March 2, 2025 Legislative Update

This communication is about my work in and perspectives on the Vermont legislature, not the national or world scene, but this session, they could overlap in unprecedented ways. Because of the “small state minimum” in federal grants, fully one-third of Vermont’s budget revenues come from the federal budget, including more than half of our direct health care spending. If there are significant cuts in the pending federal budget, we will have holes far vaster than anything we could backfill.

For now, we carry on in developing the state budget based on the current status quo. The House is in the final weeks of work on its budget for the year ahead and at the end of last week, committees provided their perspectives on the governor’s proposed budget. In my Human Services Committee, we look at what the ideal would be to fully support our network of social supports, and then list the priority areas that, “to the extent funds allow,” we recommend that the Appropriations committee add.

Our biggest concern this year was that while the governor’s budget included basic inflation increases for government-run services so that they can maintain current functions, the government services that are contracted to be provided by community agencies were level-funded. If income stays level in the face of inflation, balancing the budget means cutting back, not maintaining the same services. So, a major disparity is created among different services.

One of the largest gaps – which I discussed in my previous update about the budget adjustment bill – is in addressing our crisis in providing temporary shelter to those who homeless in light of a crisis in available housing. People cannot move out of homelessness if there are no places to move to.

The week after town meeting, as we reach the half-way point of the session, is the deadline for bills to be voted out of committees in order to cross from House to Senate or vice-versa if they are to be passed this year. The major bill from my committee will be a proposal for restructuring the emergency housing program.

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The Big Five

The crossover deadline means that we will be getting the first look at concrete proposals to address our major pressures. Often, we start a session with a “headliner” top issue. This year, there are five that are competing in urgency: Education, Housing, Climate; Public Safety; Health Care. The Governor has presented proposals for the first four of those issues. They are getting a mixed reception. The proposals are summarized below.  

Education

The most attention thus far has been on the major restructuring proposal for K-12 education. The legislature is charting its course to revise some pieces and reject others, but the majority appears inclined to move more slowly than the governor’s two-year phase-in.

The Speaker’s Office has issued a public input site, which can be accessed at: https://bit.ly/VoiceVermontEducation. Much of it is free-form response to very open-ended questions, not check boxes. This avoids the inevitable bias of the wording of questions but will present a real challenge in compiling responses into an intelligible and accurate document of the opinion of Vermonters. Results will be shared with districts, so I will report on Northfield and Berlin responses.

The governor’s plan includes a base grant per child to each district, adjusted for particular types of student need, in order to ensure equal resources for all students regardless of town. The statewide tax rate will be uniform, but with income-based deductions for homesteads. Much larger districts (maybe as few as five) are proposed to achieve common standards, including state oversight of maximum class sizes and graduation standards. Vermont has the smallest classes sizes in the country while not performing as well, so significant costs might be saved there. Reinvestment would go into teacher salaries. There is also a school choice component that has produced some strong objections and is not likely to survive the legislative process.

The initial proposal sets the base grant at about the current average per-child spending in the state. For context, Northfield’s current district is below that spending level, though if this year’s budget passes, it will come closer to the average. Berlin’s current district is a bit higher than the average.

Housing

There is consensus about continuing to invest heavily in housing, though the amounts available to spend will be debated. There is no question that, despite major funding over the past several years, we are not on track to meet needs. The Governor’s proposal include targeted funds for local infrastructure to support housing growth. The governor wants to see more progress on easing red tape that increases construction costs, such as standards for local appeals, as well as adjustments to last year’s three “tiers” that revised Act 250 review.

Climate

The “Clean Heat Standard” from last year appears to have died an untimely death. Once firmer numbers were assessed, it turned out that the naysayers were right: the potential benefits were far outweighed by the clear drawbacks and high costs. But the Global Warming Solutions Act (passed in 2020) remains law, so achieving its targets in other ways remains ahead of us. The law was passed in 2020 and it includes binding greenhouse gas emission reduction targets.

