In his first budget address, Gov. Phil Scott on Tuesday proposed jarring changes to the state education funding system that would alter Vermont’s annual Town Meeting Day tradition and require strict budgeting constraints for local school districts.
“I am committed to doing whatever it takes to put us on a new path to a more prosperous future,” Scott told a joint session of the House and Senate.
That, he said, would require level-funding for most state agencies — as well as for public school budgets. The latter have long been controlled by local communities.
The much-anticipated, 43-minute address offered the first indication of how Scott — a Berlin Republican who took office January 5 — would meet his campaign promise to be fiscally prudent while protecting the most vulnerable.
Scott asked the legislature to require local school districts to hold their 2018 budgets to this year’s levels. He also proposed making teachers contribute at least 20 percent toward health insurance coverage under any new teacher contracts. Teachers currently pay around 15 percent, while state employees pay 20 percent, Scott said. Many private-sector employees pay more, he added.
The governor acknowledged the drastic change his budget proposal represented — but he was unapologetic.
“Believe me when I say I know these are incredibly strong measures,” Scott said. “I’m not asking school districts for anything more than what I’ve asked from state government.”
While running for the open governor’s seat last year, Scott mentioned none of the specific changes to education funding he proposed Tuesday.
Some of the proposals he outlined in the speech — to boost funding for early childhood and higher education — won a warm reception. But lawmakers and those impacted by Scott’s proposed budget were surprised by how much his plan would shift the power of the purse strings.
“We value local control in this state, and now we have a governor who’s proposed a dictum from the state as to how much schools are going to spend,” Rep. Dave Sharpe (D-Bristol), who chairs the House Education Committee, said after the address.
Republicans, who are in the minority in the legislature, tended to be more positive. “This is the first time I have ever heard a governor propose absolutely no increase in taxes and no increase in fees to pay for his budget proposal,” said Rep. Heidi Scheuermann (R-Stowe). “This is the kind of leadership we need! I so look forward to working with the governor to advance his priorities.”
Scott’s school budget and health care proposals would save the state $51 million next year, Administration Secretary Susanne Young said in a briefing earlier Tuesday.
To give school districts more time to adjust to the level-funding mandate, Scott proposed delaying local budget votes until May 23 — a break from Vermont’s traditional Town Meeting Day polls, scheduled this year for March 7.
Young acknowledged that lawmakers would need to act quickly on the idea so that school boards, which have already begun crafting budgets, could change course. She dismissed any suggestion that the move would dampen Vermont’s town meeting tradition, in which local communities gather to vote on town and school budgets.
Scott would use money saved to boost childcare and prekindergarten education funding by $9.6 million next year. He also proposed budgeting $6 million more for higher education.
The governor’s proposal includes $4 million — a dramatic 15 percent increase — in state funding for the Vermont State Colleges, which have long suffered from a lack of funding. A recent decision to merge Johnson and Lyndon state colleges stemmed from concerns about declining enrollment and funding.
VSC chancellor Jeb Spaulding might have been the happiest person in the Statehouse after Scott’s address Tuesday.
“We’ve had decades of underfunding,” he said. “It will put our system on a very solid financial footing.”
The University of Vermont and Vermont Student Assistance Corporation would each get a $1 million increase.
Scott told legislators that some of the new money for higher education would go toward programs for those pursuing trades.
“When I first entered college, it was to be a tech education teacher. Being able to build something from nothing always inspired me,” he said. “So it is especially meaningful for me to propose investments that will provide young Vermonters with more career and technical experience.”
Robyn Freedner-Maguire, campaign director for the organization Let’s Grow Kids, was happy to hear about increased funding for childcare and early childhood education. “I think it’s huge,” she said.
Others worried, however, that Scott’s proposed budget limits would cripple K-12 schools — and run counter to Vermonters’ desire for local control.
“Mandated, top-down control of school budgets from Montpelier is usually a non-starter,” said Rep. Sarah Copeland Hanzas (D-Bradford).
“To level-fund spending from last year, you can only achieve that if you reduce personnel, cut programs and take people out of the classrooms,” said Senate President Pro Tempore Tim Ashe (D/P-Chittenden).
Martha Allen, president of the Vermont-National Education Association teachers’ union, said her organization might challenge the constitutionality of Scott’s proposals.
Rep. Kitty Toll (D-Danville), chair of the House Appropriations Committee, asked Finance Commissioner Andy Pallito after the budget address whether the Scott administration had other options if Vermonters dismissed the education funding proposals.
“At this point, there is no Plan B,” Pallito replied.
“I’m hoping there can be a Plan B,” said Toll, who called the proposal a major change. “Ambitious isn’t even close as a word to describe it.”
Young, in briefing members of the media on the budget, repeated that refrain again and again. “We know it’s a very heavy lift,” she said. “It’s going to create quite a lot of discussion.”
Among other plans Scott outlined in his budget proposal:
Closing the state prison work camp in Windsor, for a projected savings of $3.5 million next year. The camp has the highest per-capita cost of all the state’s prisons. Some inmates could be moved to St. Johnsbury under a pending deal with the town, Pallito said.
Saving $2.1 million by eliminating vacant jobs, re-examining contracts and cutting 14 positions in the Agency of Human Services.
Cutting $2.4 million by requiring all state agencies and departments to find administrative savings. Pallito told the House Appropriations Committee on Tuesday that he could not offer specifics on how each department would find those savings.
Saving $2.8 million by referring Vermont Health Connect customers who are not on Medicaid and are not eligible for state subsidies directly to private insurers.
Creating a $35 million housing bond through which the Vermont Housing and Conservation Board would expand housing for middle-income Vermonters.
Diverting $10 million from the state budget, plus $20 million in bonding, toward water cleanup efforts that a recent state treasurer’s report recommended should be funded at $50 million a year.
Investing nearly $1 million in opiate treatment in St. Albans.
Spending $750,000 on economic development marketing.
Investing $400,000 in small-business development counselors for Bennington, Franklin and Windsor counties.