On June 27, 2018

Legistlative update: breakdown…or “Uncle?”

By Rep. Jim Harrison, R-Bridgewater, Chittenden, Killington & Mendon

I have believed from the beginning that the Legislature and governor needed to come to some sort of agreement on the budget and tax impasse, one branch should not mandate its will over the other just because it could. Last Friday was one of those roller coaster days when there was a deal before there was no deal. Optimism before pessimism.

Here’s the recap. Last Thursday, June 21, the Senate passed a new budget and tax bill that kept the average statewide residential tax rate even with last year and increased the non-residential rate by 4.5 cents per hundred. It also included statewide negotiations for both education staff and teachers’ healthcare going forward using the model put forth by the Vermont NEA. The governor still appeared cool to the tax increase given the current revenue surplus.

House Speaker Mitzi Johnson and Minority Leader, Don Turner, met with the governor several times on Friday and struck a deal where Scott would accept the tax increase in return for language that would allocate half of the expected revenue surplus from May and June to the teachers’ pension fund and half to the education fund to help with next year’s property tax rates. Whether that was a good deal or not may depend on your perspective, but the view inside the State House that it was at least a deal…that we could get our work done and go home.

Not so fast. When Senate leader Tim Ashe balked to an agreement with the governor, Speaker Johnson retreated from the previously agreed upon deal with Scott and then floated a three way split of extra revenues hoping that would end the stalemate. That failed the Senate test as well, so the House proceeded along the Senate passed lines without agreement with House republicans and the governor.

Friday’s House session was gaveled in at 9:30 a.m. and didn’t finish until nearly midnight. Voting on the actual budget and tax bill, the focus of the special session did not begin till late in the evening.

The House and Senate returned to Montpelier on Monday, June 25 to finish up its work on the budget & tax bill. There was no apparent agreement with Scott. This all comes after the legislature passed budget & tax bill No. 2 without agreement with the governor, which ended up being vetoed. One would hope we could all learn to play in the sand box nicely this time…but I digress.

The budget and tax bill No. 3 now heads to the governor. As we write this column, it is unclear what action he will take (sign it, let it become law without signature or veto). The House may return on Wednesday, depending on his action; to adjourn for the year, override a veto or put plan No. 4 forward to resolve differences.

There are indications the governor may declare “Uncle” and let the latest budget and tax bill become law without his signature, thereby ending any angst about a potential government shutdown.

Meanwhile, the US Supreme Court ruled last Thursday that states can collect sales taxes from online retailers for purchases made by their residents. The change could mean $5 to $15 million annually for Vermont and the education fund. While the ruling should have helped with the current tax impasse, it seems to have taken a back seat at the moment.
Special Session Bills Approved:
While the headlines focus on the tax differences between the administration and legislative leaders, several bills from the special session have recently been signed into law by governor Scott.

  • H.7 – An act relating to creating the Department of Liquor and Lottery and the Board of Liquor and Lottery (merges the two departments)
  • H.8 – An act relating to boards and commissions (reviews the need for the state’s 250 plus boards and commissions)
  • H.10 – An act relating to transportation network companies (creates uniform requirements for business like Uber and Lyft)
  • S.2 – An act relating to regulating finance leases for credit card terminals (consumer protection provision for small merchants)
  • S.3 – An act relating to sexual exploitation of students (prohibits schools from confidential employment separation agreement that inhibits the disclosure to prospective employers and responsible licensing entities of factual information about a prospective employee’s background that would lead a reasonable person to conclude that the prospective employee has engaged in conduct jeopardizing the safety of a minor)

You may reach me at JHarrison@leg.state.vt.us or my cell. 802-236-3001. Messages may also be left at the State House during the legislative session at 802-828-2228. Website: www.harrisonforvermont.com.

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