Looking back a few years, the transportation sector goals of the Act rested heavily on our collaboration in the Northeast Regional Transportation Initiative, in which 12 states looked at reducing carbon emissions by addressing the fossil fuel market collaboratively. That failed because other states backed out, not Vermont. I don’t believe these types of initiatives are ever feasible by a single small state – it’s why the Clean Heat Standard never had a chance. As the Senate Pro-Tem Tim Ashe said about the transportation initiative in 2019, “banding together with the entire Northeast region all the way down to the mid-Atlantic protects us from a go-it-alone strategy."

So, we’ve had two well-intended, major efforts that have not met hopes or expectations. Meanwhile, the clock has kept ticking. Staying locked into targets on an unchanged timeline that is no longer achievable seems like making false assurances, particularly since we granted the right for anyone to sue the state for failure. I think we need to maintain the goals of the Act, but not at levels that we cannot now achieve. We need to also consider some of the governor’s proposals for better management of the process.

Public Safety

Public safety debates have focused on bail reform for repeat offenders and repealing the “Raise-the-Age” law that would add 19-year-olds to the definition of a child for juvenile court purposes. The House Judiciary Committee did vote Friday to defer that step for another two years. We have also passed a number of laws that fully erase criminal records after set periods of time. The governor is pushing back to have them in a “sealed” status instead, which would make them confidential but still allow access for law enforcement purposes.

In the category of, “NewSpeak,” a bill was introduced last week that sets out when a person who was convicted of a crime is “eligible to recidivate.” This is on top of inmates no longer being released from prison; an inmate “releases” from prison. It’s in line with another change that annoys me, in health care. You are no longer discharged from a hospital; you “discharge.” Maybe I’m getting too set in my ways.

Health Care

Speaking of health care, it seems to be the fifth wheel despite how it cuts across all sectors. Vermont has risen to having some of the highest costs in the nation. It isn’t just about an aging population, because an increasing need for care does not mean that each episode of care needs to cost more. The University of Vermont Health Network says they are being forced to cut services because the Green Mountain Care Board has required them to stay within their revenue cap. They assert that volume (the people needing care) is what is driving the increase in revenue, so to cut revenue they must cut volume by cutting services. But revenue is the combination of volume plus price. The Green Mountain Care Board is telling the Network that it must reign in prices, not cut services. There are no clear proposals emerging yet for alternatives on how to stem the trajectory of cost increases.

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A Note on Advocacy

Persistence pays. Northfield’s Mary Nadon Scott was back in the Human Services Committee lobbying for a Vermont Rare Disease Advisory Council last week, and was there to hear the committee chair say that we will be taking up the bill later this year.

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Words from the Governor

If you didn’t see it elsewhere, I’m pleased to share the comment that Governor Scott made on the third anniversary of the invasion of Ukraine:

“On February 24, 2022, Russian military forces crossed the eastern border of Ukraine. Russia’s unprovoked aggression escalated a years-long conflict into outright war, threatening the sovereignty of a free nation, and the hard-won peace of the European continent.

“These are facts, and it’s important to repeat them when the truth is threatened. Three years later Vermonters still stand with Ukraine. We still hope for peace and a just end to this senseless war. We still hold fast to the most American of ideals: liberty, self-determination and the restoration, preservation, and expansion of freedom around the world.”

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Thank you for the honor of representing you. Please stay in touch with me (adonahue@leg.state.vt.us) and with Rep. Ken Goslant (kgoslant@leg.state.vt.us). We welcome your input.

February 9, 2025 Legislative Update

 

For starters, a reminder: almost none of the news you hear early in the legislative session is actually the final word on a topic. Interesting bills that make good headlines won’t necessarily even be taken up in a committee. Proposals, even from leadership folks or the governor’s office, are still just that… proposals. Even if they move forward, it will likely be in a very changed form. For major subjects (education reform, as one example), the various proposals are a part of a discussion that will likely not be resolved – if at all – until the session nears its end in early May.

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Sanctity of a Vote

One topic did reach finality this past week. Under the constitution, only the legislature has the authority to determine validity of a member’s qualification, so our House vote to validate the House member from the Bennington-1 district was final.

There was a serious foul-up. About 50 or so voters (literally on the “wrong side of the street”) received ballots for a different district, in error. It was a close election, so those votes could have made a difference. Clearly, there were voters who were denied their right to vote for their state representative. The problem was the inability to create a solution that would not deny others in the district their right to vote, because of unavoidable byproducts of attempting to hold a new, special election. The sanctity of each vote is crucial, but two wrongs can’t make a right. I voted to keep the status quo; the overall vote was 91-42. There is now a plan to develop a law that will directly address issues like these.

