YCQM: February 24, 2013 - WCAX.COM Local Vermont News, Weather and Sports-

YCQM: February 24, 2013

>> Announcer: FROM VERMONT'S MOST TRUSTED NEWS SOURCE, WCAX BRINGS YOU YOUR NEWSMAKERS, YOUR NEIGHBORS. THIS IS "YOU CAN QUOTE ME."

>>> GOOD MORNING, EARN, AND THANKS FOR JOINING US. I'M KRISTEN CARLSON. THIS MORNING OUR NEWSMAKER IS JEB, HE'S THE SECRETARY OF ADMINISTRATION FOR THE SHUMLIN ADMINISTRATION. MR. SPAULDING, THANKS FOR BEING HERE.

>> NICE TO BE BACK.

>> JOINING ME IN QUESTIONING IS DARREN PERRON.

>> GOOD MORNING, MR. SPAULDING. LET'S START WITH A HEADLINE THIS PAST WEEK FROM THE VERMONTERS FOR HEALTHCARE FREEDOM, CLAIMING THE ADMINISTRATION HAS BEEN HIDING THE TRUE COST OF HEALTHCARE REFORM IN SINGLE PAYER HEALTHCARE IN VERMONT. LET'S TAKE A LISTEN TO WHAT THEY HAD TO SAY THIS WEEK.

>> WE'RE NOW SEEKING INFORMATION THAT WE KNOW MUST EXIST, BUT HAS NOT BEEN RELEASED BY THE ADMINISTRATION. WE ARE REQUESTING DOCUMENTS ALSO DIRECTLY FROM THE UNIVERSITY OF MASSACHUSETTS, THE CONSULTANTS UNDER THE MASSACHUSETTS ACCESS TO PUBLIC RECORDS LAW.

>> BASICALLY, THEY'RE CLAIMING THAT SOME CORRESPONDENCE BETWEEN THE ADMINISTRATION INDICATES THAT THERE IS A COST OUT THERE THAT HAS NOT BEEN RELEASED TO THE PUBLIC. YOUR RESPONSE?

>> WELL, I THINK THE CLAIM IS PATENTLY FALSE. WE PROVIDED OVER 1600 PAGES OF DOCUMENTS TO THE VERMONTERS FOR HEALTHCARE FREEDOM RECENTLY. THEY RENEWED ANOTHER INFORMATION REQUEST. I DON'T BELIEVE WE HAVE ANY OTHER INFORMATION. I KNOW THE DIRECTOR, MR. WINBERG SPENT A CONSIDERABLE AMOUNT OF TIME SPEAKING TO THE POINT PERSON AT THE UNIVERSITY OF MASSACHUSETTS. WHAT'S SURPRISING TO ME, I WAS TOLD HE NEVER ASKED IF WE HAD A HEALTHCARE PLAN BECAUSE HE MIGHT HAVE GOTTEN THE ANSWER HE DIDN'T WANT TO HEAT INDEX WHICH WAS NO. I DO -- TO HEAR, WHICH WAS NO. I WANT TO CORRECT ONE THING. THEY HAVEN'T SAID WE HAVEN'T IDENTIFIED THE COST, WHAT THEY'RE SAYING IS WE HAVEN'T IDENTIFIED HOW TO PAY FOR THE COST. THE REPORT WE ISSUED A FEW WEEKS AGO TO THE LEGISLATURE DID IDENTIFY IN DETAIL THE COST PART OF THE EQUATION, AND IT INDICATED THAT THE, YOU KNOW, THE TO -- THE TOTAL COST FOR HEALTHCARE, EVERYTHING IN, SOUP TO NUTS, IS ABOUT $6 BILLION, BUT WHAT THEY ALSO IDENTIFIED IN THEIR REPORT WAS IF WE MOVE TO A UNIVERSAL PUBLICLY FINANCED SYSTEM THE WAY WE ARE PLANNING TO, WE COULD SAVE A HALF A BILLION DOLLARS A YEAR, APPLES TO APPLES COMPARISON, COMPARED TO WHAT WE'RE DOING RIGHT NOW. NOW, THAT'S NOT EXACTLY WHAT WE'RE GOING TO BE DOING BECAUSE THE AFFORDABLE CARE ACT WAS PASSED IN WASHINGTON AND IT REQUIRES US TO INSURE, YOU KNOW, EVERYBODY, AND TO PROVIDE A HIGHER LEVEL OF COVERAGE THAT MANY OF THE PEOPLE UNDERINSURED NOW DO. EVEN WITH THE CHANGES, THE REPORT INDICATED WE COULD SAVE ROUGHLY $300 MILLION OVER THE FIRST THREE YEARS, SO I DON'T THINK THERE'S ANY DISPUTE ABOUT THE FACT THAT WE COMPLIED BY PRESENTING IN DETAIL THE COST SIDE OF THE EQUATION. WHAT WAS IN CONTENTION IS -- THERE'S A CONTENTION WE SHOULD HAVE TOLD THEM HOW WE'RE GOING TO PAY FOR THIS.

>> RIGHT.

