2025 Pre-Session Update

 

The 2025 Session

Rep. Anne Donahue

Dec. 18, 2024

 

Hello, all, and best wishes for the holidays you celebrate and for the new year ahead.

Before the start of each session, the Times Argus asks legislators to share what they see as the priorities and challenges, as well as their approaches to bipartisanship work, what constituent concerns are, and “what will be a win” for the session.

These are the answers I submitted:

Priorities

Just to upend the headliner conversation: addressing property tax increases should not be our highest priority. Framed that way, it is a deceptive goal that would allow for a narrow solution and fail to address any real problem – in fact, could make it worse. That is because property taxes can be reduced by simply shifting education costs into a different revenue source, like income tax. Those taxes, instead, could shoot up. Lack of affordability is then unchanged; it only shuffles the deck.

The real problem goes to the entire failed funding system and, at its heart, to the ever-increasing costs of education and the need to find out the multiple reasons, and which can be addressed. We have a confluence of deeply intertwined crises of affordability and access in education, housing, workforce and health care. One of the biggest underlying drivers – and least able to be changed by local school boards – is the cost of health care.

Our health experts say a primary necessary intervention for that is to enhance housing access. Lack of housing impacts people’s health and impairs workforce recruitment; workforce costs then drive both health and education costs; but investments in taxpayer-supported housing hit back on affordability, driving away potential new workforce.

Health care costs and access are a greater crisis with a far worse current trajectory than education. Yet, if connected to education spending, the impact there is clear. To use simple sample numbers, if 90% of your budget is personnel and 20% of personnel costs are health insurance and health insurance costs go up 15% a year… you’ve got a budget problem that squeezes out any other needs. That hits school budgets, but also municipal budgets, business expenses, and health care costs themselves.

Here are the dire facts:

Community hospitals have a steady decline in days of cash on hand over the past 10 years, going below recommended sustainability. Community health centers are starting to operate at losses – clearly not sustainable. A November national hospital finance report projects 705 hospitals at risk of closing, eight of them in Vermont. Four in Vermont are deemed at risk of closing in the next 2-3 years.

But for payers… a plan with an out-of-pocket maximum going to $18,000 for a family of four costs $38,000 per year. Yet insurers are also at increasing financial risk with their required margins dropping. The average payments for care made by Blue Cross Blue Shield per person went from a rate of $6,300 per year in January of 2020 to $10,080 in June of 2024. Those comparison numbers do not include the year of the COVID drop and do not include the additional consumers payments in out-of-pocket costs in copays and deductibles.

At the same time, consumers are facing longer and longer waits for access to care. The choice to close the CVMC inpatient psychiatric unit will drive new ER waiting room crises and deny the highest level of necessary care, right at a time that needs are increasing. It was a short-sighted, discriminatory and political reaction to being required to cut costs.

But some types of changes in how services are delivered will be necessary in the near future.

The reasons that set Vermont apart, with costs higher and rising faster than elsewhere in the country, is our demographics. Our working age population is shrinking and our age 65+ population is growing. That means less in premium revenues coming in, and significant increases in services being utilized. Older folks need a lot more health care. We’ve known this demographic trajectory for years, and failed to plan for it, spending money on new programs instead. Now we have to come to grips with it.

It means looking at more specialty services being regionalized, and inefficient ones being cut – steps Gifford Hospital recently started moving on. We also have to stop forcing commercial payers to subsidize government health programs.

Thus, my highest priority is new health reform actions, integrated into the entire cross-sectionality of our economic and demographic drivers.

The Biggest Challenge

Right now, our economy is strong, although facing some uncertainties over the next several years. However, our revenues are growing more slowly than the spending pressures. Our budgets have increased above the rate of inflation for years. For valuable detail on the economic and budget picture, you can see our fiscal experts’ projections at: ljfo.vermont.gov/assets/Publications/All-Legislative-Briefing-December-4-2024/December-2024-Legislative-Economic-Review.pdf, and ljfo.vermont.gov/assets/Publications/All-Legislative-Briefing-December-4-2024/JFO-Posting.pdf

The bottom line is that we cannot keep trying to get everything we want and yet also curb the growth of cost burdens. The challenge in facing these crises this year will be whether a non-partisan majority will be willing to make unpopular choices for the long-term benefit of Vermont. Most of us are willing to say, “yes, cut excess spending… except, not that.” And we all have a different, “not that.” We need to focus on what the smart choices are, not necessarily the popular ones, and that will be the biggest challenge.

The other challenge will be the amount of turnover, which will slow the start of the session, plus the decision of Democrats to consolidate leadership in Chittenden County. Fully one third of the House will be turning over, with 51 freshmen out of 150 members. Democratic representatives, who still hold the chamber majority, elected two members from Essex Junction as their Majority Leader and Assistant Majority Leader and nominated the current Speaker, Jill Krowinski of Burlington for election as Speaker in January. The Senate Democrats have also placed leadership into Chittenden County members. This presents challenges for the interests of all Vermonters outside of Chittenden County, where needs and economies differ.

Bipartisanship

I became an Independent this year in the effort to shed some of the increasing divisiveness that has crept into our statehouse in more recent years. Labels seem to matter more that our common priorities.

We have the opportunity at a fresh start because voters rejected having a supermajority of one party. The supermajority created an attitude of not needing to listen to anyone else’s ideas.

My hope is that we will embrace that change by electing an Independent Speaker, challenger Laura Sibilia, rather than reinstating past Speaker Krowinski, who remains grounded in the attitudes of a supermajority.