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Budget Adjustment

We also voted on the mid-year adjustment of last year’s budget. It now goes to the Senate for consideration. In theory, this annual bill permits shifting money from areas of underspending into those that had shortfalls. This year, higher than expected revenues provided greater leeway to add funding where needed. But anything spent now cuts into meeting new goals for the year ahead.

There ended up being only one area of dispute. The House is proposing to backpedal on its compromise with the Senate from last year regarding putting restrictions on the emergency motel program for homeless Vermonters. Those eligible for a room are primarily households with a child under 19, age 65 or older, or with a disability, and who lack adequate housing, when there is no shelter space available. Under the current budget, an 80-day annual limit for access to a motel voucher does not apply during a “winter housing” exemption that ends on March 31.

Last fall, some households lost coverage for exceeding 80 days during the time before the winter exemption started, and Vermonters watched with concern as some ended up without shelter during that time. The revision proposes that the current winter exemption be extended through the end of the budget year (June 30) so that no one would lose shelter while we continue to try to agree on longer-term solutions. Surely, we did not want to repeat last year’s crisis when we reach April 1?

As I tried to articulate on the House floor, this misconstrues the nature of the dilemma. We cannot create motel rooms that don’t exist. As a result, some of these eligible households are currently still being turned away for lack of capacity even though they are eligible within the current rules. Being eligible as “homeless” is defined as not having an “adequate” place to live. It includes, for example, families who have to double up and those without a stable address. “Unsheltered homelessness” means the subset of those who are homeless who have no place to spend the night that is considered fit for human habitation.

The current rules make no distinction, so there is no priority for those who are completely without shelter. If those already in a motel can now remain longer, there will be more of those who are newly homeless – including those with no shelter at all -- left out, because of lack of capacity. Extending the “winter exemption” so that there is no cap on the length of stay does not increase motel capacity or ensure shelter. It only creates a priority for those who are already there.

Members made statements of compassion on the House floor that ignored that impact altogether: “I voted yes because every child we fail today is a lost opportunity for Vermont’s future;” “If we look outside, we see weather no one should be unhoused in. With climate chaos, harsh weather is possible anytime of year;” and, “There are many issues involving homelessness that this body must solve, in the long term. Kicking people into the cold solves none of them and would cost lives, in the short term.”

I explained my vote against the change in the bill, stating, “Extending the length of stay for some people, resulting in cutting off access to shelter for others, is not the right way to support those most in need. It actually turns our backs on them.” The overall bill passed, 87-51, and is now in the Senate’s hands.

The bill that will attempt to develop a longer-term solution is currently under review in my Human Services committee. Whatever it ends up proposing, however, won’t take effect until July of 2026, which means the struggle over interim funding and motel use will continue for the budget that begins this July. The governor’s proposed budget includes $30 million in motel vouchers, which extends the current program but it does not re-expand it to the new budget adjustment bill proposal.

I strongly believe our focus is both far too broad and far too narrow. We want to do optimal things, even when it leaves many people at highest risk behind. I think we should always do everything possible to provide a roof over the head over those who have none, who are unsheltered. Right now, we only do that – even under the “winter exemption” – for those in the defined “vulnerable population.” But that roof may not mean private hotel rooms and should not give priority to those who do have other options, even if they are not optimal.

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Establishing Fair Payment

The governor’s budget presented in January noted the significant costs in simply “keeping the lights on” for existing government programs. Inflationary pressures, including health care costs, mean it costs more to maintain the same services. Thus, he said, there will not be much to spare even with our improved revenues. He hopes to use some to reduce any increase in property taxes while reforms in education spending roll out.

This recognizes the fact that if something is level-funded as costs rise, the service is actually cut. That is the reality of portions of the proposed budget, however, because the many government services that are funded through payment rates or grants to private, non-profit agencies are not receiving any increases to offset cost pressures. That includes community mental health agencies and the home- and community-based services provided by home health care, as examples. Every year, we hear from advocates for these services begging for sustainable funding that would maintain their work. We have to react based upon trying to assess disparate needs and to balance the budget.

