Democratic Lawmakers Want 'Plan B' On Budget From Scott

Jan 26, 2017

As it becomes increasingly apparent that Gov. Phil Scott’s bombshell budget proposal Tuesday won’t pass muster in either the House or Senate, key legislators are already asking the Republican for an alternative spending package. It does not appear that one is forthcoming.

About two dozen senators packed into a committee room on Thursday afternoon for a briefing from legislative analysts.

The topic was Scott’s proposal to enforce a spending freeze on local school districts, and all its accompanying impacts on the state budget. About 10 minutes into the meeting, Essex County Sen. John Rodgers raised his hand for a turn to speak.

“It doesn’t look like there’s much of this that’s going to make it through the process, so I don’t think we need to spend too much time on it,” said Rodgers, a Democrat.

Rodgers’ sentiments encapsulate how many lawmakers — especially Democratic ones — are receiving Scott’s proposal. And the implausibility of his plan getting anywhere in Montpelier has become increasingly apparent.

“I think right now many members of the Senate are thinking one, is this even possible, two is this desirable, and then three, is it legal,” says Senate President Pro Tem Tim Ashe.

For many in Montpelier, the answer to all three of those questions is a resounding "no."

"My hope is they have a back-up plan to present if the Legislature is unable to pull of the miracle of getting a vote through by next Friday." — Senate President Tim Ashe

Scott’s plan would put more than $100 million in new liabilities on the education fund, which is the portion of the state budget funded mostly by property taxes. It’s a tactic that has allowed Scott to close a general fund shortfall while funding a range of new public programs, all without raising new taxes or fees.

Scott’s budget numbers only work though if lawmakers force local school districts to freeze spending next year – he’s using savings from that mandate to balance his budget. It’s a concept that’s proving problematic among lawmakers.

“Some districts which have been high spenders in the past now get locked in at a high-spending level. Meanwhile, people who have been very dutiful and try to keep their spending down now get locked in, perhaps artificially low,” Ashe says.

Scott’s plan does allow for districts to raise additional funds, on a one-time basis, for next year’s school budgets. Scott’s mechanism for raising that extra money, should districts avail themselves of it, is an assessment on property owners in the district.

Senate lawmakers get a briefing Thursday on the proposed budget from Gov. Phil Scott.
Credit Peter Hirschfeld / VPR

But that means it would be much easier for property-rich districts to generate the funds than districts in less affluent areas. And Democratic lawmakers say it might run afoul of a Supreme Court precedent designed to ensure funding equity across district lines.  

House Speaker Mitzi  Johnson says she worries about the consequences of placing new liabilities on the education fund – like higher education, child care subsidies and teacher retirement costs, as Scott has proposed. Folding those line items in the education fund, Johnson says, will only balloon property tax rates in the future.

She says the proposal is doubly concerning, given that school districts are working to implement a wide-ranging school-district consolidation bill passed by lawmakers in 2015.

“And I think right now we’ve got to focus on letting that settle out and not create more uncertainty in the process,” Johnson says.

Another catch to Scott’s plan: It requires March Town Meeting Day votes to be pushed back to May 23. Lawmakers will have to give guidance to districts within a couple weeks on whether they should cancel those March votes.

Ashe says that gives lawmakers only a matter of weeks to vet the complex budget proposal. And he says it’s a near impossibility that could happen in that timeframe, even if lawmakers were on board in concept.

"As long as they agree with my vision and we can do this without taxes and fees, I think that's half the battle, is agreeing to the vision." — Gov. Phil Scott

“The administration presented a budget which is based on an almost impossible education funding construct, so my hope is they have a back-up plan to present if the Legislature is unable to pull of the miracle of getting a vote through by next Friday,” Ashe says.

Johnson agrees.

“It would be fantastic if the governor wants to put forward an alternative proposal,” Johnson says.

But Scott isn’t so ready to part with Plan A.

“I’ve placed my pathway, my roadmap of sorts to how we can get there, and if they don’t agree at this point, I’m all ears in terms of how we can accomplish the goals of this initiative,” Scott says.

Scott convened a press conference Thursday afternoon, to spotlight a non-degree education program that offers an alternative career path for non-traditional students. If his plan goes forward, that program gets a $1 million boost next year.

Scott says he’s convinced there are enough savings in the $1.6 billion K-through-12 education system to free up money for other education initiatives. He says lawmakers don’t have to agree with the spending freeze in order to move forward.

“As long as they agree with my vision and we can do this without taxes and fees, I think that’s half the battle, is agreeing to the vision,” Scott says.

He says by delaying Town Meeting Day votes, he, lawmakers, school boards and the public will have the time they all need to find a way to make it work.