Budget and pension reform bill threatened with veto by Governor Scott

MONTPELIER, Vermont (WCAX) – The Vermont Senate has approved its version of the state’s $8 billion budget, but elements of the plan continue to go against Governor Phil Scott, who has threatened to veto the measure.

The budget includes major investments in housing, water and sewer, broadband, and workforce development. There is approximately $16 million for the recruitment of long-term care and mental health personnel. It also includes $25 million to stabilize the state college system and $11 million for local utilities to update Vermont’s power grid.

Lawmakers aim to adjourn in two weeks, but before that they need to iron out some disagreements with the governor. Top Senate budget writers describe Vermont’s largest budget as oversubscribed. “Over $70 million in demands for what we had in the money,” said Sen. Jane Kitchel, of County D-Caledonia. That’s partly because lawmakers spent winter pandemic relief money to bolster the state’s health care workforce.

The Legislative Assembly budgets and Governor Scott’s proposals share many similarities. Scott says the Senate version comes close but still misses the mark because it leaves out funding for economic development, workforce training and cellphone towers. He says it also lacks tax breaks for seniors, veterans and young workers. “It’s really important, from my perspective, to take advantage of this unique opportunity to grow the economy, revitalize Vermont and make our state more affordable,” he said.

Lawmakers are leaning toward tax breaks for young families. “The workforce needs to change…on what basis do you choose one profession over another?” said Kitchel.

Now that the two houses have passed their budgets, they will reconcile the differences in a conference committee before sending it to the governor.

Meanwhile, the governor is also raising the red flag on the Legislature’s bipartisan retirement agreement negotiated with the teachers’ and state employees’ unions. The plan allocates $200 million and is expected to reduce the $3 billion unfunded liability by $2 billion.

But in a letter to key lawmakers last month, Scott says he wants a risk-sharing provision and wants new hires to have the option of participating in a defined-contribution plan, like a 401K. “The private sector like the public sector, they want some flexibility. They want a bit of freedom and independence,” he said. The governor says the economic conditions on which lawmakers’ plan is built won’t last forever.

Democratic and union leaders say the governor is making last-minute changes. “I’m frustrated with how the governor is engaging at this late hour on this issue,” said D-Windsor County Chairwoman Becca Balint. She says the bill was crafted after months of work where the Scott administration was at the table and that it also creates a pension oversight committee that future proposals — including those from the governor — can be reviewed. .

“It’s not like we rejected him, absolutely not. But the legislation was meant to be specific to what was being negotiated,” Senator Kitchel said. She says there simply isn’t enough time to consider the governor’s proposal before the adjournment.

It’s unclear whether the governor will veto the pension plan if lawmakers don’t make changes.

Copyright 2022 WCAX. All rights reserved.