If we are all committed to best outcomes for Vermonters, we will be willing to listen openly to all ideas before coming to agreements – or even agreeing to disagree – in the end results. I am committed to continuing to do that. Most of all, my mantra should be – though I hate to quote from Facebook posts, I just saw this one and think it is right on – “Be teachable. You don’t know everything and you’re not always right.”

Constituent Concerns

Across the board, the major concern I hear from constituents is about affordability, and not restricted to property taxes. It includes areas such as fees, housing costs, and the potential of heating cost increases in order to make Vermont a leader on carbon emissions. I hear a lot of consensus on doing our part to address climate change, but not to think we can change a world trajectory by taking on more than our share of that burden.

What Will Be a Win?

It would be a win if we leave without creating a single new study that simply kicks “solutions” to our urgent and crippling problems to another year. I want to see us do the hard work of making very specific progress on health care and education spending, revenue, and quality outcomes.

Legislative Note on Education Finance Report

 

Legislative Note

Rep. Anne Donahue

Dec. 2, 2024

 

I highly recommend a recent report by the state Board of Education explaining how our education finance system works.

It is really clear and understandable and explains some things I have tried to explain in the past -- like why a town's taxes can go up even when the school budget is cut, and what the "common level of appraisal" is -- but does a much better job! It includes a comparison to other states' systems... no one does it the way we do.

With the pending debate in the Legislature beginning in January about potential changes, this is invaluable background to understand the discussion.

The report can be found here: https://education.vermont.gov/sites/aoe/files/documents/edu-vermont-education-funding-system-explained-2024.pdf     

Best wishes for the coming holiday season!

Anne

Post Election Thoughts and Thanks

 

Hello neighbors,

I want to express my appreciation to voters for their support and confidence in returning me to represent Berlin and Northfield at the statehouse in Montpelier. I commit to continuing to work hard and with others in being solution-oriented, to share information on key issues, and to explain my decision-making process on votes.

I also ask that you continue to connect with me about issues of concern. We may not always agree, but it is important to me to hear and understand all perspectives. If all our challenges were simple, we would not need dialogue and debate. I have always believed that the sharing of ideas, rather than unilateral thinking, produces best outcomes. None of us can stand alone and claim to know the best answers to everything.

That is why I was so personally pleased to see the election results this year that will strengthen balance in our governing as a state. A legislative supermajority of any party, where the majority can steamroll its own solutions because it knows its ability to override any veto, does not support shared dialogue. When there is no need or interest in listening to alternative approaches, there is no process of constructive challenge to its own thinking.

We now retain both a Republican governor and a majority Democratic Senate and House, with its inherent checks and balances. However, now that the Democratic supermajority has come to an end in the legislature, both must work together to avoid stalemate. Hopefully this will bridge the growing divide we have experienced in the recent past.

As an Independent, I hope I can enhance this rebuilding of collaboration.

That is why I am also supporting Laura Sibilia, another Independent, in her challenge for the position of Speaker of the House. This position bears leadership responsibility for overall direction and priorities of the House and for the effectiveness of its work.

In the recent past it has been led by unilateral decision-making. A shift in this leadership culture needs to occur. There is real urgency to addressing economic pressures on multiple fronts: education, health care, housing, climate resilience and more, all within the context of affordability for Vermonters. This means we need to re-organize under a leadership that holds a primary focus on building strong working relationships and developing concrete and effective outcomes.

Lastly, I want to thank all for the well wishes after hearing of my mishap just a week before the elections. A broken leg is a real curveball in life’s usual course. I’m now hopping around (no weightbearing on the right leg for 8 weeks) but look forward to being on two feet – at least partially – by January.

Thanksgiving wishes,

Anne

Veto Session Update

 

Legislative Update, Veto Session

Rep. Anne Donahue

June 11, 2024

Five bills have been vetoed thus far since the end of the legislative session, with some not yet acted upon by the governor. The legislature will be meeting next Monday and Tuesday, the 16^th and 17^th, for possible votes on overrides of the vetoes.

Constituents have begun to reach out to urge for or against voting to override. One note said the person assumed I was going to vote against any overrides, since as a Republican I will support my Republican governor. So I want to be clear from the outset: a veto from a governor, from either party, would never affect my previous decision of whether it was a good bill or not.

The only reason I would change my prior vote would be if I received new or different information to consider that developed after we passed a bill. That has not been the case for any of the vetoed bills thus far, so I do not expect to change any of my votes, whether they are in line with the governor’s position or not. I have always been a fairly independent Republican and in fact, in the interest of greater transparency, that is why I am running this year as an Independent.

A lot has been made of the record number of vetoes by Governor Scott. That should not be surprising. For as far back as my history can recall, this may be the first time that we have had a governor of one party and a legislature with a supermajority from the opposing party. A “supermajority” means that a party has two-thirds of the legislative seats, enough to override any veto. If power is divided between legislative and executive branches, there is a range between 50% and 2/3rds that forces efforts to compromise. If the majority in the legislature passes a bill but has not listened to concerns by the minority, it faces a potential veto that it may not be able to override. In that situation it is in everyone’s interests to work together. There could still be an override of the governor if there is enough minority support to reach the 2/3 threshold, but it is far from guaranteed.

