Reflections

With the Governor allowing the legislature’s third budget and tax bill to become law just in time for the new fiscal year to begin, the 2018 legislative session (and special session), came to an official close on June 29.

At times, it seemed a long and detoured course to adjournment, with a number of policy differences between legislative leaders and the Governor. January began with quick passage of recreational marijuana left over from last year and the spring saw passage of several new firearm restrictions in the wake of the school threat by Jack Sawyer in Fair Haven. But what put the session into overtime was the standoff on the statewide education property taxes and whether they should increase or not, in a year when state revenues were higher than expected.

Legislative leaders appeared to be willing to articulate their differences with Scott on a number of issues, from a $15 minimum wage to a new payroll tax to fund a family leave benefit. The Governor used his veto pen eleven times, tying Howard Dean’s record in 1994. Three of the vetoes were on the budget and tax bills as legislative leaders sought to see just how far they could go on property tax rates. In the end, residential property taxes will remain level for FY 2019, but the nonresidential property tax rate will increase by 4.5 cents per $100.

The special session dragged on for a month (although most weeks included only one or two days of meetings). I am not of fan of prolonged sessions and as such, I forfeited any legislative pay during the overtime session. Next year, if returned to Montpelier by the district voters, I plan to introduce legislation that would only pay lawmakers for the 18 week regular session and not for an extension. Perhaps if the pay stops, the legislature collectively will be motivated to get its work done and make the necessary compromises with the executive branch in a more timely fashion?

In agreeing to let the final budget & tax bill become law, Scott pointed out some of the many positives the legislation contained, including:

  • Eliminating the income tax on social security for low and middle-income households;
  • Lowering income tax rates to ensure Vermonters do not see a $30 million VT income tax increase due to federal tax changes;
  • Keeping average statewide residential education property taxes even with last year;
  • Dedicating $15 million toward paying down teacher retirement obligations;
  • Paying off the $3.9 million debt of Vermont Life Magazine (unfortunately publication will cease);
  • Establishing statewide bargaining for public school employee’s health care contract while reconstituting the board that directs it;
  • Establishing a commission to study student/staff ratios in public schools;
  • Setting a new default residential property tax formula to be the same as in the prior fiscal year unless the legislature determines otherwise.

By letting the budget become law without his signature, Scott accepted a 4.5 cent increase in the non-residential property tax rate. This move violates his “no new tax” pledge, and in a statement he laid blame for the increase at the feet of legislative leaders saying he had no choice but to allow the bill to become law to avert a government shutdown.

Putting forth a different spin, House Speaker Johnson and Senate Leader Ashe issued a joint statement following the tax standoff, where they said, “It’s a relief that the Governor is finally willing to accept the significant compromise the Legislature worked hard to put forward….The Governor and Legislature were originally $57 million apart, but the Legislature moved $37 million closer to the Governor’s position.”

It remains to be seen how the budget standoff will play out with voters during the election.

Democrats have fielded more candidates for the House than the Republicans with a goal toward winning a supermajority, which could seriously erode the Governor’s influence, if re-elected.

All eyes now go to the primary on August 14 to see who the candidates will be on the November 6 general election ballot.

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