>> IF THE TOTAL COST IS 3.5 BILLION EXCLUDING THE FEDERAL FUNDS AND WE'RE LOOKING AT PROBABLY LIKE 1.6 BILLION TO REPLACE PREMIUMS AND SO FORTH, WHERE ARE WE GOING TO GET THAT. AND OUR CONCLUSION OR OUR DETERMINATION WAS THAT, LOOK, THERE'S NO WAY THAT WE COULD START THIS SINGLE-PAYOR SYSTEM UNTIL 2017, SO WE'RE NOT GOING TO BE ASKING THE LEGISLATURE TO PASS A TAX PACKAGE TO FINANCE THAT PLAN, WHICH COULD EASILY CHANGE BETWEEN NOW AND 2017, AND JUST TO BE CLEAR WITH THE VIEWERS, THERE IS -- IF WE -- THERE'S NO WAY WE COULD START BEFORE 2017 WITHOUT A WAIVER FROM CONGRESS. IT'S NOT AN ADMINISTRATION WAIVER FROM THE OBAMA ADMINISTRATION. YOU HAVE TO HAVE CONGRESS GIVING YOU SPECIFIC WAIVER FOR VERMONT TO GO FORTH BEFORE 2017.

>> LET'S WORK ON THAT POINT BECAUSE AS YOU KNOW, THERE WAS A LOT OF TALK ABOUT THIS WAIVER AND THERE WAS A PRESS CONFERENCE WITH THE CONGRESSIONAL DELEGATION, WITH THE GOVERNOR SAYING VERY CONFIDENTLY THAT THERE WAS A FEELING THAT THE STATE WOULD GET THIS WAIVER. WHAT WENT WRONG, WHAT HAPPENED?

>> WELL, YOU KNOW, I DON'T REMEMBER THE PRESS CONFERENCE, BUT SINCE YOU SAID THERE WAS ONE, I'M ASSUMING IT WAS THERE.

>> THERE WAS A LOT OF CONFIDENCE.

>> THERE'S NO QUESTION THAT GOVERNOR SHUMLIN AS HARD CHARGER, AN ENTREPRENEUR, AND HE DOESN'T LIKE TO TAKE NO FOR AN ANSWERS HE WANTS TO GET THERE AND HE FEELS HIS JOB IS TO PUSH AS HARD AS WE CAN, BUT, YOU KNOW, BY THE TIME THIS SUMMER ROLLED AROUND -- AND BY THE WAY, THE ACT 48 THAT INCLUDED THE REQUEST FOR THE ADMINISTRATION TO PRESENT A REPORT, IT WASN'T PASSED IN THE LAST LEGISLATIVE SESSION, IT WAS PASSED IN THE SESSION BEFORE THAT AND A LOT HAS CHANGED SINCE THE ORIGINAL HOPE OF BEING ABLE TO START GREEN MOUNTAIN CARE AND ITS UNIVERSALLY PUBLICLY FINANCED PHASE BEFORE 2017. IT JUST, YOU KNOW, I THINK THERE WAS HOPE, BUT IT BECAME CLEAR, FIRST OF ALL -- WELL, THE GOOD NEWS WAS THE SUPREME COURT RULED IT WAS CONSTITUTIONAL, BUT GIVEN THE EXISTING CONGRESS WE HAVE DOWN THERE AND THE ELECTIONS THAT HAVE COME ALONG, THERE WAS NOT GOING TO BE AN OPPORTUNITY TO START IT BEFORE 2017. SO WE REALLY MADE THE DECISION, YOU KNOW, PEOPLE CAN MAKE DIFFERENT DECISIONS, BUT OUR GROUP DECISION IN THE SHUMLIN ADMINISTRATION IS SINCE WE'RE NOT GOING TO ASK THE LEGISLATURE TO PASS A TAX PACKAGE UNTIL 2015 IN ANTICIPATION OF STARTING IN 2017, THERE WOULD BE NO REASON TO PUT A SPECIFIC FINANCE PLAN ON THE TABLE NOW. IT WOULD BE SMARTER TO START WITH THE COST SIDE AND, YOU KNOW, ISSUE CLOSE TO 100-PAGE REPORT THAT HASN'T REALLY, I THINK, BEEN DIGESTED BY EVERYTHING YET, BUT WE -- EVERYBODY YET, BUT WE NEED TO UNDERSTAND WHAT WE'RE PROPOSING IN TERMS OF SAVINGS, DELIVERY SYSTEM, PAYMENT REFORM, AND THEN HAVE TIME TO HAVE A CONVERSATION ON THE BEST WAY TO PAY FOR IT. I WANT TO EMPHASIZE SOMETHING, AND BY THE WAY, YOU KNOW, I'M NOT THE HEALTHCARE GURU IN THE SHUMLIN ADMINISTRATION, BUT I CAN TELL YOU, YOU KNOW, OUR PLAN IS TO HAVE THE SYSTEM GOING FORWARD COST LESS THAN IT WOULD OTHERWISE. IN OTHER WORDS, WE'RE NOT SAYING IT'S GOING TO COST LESS IN THE FUTURE THAN IT DID LAST YEAR OR THIS YEAR, BUT THAT THE SLOPE OF THE COST INCREASES WILL BE LESS THAN IF YOU LEAVE -- THE SYSTEM STAYS AS IT IS NOW. SO THAT'S OUR HIGHEST HOPE IS THAT WE CAN COVER EVERYBODY, MAKE SURE PEOPLE HAVE ADEQUATE COVERAGE AND WE CAN DO IT AT A COST LESS THAN WE OTHERWISE WOULD BY STAYING WITH THE EXISTING SYSTEM.

>> SO WHEN THE MASSACHUSETTS CONSULTANTS WERE HIRED, THE EXPECTATION WAS HOW TO PAY FOR IT WOULD BE PART OF THEIR REPORT. THERE ARE PEOPLE IN THE ADMINISTRATION WHO WERE QUOTED, I BELIEVE IN THE FALL, SAYING THIS FINANCING WAS GOING TO BE PART OF IT AND THEN THE REPORT COMES OUT AND HOW TO PAY FOR IT IS NOT PART OF THE REPORT. DID THE ADMINISTRATION EVER TALK TO THE PEOPLE AT THE UNIVERSITY DOING THE CONSULTING AND SAY CHANGE THE REQUIREMENTS, DO NOT INCLUDE THIS? WAS THERE ANY COMMUNICATION ABOUT CHANGING THE REQUIREMENTS OF WOULD HOW TO PAY FOR IT BE PART OF THIS FINAL PACKAGE?