This year, my committee is working on a bill that would create a more objective standard for assessing budget needs. It would require the Agency of Human Services to do regular Medicaid rate payment reviews using objective standards that result in rates that are “reasonable and adequate to achieve the required outcomes,” including a cost adjustment factor to reflect inflation and labor market dynamics. That would not mean those would be the actual payment rates that ended up in the state budget. What it would do would be to level the playing field in assessing what we can and cannot afford. If we can’t afford it, we need to acknowledge it, not pretend we are paying for it. In many areas, we currently have no objective way of telling whether we are paying 50 or 75 or 90% of what full funding would be. Budget choices end up being inequitably-informed choices.

The Agency itself has testified in support of the proposed new requirement for regular rate reviews, though it was not quite willing to acknowledge that we currently are operating on a double standard in what we pay for state-run services versus those funded by state rates. It is a myth to tell ourselves that we are actually providing a service if the service-provider isn’t being paid enough to do the job and has to cut what it is providing.

The issue of Medicaid underpayment is better known in the realm of hospital care, and that is coming to the forefront in its own way. Historically, hospitals make up the difference through “cost-shifting” and using higher private insurance rates to make up the deficit. Our increasing insurance premiums reflect the increases in costs being charged for the services, but also, in effect, include a “surcharge” for covering government underpayment.

It can result in perverse outcomes. For example, inpatient psychiatric care is one of the few services that private insurance underpays for, part of historic bias and lack of parity in mental health care. Hospitals therefore can’t cost-shift, and they lose money. That’s why Central Vermont Medical Center eliminated inpatient psychiatry altogether at the end of January. Faced with a need to cut the level of growth in its budget, it cut the money-loser – a straightforward financial decision, irrespective of any balancing of impacts on the health of its patient population.

Unsustainable health care costs are high on the legislative agenda this year, but where those conversations will go is hard to predict. There is finger-pointing in all directions, despite an urgent need to put heads together collaboratively.

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Please keep in contact to share your opinions and concerns; Rep. Ken Goslant and I both welcome your input. You can reach us at adonahue@leg.state.vt.us and kgoslant@leg.state.vt.us. A full archive of my legislative updates can be found at representativeannedonahue.blogspot.com

Legislative Update, January 26, 2025

 

Several key initiatives are underway already as this year’s legislature looks to address high priority items on education funding, housing, and criminal justice, with proposals on the table from the governor. His full budget proposal will be presented in a speech to the General Assembly on Tuesday.

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Education Funding

It takes a lot to build enough pressure to completely reshape a system created 25 years ago, but there may be momentum this year to do it. To meet a 1997 Vermont Supreme Court decision on equity, we have been funding our schools through a statewide pot of money. The court said our kids should not have the adequacy of funding for their schools be based on the town they happen to live in. A child in a town with a low tax base should have an equal access to education as one in a wealthy town.

But when we turned to creating a statewide fund, the structure tried to protect the concept of “local control.” Towns could still run their own schools and set their own budgets. The budgets were then sent to the state so that a statewide tax rate could raise the money to meet those budgets. We have learned the hard way that this is a combination that doesn’t work. Having each town decide on what it needs to spend, and then having all towns chip in to pay whatever the grand total turns out to be, means everyone has to contribute in paying higher property taxes for the sake of towns that vote for high budgets.

That isn’t actual local control. It is a local town being held hostage to the spending decisions of other school districts around the state.

There are three major pieces to the governor’s proposal:

First is that a budget adequate for quality education needs to be set at the state level for allocation to districts. This kind of a formula is the mechanism used by the majority of states. You can see the details on this type of system – compared to ours – in the very readable report put out by the Department of Education in November. This kind of foundation formula would allow for a single, state-wide tax rate [thus no more need for a “common level of appraisal” to equalize towns], still keeping deductions for lower income homeowners.

Second is that the quality of our education system needs to be enhanced by stronger consistency and leadership by unifying into five large, geographic districts. There are a lot of rationales for doing this, both financial and to benefit student opportunities. Declining assessment scores in Vermont schools is a real concern, and there are many disparities in what students can access.

Finally, there are expanded roles for state support and oversight. Currently, even graduation requirements differ among districts.

