Will The Bipartisan Cooperation On Vermont's State Budget Be Short-Lived?

Mar 31, 2017

A budget plan put forward by the House of Representatives this week has won nearly unanimous support across party lines, but the bipartisan harmony over fiscal issues may be short-lived.

With a Republican governor and a Democratically controlled Legislature, Montpelier had been bracing for a partisan battle over fiscal issues this year.

About two weeks ago, House Speaker Mitzi Johnson summoned political reporters to the Cedar Creek room for an impromptu press conference. Flanked by some of her key committee chairs, Johnson proceeded to rip into Gov. Phil Scott’s 2017 budget proposal.

“The governor’s proposed budget is a house of cards. We know that. He’s shirked his responsibility to put a balanced budget on the table,” Johnson said.

With a $70 million shortfall in next year’s spending plan, and a wholesale rejection of Scott’s plan to resolve it — Scott wanted to freeze school spending next year, and use the savings to close the budget — Johnson said it was Scott’s job now to offer up a new budget approach.

The next day, at a press conference of his own, Scott said no such plan was forthcoming. And the Republican governor insisted that the House’s budget difficulties were of its own making.

“How about an opportunity to think outside the box, think creatively about what we can do to become more efficient?” Scott said. “I’m just waiting for a proposal for House Appropriations to do so.”

The exchange seemed to foreshadow a session of bitter fiscal divide. But something unexpected has happened in Montpelier. And on Thursday afternoon, the House’s $5.8 billion budget plan passed by a vote of 143 to 1.

"People will stand up and say, 'Yes, we need to act, we need to take extraordinary measures to maintain our values.'" — Rep. Robin Chesnut-Tangerman

It is a historically lopsided vote on a budget bill. And it signals a partisan unity that previously seemed unlikely.

The bill won support from Republicans because it doesn’t rely on any new taxes or fees to balance the budget. Johnson says earning GOP buy in was part of the plan.

“And [I] feel like we’ve worked really hard to put together a budget that is within the ballpark of the kind of thing the governor would be willing to work with us on,” Johnson says.

Scott, for his part, was effusive.

“My line in the sand has been no new taxes and fees, and they’ve adhered to that,” Scott says.

Scott says he’d still like to see lawmakers reduce spending in the public education system, but he says “I just want to emphasize how much I appreciate the work the House has done.”

“I know it didn’t come easily,” Scott says.

With potentially dramatic reductions in federal revenue on the horizon as a result of President Donald Trump’s proposed budget, however, the fiscal détente may be temporary. And as Calais Rep. Janet Ancel, chairwoman of the Committee on Ways and Means, made clear on the House floor Thursday, there’s another key reason that Democrats adopted a no-new-revenues budget this year.

“We’ve preserved whatever additional tax capacity we have for future response to whatever budget cuts come to us,” Ancel says.

That House Democrats have signaled a willingness to use new revenues next year is one of the reasons more liberal lawmakers voted ‘yes’ on this year’s budget plan. Middletown Springs Rep. Robin Chesnut-Tangerman, the head of the House Progressive caucus, says he’s concerned that the budget he voted for Thursday doesn’t raise enough money for vulnerable Vermonters.

"We in Vermont have to start figuring out how we’re going to manage our state's finances and in my opinion become less dependent on federal dollars." — House Minority Leader Don Turner

“A ‘no’ vote would have put us standing apart from Democrats and Republicans. And there’s value in that, politically,” Chesnut-Tangerman says.

But Chesnut-Tangerman says he’s convinced that he’ll be able to work with Democratic lawmakers next year, or possibly during a special session this fall, to backfill federal reductions with new state tax revenues.

“People will stand up and say, ‘Yes, we need to act, we need to take extraordinary measures to maintain our values,” Tangerman says.

The question of using Vermont taxpayers’ money to offset federal losses is the one that could restore the partisan split in Montpelier after this session adjourns.

“We can’t be taking care of everything for everybody forever. And that’s where I think the mentality of this building has gone,” says House Minority Leader Don Turner.

Turner says he supported the budget only because it doesn’t raise new taxes or fees. Turner says changes at the federal level aren’t going to alter his desire to hold the line on state spending.

“We in Vermont have to start figuring out how we’re going to manage our state’s finances and in my opinion become less dependent on federal dollars,” Turner says.

Scott isn’t ruling out the possibility of using new state revenues to shore up programs hit by federal reductions. But he isn’t nearly as bullish on that option as House and Senate Democrats have sounded.

"Raising taxes is the last resort," Scott says. "We’ll just have to see what happens in Washington."

The budget now heads to the Senate, which will make its own revisions to the plan. But the real battle over spending issues might be postponed until Montpelier finds out what Trump’s budget plan means for Vermont.