>> YES, THERE WAS. WE MADE THE -- THE ORIGINAL CONTRACT THAT WAS SIGNED OVER THE SUMMER HAD A FULL RANGE ACROSS THE BOARD, NOT ONLY THE COST PART, BUT HOW YOU WOULD PAY FOR IT AND THIS SUMMER WENT INTO FALL, WE MADE THE DETERMINATION AS AN ADMINISTRATION THAT IT DIDN'T MAKE SENSE TO ASK THE LEGISLATURE TO PASS A FINANCE PLAN TWO YEARS BEFORE WE NEEDED TO. WE TOLD THEM STOP WORKING ON THE FINANCE PART OF IT.

>> WHAT WAS THE DATE ON THAT?

>> AND THAT WAS -- IT WAS IN MID NOVEMBER. MID TO LATE NOVEMBER. I KNOW THAT BECAUSE I SAW THE MATERIALS THAT THE VERMONTERS FOR HEALTHCARE FREEDOM PUT OUT YESTERDAY. BUT I CAN TELL YOU, THERE IS NO SMOKING GUN. I MEAN, THE IMPLICATION, THE SUBTEXT THAT THEY'RE TRYING TO SAY IS, HEY, WE SAW SOMETHING THAT SCARED US OR THAT WOULD SCARE VERMONTERS, SO WE TOLD THEM DON'T PUT IT IN THE REPORT. THAT'S NOT WHAT HAPPENED. WHAT HAPPENED IS WHAT I SAID. REALLY, AS A GROUP, WE REALIZED WE ARE NOT GOING TO ASK THE LEGISLATURE TO PASS A TAX PACKAGE TWO YEARS BEFORE THEY NEED TO. I HAVE NEVER SEEN THAT HAPPEN AND WATCHING THE LEGISLATURE FOR A QUARTER OF A CENTURY, AND IT WOULDN'T HAPPEN THIS TIME AND THE GOOD NEWS IS WE CAN NOW HAVE AN ONGOING DISCUSSION, NOT ONLY ABOUT HOW WE'RE GOING TO PAY FOR IT, BUT WHAT WE ARE GOING TO BE PROVIDING THE PEOPLE AND WHAT THE COST IS. YOU KNOW, IN SOME WAYS, IT'S IRONIC THAT THE SKEPTICS -- LET'S PUT IT THAT WAY, AND IT'S FINE. I THINK IT'S FINE TO HAVE SKEPTICS. THIS IS A BIG CHANGE, ONE OF THE BIGGEST CHANGES THAT WE'VE ASKED VERMONTERS TO CONSIDER, AND WHEN IT COMES AROUND, THERE WILL BE A MAJOR FINANCE PACKAGE. OF COURSE, WE'RE HOPING TO PAY LESS THAN WE'RE PAYING NOW AND THE GOVERNOR HAS MADE IT CLEAR, HE'S NOT GOING TO PULL THE TRIGGER UNLESS WE'RE SURE WE ARE GOING TO BE PAYING LESS THAN WE WOULD OTHERWISE, BUT WHEN WE CHANGE FROM A PREMIUM-BASED, EMPLOYER-BASED AND PREMIUM-BASED SYSTEM TO A UNIVERSAL NUMBERLY FINANCED SYSTEM, THAT'S A -- PUBLICLY FINANCED SYSTEM, THAT'S A BIG CHANGE AND IT'S PERFECTLY UNDERSTANDABLE THAT THERE ARE PEOPLE WHO WANT TO LOOK CAREFULLY UNDER THE HOOD AND THEY'RE SKEPTICAL, BUT IT'S KIND OF IRONIC THAT THROUGH THE SUMMER AND FALL, PEOPLE ARE SAYING, HEY, YOU'RE MOVING TOO FAST AND WE SAY, OKAY, WE DOMENT NEED TO DO THIS UNTIL 2015, WE HAVE TIME TO DISCUSS WITH THE PUBLIC, AND ALL OF A SUDDEN, WE'RE TRYING TO HIDE SOMETHING. LOOK, THERE ARE PEOPLE THAT DON'T WANT THIS TO HAPPEN AND WE CAN EXPECT, YOU KNOW, VARIOUS WAYS TO TRY TO UNDERMINE AND REMOVE, YOU KNOW, THE PUBLIC SUPPORT FOR THIS SYSTEM BETWEEN NOW AND THE TIME WE TURN ON IT. WE BELIEVE THE PUBLIC -- AND I THINK THIS IS BORNE OUT IN SURVEYS AND STUDIES, THE PUBLIC IS SUPPORTIVE OF THE DIRECTION WE'RE MOVING IN. THE LEGISLATURE HAS BEEN SUPPORTIVE OF THE DIRECTION WE'RE MOVING IN, AND WE'RE TRYING TO CONTINUE TO LEAD IN THAT DIRECTION.

>> THIS GROUP OBVIOUSLY IS OPPOSED TO SINGLE-PAYOR, SO THE BOTTOM LINE IS HERE, THE ADMINISTRATION IS NOT HIDING ITS FINANCING PLAN FOR SINGLE-PAYER.

>> WE ARE NOT.

