Legislative Preview, 2024

 

Every year, the Times-Argus asks local legislators to share their priorities for the legislative session ahead, and the first half of this preview report is a copy of that – a fairly quick read. After that are some details.

If you don’t like to delve into numbers, stop after the preview!

I see the overall role of government, and therefore our necessary priority, as funding essential services at a cost that we can afford. Affordability does not mean by personal perception. It means not letting the state economy crash, hurting us all but those who struggle financially the most.

The details that bedevil us? What are “essential services,” which is a subjective decision. What is affordable for economic stability, which is more objective, if we are following fiscal expertise. For example, our state fiscal analysts tell us we are still facing about a 50/50 chance of a recession in the near future.

My fiscal priority this year is to push back against the momentum to increase new initiatives. These have been caused in part by the number of new legislators this session who have only lived through the recent years of unprecedented federal funds flowing into Vermont. The desires are good ones, but we have added major new programs already and sustaining them will be extremely challenging as we return to more modest revenues. We need to stabilize and meet existing needs before we add more.

Within existing core responsibilities, costs are rising more steeply than the governor’s plan to increase base budget spending by only three percent. His may thus be an unrealistic goal. We are already locked in to a 15% increase in health costs and a four percent pay act increase plus a new paid family leave program for state employees. We have the inflation jump of the past year, retirement fund obligations, and further budget increases to pay for last year’s bill to significantly expand support for childcare. We also need to maintain climate change mitigation efforts and address the unresolved homeless motel program.

All of those require more than three percent growth, so deep cuts would be required in other vital services if we restrict ourselves to this; even more reason that it is critical to avoid any and all new initiatives.

Education costs are predicted to increase by 20% due to some similar pressures, adding to the need for fiscal restraint. Once again, health costs are a driver that will not change without more aggressive reforms. Economic stability also demands a priority of ongoing state intervention in grappling with the critical housing shortage and labor force recruitment challenges.

I have two priorities for the budgets in existing essential services. In health care, we need to stop abandoning low-income senior citizens when they go on Medicare and face a cost cliff due to our drop in state support. For children in trouble, we need to rebuild foster care, mental health treatment, and treatment capacity for youth violence.

My policy priority continues to be the full incorporation of mental health into our health care system, which will bring better access and better care. We also need to reassess our criminal justice system so that it does a better job of protecting citizens while also respecting civil rights and avoiding measures that increase cycles of criminality.

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Fiscal Details

Our December presentation from the Joint Fiscal Office consultant was a summary of the national economy and implications for our own. Their take on it is an improving economy with the rate of inflation down, solid growth, and low unemployment. Consumers see the economy with a great deal more pessimism yet spending trends (which drive the economy) do not reflect that pessimism.

There are also “mounting headwinds,” with the risk of a recession dropping but still at about a 50/50 chance, and with low unemployment creating a risk of wage-price spirals. That’s when wages increase in order to attract workers, but then drive increased prices for products. Vermont’s worker gap far exceeds the national average, with fewer than 7,000 unemployed versus 17,500 job openings, which often means the market is even tighter than it appears due to lack of enough of the matches between skills and job openings.

As reflected in some further data, our continuing demographic challenge makes the picture even worse, because we will be losing numbers in our existing labor force in the years to come. Between 2010 and 2022, we already lost five percent in the ratio of labor force to population. However, the 35-54 age group – those moving into peak earning years (Interpretation: tax revenue) – dropped from 32 to 24 % of our population, and incoming the future incoming work force – those 0-14 – dropped from 20 to 15%. Those soon-to-leave the workforce, ages 55-64, increased from 9 to 15%, and those already into retirement years, 65 and older, increased from 13 to 20%.

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Housing

The shortage of housing didn’t come out of the blue. We’ve sharply dropped in construction of new units since the 2008 recession. Multiple factors have made it much worse, and we are not remotely close to closing the gap, without even including possible population increases or the loss in housing units from age/decay over time.

A healthy housing market is defined as having a 3% vacancy rate in owned housing and 5% in rental housing. In Washington County, the rate for owned homes is 1.57% and for rental housing, it’s 1.65% -- well below the state average and on par with Chittenden County. There are many fascinating details about individual community and county data for those who enjoy knowing that kind of detail about their communities on the website, https://www.housingdata.org/profile/housing-needs.

