Budget, pension reform bill face veto threat from Gov. Scott

Published: Apr. 20, 2022 at 6:04 PM EDT
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MONTPELIER, Vt. (WCAX) - The Vermont Senate has approved their version of the $8 billion state budget but elements of the plan continue to run afoul with Governor Phil Scott, who has threatened to veto the measure.

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

Lawmakers are aiming to adjourn in two weeks, but before then they have to iron out a few disagreements with the governor. Top Senate budget writers describe Vermont’s largest-ever budget as oversubscribed. “Over $70 million in requests for what we had in money,” said Sen. Jane Kitchel, D-Caledonia County. That’s in part because lawmakers spent some pandemic relief cash in the winter to shore up the state’s health care workforce.

The Legislature’s budgets and Governor Scott’s proposals share many similarities. Scott says the Senate’s version is getting closer but still misses the mark because it leaves out funding for economic development, workforce training, and cell towers. He says it also lacks tax relief for seniors, veterans, and young workers. “It’s really important, from my standpoint, to take advantage of this once-in-a-lifetime opportunity to grow the economy, revitalize Vermont, and make our state more affordable,” he said.

Lawmakers are leaning toward tax breaks for young families. “Workforce needs change... On what basis do you choose one occupation over another?” Kitchel said.

Now that both chambers passed their budgets, they’ll 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 pension deal brokered with teacher and state employee unions. The plan allocates$ 200 million and is expected to make a $2 billion dent in the $3-billion unfunded liability.

But in a letter to top lawmakers last month, Scott says he wants a risk-sharing provision and wants new employees to have the option to enter into a defined contribution plan, like a 401K. “Private sector public sector alike, they want some flexibility. They want some freedom and independence,” he said. The governor says the economic conditions lawmakers’ plan is being built on won’t last forever.

Democratic leaders and the unions say the governor is making last-minute changes. “I am frustrated with the way the governor is engaging in this late hour on this issue,” said Sen. President Becca Balint, D-Windsor County. 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 the governor’s --can be considered.

“It’s not as though we’ve rejected it -- absolutely not. But the legislation was aimed at being clean at what was being negotiated,” Sen. Kitchel said. She says there just isn’t enough time to consider the governor’s proposal before adjournment.

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

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