Once the supermajority number is reached, the only way an override will fail is if some members of the majority party itself do not support the bill. That happened earlier this year, for example, when there was no override attempt of the governor’s veto of the flavored vape and tobacco ban. The majority knew some of its members did not support it, so it did not call for a vote at all and left the veto standing. (It was a bill I had supported.)

Given that level of power – where compromise is not needed – one party can fully control outcomes. Inevitably, it means that some bills will go farther to an extreme on a spectrum of viewpoints. Unless a governor wants to simply concede to every such initiative instead of communicating her or his beliefs about better outcomes for Vermonters, there will be more vetoes than if there was a more level balance of power.

While Governor Scott has voiced concerns about many bills passed this session, he has only vetoed a few. Those we already know will be on the agenda next week – and my earlier votes on them – are these:

H.887: An act relating to homestead property tax yields, non-homestead rates, and policy changes to education finance and taxation.

This is the bill setting property tax rates, which must pass in some form every year. Voters pass the spending amount in their school budgets, and the legislature must set a rate that will raise the money to pay the bill. We have known for years that the system, within its very effort to create fairness, is fundamentally flawed. Towns vote on individual budgets but must pay a designated amount of the statewide spending, regardless of the reasonable of its own spending. When big increases in home values combine with big increases in budgets, everyone feels it most harshly, which happened this year. Rates have skyrocketed.

The bill passed by the legislature adds stopgap funds from other sources to reduce those rates a bit for this year but does nothing to resolve the fact that the same thing will keep happening in the future. I am less deeply concerned by this year’s increase as I am about the ongoing deferral of tackling the underlying issue. I voted against the bill and will vote against the override. This is potentially the only bill that has some Democrats feeling nervous about voter reaction, so it is possible that there will be an effort to develop and pass a new bill rather than to override the veto.

***

H.706: An act relating to banning the use of neonicotinoid pesticides.

The focus of this bill is the critical protection of pollinator bees. The governor is concerned that it is anti-farmer, because Vermont is a tiny market and can’t control the availability of seeds that are not treated with these chemicals. I voted to support it, because I believe it has protections built in against adverse consequences. It doesn’t take effect until the New York State law does, and that state’s market can ensure access to seed. The bill also allows for suspending the law if crops or economic stability are significantly threatened. I will support an override.

***

H.289: An act relating to the Renewable Energy Standard.

In contrast to H. 706, the RES bill has no protection against an unknown, but potentially severe, financial consequence. It seeks to expedite our existing, aggressive standards towards fully renewable energy, but experts can’t predict the costs with any degree of confidence. I voted against it and will vote against the override.

***

H.72: An act relating to a harm-reduction criminal justice response to drug use.

This is the “safe injection site” bill, to fund a program in Burlington where illicit drugs can be used under supervision so that if a person overdoses, they can receive an immediate medical response. The mantra is, it will save lives. I have supported broad access to Narcan, the overdose reversal drug for that reason. I support strong resources for prevention and treatment.

But will a site like this actually save lives? Or do we shoot ourselves in the foot by educating on prevention and yet sending a public message that it’s OK to use, as long as you practice “safe use” – when we know there is no such thing as safe use? We could lose more lives in the longer term, and in a world of limited resources, choosing one thing ($1,000,000 for the safe injection site) means fewer resources for existing, proven interventions. I voted against it and will vote to sustain the veto.

***

H.645: An act relating to the expansion of approaches to restorative justice.

I found this bill to be a tough call. I believe in the evidence that restorative justice for non-violent crime is more effective than punitive measures. I strongly believe that there should be equal access to these programs in Vermont, regardless of county. That isn’t true now.

This bill works to ensure access across the state. It will be expensive, and there is no money in the budget to pay for it, since the costs won’t come until next year. The governor’s veto was based upon the fact that we don’t know where the money will come from to implement it.

For me, the bigger problem is that although it professes equity in access, it doesn’t actually create it. It will require every county to have a program, but in the name of local prosecutorial authority, it doesn’t require that the standards be the same. The same crime will block access to a restorative justice program in one county, but not in another. That’s still not equity. I voted no and will vote against an override.

***

Given the supermajority, will my votes make a difference when I oppose an override, given that the original House and Senate votes have it locked in already? Not likely. Fortunately, the Legislature still retains degrees of collaboration at the nitty-gritty level of committee work.

While some majority priorities can be and are rammed through, most committee chairs do want to build consensus, and bring bills to the floor that have a unanimous committee vote. Democracy survives there, even within a supermajority legislature. Once a bill gets to the floor, no one is listening to debate anymore because the votes are pre-ordained. This is even more true, when a veto override vote is called. Don’t expect any surprises.

***

Thank you, as always, to all those who make contact and share your concerns. You can reach out any time to Rep. Ken Goslant at kgoslant@leg.state.vt.us or me at adonahue@leg.state.vt.us. And have a great summer!

End of Session Legislative Update

 Brain teasers:

How many bills can you read and pass in 14 hours?

How much in new taxes can you enact in a day?

How many times can you repeat studies of the education funding system without acting on them?

The end of a two-year session always comes in as a firestorm of decision-making. Some of that is human nature. I always crammed for tests at the last moment in school. Some of it is when one is dependent on someone else: If the Senate doesn’t send us a bill until there are only a few hours left, the choice in the House is to either rush it to a vote to concur or to abandon an important initiative. And some of it is simply session exhaustion. Better to stay until 2 a.m. and cram everything through than to extend the session several more days to complete work more thoughtfully. It seems to be something embedded into our process.

