By Rep. Jim Harrison
This past Wednesday, Dec. 4, members of the Vermont Legislature returned to Montpelier for a day of briefings in preparation of the new session on Jan. 7. The agenda included updates on clean water, climate initiatives involving transportation, the Vermont economy and fiscal issues.
Once again Vermont leads the nation with the lowest unemployment rate (2.2%). A closer look, however, shows that the rate is more indicative of the state’s growing demographic change with fewer workers overall. And if real estate values are a measure of an area’s economy, there is a wide difference between southern Vermont and Chittenden County. Home prices in Chittenden and Grand Isle counties are up 13% from the prior peak of 2007-2008, whereas Rutland and Windsor counties are down over 12% with Bennington down almost 17% during the same period.
The last two years show a small uptick in total population for the state. While the numbers are modest (2,500 over two years), it reverses a negative trend from 2012-2016.
Vermont General Fund revenues during the current fiscal year are up 1.3% over projections, led by strong personal income tax numbers. While that is good news, it doesn’t mean the state budget will be any easier to construct in the coming months. Annual increases in costs, from items like health insurance and pay hikes, along with the increasing amount needed to put toward the unfunded pension liabilities, will outpace the expected growth in revenue. Current estimates from the administration point to a budget gap of $60-80 million for the FY 2021.
What else is on tap, you may ask? As this is the second year of the biennium, all bills introduced last session and not passed, can be considered. Two bills passed last spring, medical monitoring and a waiting period for gun purchases, were vetoed by the governor and potential override votes could be taken. Additionally, legislators have been proposing new bills for introduction throughout the summer and fall.
Already on the House calendar is the paid family leave benefit funded by a new payroll tax on all employees and/or employers, as well as the $15 minimum wage legislation. Both issues are considered priorities of the Democratic leadership, but an agreement between the House and Senate proved elusive at the end of the last session in May. Both issues also potentially face gubernatorial vetoes due to Scott’s opposition to a new tax on Vermonters and potential impact on the state’s business climate.
Another bill up for action in the House is a bill that would institute registration fees and a directory of home contractors that are not already licensed. The bill, S.163, has passed the Senate and three different House committees. But a 6-5 close vote by the influential Ways & Means Committee could foretell an interesting discussion on the House floor. Proponents believe the contractor registration will serve as a valuable consumer protection measure (most states have some type of registration), while opponents feel it is one more fee on small business and a possible government intrusion into their affairs.
In the off session there has been a lot of media surrounding the changing climate. A group of lawmakers, comprising the climate caucus, are expected to push several agenda items forward, including a proposed regional transportation initiative (Northeast states). According to Julie Moore, Secretary for the Agency of Natural Resources, the initiative could increase transportation fuels from 5-18 cents per gallon, depending on which plan is adopted by the multi-state group. Locally, Burlington Mayor Miro Weinberger has urged a statewide adoption of a carbon tax beginning at about 30 cents per gallon with annual increases of 10% plus CPI. Of course Burlingtonians don’t have to travel the same miles on average as the typical rural Vermonter.
Climate initiatives are being spearheaded by an active group of students and many others in Vermont and elsewhere. Last spring, a group of students disrupted and closed down the House Chamber in order to draw attention to a “climate emergency.” Whether such tactics help or hurt their cause remains to be seen. And of course, the questions remain what proposals, at what cost and potential benefit will accrue here in Vermont, the second smallest U.S. state.
Legislation to establish a commercial market for marijuana through a tax and regulate model, is expected to receive much attention this coming session. S.54 has passed the Senate as well as one House Committee, but needs approval in two more committees before it could see a vote by the full House. The Governor has indicated a receptivity to the idea if certain provisions are included, such as a roadside saliva test (which is not currently in the bill) and location of marijuana enterprises only if local towns approve.
Expanding the scope of Vermont’s Act 250 land use law saw several months of testimony and discussion in the House Natural Resources Committee this past session. While no bill emerged, it is likely the committee will pick up the proposed changes again come January.
And sure to be under scrutiny, will be the statewide property tax to support school budgets. Unlike a year ago, when the tax commissioner’s December letter forecast no growth in average statewide rates, this year’s forecast is looking at an average 6% increase. Changes can happen between now and May, but starting off at 6% hike even before local budgets are approved can create a challenge lawmakers will want to evaluate.
The stage is set for the 2020 legislative session. Beginning in January and throughout the 2020 legislative session, I plan to provide regular updates on what’s happening at the State House. In the meantime, I want to wish you and your family a joyous holiday season.
Jim Harrison is the state representative for Mendon, Bridgewater, Killington and Chittenden.