>> I'M JUST CURIOUS, WHAT DO YOU IT THIS CHANCES ARE, WE'RE TALKING 2017, A LOT HAS TO HAPPEN. YOU'VE BEEN AROUND THE STATE FOR A LONG TIME, YOU KNOW THAT SINGLE-PAYER IS A PATH THE STATE HAS GONE DOWN BEFORE AND IT FELL APART WHEN IT CAME TO WHO'S GOING TO PAY FOR IT. WHAT DO YOU THINK THE ODDS ARE THAT THE STATE WILL THAT HAVE SINGLE-PAYER AFTER 2017?

>> OUR EXPECTATION IS AROUND 2017, WE WILL HAVE A SINGLE-PAYER SYSTEM. YOU CAN SEE I HAVE A FEW GRAY HAIRS IN MY HAIR AND BEARD. WHEN I WAS IN THE STATE SENATE AND WE WERE LOOKING AT EDUCATION FINANCE REFORM. THE FIRST TIME AROUND WHEN I WAS ELECTED, WE HAD SOMETHING CALLED THE LEANI SYSTEM. WE HAD A LOT OF TALK ABOUT INEQUITIES IN THE PROPERTY TAX AND THE ONLY WAY TO ADDRESS THAT WAS WITH A STATEWIDE PROPERTY TAX. THAT WAS PART OF THE ORIGINAL FOUNDATION PLAN, BUT WE DIDN'T HAVE SUPPORT, THE FOUNDATION PLAN WAS PASSED WITHOUT A STATEWIDE PROPERTY TAX. THE NEXT YEAR COMES AROUND, YEAR AFTER YEAR, PEOPLE OPPOSE A STATEWIDE PROPERTY TAX AND IT TOOK A WHILE FOR PEOPLE TO TALK ABOUT IT AND UNDERSTAND IT AND NOW WE HAVE AND HAVE HAD FOR A DECADE A STATEWIDE PROPERTY TAX AS A FOUNDATION OF OUR EDUCATION FINANCE SYSTEM AND I USE THAT AS EXAMPLE BECAUSE I THINK PEOPLE IN THE PAST WOULD LOOK AT A SINGLE-PAYER SYSTEM AND SAY, GEE, THAT'S SCARY, IT'S DIFFERENT, HOW ARE WE GOING TO DO THIS AND IT CAN'T HAPPEN, AND MAYBE IT DIDN'T, BUT THAT DOESN'T MEAN THAT AS PEOPLE GET USED TO AN IDEA, HAVE A CHANCE TO TALK IT THROUGH, UNDERSTAND HOW IT WOULD WORK, THAT WE CAN'T DO IT. AND OUR EXPECTATION IS THAT THE PUBLIC HAS PROGRESSED ALONG THE PATH THAT WILL ALLOW US TO ACTUALLY TURN THE SYSTEM ON ON OR ABOUT 2017.

>> SO WHY NOT -- THIS IS A REPORT, THIS IS NOT A MANDATE, NOT SOMETHING THE LEGISLATURE HAS TO DO. WHY NOT JUST ALLOW THE FINANCING, ALLOW HOW TO PAY FOR IT BE PART OF THIS REPORT, START THAT DIALOGUE, START THAT DISCUSSION, GET THAT INFORMATION OUT THERE, PROVIDE SOME OPTIONS FOR VERMONTERS TO START THINKING ABOUT THIS, CHEWING ON THIS AS IT'S COMING DOWN THE PIPELINE AND THERE'S NO MAN DATE THAT YOU HAVE TO SAY THE LEGISLATURE PASS THIS TAX PACKAGE. IT WOULD JUST INFORM THE DECISION MORE GOING ALONG.

>> I CAN UNDERSTAND WHY PEOPLE WOULD SAY THAT AND THE PROCESS HERE, I WANT TO MAKE IT CLEAR BECAUSE I THINK WE'RE TRYING TO BE TRANSPARENT. THERE WERE MULTIPLE DISCUSSIONS WITH THE GOVERNOR AND WITH HIS ADVISORS ON WHETHER OR NOT TO HAVE UVM DEVELOP A SPECIFIC FINANCE PLAN.

>> UMASS, RIGHT?

>> I'M SORRY, UNIVERSITY OF MASSACHUSETTS. THERE WERE SOME PEOPLE ARGUING IN FAVOR AND SOME PEOPLE ARGUING OPPOSED.

>> WHAT WAS THE GOVERNOR'S VIEW?

>> HE WAS LISTENING, OKAY? AND REALLY, PEOPLE SAID, LOOK, IF WE ISSUE A SPECIFIC FINANCE PLAN, ONE SIDE OF IT WAS IF YOU ISSUE A SPECIFIC FINANCE PLAN NOW BEFORE PEOPLE UNDERSTAND WHAT -- ESPECIALLY WHEN YOU'RE NOT GOING TO ASK THE LEGISLATURE TO PASS IT FOR ANOTHER TWO YEARS, IT'S GOING TO BE -- ALL THE FOCUS IS GOING TO BE PICKING APART A FINANCE PLAN THAT YOU'RE NOT EVEN PLANNING TO INTRODUCE FOR ANOTHER TWO YEARS AND NOT FOCUSING ON WHAT WE'RE GOING TO DO TO LOWER THE TRAJECTORY OF THE COST INCREASES, PROVIDE COVERAGE FOR PEOPLE. YOU KNOW, THE BIG PART OF THAT REPORT WAS ALSO HOW TO FINANCE THE HEALTHCARE EXCHANGE, WHICH IS GOING UP INTO EFFECT THIS COMING JANUARY, AND IT WOULD BE A DISREACTION THAT WOULD ACTUALLY DO -- DISTRACTION THAT WOULD ACTUALLY DO LESS TO ENHANCE THE PUBLIC UNDERSTANDING OF WHERE WE END UP AS OPPOSED TO IMPROVE THE PUBLIC UNDERSTANDING AND THAT'S THE SENTIMENT THAT PREVAILED.