Thus, answer number one: Between 10 a.m. and 2 a.m. Friday-Saturday, we passed some 26 bills – everything from finishing minor amendments to the biggest items of the session: the budget, the education funding bill, the broad revision to Act 250 (our land use law.) But “read” before passing? In many cases, committees had a brief window of time for review, and members had no advance time at all for reading.

Answer number two: We added four new taxes or fees, none of them broad-based or staggering, but cumulatively, $62 million in new revenue, in addition to taxes from last year that are starting to hit: the 20% increase in motor vehicle fees and the payroll tax for funding childcare subsidies.

Answer number three: By some counts, we’ve done 38 studies of the education funding system since 2000, with lots of promises but no resulting significant action, despite broad recognition of the need for structural reform.

***

Education Funding

This year’s property tax increase crisis led to major momentum to… do a bigger study.

The yield bill – setting the rates to determine how we balance the education spending budget – had a primary focus this year of scraping up other money so that property tax increases could be less drastic. The effect will be to defer the impact of spending decisions by a year. Next year, those deferred costs will be added to the increases that will, in part, be the result of having “kicked the can down the road” on change. There were no new cost-containment proposals in the bill, even for the short term while waiting for a new study committee report due in 18 months.

In January, estimates were that projected school budgets would result in an average of an 18% increase in property taxes, not including the local effects of changes in relative property values (the common level of appraisal, or CLA.) In town meeting day numbers, it had the combined effect of a 24% increase in Northfield and a 26% in Berlin. Both of their district budgets were defeated. The new base increase estimate is now about 13.8% instead of 18%. 

That has come about through several factors. Multiple budget revotes lowered statewide spending a bit, and it is statewide spending that establishes how much money needs to be raised. The new yield bill reduces that further by adding other sources of taxes to offset (or “buy down”) the effects of new spending. These included a one-time $25 million transfer from the General Fund, a new 3% surcharge tax on short-term rentals (projected to raise around $12 million), and the repeal of a tax exemption on software accessed over the internet, expected to raise about $15 million. Those funds also contributed to the ability to create a one-time offset for the two-thirds of Vermonters who pay property tax based on income. There is a bonus 13% subsidy for the property tax credit to ease the degree of increase that would have occurred because of the timing lag of income versus tax years.

Currently, because of the statewide mechanism, districts that spend a lot get supported by those that keep costs down. There is little incentive to run a tight budget, but those who do are hurt the most when costs go up statewide. Cuts they make to the local budget gives minimal reduction to the local tax rate. That’s a lousy system.

Deferring some of this year’s huge increase for a year might have been OK if we also began some actual reforms to the funding structure, but that has also been deferred. The mega-study on creating an entire new vision for education to go along with new ways to finance it won’t be ready for action for at least another two years. There was a lot of flowery language before the vote, rejoicing over the bright future that will come when everyone contributes to the “Blue Ribbon Commission.” It was all things that have been said many times before. 

The 93-44 vote in the House (13 absent, and some Democrats joining Republican opposition) means it could be close as to whether the bill will survive an expected veto from the governor. A 2/3rds vote (100) is required for an override. We will return on June 17 for veto override votes.

***

Budget

The governor introduced his budget proposal at the start of the year to hold to an increase of roughly 3% from last year, with no new taxes or fees. The final version had comparatively tame additions, aided by increased revenue over original projections. It ratcheted up financial regulatory fees by about 20 percent to gain an added $19.4 million. That will be pretty well hidden from everyday pocketbooks, with difficult to predict filter-down costs into the economy. The final general fund increase was a half percent higher and the overall state budget was about a quarter percent higher than the governor’s, at $8.57 billion in full.

I was upset over the fake budget the House past two months ago. Major spending initiatives and the taxes to pay for them were placed in separate bills, so that they did not appear in the budget bill, even though they would all end up being paid out of the budget. The Senate eliminated almost all of that. 

I was also very pleased to see that we began to address the Medicare cliff in this year’s budget, which has been a high priority for me. By next year some 15,000 lower-income seniors will be added to those helped with their Medicare premiums or co-pays.  Before this, they lost health care financial support when they turned 65, sometimes in significant amounts, because the criteria for assistance dropped so steeply in Medicare. States can expand support options and many have done so, but we have been helping only those with incomes below the poverty level, which is $15,000 a year for an individual. The change will increase eligibility to 145% of the poverty level (about $21,000.)

The Salsbury fish hatchery, defunded in the governor’s budget, had broad constituent push back and the final budget added it back.

The hotel emergency housing program was cut back, and the compromise on which ways to hold the line was messy. Compromise can force that. I think some general eligibility is still too broad, but eliminating the assurance of shelter for all in true, extreme weather goes too far. Hopefully we will truly expand enough shelter capacity (non-hotel) to make up the difference.

Our community social services providers, who don’t get the benefit of state employee contracted raises, will received a 3% increase; the governor had left it at zero.

One hidden add-on remained. I was told that it wasn’t hiding anything; I should just think of it as a “box outside of the box” – new taxes and spending that didn’t show up in the budget bill. That came in a bill that suddenly combined two separate ones that were worked on all session in both houses: the Act 250 reforms and new money for housing expansion and supports. An added $15.7 million was raised through a new second-home property transfer tax to put funds into an array of housing supports. 

Through being combined, a yes or no vote included a decision on the re-envisioning of our land use laws, commonly referred to as Act 250. It determines what people can do with their own property so that we can control growth and restrict it to the places we believe as a state that growth should occur. That bill will divide all Vermont land into three “tiers,” to be determined by regional maps developed by the Natural Resources Board and applied by a new Land Use Review Board, rather than applying Act 250 review based on specific sizes and attributes of property.

