The Vermont Senate gave preliminary approval to its draft of Vermont’s $8.5 billion state budget on Wednesday by a vote of 24 to 5 — teeing up showdowns with the House, and eventually Gov. Phil Scott.
The upper chamber’s version of H.494 echoes, in many key respects, the budget already passed by the House. Both chambers, for example, want to spend substantially more on the Vermont State Colleges system, human services and child care — and to end a pandemic-era motel program for people experiencing homelessness.
But the House and Senate remain at odds about paid family and medical leave. And Scott has made clear he is adamantly opposed to the new (or higher) taxes and fees that Democrats across both chambers will need to pay for an array of new or expanded programs.
The Senate’s chief budget writer, Jane Kitchel, D-Caledonia, emphasized on the floor that sustainability has been her watchword. Federal stimulus spending during the pandemic resulted in unprecedented surpluses for the state — but those days will soon be over. And she said the appropriations committee had been particularly vigilant about not using one-time surplus dollars to pay for ongoing expenses.
“We paid a great deal of attention to base funding,” she said, pointing, for example, to the Senate’s decision, contra the House and Scott, to not rely on $18 million in one-time money to pay for certain pension obligations.
The House and the Senate have both committed to significant increases to a wide array of human services providers, though the upper chamber’s spending plan offers slightly more. Additional state spending on such programs, together with matching federal funds, would total $79.5 million in the House’s budget. In the Senate, it’s $85 million.
The Senate’s budget also sets aside enough money to fully fund expected state matches, over three years, to draw down federal funds from the 2021 Infrastructure Investment and Jobs Act. (The House only included one year.) But to do so, it leans in part on 20% across-the-board increases in Department of Motor Vehicles fees first proposed and passed by the House.
Republican senators and Scott’s administration are pleased that matching funds are accounted for — but they wanted surplus funds, not higher fees, to pay for them. On the floor Wednesday, Sen. Russ Ingalls, R-Essex, asked his colleagues to take the DMV fees out of the budget so that they might be voted upon separately. His motion failed, 22 to 7.
There are other relatively minor differences between the House and the Senate’s positions. The Senate plan, for example, includes $6.9 million in grants to organic dairy farms, as well as $1 million to continue Vermont’s worker relocation incentive. The House included neither.
But the key difference between the two chambers’ versions? A comprehensive paid family and medical leave program — or the lack thereof. The Senate has earmarked enough funding for the slimmed-down parental leave benefit they folded into their child care bill, S.56, which would reimburse a single household up to $600 a week for up to three months if a parent stays home with a new child.
The Senate’s budget, however, does not include the money needed to cover the paid leave plan, H.66, passed out of the House in March and now before the Senate. That legislation would provide a much more generous benefit to a wider array of workers — including those who need time off to deal with a serious illness or to care for a family member.
The parental leave plan advanced and funded by the Senate would be relatively cheap — an estimated $7.6 million next year, and $15.7 million the next, when the state would pay out a full year of benefits. The House, meanwhile, needed $37 million next year, simply to begin standing up the administration of its paid leave program. Costs would eventually rise to well over $100 million each year to pay claimants.
The Senate’s budget reiterated what Senate leadership has been saying for months: that child care, not paid leave, is the priority, and that Vermont can ill afford both. Their budget assumes Vermont will spend about $88 million next year on child care and parental leave, with over $80 million of that going to child care.
But at a Statehouse press conference held Wednesday afternoon — just as senators were taking to the floor to vote on their spending plan — House lawmakers and paid leave advocates attempted to make their case one last time. Many hands make light work, Rep. Emilie Kornheiser, D-Brattleboro, argued, and while the total price tag for the program to the state may be high, she encouraged people to consider the individual cost to, and impact on, Vermonters.
“For an employee earning $50,000 a year, the employee and the employer would each pay only $137 a year — for all of the benefits for 12 weeks of leave,” said Kornheiser, who helms the House’s tax-writing Ways and Means Committee. “No employer can cover that level of benefits on their own for that cost. This program saves money and it saves lives.”
A final vote on the budget is expected in the Senate on Thursday. After that, House and Senate negotiators will have to reconcile the chambers’ differences in a conference committee.
