Twelve League members met with Governor Phil Scott at the State House on a rainy March 1st day.
Scott had just returned from the National Governors Association meeting in Washington, D.C.
Scott vehemently opposed the federal immigration policy. The Republican governor was one of the first governors to speak up against the president. The Governor stated that “we have a moral obligation to help others.” Vermont continues rely on immigrants to counteract the ongoing migration out of the State. Our population continues to be stagnant and even has even encountered slight declines over the last decade.
Our state population would be stagnant or dropping without the influx of immigrants. Since 1989, at least 6,300 men, women and children have come to Vermont through a federal refugee resettlement program. Ninety percent have become naturalized citizens. The population of Vermont is 627K, the smallest after Wyoming. Immigration is a significant factor to the economic health of Vermont.A robust population equals more tax filers and a more competitive pool for programs such as health care.
Governor Scott restated his campaign promise that he would not raise taxes or implement any additional fees. He again echoed his commitment to level fund the state’s budget and education spending. The Governor’s primary focus is economic growth, “We can not take care of our people if there is no revenue to do so.” It's the economy, stupid is the saying that has epitomized the political realm for decades and Scott is not deviating from this adage.
At $30B, Vermont has the smallest economy in the US. Vermont is experiencing some of the lowest unemployment rates in the country at
around 3.1%. Business costs continue to remain prohibitive, ranking Vermont at 47th most business friendly. Compared with a population
base similar to Vermont, Wyoming ranks 1st as tax-friendly for businesses. Vermont’s economic outlook over the next five years is projected to be one of the worst in the U.S. The Governor continued by stating that Vermont has a $70 million revenue shortfall compared to this time last year and that corporate revenue was down by 200%.
With this reality and federal policy in flux, Scott is concerned. “Half of our budget is based on federal funding.” While Scott anxiously awaits
what cuts will be made to our discretionary domestic spending, he was assured that the budget would increase around public safety, national security and the military.
In January, Scott called for a local school budget freeze and level funding of the State’s general budget. He stated that there was plenty of money in the system and that it needed to be reallocated. He proposed eliminating the $75 million General Fund budget gap through teachers retirement at $35 million, the other $40 million with cuts in human services and reallocation in Medicaid program.
Questioned about a more progressive individual tax structure on the top 1%. Scott responded swiftly, “No.” Vermont is currently ranked 7th for its tax rate on the 1%, one of the most progressive tax structures in the country.
Governor Scott reminded us that Vermont is serving 86,000 students at an average of $19,000 per student, the second largest portion of our State budget. He wants to reallocate $9.6 million from K-12 education to early childhood education and childcare programs. Higher education will also be allocated $6.5 million. District budgets would be tied to student population growth rates moving forward under the Scott proposal.
The effect of compliance with the budget freeze was discussed and that in fact the State is transferring their piece of the financial burden
onto a local level by allowing a 5% assessment on the grand list to cover costs.
We moved on to health care. Medicaid is the largest portion of Vermont’s budget at $1.7B. Scott states, “One-third of our population works
with Medicaid.” Scott discussed the rollout of a pilot program for OneCare, an Accountable Care Organization (ACO), involving 30,000 individuals. With OneCare, focus is on quality care and improved outcomes. This pilot helps to ensure a more holistic approach with Medicaid. Scott wants to ascertain its success before applying it to whole state. Currently, $93 million in state and federally-matched funds is allocated to this program.
We continued on with questions around universal primary care. The League asked about the two new tri-partisan supported bills, S53 and H248, which propose creating publicly financed primary care for all. Governor Scott was clearly not impressed with universal health care, and stated that it was too expensive. Scott stated we are going to need to look at creative ways to manage costs. Perhaps we will need to expand our aging pool with other states nationally to remain competitive.
We briefly touch on the $2 per night Occupancy Fee Bill Proposal H.217. This legislation predicted to raise as much as $10 million per year
to support affordable housing in Vermont and reduce homelessness. Scott quickly responded that he will stand by his promise to not raise any taxes or implement any additional fees. He did say that we need to make a commitment to affordable housing so that we can keep families here and attract families to move here.
As we closed, Governor Scott reminded us how important it is to find common ground and work together.