Tier 1 allows development with a waiver of Act 250 review and is confined to more urban areas that have sewer and water infrastructure and designated town centers and a strong local staffing ability for a town to review its own projects. Tier 3 are critical natural resource areas that will come under high protections against any development. The official definition of Tier 2 is “an area that is not Tier 1 or a Tier 3 area.” All of Tier 2 will come under ongoing Act 250 review.

It will take several years to roll out, and in the interim, some flexibility will be in place to encourage housing development as long as acreage requirements are met. 

Earlier in the session, I asked what money was being put aside to reimburse property owners for taking of land by “eminent domain,” and I was told no one’s land was being taken. But “taking” in the legal sense means significantly reducing value for a public need. If your land drastically loses value because it gets mapped in as “Tier 3” and can’t be developed at all, done in order to benefit all of us to protect our natural environment, usually there is some level of reimbursement owed. We will now need to wait and see whether and how this bill plays out. I did not support it.

***

Scattered Bill Notes

Almost under the radar among the last-few-hour bills was one that adds aggressive criteria that must be met before a government function can be contracted out. We have strong law on this already so that we don’t cut state jobs just to cut corners. Does this new bill go overboard without enough information? Here’s what our nonpartisan fiscal analysists said about potential cost: “The size of direct fiscal impacts on the General Fund and other State funds is uncertain but could potentially be substantial.”

A huge bill to protect Vermonters regarding access to personal data, with an added focus on child protection, was nearly lost in House-Senate negotiations, but survived the final days after going back and forth several times on the last day. The House wanted it stronger; the Senate was more cautious. (The vote on a bill that goes through that kind of ping-pong can end up titled this way: Shall the House concur in the Senate proposal of amendment to House proposal of amendment to Senate proposal of amendment thereto!)

Another new law will allow organizers to use a process that eliminates a secret ballot for a worker decision to unionize. It was called a labor protection act; I see it as an anti-worker rights act. It was one of the pieces added to another bill, thus opposing it meant being recorded as voting against the good parts of the original bill (which included restrictions on employers proselytizing and looking into better protection for farmworkers.) Protections against arm-twisting need to go both ways, and I voted no.

A crucial bill I worked on in the Human Services Committee to ensure we had the right secure treatment settings for a small number of individuals with disabilities charged with violent crime but not competent to stand trial led to a standoff with the Senate committee over a single word. Everyone wanted the bill, but it almost died over semantics on using the word “forensic” or not in the description. Who would blink first? (Can you spell the word, “stubborn”?) At last, compromise occurred.

A bill I introduced and pressed for over two years failed on the last day. It would have protected farmers in accessing the parts and tools they need to repair their own equipment, instead of being locked into a manufacturer monopoly. The Senate gutted the “Right To Repair” bill when it passed it in the final days, and there was no time left to negotiate restoring any of the protections that were in the original bill.

On the plus side, the Senate bill that made controversial changes to the Fish and Wildlife Board was abandoned on the House committee side.

***

Insider Baseball

Every year in the final days, I fight for the ability – the right on behalf of those I represent – to actually read a bill or amendment before I vote on it. Almost unthinkable that one would have to fight for that. One time last week when I raised an objection on the floor, another member, in a comment clearly directed at me, said he believed in respecting the work of the committee instead of feeling a need to review the work directly. Of course I respect their work, but I don’t believe I’m doing my job if I don’t even know what it is that a committee is recommending. Nor do I think a race to the finish on our final day benefits our work.

Here’s one episode that gives a rare exposure of how politics can play out in processes: 

The House had a bill with assorted revisions to our current laws on the cannabis market. It didn’t come back from the Senate with their proposed changes until early Friday afternoon. One change struck out an existing piece of our restrictions on advertising. That bans the offering of “a prize, award, or inducement for purchasing cannabis” – in other words, the bill was making it legal to use prizes or awards to increase sales. I proposed sending the bill back to the Senate with “further proposal of amendment” to accept everything else, but to remove the deletion of that ban. 

Members of the House committee itself expressed some clear support – they didn’t think the deletion was good policy, either. But their leadership urged them to oppose my amendment because there might not be enough time left for the Senate to vote on a cross-proposal. The bill potentially could die. I argued that we should be voting based on what we thought was right, and not let the Senate control an issue by slipping a change in knowing time was running out.

Despite the leadership argument, there was a very rare rebellion in the ranks of the supermajority. People clearly did not think this should be deleted from the bill, and the standard voice vote sounded close. Before the result was called by the Speaker, a member called for a division, meaning people must stand up to vote yes or no, enabling an exact count. It’s hard to see from one’s seat, but it looked as though it was going to be close. After the count, the Speaker started consulting with the House clerk. It seemed something was awry.

Suddenly, a member from the majority party called for a roll call vote (these voting format changes can be requested any time before the vote result is announced.) That meant folks were going to have to put their names to the vote if they broke ranks with their leadership. It later turned out that the consult by the Speaker was on the question of whether under the rules she could use her tie-breaking vote authority, and the answer was no. That only comes into play if there is a tie in a roll call. Thus, the roll call was requested to get the dissenters in line and avoid the embarrassment of a loss on the vote. The tactic worked to get enough votes to shift, and my amendment failed, 85-59. That count meant a lot of Democrats still stuck to their guns to support me, but not enough of them.