The intended outcomes of the plan are stated as education quality (“better educational outcomes for all Vermont students and better support for schools to achieve our shared goals”); equitable funding (“students with similar needs, receive the same resources and funding regardless of geography”); and efficient use of resources (“more consistent and sustainable use of resources to support innovation, personalization and quality”). You can watch the presentation to the legislature at education.vermont.gov/news/aoe-presents-stronger-schools-stronger-students-education-transformation-proposal

Putting a proposal out on the table is a way to draw out a lot of criticism, but it’s also the best way to start generating serious discussion about the options to be considered. That discussion will now continue in the education and the tax committees in both the House and the Senate in the weeks to come.

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Housing

The governor is seeking further revisions to last year’s work on easing regulatory barriers to the construction of new housing, in particular, the current broad appeal rights that can add costs and delays. His proposals include extending last year’s limited waiver of Act 250 review for construction to more areas where sewer and water infrastructure already exist.

Significant to our local towns is a proposal that would help fund extending that kind of infrastructure in smaller towns that can’t afford to do it. One example came up during recent resident input in Northfield, where the Falls was noted as having areas that could be ideal for housing expansion but would require expensive sewer lines.

The proposed new program would allow municipalities and developers to borrow funding for infrastructure upgrades needed to build a new housing project against its future value.

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Criminal Justice

The proposal from the governor would address bail, reversing some changes that allow release without bail, when a person has been accused of repeat offenses while awaiting a determination on a first one. It also would repeal the next phase of the “raise-the-age” law passed several years ago. That law turned 18-year-olds into juveniles for Family Court purposes, and the pending next step is extending juvenile status to 19-years-olds. (It does not include the top 14 most violent crimes.)

The bail issue is always a tough one, because bail has a fundamental flaw that challenges equal justice: Some people end up in jail waiting for their cases to be heard while others, although facing identical charges, can be free on the street purely based on having more financial resources. A person may end up sentenced to, “time served,” meaning the time they’ve already been waiting in jail is included. But that means the same jail time is also being served by the person who has been waiting and is not convicted.

Something clearly does need to be done to address those who are released until a case is heard and yet are being re-arrested on more charges in the meantime. We need to address it in a way that upholds the principle that is the foundation of our justice system: these people are, at this point, still innocent of the crimes they’re accused of.

The second topic will likely face major legislative pushback because the momentum in the legislature for treating young adults as children has been strong in recent years. My Human Services Committee joined with the Judiciary Committee for hearings on “raise-the-age” this past week.

When I was first in the legislature two decades ago, Vermont was one of only two states (Alabama was the other) that treated 16- and 17-year-olds as adults, with their arrests starting in adult court before being considered for a possible move to Family Court. I fought to raise that age so that the presumption was the opposite and those cases start in Family Court.

Now we’re at the other extreme with a highly convoluted system based on multiple age and crime categories that result in juvenile status, youthful offender status, or adult status. Some, but not others, can start in one court and then be switched.

The argument is the growing knowledge about brain development that shows those in their early 20s are still more prone to impetuous decision-making and risk-taking that should be considered in addressing criminal activities that they will likely outgrow. There is also research that indicates that when treated as adults, these young adults are more likely to continue criminal involvement rather than to outgrow it.

I support the use of transfer to youthful offender status to address these realities, but not the wholesale expansion of Family Court to take on cases for those 18 years old and above by redefining them as children.

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Bill Introductions

I’ve signed on again to the effort to have an income tax exclusion for military retirement income to put us in line with almost every other state. It is a key workforce issue. I’ve also reintroduced the right-to-repair bill, which almost made it to the finish line last year, until time ran out to resolve House and Senate differences.

An amusing closing note: Last week I reintroduced a bill to protect the right of consumers to pay cash. This week, I received a formal letter of support from… drumroll… the National Armored Car Association in Reston, Virginia. It’s amazing how some organizations track every piece of legislation that could affect their industry, in every state legislature!

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Please keep in contact to share your opinions and concerns; Rep. Ken Goslant and I both welcome your input. You can reach us at adonahue@leg.state.vt.us and kgoslant@leg.state.vt.us. My archive of legislative updates can be found at representativeannedonahue.blogspot.com