Well, for better or for worse, we’re finished for this year. The final action was, as usual, next year’s budget which begins July 1. It appears to show a staggering increase from two years ago, by more than a billion dollars – an increase of more than 16%.
But that number should sound
familiar – it’s roughly the amount we’re received each of the past two years in
emergency federal funds. So, the “real number” is much lower, and it’s
important to understand the difference between our base budget and what we call
“one-time” funds.
The base budget funds all of
our ongoing budget for the operations of government. It increases based upon
inflationary costs, pay increases, and any new programs intended to continue in
future years. One-time appropriations are those that are for single-year expenses.
They can create a future pressure because people want them to continue (at an
increase to the base budget), but they come with no promise that will happen.
The base budget of state funds
increased by 4.5 percent this year and 5.4 percent last year, so a 10% increase
in the past two years -- from $4 billion to $4.2 billion to $4.4 billion. This
includes the transportation and education budgets. The full base budget also
includes hefty annual federal support, much of that coming through Medicaid
funding. That has increased over the past two years from $2 billion to $2.2
billion to $2.3 billion. So federal funding is about a third of our total annual
budget.
The most important question
to many folks is whether the full budget reflects increases in our existing taxes,
or requires an increase in tax rates or through new taxes. As has been true for
several years back, this year’s budget does not require additional revenues; it
reflects increased revenues from our existing tax base – including the “January
surprise” -- a much healthier revenue flow than what was expected with the
economic impact of COVID.
We added some 19 permanent
state positions this year, and despite the fact that it did not require new
taxes to cover them, it does concern me. This is the first time in many years
that we have added this many new permanent positions. While the costs of these
are included in the final, balanced budget, it locks in that cost. If we hit
future tight budgets, it adds to the angst involved in potentially laying off
staff.
***
The competing needs in the
state are always very difficult to balance, because there are many. No one can
get every piece they want; compromises are necessary. I was comfortable with
the bottom line, despite some choices I didn’t support, and I voted yes; the
overall vote was unanimous. In a follow-up year-end update, I’ll list some of
the key investments made through the federal rescue act funds along with other
budget highlights.
I recognize some folks don’t
believe any increases in the base budget should be considered, so I’m going to
drill down on one example of need. The budget includes a 3% increase for our
community mental health agencies. At the same time, the budget includes a 4.1% average
increase to state staff. This difference happens year over year, so the
disparity continues to grow more extreme. The result is that staff leave the
community agencies in order to try to make a better living, and by most recent
count, the agencies have 780 vacant positions.
One result is that children in
mental health distress currently have a six-month wait to access counseling. Is
it any surprise that their conditions get much worse? We are seeing increased
numbers of children who live in our hospital emergency rooms for days, or
occasionally even more than a week. The term used is “boarding.” They have a
mental health crisis so severe that it needs inpatient care, and there are not
enough beds. It many cases, it would have been avoided if they got care sooner.
Now there is a new impact as
well. Private, for-profit businesses are opening up shop to compete for
contracts with our schools for the mental health supports needed for students. Those
businesses are pilfering community agency staff by paying higher salaries. They
are turning around and offering contracts to schools that have less robust
services, yet are more expensive.
Why would a school system
choose a higher cost contract rather than through the local community agency (in
our case, Washington County Mental Health)? Because the agencies have too many
vacancies to supply the staff that the schools need. This downward spiral will
cost more in school budgets while offering less support to students and
increasing fiscal instability for our community agencies.
Salaries at community mental
health agencies not eligible for federal rescue act funding. They are part of
our competing base budget priorities.
***
The budget isn’t the only
place with competing interests in the same bill.
Three examples from last
week: The housing bill includes crucial investments in affordable housing. It
also creates a state rental housing registry (with five new state positions to
run it) -- onerous because the cost would be borne by landlord fees that will
be passed on in rent increases. I voted against the registry but when it was
merged into one bill, I voted for the bill as a whole. The housing investments
were too important. That bill remains awaiting Senate action.
Similarly, the unemployment
bill made essential changes to how to maintain the Trust Fund but also prevent
radical increases for business. It did this by discounting last year’s layoffs
from the rating system that penalizes high layoff rates. It also included
important investments to build our workforce. The same bill added $100 a month
to unemployment benefits once the federal supplements end. There are a number
of arguments against doing this as the crisis comes to an end, but for me the
other parts of the bill outweighed the dispute over that issue, so I voted in
support.
In terms of the cannabis
bill, last year the House unanimously accepted my proposal that we not permit
advertising when the new legal market begins. Legal sales with regulation are
supposed to be about reducing the illicit market and increasing user safety
through having potency and product purity standards. Identified priorities in
the statute include not supporting increases in use. The Senate blocked the ban
and we ended up with a bill with no advertising oversight at all, instead
putting the issue off for negotiation this year.
When the advertising limits
bill came out this year, I proposed a narrower addition that would prohibit
advertising that was specifically targeted at increasing cannabis use. This
time – in fear of Senate rejection of even that – the committee voted against
it and it thus lost on the House floor, even though a number of Democrats
joined Republicans in support. Despite that, I voted for the bill; without it, we
would move ahead with no advertising restrictions at all.
***
When off-season committees
meet this summer and fall and the legislature returns next January, it will be
in person. The only exception would be a return of emergency restrictions on
capacity or distancing.
The resolution making that
change added authority for the Joint Rules Committee to place limits on public
access when legislative committees begin meeting back in the statehouse. I’m on
the House Rules committee, and I objected vociferously. If we are in the
statehouse, I will not abide by limits on public access.
So, it was revised into two
parts. There can be conditions on public access if needed for safety, such as a
face mask requirement. (Our air-handling equipment provides seriously
inadequate ventilation.) However, access itself cannot be limited.
For indoor spaces, we have always
had capacity limits. Public hearings, for example, often draw a large crowd
that cannot safely enter the House chamber. An “overflow room” is set up, with
audio-visual access. Thus, with my support, authority for limiting access for
inside spaces remained in the resolution.
***
As Rep. Goslant and I return to our regular “day jobs,”
we remain available for questions or assistance. You can contact me at adonahue@leg.state.vt.us or Ken at kgoslant@leg.state.vt.us.
All
of my legislative updates for this year – and years past – can be accessed at representativeannedonahue.blogspot.com.
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