***

Obviously, a lot has happened in the final days. The journal with the list of Friday’s bills isn’t out yet as I write this; staff is still assembling it, and with so many bills “taken up prior to entry in the notice calendar” there is no listing available elsewhere. Please reach out to Representative Ken Goslant or me if you have questions about any bill outcomes, at kgoslant@leg.state.vt.us or adonahue@leg.state.vt.us As always, thank you for the honor of representing you.

April 27, 2024 Legislative Update

 

Legislative Update

Rep. Anne Donahue

April 28, 2024

 

Sometimes the legislature is a pendulum of careening objects… and that’s even before a bill moves from the House to the Senate. Two weeks ago, a whole new education funding plan was unveiled in the Ways and Means Committee and the initial announced plan was to vote it out in a mere two days – far too fast for judicious consideration.

Two weeks later, we received the bill on the House floor. It was stripped of any and all reforms, even short-term cost containment for next year. Perhaps it was a straw man, only intended to draw in negative reaction from those with vested interests and thereby create an excuse for doing nothing this year to change factors that led to the crisis in property taxes.

The core of the new bill is yet another study. There have been 39 different studies on Education Fund reforms since 2000. The new Commission has 23 members and a huge array of tasks, almost guaranteeing that its mandate cannot be achieved. Waiting for its recommendations means at least two years before any proposals come forward to reform what everyone agrees is a dysfunctional system. We know the status quo is failing.

It is now in the Senate hands to consider whether to agree to our proposal.

What is not transparent within the complexity of the current system is how much local taxpayers are held hostage to what other towns want to spend. Without better cost-containment mechanisms on upper-end spending, towns that maintain thrifty budgets end up paying for those that want to spend more. It is what makes cutting a local tax increase so difficult: for every dollar cut, the town only sees 25 cents reduced from the budget impact on its own tax rate. Those who want to spend more have only to contribute 25 cents locally per each dollar increase.

That is a key part of what is meant by the structural change needed: We need mechanisms that prevent excessive spending by individual districts from being included in the statewide funding that places the cost on everyone. At the same time, maintaining enough sharing of costs to protect equity is a core value.

The crumbs tossed to taxpayers in the House bill were that we eased the homeowner tax increase slightly by creating several new taxes and putting that revenue in the Ed Fund. In addition, an increase was shifted onto all commercial property, landlord property, and camps or second homes.

In the legislature, one often relies heavily on colleagues who have developed an expertise in a particular area and whose analysis one trusts. For me with education funding, that is Rep. Scott Beck, who has been on either the Education or the Ways and Means Committee since 2015 and understands the system deeply. His words on the floor:

“There is nothing in this bill for short-term or long-term cost containment, or structural reform... Our taxpayers are going to get absolutely hammered this fall and we will not even be able to tell them that we made a course correction. And then they are going to get hammered again next year, and then this Commission will come… and tell [taxpayers] we might make a change by fiscal year ‘28. Our taxpayers can’t handle any more; it is unconscionable that we aren’t making structural reforms right now.”

One of the proposed amendments was an interim “allowable spending” percentage for the next two years that, if exceeded, would place a higher cost on the spending district. It was rejected.

One truly logical proposal was to suggest that if were delaying reforms to avoid unintended consequences, we should at least make the new taxes on computer software and short-term rentals temporary – then reassess as part of those future comprehensive reforms. As I said in explaining my vote of support, “We have a misfit when we refuse to initiate even interim changes that actually address our Education Fund stressors – we say we shouldn’t move that fast – yet reject a sunset on what should be solely a stop-gap measure, not permanent new taxes.” That amendment was rejected 41-100.

I need to note that of the $200 million or so in increases in the education budget statewide, close to $30 million was caused by the legislature’s decision last year to fund universal school lunches. I mention it because I supported that decision and need to be transparent about it. Unlike some types of constituent input in the form of cut-and-paste emails, I heard thoughtful and persuasive direct arguments in support from local residents. We knew that decision would be borne by the Education Fund.

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Lots To Come

The Senate passed its version of the budget this past week, with numerous changes from the House bill. That signals that we are on schedule for ending the session by the end of the second week in May, because it takes about two weeks to reconcile differences. There are too many differences to sort out quickly. The Senate does rely on significantly fewer tax increases. It also pared back the House expansion of the hotel emergency housing program.

Although it budgeted a lower level than the House for the increase in support for Medicare cost-sharing for low-income elder Vermonters, it did still support the need for some increase. These Vermonters actually experience a significant drop in health care support when they go onto Medicare. I was glad to see it included, as it is something I have been fighting for.

These two weeks will see bills passing at dizzying speed. Many controversial bills I described in updates throughout the session are coming back from the Senate with significant changes, so new decisions (are they better? worse?) will need to be made before we wrap up. Among those controversial bills include the changes to the Act 250 process and whether it will help or hurt housing development (H.687); the changes to the Renewable Energy Standard (H.289); and Fish and Wildlife Board changes (S. 258). Still in play in the Senate but with time running out is my Right to Repair bill for agricultural equipment (H. 81).

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Right Person, Right Timing

One little “add on” in the Senate Transportation bill was $2 million to purchase a large parcel of land in Berlin for a new state central garage. The old one was destroyed in the July flood and it would be senseless to rebuild on the same flood plain. I got a word of alarm from a resident last weekend: The land is a 23-acre piece of the state-designated town center that has been in development by Berlin for years. The hope has been that it would be a growth area for desperately needed multi-family housing.