>> VERY QUICKLY, WHERE WERE YOU ON THAT ARGUMENT?

>> LISTEN, IF I'M LOOKING MY JOB RIGHT, CHRISTEN, YOU CAN'T TELL THE DIFFERENCE BETWEEN MY PERSPECTIVE AND THE GOVERNOR'S PERSPECTIVE, SO I SUPPORT THE DECISION THAT WAS MADE BY THE GROUP.

>> WE NEED TO TAKE A QUICK BREAK TO FINANCE THIS PROGRAM, SO

>> WELCOME BACK, EVERYONE. WE'RE TALKING TO SECRETARY SPAULDING ABOUT A NUMBER OF BUDGET ISSUES. LET'S MOVE ON TO THE TRANSPORTATION BUDGET. WE'RE LOOKING AT, I BELIEVE, THE LAST FIGURE WAS ABOUT $35 MILLION IN A BUDGET HOLE THERE. A COUPLE OF PROPOSALS ON THE TABLE RIGHT NOW, A GAS TAX, SOME HAVE SAID THAT WE SHOULD MOVE TO A SALES TAX TO FILL THIS GAP. WHAT'S THE ADMINISTRATION'S TAKE ON THIS? WHAT SHOULD WE DO?

>> WELL, WE ARE FLEXIBLE IN TERMS OF WHAT THE FINAL PACKAGE WOULD LOOK LIKE, BUT WE DO THINK WE NEED TO CLOSE THE GAP BETWEEN THE NEEDS TO MAINTAIN OUR TRANSPORTATION SYSTEM AND NOT FORFEIT FEDERAL FUNDS, AND WHAT THE CURRENT REVENUE STRUCTURE WILL BRING IN. AND IF WE DON'T RAISE SOME ADDITIONAL REVENUES, WE WILL BE -- THE LAST I HEARD WAS THAT WE, YOU KNOW, IT'S GONE UP FROM ABOUT 40 TO 55, $56 MILLION OF FEDERAL REVENUE THAT WE WOULD FOREGO. THE REASON FOR THAT IS THERE'S A STATE MATCH FOR THE FEDERAL FUNDS AND IF WE DON'T HAVE THE STATE MATCH --

>> WHAT'S THE DEADLINE ON THAT? WHEN DO WE HAVE TO HAVE A TAX OR SALES TAX IN PLACE TO KEEP THAT FEDERAL MONEY?

>> WELL, WE NEED TO HAVE IT IN PLACE BY THE END OF THIS LEGISLATIVE SESSION SO WE CAN GET IT STARTED ON THE FIRST OF JULY. THOSE ARE THE CURRENT PROJECTIONS AND IN THE COURSE OF A YEAR, CASH FLOW BASIS, YOU KNOW, IF YOU KNOW YOU'RE GOING TO HAVE THE REVENUE AND APPROPRIATION AUTHORITY FOR A YEAR, YOU CAN MOVE UP SOME FUNDS THAT WOULD HAVE BEEN USED TOWARDS THE END OF THE YEAR IN THE BEGINNING OF THE YEAR, SO AS LONG AS WE HAVE A DECISION BY THIS LEGISLATURE, WE'LL BE OKAY. AND ANY DECISION IS OKAY. IF THE DECISION IS WE'RE NOT GOING TO RAISE REVENUES, THEN THE RESULT IS SOME OF THE IRENE RECOVERY PROJECTS WILL TAKE LONGER AND WE'LL BE FOREGOING SOME FEDERAL REVENUES THAT WE COULD HAVE USED TO IMPROVE OUR ROADS AND BRIDGES. AND, YOU KNOW, THE GOVERNOR'S POSITION IS THAT WOULDN'T BE THE SMARTEST THING TO DO. WE KNOW WE HAVE A LOT OF UNMET NEEDS IN OUR ROADS AND BRIDGES AND WE OUGHT TO MAKE SURE THAT WE DON'T SEND MONEY BACK TO WASHINGTON THAT WOULD THEN JUST BE SENT TO SOME OTHER STATE. AND, YOU KNOW, I THINK IT'S WORTH POINTING OUT THAT OVER THE LAST COUPLE OF YEARS, THERE ARE -- THERE'S AN ANNUAL REPORT ON THE CONDITION OF ROADS AND BRIDGES, AND OVER THE LAST TWO YEARS, THE PERCENTAGE OF ROADS THAT ARE IN THE MOST POOR CONDITION AND THE PERCENTAGE OF BRIDGES THAT ARE IN THE MOST IMPORTANT CONDITION HAS BEEN GOING DOWN AT THE SAME TIME AS THE, YOU KNOW, THE GOOD CONDITIONS ROADS AND BRIDGES HAS BEEN GOING UP AND WE DON'T WANT TO LOSE THE POSITIVE MOMENTUM. NOW, A LOT OF THAT'S BEEN AS A RESULT OF, YOU KNOW, STIMULUS FUNDS THAT WERE COMING IN AFTER THE LAST ECONOMIC DOWNTURN AND SOME IRENE FUNDS, BUT THE BOTTOM LINE IS, ACTUALLY, WE'RE MAKING PROGRESS AND WE DON'T WANT TO GO BACKWARDS. AND, YOU KNOW, I KNOW THERE'S BEEN A LOT OF TALK IN THE PUBLIC ABOUT THIS, SO WE DON'T HAVE TO GO ON TOO LONG, BUT THE PRIMARY SOURCE OF REVENUES TO PAY FOR THE IMPROVEMENT AND MAINTENANCE OF OUR ROADS AND BRIDGES COMES FROM FUEL TAXES. AND I CAN TELL YOU, YOU KNOW, YOU CAN LOOK AT THE TAX -- THE REVENUES -- BY THE WAY, STATE GENERAL FUND REVENUES FOR THE FIRST SEVEN MONTHS OF THE YEAR THROUGH JANUARY ARE ROUGHLY 7.5% AHEAD OF WHERE THEY WERE LAST YEAR, SO THE ECONOMIC RECOVERY IS CONTINUING IN VERMONT RIGHT NOW. BUT -- AND MOST -- IF YOU LOOK AT MOST INDIVIDUAL COMPONENTS ON THE GENERAL FUND OR EVEN ON THE TRANSPORTATION FUND SIDE, YOU WOULD SEE THEM INCREASING YEAR OVER YEAR. THE ONLY ONE THAT ISN'T IS THE GAS TAX BECAUSE, YOU KNOW, AS PEOPLE ARE DRIVING FEWER MILES, AS PRICES GO UP AND AS PEOPLE DRIVE MORE FUEL-EFFICIENT CARS, THE AMOUNT OF REVENUES THAT ARE COMING IN TO TAKE CARE OF ROADS AND BRIDGES GOES DOWN. IT'S NOT TOO HARD TO FIGURE OUT THAT, YOU KNOW, THAT'S GOING TO CAUSE SOME PROBLEMS IN OUR ABILITY TO MAINTAIN OUR ROADS AND BRIDGES.

