Dear Friends and Neighbors:

Your Representatives consider it an honor to represent you in our State Legislature and to communicate the activities of the General Assembly to you in this newsletter. Please feel free to contact The Vermont Republican Party or your legislator with your questions or concerns.

EDUCATION:
Providing all Vermont children access to high quality education is a top priority to the Republican caucus. We also understand that Vermonters feel the pinch of increased property taxes, and we have a responsibility to Vermont tax payers to provide opportunity and equity for all Vermont students with a sustainable, affordable plan that addresses rising public education costs in this state.

There is significant concern over runaway PK-12 education spending in Vermont, and whether the money being spent is leading to desired outcomes. Currently, the House Education Committee is looking at issues surrounding spending, governance, class size, small schools, special education, and counting of students.

Republicans on the House Education Committee are working hard to address these concerns by steering legislation that will address unsustainable increases in costs without jeopardizing equity and access to quality education for all Vermont children. Our Caucus has offered proposals that include school choice, capping costs for all Vermont school districts, a reorganization of governance, a competition driven model for small school grants, and adjusting student-teacher ratios. Currently Vermont has the highest per pupil cost in the U.S. and the lowest student-teacher ratio at 4.7 to 1. By simply increasing that ratio to 5 to 1, we save Vermont taxpayers $73 million dollars. It is too early to report how this may turn out, but it is hoped that significant changes will be made this session that will affect FY 2017.

We are committed to working with the Speaker and House Democrats to advance these proposals to provide high quality education for all Vermonters while remaining sensitive to the financial realities of Vermonters. Affordability is and will remain our common mantra as we work to improve education in Vermont.

WATER QUALITY:
The quality of Vermont’s water is important to everyone; the Shumlin administration has made this a priority topic; thus the bill H35 was developed. Although we all acknowledge that action is necessary to address the pollution of our lakes and streams; how to accomplish that goal in an affordable way so that we can measure results, is a difficult task. Vermont’s waters have been the recipient of sediment ,phosphorous and nitrogen over generations; as a result of these inputs lakes and streams are displaying signs of contamination including blue and green algae.

H35 establishes standards for the agricultural and forest industry; for development and for impervious surfaces; and for the state and town highway system; in other words, it affects EVERYONE in the state.

The Water Quality Bill (H-35), was passed by the House Fish, Wildlife, and Water Resources Committee 7-2 late on the afternoon of February 20th. The bill looks to provide additional staffing to Agency of Natural Resources and the Agency of Agriculture, along with funds for municipalities and local nonprofits to address the requirements of Lake Champlain’s TMDL. Much of the dissent to the bill by the minority of the committee was due to the financing of the bill, which calls for a .5 cent increase to the rooms, meals, and liquor taxes (thankfully to sunset after 3 years because of our request for a sunset), a 2 cent gas tax, and new fees on agriculture. The ANR fees, which were removed from the fee bill, will be finalized this week.

A member of our caucus pushed for H.29, our caucus’ proposal, led by Lynn Dickinson, to utilize 6 million from the Housing and Conservation Trust Fund to finance the Clean Water Fund proposed in the bill. Despite continued support by members outside the committee, this proposal was not accepted. The bill now heads to the Ag Committee for review.

TAXES:
The Ways and Means Committee in the Vermont House of Representatives has the responsibility for all revenues coming to the state. This includes all taxes, fines, fees, federal grants, gifts, estate revenue, etc. that’s any money coming into the state coffers. The committee is made up of three Republicans, seven Democrats and one Independent.

Currently the committee is focusing on elements of the Miscellaneous Tax bill sent over to the statehouse by the Governor. The committee will probably divide the bill into two bills, one for incoming new revenue and one for policy changes. At least one of those bills will most likely be voted out by the committee Town Meeting, maybe both.

In addition, the Committee is considering changes to the state’s Current Use program. This is the program that taxes property on its use right now, not its potential use. The property in Current Use is dived into agricultural and forestry property. Nearly half the land in the state is enrolled in Current Use, and these property owners are getting an average reduction in property tax of 88%. This is a total cost to the education fund of $45 million and cost to the municipal taxpayers of $15 million.

One bill has moved from Ways and Means to the House floor, the Fee Bill. Fees keep taxes lower than they would otherwise be, because all taxpayers don’t have to pay the costs of things only a few people use.

BUDGET:
The State of Vermont’s budget is actually 3 major budgets. The General Fund budget is the operating budget for general government, the Transportation Fund and the Education Fund, the last two serve the purpose for which they are named. Regarding the general fund, the budget has grown from FY14 of $1,386,182,989 to FY15 of $1,406,400,926 (up1.46%) to FY16 of $1,467,801,939 (up 4.37%).

Revenue, for the General fund, over the same time frame is FY14 of $1,328,400,000 to FY15 of $1,367,900,000 (up 2.97%) to FY16 of $1,411,700,000 (up 3.2%). Of specific interest is that the revenue for each year has never been enough to pay the General Fund expenses without using ‘special fund’ savings. The state is now out of those savings and the current budget will need to be cut to match expenses to revenues.

As the budget was presented to the Legislature, it had a $94.5 million dollar gap for which the Governor presented a plan to close. The plan includes tax increases to the payroll tax and the loss of a tax deduction for taxes paid. Then in late January, the state received news that projected revenue for the year would be short $18.6 million. This makes the budget gap $113.1 million. Options to close this gap are currently being developed.

HEALTH CARE:

Most people will recall the publicity over the governor’s decision to “drop” single-payer health care. In reality, he never said he was dropping it; only that it was not viable right at this moment. Act 48, creating a universal plan, is still the law of the state, despite the fact that it would be completely unaffordable for Vermont to ever achieve. Initiatives underway this session by the Democrats include continuing building blocks for a single payer system, and increasing spending in health care significantly, despite our budget deficit. We are committed to protecting Vermonters from any actions that lock us in to a future single payer system. We will also push back against new spending, which will either require new taxes (such as the payroll tax), or will force far more damaging cuts in other parts of the budget.