I got in touch with Sen. Andy Perchlik who was well positioned by being both one of our Washington County Senators and the Chair of the Transportation Committee. It turned out the bill was already up for a vote on the Senate floor, usually too late to initiate any change. But Sen. Perchlik got a day’s delay on the bill to hear from both Town Administrator Ture Nelson and the Secretary of the Agency of Transportation, Joe Flynn.

There was quick consensus that though the money should still be appropriated, it shouldn’t be tied to a designated piece of land. That will allow the time and leeway for AOT to work with Berlin to assess the best options for moving forward. The amendment was made on the Senate floor the next day. Although the parcel seems to be well suited for the state garage, Flynn said AOT has no desire to be somewhere it’s not wanted and is in strong agreement that housing is the state’s highest priority. Rep. Ken Goslant and I were able to sit in to hear the discussion and praise the outcome, and I’ve talked to the House Transportation Committee to ensure smooth support there.

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Congrats

This year’s class of new Eagle Scouts were presented on the House floor this week, and it was a joy to see one of our own on the list, Jonathan Andrew Tenney of Northfield!

***

Thank you for your support and the honor of representing you. Rep. Goslant and are available anytime to hear your concerns and input at kgoslant@leg.state.vt.us or adonahue@leg.state.vt.us. My archive of legislative updates is available at representativeannedonahue@blogspot.com.

April 14, 2024 Legislative Update

 Legislative Update

Rep. Anne Donahue

April 14, 2024

I was all ready to rant and rave in this week’s update, until I found out that, 

a) the news media had exaggerated the status of a proposed bill and, 

b) major parts of the preliminary draft had already been put on hold. 

We are not going to pop a new education funding system into place with three days of committee review.

It may come as a surprise to know how often legislators must rely on the same news broadcasts the public gets. There are 11 Senate committees and 13 House committees, so keeping track of what they are doing prior to a bill being voted out and reaching the floor is nigh impossible. When a constituent writes to ask about the status of a bill, I can always catch a colleague to find out what’s happening within their committee. I usually also skim the weekly calendar for all committees to get a sense of what they are working on. But that’s a far cry from actually knowing details.

There have been rumors about development of a new education funding formula ever since the catastrophe that struck this year with soaring budgets and voter rejections. But obviously doing that is not a three-day job. Even after much longer work on some revisions last year, one part of the crisis this year came about as a result of unintended/unforeseen consequences of those changes. 

What actually happened in the Ways and Means Committee this past week is that a number of ideas that have been under discussion for weeks were put into a draft in order to see what concrete language would look like. That doesn’t mean that there was an actual bill yet that was proposing those ideas. But the draft certainly lit a firestorm. To clear the air, the committee chair publicly clarified that none of the long-term system changes are on the table for this year. There is not enough time left in the current session to do due diligence on major changes. 

That would have been my rant; now instead I’m letting you know you can ignore the reports. There is now an actual draft bill which, as of Friday, proposes some interim ways to ease this year’s homestead property tax increase by several new taxes and shifts among tax sources. Some of those will be controversial. I’ll mention them without opining at length, since they may or may not remain in the bill by the time it reaches the floor next week:

~Add what is called a “cloud tax,” applying the sales tax to software you purchase and access over the internet. That would raise a projected $20 million annually.

~Add a 1.5 percent surcharge for a “short-term rental impact” tax that would raise about $6.5 million. (A 10% surcharge, raising $24 million, has also been considered.) The majority of those rentals are AirBnBs that homeowners use to raise some added income.

~Increase property tax credits for one year by 15 percent to further reduce the homeowner tax burden for those at $90,000 income or less, who pay in part or fully based upon income rather than house value.

~Increase the higher, separate non-homestead property tax (rental property, business and second homes, most owned by Vermonters and some passed down to renters) to reduce the homeowner rate.

A reminder of where the money comes from currently to pay the $2.3 billion Ed Fund, in rough percentages: 

~non-homestead property tax, 38% (40% minus 2% in current use land exemption); 

~homestead property tax, 27% (34% minus 7% in property tax credits); 

~sales tax, 26%; 

~one quarter of rooms and meals tax, 2.6%; 

~one third of purchase and use tax (vehicles), 2%; 

~lottery, $1.5%; then smaller miscellaneous items.

The long-term proposal that drew such consternation before it was taken off the table for now was to develop a statewide tax that would be used to provide all school districts a base payment per student. The payment would be based on an analysis of what an “adequate education” costs in Vermont. Voters would only consider any added local spending in excess of that base, thus taking most of the local decision-making power away from voters. It would recognize that current local budget votes end up imposing costs on everyone else, and thrifty budgets hardly reduce a local tax burden at all. 

The current draft bill turns that proposal into a task force study for a report back next year.

***

Back to the general fund budget: the Senate is working to finalize its response to the House, and is taking a much more conservative course, pushing back on some of the major new tax and spending bills that the House passed. 

There was an interesting comment by Sen. Jane Kitchel, the Chair of the Senate Appropriation Committee, as reported by VT Digger. She said the budget is where new positions and revenue sources should end up, rather than through individual policy bills, as the House sent over. “We’re going to be building our budget the way we always do — so some of these bills that the House passed will end up being incorporated into the budget,” she was quoted as saying.

It caught my eye because that was what I argued for on the House floor: that we were being deceptive by passing an alleged budget that put some major new expenditures and the taxes to pay for them into separate bills, rather than including them as part of a full budget.