>> AND THAT'S CREATED A NATIONAL DISCUSSION, STATE LEGISLATURES ARE LOOKING AT THIS ACROSS THE COUNTRY ABOUT HOW DO YOU PAY FOR THIS. THIS IDEA HAS POPPED UP THAT WOULD HAVE PEOPLE PAY PER MILE, YOU SORT OF PAY FOR WHAT YOU USE. WHAT DOES THE ADMINISTRATION THINK OF THAT IDEA?

>> I THINK WE THINK IT'S DEFINITELY WORTH PURSUING, BUT AS YOU MENTIONED, NOBODY HAS QUITE FIGURED OUT HOW TO IMPLEMENT THAT YET AND I SUSPECT IN CONCEPT, I THINK IT'S A GREAT IDEA MYSELF AND I'M SURE THE GOVERNOR WOULD THINK IT'S A GREAT IDEA. I HAVE A FEELING WHEN YOU START SAYING, OKAY, WHAT THAT MEANS IS THAT EVERYBODY'S CAR IS GOING TO HAVE A GPS IN IT AND SOMEBODY'S GOING TO KNOW EXACTLY WHERE YOU'RE DRIVING AND WHEN YOU CROSSED OVER THE ROAD --

>> COULD RUN INTO SOME LOG GIST STICK SKAL PROBLEMS.

>> COULD BE SOME ISSUES WITH THAT.

>> A LOT OF SMART METERS HAVE BEEN CONCEIVED.

>> I THINK IT WILL TAKE A WHILE FOR ADOPTION TO TAKE PLACE. OF COURSE, WE DON'T HAVE SOME OF THE OPPORTUNITIES THAT MANY STATES DO THAT HAVE A HIGHER VOLUME OF TRAFFIC. MORE STATES, IF THEY HAVE THE VOLUME, ARE MOVING TO TOLLS AND, YOU KNOW, WE JUST DON'T HAVE THE VOLUME THAT WOULD JUSTIFY THE INVESTMENT AND THE UPKEEP ON THAT KIND OF A REVENUE-GENERATING POSSIBILITY. AND, YOU KNOW, SO I THINK -- IT'S NOT LIKE THE GOVERNOR DOESN'T WANT TO RAISE -- I THINK PEOPLE GET THE IDEA, HE DOESN'T LIKE RAISING TAXES AND I THINK THAT'S JUST IN-BRED, BUT WHEN YOU LOOK AT THIS AREA, I THINK YOU REALIZE THAT YOU HAVE A STRUCTURAL MISMATCH HERE THAT JUST CAN'T KEEP GOING ON.

>> LET'S SWITCH FOCUS HERE. THE GOVERNOR IN HIS BUDGET SPEECH PROPOSED SOME BIG CHANGES TO WELFARE TO WORK PROGRAMS AND THIS HAS BEEN RECEIVED PRETTY ROUGH, I THINK YOU COULD SAY, IN THE LEGISLATURE BY MEMBERS OF HIS OWN PARTY, BY PROGRESSIVES. REPUBLICANS SEEM TO HAVE SOME INTEREST IN IT. THEY SAY THIS IS REALLY HURTING THE POOR. HOW MUCH OF A PRIORITY IS IT FOR GOVERNOR SHUMLIN TO GET THIS THROUGH, THESE CHANGES THROUGH THIS SESSION?

>> THIS IS A HEARTFELT, HIGH PRIORITY, THE HIGHEST PRIORITY I WOULD SAY AT THIS TIME FOR THE GOVERNOR SHORT OF WORKING ON THE TOTAL ECONOMIC PROSPERITY TRA YEK TOER HE WANTS TO -- PRACTICE JEK TOER HE WANTS TO TAKE VERMONT ON AND THIS IS SEEN AS AN IMPORTANT PART OF THAT AND IT'S NOT MEANT TO HURT THE POOR. IT'S MEANT TO HELP THE POOR. BY THE WAY, WHEN ANY GOVERNOR IS IN THE LEGISLATIVE SESSION, THEY TEND TO INVITE VARIOUS COMMITTEES TO COME IN FOR A SANDWICH FOR LUNCH AND TALK ABOUT HOW THINGS ARE GOING.

