May 9, 2020 Legislative Update

We should have been in our final week, this current week – the final days of legislators rushing around to get agreement on bills so that they make the final deadline, which is marked by the completion of the state budget. It isn’t going to happen that way this year.

In the next week or two we will wrap up a new bill making adjustments to the current fiscal year’s budget. The administration can only move small amounts of budgeted resources around without legislative approval, and there has been a need to move big amounts around. There is also a huge shortfall in the revenues to balance the current year’s existing budget. Because we have contingency reserves, we are going to be able to move money to offset those losses. A big chunk is due to the delay in the tax return deadline to after July 1. We will move those into the current fiscal year balance after they come in, and thus end the year in balance.

But the new budget year begins on July 1. A new budget must be passed by then, and the administration is scrambling to come up with a proposal for a three-month budget to carry us from July to September. Once the legislature gets that, it will be on a tight timeline to vet it and get it passed.

When we have a better financial picture of the real impact of the economic shutdown in late summer, we will need to be back at the statehouse to pass a budget for the remaining nine months. “Back at the statehouse” in corona-newspeak will likely still mean remotely, not physically. We’ve all converted to new meanings of language these days. In statehouse jargon, the budget has always been referred to as “the big bill,” presumably due to its length. The new jargon now references the contrasting “skinny bill” that will takes us through the first three months of the fiscal year.

For accounting reasons, the money that has been poured into COVID-19 emergency responses is not being included in the current budget adjustment. Those costs will show up in the skinny bill. At that point we should know which pot of federal money will cover them. This week, however, we received the first summary from the governor’s office on what those numbers look like.

Money already spent as of May 6: $48,702,376. Money not actually spent yet, but already committed and in the process of being spent through the end of the current fiscal year: $117,571,881, for a grand total of $166,274,257. Just as a reference point – since this would be small potatoes in some state’s budgets -- $48 million is roughly the amount in new budgets that is frequently fought over in a typical year when standard inflationary costs rise by that much above expected revenues. Even assuming we didn’t have major lost revenues, it would have been nearly inconceivable to pay this tab without federal relief. This does not include potential new uses for the federal CARES Act relief funds, such as the $60 million “hazard pay” bill passed by the Senate and under review in the House.

The chart released this past Friday divides the numbers up both between “already spent” and “already committed,” but also between those costs that the governor had the authority to spend and those that the legislature’s Joint Fiscal Committee will need to approve; I’m not going to do that breakout, but just where the totals end up. This is a long list of numbers, but I’m trying to present public accountability rather than just what gets caught by the news headlines.

The Department of Vermont Health Access (no surprise, the biggest piece of all): $33,022,266. Most of this is for health care provider relief to prevent medical practices and hospitals from collapse. It is only a small portion of their losses and what they will need for recovery; this is separate from the help they did receive directly from the federal relief bills.

The next mega-category, running a very close second, is the Department for Children and Families: a total of $31,911,329, but this is broken out among its many different departments. It includes $13,565,821 in the child development division, mostly in the “extraordinary relief” category for child care stabilization and essential persons payments and $13,503,862 in rental of motel rooms to help assure physical distancing for homeless folks who might have otherwise been in shelters. There is also $1,528,000 in the Office of Economic Opportunity for emergency shelter and response; $1,413,008 for increases in the Reach Up (aid to families) caseload; $1,256,000 for extraordinary relief for DCF residential provider agencies; plus overtime and remote workforce costs spread across those and other DCF administrative functions.

The Department of Health’s public health division is listed for $17,000,000; that’s primarily for the costs of COVID-19 testing and tracing. VDH also runs the state’s drug and alcohol division, and the costs there are $4,010,681, mostly in provider relief payments.

Other Agency of Human Services costs include $8,177,347 within the Department of Mental Health, listed as covering Vermont Psychiatric Care Hospital additional COVID-19 Costs, the fit up and operating costs for a special inpatient psychiatric unit for COVID-19 positive patients (beginning developed at Springfield Hospital) and financial relief for community mental health agencies, including enhanced pay for staff doing face to face contact work. I’m assuming the $7 million added support for the Brattleboro Retreat is listed under the statewide health provider ($33 million) figure.