Most other major bills that worked their way through House or Senate are also now being vetted by the opposite body; they will either be accepted, die, or most likely come back with proposed revisions (minor or major.) 

If the changes aren’t acceptable, appointed conference committees of three Senators and three Representatives get to hash it out to seek compromise. This is the end-of-session process that gets highly chaotic. With a May 10 date set for the session’s end, the pressure will be upon us soon.

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Can the process of compromise and consensus-building work? 

Yes. I give credit to my committee chair for leading us through a Senate bill to reduce exposure to chemicals with significant health risks. It’s a highly important topic, but how to approach it could have been very controversial. Our committee includes seven Democrats, two Republicans, one Progressive, and one Independent, bringing a wide variety of views. We voted the bill out 11-0 because testimony was considered from all sides and incorporated: tackling risks but weighing feasibility of how quickly restrictions could be made effective.

Importantly, we recognized that Vermont is not large enough to be a “market changer.”  If we ban something, our market is not large enough to get manufacturers to change course. We will just lose the ability to get the products and hurt our local manufacturers in the process. Instead, we carefully followed the lead of a few larger states (California, most often) in terms of both the chemicals and the products, as to whether alternatives are available. We also set phase-out timelines based on those factors. 

The intentional addition of a number of chemicals will be banned in 2026 from products with a lot of risky skin contact, namely cosmetics and menstrual products. Cosmetics is very broadly defined: anything “intended to be rubbed, poured, sprinkled, or sprayed” on the body for the purpose of “cleansing, promoting attractiveness, or improving or altering appearance,” with soap as the only exclusion.

Dangerous PFAs (“forever chemicals”) will also be regulated then, from children’s products, clothing and textiles, and cookware. By 2028, the ban will reach artificial turf, which is currently loaded with these chemicals which slough off onto the skin and clothing of those playing on them, as well as into our water tables.

There was one skirmish. On the last day, finishing up the 30-page bill, we were resolving a few final items, including the maximum amount traces of lead that could remain in cosmetics (including in naturally occurring forms.) 

The Senate had sent us the bill saying it had to be under 10 parts per million, the same limit as set by California and others. Washington State alone had recently set the maximum at one part per million, which our local manufacturers said was not feasible. Local environmental groups pushed for that level, and we were split on it.

We came up with a compromise at five. But that was without taking any new testimony since we were in the final “mark-up” before the vote. Testimony is typically not continued for the committee back-and-forth changes on final parts of a bill. 

The day after our committee vote we – and many of our House colleagues – heard outcrys that five was no more feasible than one. We received an amendment proposing a return to 10 and after stalling on reaching agreement, had a vote and agreed 7-4 to accept 10. 

There were some vigorous voices of opposition on the floor and a roll call vote was requested, ending up with 101-28 favoring the revision. After resolving that, the final vote, also a roll call, was 138-0 in favor of the bill as a whole. 

Now, we watch and await whether the Senate will accept our improvements to its bill!

***

The repaving of Route 12 from Northfield (just past the front of my house and just before Cumberland Farms) through Berlin to the Montpelier line is now underway. It will be starting on the Northfield end, with single lane closures with alternating one-way traffic throughout the length of the project. 

If you would like a weekly email updating where the work will be happening that next week, you can email Bethany Oprendek at bethany@bbo-enterprises.com and request to be added to the email list for “Northfield-Berlin STP PS24(1).” If you want to check the status on your own, go to vtrans.vermont.gov/projects/updates and click on the “Northfield-Berlin” project.

***

Speaking of roads, Anyone else on the roads Monday evening?

My brother came up from Maryland for a visit and wanted maximum totality viewing of the eclipse, so we went up to North Troy to avoid the big-town crowds. The return home was going fine most of the way, since we were going via local roads.

Just a few miles north of Montpelier on Rte. 12 south, we were diverted by GPS via back roads to Bailey Drive and hit total gridlock. It took about an hour to get back on 12 via Dog River Road, then it seemed to be clear sailing continuing south.

Just before Chandler Road, GPS gave a “road stoppage ahead” alert and diverted us onto Chandler. Once again clear sailing, until about a quarter mile before Cox Brook Road: dead stop. We inched forward and realized that Rte 12 and Chandler/Cox Brook would have to merge – and then reached Cox Brook and discovered there was a long line of cars there to merge with first, as well!

It looked like it would take an hour or more for that last mile home, so we went west on Cox Brook instead to cross on Aseltine. The stop-and-go line of cars heading south extended endlessly beyond Aseltine! It appears they were all avoiding the jammed-up I-89 Waterbury entrance and then hitting the backlog of cars that was avoiding the Montpelier entrance, all trying to reach exit 5. My brother was driving his compact 2WD car and we had quite the experience with his crash course in Vermont mud driving, but made it easily home by reaching Rte 12 and doubling back north.

Watching from my house, the traffic on 12 was still stop-and-go at 9 p.m. By 10 p.m., it was moving steadily but still an endless stream of drivers. But even all those out-of-state folks were behaving politely, taking turns with merges and even breaking their flow to allow us to cross the Cox Brook one-lane covered bridges when we were headed counter-direction.

A memorable eclipse, and memorable traffic.

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Thank you for the honor of serving you. Please be in touch with me (adonahue@leg.state.vt.us) or Rep. Ken Goslant (kgoslant@leg.state.vt.us) at any time for questions or input.