>> COFFEE IN THE MORNING.

>> COFFEE IN THE MORNING, YEAH, AND I WAS IN THE OFFICE A COUPLE DAYS AGO WHEN ONE OF THE COMMITTEES WERE IN THERE AND THERE WERE TWO DEMOCRATIC SENATORS SAYING LOOK, I'M TELLING YOU, SPEAKING TO THE OTHER SENATORS THERE, IN MY COUNTY THEY'RE SAYING YOU'RE NOT GOING FAR ENOUGH, GOVERNOR, AND I THINK THERE'S MORE SUPPORT THAN PEOPLE REALIZE. CERTAINLY THE SKEPTICS ARE MAKING A LOT OF NOISE RIGHT NOW AND THAT'S TO BE UNDERSTOOD, BUT LET ME TRY TO EXPLAIN WHAT HAPPENED BECAUSE I THINK IT'S KIND OF INTERESTING. THE GOVERNOR CAME TO THE SECRETARY OF THE AGENCY OF HUMAN SERVICESES THIS SUMMER AND ONE OF THE ASSISTANTS IN THE GOVERNOR'S OFFICE AND SAID, LOOK, I KEEP HEARING FROM BOTH EMPLOYERS AND VERMONTERS THAT WHEN THEY GO BACK TO WORK, THEY GET PENALIZED, SO THEY WERE BETTER OFF NOT GOING BACK TO WORK. AND I WANT YOU TO BRING ME A PROPOSAL, YOU'RE THE EXPERTS, THAT'S WHAT I'M PAYING YOU FOR, BRING A PROPOSAL THAT ADDRESSES THIS SO-CALLED BENEFIT CLIFF OR SLOPE WHERE PEOPLE HAVE NO INCENTIVE TO GO BACK INTO THE WORKFORCE. I WANT TO ADDRESS THIS ISSUE. YOU'RE THE EXPERTS, BRING ME A PROPOSAL. THEY COME BACK A COUPLE OF TIMES, IT'S DIFFICULT, GOVERNOR, BUT WE'VE DONE SOME WORK AND THE SINGLE BIGGEST IMPEDIMENT TO GETTING PEOPLE BACK IN THE WORKFORCE IS INADEQUATE CHILD CARE SUBSIDIES, AND WE CAN DO SOMETHING ABOUT THAT, BUT I GOT BAD NEWS FOR YOU, GOVERNOR. IT COST OF QUITE A BIT OF MONEY. HE SAYS I DON'T HAVE A LOT OF MONEY, WE'RE ALREADY SPENDING A LOT OF MONEY, WE'RE ONE OF THE HIGHEST SPENDING PLACES IN THE COUNTRY, YOU HAVE TO LOOK FOR SOME PLACE TO REALLOCATE. THEY CAME BACK AND SAID, LOOK, THE BEST PLACE WE CAN REALLOCATE FROM TO REMOVE THE IMPEDIMENT, THE VERMONT SUPPLEMENT TO THE FEDERAL EARNED INCOME TAX CREDIT. OURS IS THE SECOND MOST GENEROUS IN THE COUNTRY, IF WE COULD CUT BACK THERE, WE COULD USE THE MONEY TO MAKE WHAT WE CONSIDER TO BE A BETTER INVESTMENT IN HELPING PEOPLE OUT OF POVERTY AND INTO WORK. AND THAT'S REALLY HOW IT CAME ABOUT. AND, YOU KNOW, HE ALSO, AS PART OF THAT PACKAGE, FELT THAT THE -- BEING THE ONLY STATE IN THE COUNTRY THAT HAS NO TIME LIMITS ON THE BASIC WELFARE PROGRAM, THE REACH-UP PROGRAM HERE IN VERMONT, IS ALSO -- IS A DISINCENTIVE TO HELPING PEOPLE BACK INTO THE WORKFORCE, AND HE REALIZES THAT THIS IS A PACKAGE. HE OFTEN SAYS THAT BECAUSE, YOU KNOW, IN ORDER TO REMOVE THE TIMELESS FEATURE OF THE REACH-UP WELFARE PROGRAM, YOU NEED TO MAKE SURE YOU'RE PUTTING SOMETHING ELSE IN PLACE THAT HELPS PEOPLE GET BACK TO WORK. SO THAT'S WHY WE NEEDED TO INCREASE THE CHILD CARE SUBSIDY. IT'S WHY WE ARE MAKING PROPOSALS AND I THINK IT WILL PASS IN THE LEGISLATURE, TO INCREASE THE NUMBER OF PEOPLE THAT GET FREE LUNCH IN OUR SCHOOLS. WE'RE DOING A VARIETY OF THINGS TO TRY TO HELP PEOPLE THAT ARE IN A LOW-INCOME SITUATION, BUT WE'RE TRYING TO REMOVE THE TRAP THAT KEEPS THEM THERE.

>> REALLOCATION SEEMS TO BE THE WORD OF THE DAY THESE DAYS. YOU BROUGHT UP AT OUR NUMEROUS TIMES AT OUR POLICY OVER EASY EVENT LAST WEEK. THERE'S JUST NOT MONEY AND THINGS ARE BEING SHIFTED AROUND. IS THAT BASICALLY THE BOTTOM LINE?

>> IT'S TIME FOR CUTS.

