Vermont lawmakers on Friday advanced a short-term state budget designed to keep the lights on as they await more information about how the coronavirus pandemic has affected the state's finances.
The three-month spending plan, which would take effect in July, level-funds much of state government — reversing cuts proposed by Gov. Phil Scott's administration. Scott's budget writers had suggested to lawmakers that they trim spending in many agencies and departments during the first quarter of the next fiscal year by an annualized rate of 8 percent.
But Rep. Kitty Toll (D-Danville), who chairs the House Appropriations Committee, told colleagues on Friday that doing so without an accurate revenue forecast and without input from the general public would be irresponsible. She said her committee was prepared to make tough decisions at the end of the summer when it returned to finish the state's annual spending plan.
"This budget is intentionally far from complete, as this difficult work will happen in August when our fiscal picture is clearer and decisions can be made based on facts and fully understanding the needs of Vermonters," Toll said during a remote meeting of the House.
The chamber voted 142 to 5 in favor of the bill on Friday. The House is expected to give it final approval next week, at which time it would move to the Senate for consideration.
While level-funding most state government entities, the legislation would allocate more than $47 million of Vermont's $1.25 billion in federal Coronavirus Relief Fund dollars. The House plan would distribute $15 million apiece to the Vermont State Colleges System and the University of Vermont, as well as $5 million to the Vermont Student Assistance Corporation. The Secretary of State's Office, state's attorneys and the legislature itself would each receive $2 million of the federal funding.
The bill would also fully fund the state's pension obligations, which Toll said was essential to maintaining its credit rating. "This was critical to send this signal to Wall Street that we will pay our debt and pay our obligations," she said.
Though the House chose not to cut funding, it did formalize a hiring freeze for all but essential positions during the three-month period. At the same time, it agreed to implement certain pay raises negotiated by the Vermont State Employees' Association prior to the pandemic.
In her comments to colleagues, Toll characterized the legislation as "a simple, bare-bones budget." But Rep. Cynthia Browning (D-Arlington), who often clashes with Democratic leaders, questioned whether it was wise to pay state workers more and to avoid budget cuts when preliminary revenue forecasts look so grim.
According to the latest projections from the state's economists, Vermont is likely to collect $378 million less than expected next fiscal year — a 15 percent decline from previous forecasts.
"Madam speaker, I am concerned that we are spending ahead of our revenue," Browning said. "We are spending ahead of our funding."
Rep. Anne Donahue (R-Northfield) echoed the sentiment, arguing that "sustaining current levels of operations now will put Vermonters at much higher risk for deeper cuts in the remaining three quarters of the fiscal year."
At the other end of the political spectrum, Rep. Randall Szott (D/P-Barnard) criticized Toll's committee for failing to consider engaging in "emergency deficit spending." He said that "austerity budgeting" disproportionately impacts those most at risk during an economic downturn.
In the end, only Szott, Donahue, Browning and two others — both Republicans — opposed the budget.