This year’s budget totaled $6.1 billion.
But lawmakers and the governor will return in August and September — once more updated financial forecasting is available — to pass a complete budget for fiscal year 2021.
Rep. Anne Donahue, R-Northfield, one of the five legislators who voted against the spending package, said she couldn’t support the bill because it didn’t do enough to decrease spending.
“My very reluctant no vote is based upon my great fear that sustaining current levels of operations now will put Vermonters at much higher risk of deeper cuts in the remaining three quarters of the fiscal year,” she said.
During his press conference on Friday, Scott said he thought it was “short-sighted” that lawmakers weren’t doing more to reduce spending in the budget.
“I believe that we’re all going to have to tighten our belts a bit. I know businesses are going to have to each and every one of us individually going to have to. And we as a state are going to have to as well,” the governor said.
The budget approved by the House on Friday is expected to pass on a second vote next week before moving over to the Senate.
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