Also under AHS is the Department of Aging and Independent Living, with $6,260,281 in the community mental health center relief category for their work with developmental disability clients and for flexible family crisis payments, and $5,573,500 in relief payments to nursing homes and adult day programs. The Department of Corrections has $2,970,714 in costs for remote workforce; enhanced hazard pay levels for facility and nursing staff; and room and board for staff. The AHS Secretary’s Office has an additional $6,177,458 in food assistance, isolation housing and recovery, and expanded 2-1-1 coverage. I have not broken out various AHS departments that have lesser costs attributed to remote workforce or overtime needs.

The Public Safety Division, including state police, is at $15,344,874. The bulk of it is for establishment and the running of the state emergency operations center. The Department of Buildings and General Services has $5,888,974 in added costs for COVID-19 related pay and operating costs and COVID-19 related lease agreements.

There are two other large categories on the list that are more indirect.

One is a contingency fund to account for the possibility that the federal government will not reimburse the state for the advance payments it sent when unemployment applicants were not getting any payments due to the massive backlog. That’s $10,661,205.

Finally, there are supplemental operating costs that are specifically listed as probably not eligible for federal relief funding, the largest of them in transportation at $6,112,016, but other miscellaneous departments, including the Agency of Natural Resources and the Agency of Commerce and Economic Development, at a total of $4,078,359.

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Elections

COVID-19 will have all sorts of impacts on this year’s election cycle. State candidates don’t need signatures on petitions to run for office (too much face-to-face contact required). Incumbents will be filing petitions before the end of the current session, and since they can’t accept money from lobbyists while still in session, that will impact fundraising for those who receive such contributions. Door-to-door campaigning will be off the table. The impact of that is speculative right now. More money raised and spent on advertising in lieu of direct voter contact? Will it increase the imbalance in the advantage incumbents have?

Primary elections will not be changed, because there isn’t the time to set up an all-mail system, but voters will be encouraged to vote by absentee ballot. Unless there is a random hot local primary for a state office, there aren’t likely to be problems with big crowds at ballot boxes.

November is a different question. Vermont already has one of the most open absentee voting processes in the country, and in the last presidential cycle, 2016, almost 30% of votes came through early absentee ballot. No change would be needed to simply increase encouragement for more people to vote by mail-in ballot, and there doesn’t appear to be much concern over aspects of the bill we passed in March that permits safety measures such as drive-by ballot collection.

What is under debate is implementing the provision that would require town clerks to send ballots by mail to all registered voters, in other words, not based on a request. I think it that’s a tougher issue, philosophically, but I’m not very clear on why it is being perceived as partisan. I think the question is whether or not that encourages voting by people who are not invested enough to show up at a poll or ask for an advance ballot – and if not invested enough to do that, have not educated themselves at all regarding who they believe represents them best. If those folks do vote, I don’t know that it favors one party over another.

Yet I do have a gut feeling that although we want people to be involved and vote – I’ve supported our initiatives for expansive automatic voter registration – they ought to want to be involved enough to take some initiative on their own to exercise this fundamental civil right and duty. The legislature played its role in authorizing the Secretary of State and Governor to make what changes might be needed for safety, so I’ll be watching from the sidelines to see how it plays out.

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Unemployment

The nightmare continues, but the system is inching forward in the catch-up on the onslaught of applicants – including for the new program for self-employed folks and others not eligible for regular UI because of issues such as an insufficient work history. With some of the new business re-openings, weekly claim numbers have also begun to drop.

As of the weekend, there were 7,576 unemployment claims still being processed out of the 61,835 eligible claims; 54,277 are receiving benefits. For PUA (Pandemic Unemployment Assistance), there are 3,334 who are eligible but still being processed; 8,623 are receiving benefits. An additional 8,808 applicants are still awaiting determination, and some of these will end up being determined ineligible.

If you are someone who has still not heard anything from DOL, let Rep. Goslant or me know, and we can put you on the legislative volunteer assistance team list for individual follow up.

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Feel free to get in touch any time during the session with Rep. Goslant and me. It is an honor to serve you. (kgoslant@leg.state.vt.us; adonahue@leg.state.vt.us)