>> I THINK IT'S EASY TO TALK ABOUT -- I WANT TO ANSWER BOTH OF THOSE. I GUESS SOME PEOPLE WOULD SAY REALLOCATION, IF REALLOCATION IS IN A SENSE A CUT FROM ONE PLACE TO PUT IT SOMEWHERE ELSE, SO IT'S CERTAINLY, IF WE'RE GOING TO MAKE SIGNIFICANT NEW INVESTMENTS AND IF YOU RECOGNIZE AT THE SAME TIME THAT VERMONT IS ONE OF THE -- YOU KNOW, YOU CAN ALWAYS QUIBBLE ABOUT WHAT WE'RE NUMBER THREE, NUMBER SEVEN, NUMBER FIVE, BUT WE ARE DEFINITELY ONE OF THE HIGHEST SPENDING STATES IN THE COUNTRY AND WE'RE ONE OF THE HIGHEST TAXED STATES IN THE COUNTRY AND GIVEN THOSE DYNAMICS, YOU KNOW, WE THINK THAT WE NEED TO BE OPEN TO THE CONCEPT OF REALLOCATION. NOW, STRAIGHT ACROSS-THE-BOARD CUTS, I'LL TELL YOU, ONE OF THE BIGGEST CHALLENGES I HAVE IN MY POSITION, ONE OF THEM IS TO LOOK OUT FOR THE BUDGET AND THE FINANCES OF THE STATE, IS THAT EVERYBODY SAYS THEY, YOU KNOW, WANT TO HAVE LESS GOVERNMENT BUT AT THE SAME TIME, THE EXPECTATIONS FOR WHAT GOVERNMENT NEEDS TO DO KEEP GOING UP AND, YOU KNOW, PEOPLE WANT TO HAVE MORE OVERSIGHT ON OUR LARGE MULTI- MILLION-DOLLAR INFORMATION TECHNOLOGY PROJECTS SO WE DON'T HAVE BOON DOING GELS, YOU HAVE TO HAVE RESEARCH UP FRONT TO MAKE SURE YOU'RE DOING THE PROPER ANALYSIS AND THAT TAKES PEOPLE. PEOPLE WANT THE FEDERAL GOVERNMENT TO STEP IN WHERE THEY'RE BACKING OUT OF MOSQUITO CONTROL AND I THINK WE PROBABLY NEED TO DO THAT AND WE'RE PROPOSING TO DO THAT, SO IT'S EASY TO TALK ABOUT CUTS, BUT IN MY EXPERIENCE, IT'S HARDER TO IDENTIFY THEM. NOW, YOU KNOW, LAST YEAR WE WERE PRETTY PREOCCUPIED WITH THE RESPONSE TO IRENE RECOVERY. THIS YEAR, WE ARE GOING TO PUT MORE EMPHASIS BETWEEN NOW AND THE NEXT LEGISLATIVE SESSION ON LOOKING FOR WAYS THAT WE CAN ACTUALLY GAIN EFFICIENCIES BY CONSOLIDATION IN STATE GOVERNMENT OR IDENTIFY PROGRAMS THAT COULD BE DOWNSIZED OR REMOVED, BUT I THINK THE IDEA THAT THERE'S SOME PROGRAMS IN STATE GOVERNMENT THAT JUST SHOULDN'T HAPPEN ANYMORE SOUNDS GOOD, BUT WHEN YOU ACTUALLY GET DOWN TO IT, IT'S VERY DIFFICULT TO IDENTIFY THE ONES THAT REALLY DON'T NEED TO BE THERE. I MEAN, YOU KNOW, PEOPLE SAY, WELL, THE TAX DEPARTMENT IS NOT MY PRIORITY AND IT'S NOBODY'S PRIORITY, BUT YOU NEED A TAX DEPARTMENT. YOU NEED A HUMAN RESOURCES DEPARTMENT. PEOPLE NEED TO HAVE PLUMBING INSPECTORS AND BUILDING INSPECTORS AND FIRE SAFETY AND, YOU KNOW, I MEAN, IT'S -- I'M NOT REALLY AWARE OF ANY PROGRAMS IN STATE GOVERNMENT THAT PEOPLE THINK REALLY SHOULDN'T HAPPEN AND IF THEY WERE SOME, THEY WOULD BE SO SMALL THAT IT WOULDN'T EVEN CHANGE THE DIAL ON THE OVERALL TRAJECTORY.

>> WE HAVE JUST ABOUT A MINUTE LEFT. GOVERNOR SHUMLIN SPENT SOME TIME IN WASHINGTON, D.C., TALKING ABOUT A HOST OF ISSUES. HE HAS BEEN NOW LENGTHED TO A SECOND TERM. -- ELECTED TO A SECOND TERM. HOW MUCH LONGER DO YOU THINK HE WILL SPEND AS GOVERNOR AND DOES HE HAVE AN INTEREST IN SPENDING MORE TIME IN WASHINGTON, D.C.?

>> I HEARD THE GOVERNOR SAY JUST IN THIS WEEK TO A GROUP OF PEOPLE, I HAVE NEWS FOR YOU, EF NO INTEREST IN GOING TO WASHINGTON, D.C., AS A SENATOR, I HOPE TO GET THINGS DONE IN ANOTHER TERM OR TWO AND THEN I'M GOING BACK TO PUTNEY. THAT'S WHAT HE SAID AND IN MY PERSONAL EXPERIENCE SPENDING TIME WITH HIM, I WOULD BE VERY SURPRISED IF HE HAS ASPIRATIONS OF GOING TO WASHINGTON MORE THAN HE IS THAN TO VISIT.

>> THANK YOU, JEB SPAULDING, WE HAD A LOT TO TALK ABOUT. WE APPRECIATE YOUR INFORMATION.

>> ALWAYS A PLEASURES.

>> THANKS FOR JOINING US, EVERYONE. HAVE A GREAT SUNDAY, TAKE CARE. CAPTIONING PROVIDED BY. CAPTION ASSOCIATES, LLC www.captionassociates.com