The deficit in current construction of new units is a whopping 4.7 (based on a 5-year average.) What that means is that for every new home or apartment unit currently being built, we actually need almost five more to be built if we were to close the vacancy gap. This is despite the $268 million the state (with a great deal of the recent federal money) has invested in the past two years to support what would normally be a private market process for housing construction. Much of that is still in the pipeline for the shovels to actually hit the ground.

Other data I’ve discussed earlier in this update can be reviewed there and in much greater detail on these sites:

https://accd.vermont.gov/press-releases/webinar-housing-deficit-data-presentation

https://ljfo.vermont.gov/publications/legislative-briefing

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Education

When a system changes, there are usually winners and losers, and that will be the case with the new method for assessing the costs of educating out K-12 students. Pupil weighting was revised last year to more closely match the actual costs of educating children in different communities. One child in a school does not count as one child for “pupil weight,” or cost, for the purpose of how much the school district receives from the Education Fund. High school students cost more than elementary, for example, so they are weighted more and school districts’ costs are adjusted differently if the elementary-to-high school ratio is different.

The two largest categories that gained “weight” in the new counts were low-income children and those with English as a second language, with a new rural school component as well. A more detailed explanation of pupil weighting and changes can be found at: https://ljfo.vermont.gov/assets/Subjects/Issue-Briefs-Related-to-Education-Finance/8e94aa83db/GENERAL-371568-v3-Understanding_Pupil_Weights-v3.pdf

Berlin and Northfield will be affected differently. Based on the early estimates, Northfield will see little impact from the change, because current weighting of students in the Paine Mountain district will likely be fairly close to the new counts. Berlin will gain some, because the pupil count in its in the Washington Central district will increase given its higher number of pupils with a higher weighting.

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Policy Bills

There are a record-breaking number of new policy bills being introduced by individual legislators this session, creating a big and likely wasted workload for our legislative counsel drafters. Why wasted? In the second year of a biennium, most of the legislature’s time is taken up by finishing last year’s “must do” work and addressing this year’s required tasks.

Bills that were taken up last year, but didn’t make the deadline, will be up first for consideration, and bills that passed one body but not the other are yet to be reviewed. In my committee, for example, we’re already getting heavy lobbying about the ban on flavored vaping products that passed the Senate last year, and we didn’t get to yet.

By the time new bills get introduced and allocated to committees this year, there will be virtually no time for them to be addressed. That’s not to say they don’t have merit – but a lot of ideas may have merit without beating out the competition for limited time. We had an unusually high turnover in the House this session, which likely accounts for some unrealistic expectations.  Ergo, this year more than ever, if you see a headline about a new bill – check in with me or Rep. Goslant about whether its odds of getting action before you get too excited about it (pro or con.) 

My bill initiatives are fairly modest. I’m mostly focused on having the Senate pass my right-to-repair bill for consumers in its broader form. The House passed the agricultural equipment component last year. I’m also hoping for some action on my existing bill to increase health care support for low-income elders who lose coverage when they move to Medicare.

A few short bills (some requested by constituents) address narrower needs: a notice requirement when renting a mobile home lot that is in a designated flood plain; a requirement that businesses maintain cash payment options; and public meeting access protections in our evolving digital world.

I’ve also been deeply involved in a personal effort to identify burial locations for those who died at our state hospital in the late 1800s and 1900s before the laws required hometowns to take responsibility. Some were buried in unknown locations on the grounds, and it turns out that may have happened at other state institutions as well. I’d like to see an inventory done of such sites and some efforts to identify and protect those that can be located.

These are mostly in what are termed “short form” bills, which are quick to draft, because they present the basic idea but leave the concept to be fleshed out only after a committee has made a decision to take it up.

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As we begin the new session on January 3, please remember to keep in touch with me and district-mate Rep. Ken Goslant when you have questions or concerns to share. We are here to serve you and listen to your voices. It is an honor to do so. Emails are adonahue@leg.state.vt.us and kgoslant@leg.state.vt.us All of my updates, current and all through the past, are accessible at representativeannedonahue.blogspot.com.