2018 Legislative Wrap Up-Part 1

2018 Legislative Wrap Up-Part 1

This year’s budget supports a healthy economy, strong families, and gives communities the resources they need to thrive, today and for years to come. We have a tradition in Vermont of focused, smart budgeting.  Revenue we can count on receiving annually is used to pay for ongoing expenses; windfalls, like receipts from the recent tobacco settlement, are invested in paying down state debt and building our savings. This protects us from the uncertainty brewing in DC, the likelihood of a recession, and ensures we can continue to make the kind of investments that support our working families.

Included in the budget are protections for vulnerable Vermonters. The bill restores the cuts the Governor proposed to those with disabilities and who receive developmental services. It provides a 2% increase to community service providers like the VNA and increases funding for meals on wheels. It directs federal dollars to reimbursement for infant and toddler care.  It makes strategic investments in our economy and significant investments in the justice system, enabling families crippled by the opioid crisis to move on. It helps struggling dairy farmers. It invests in supportive housing for people with mental illness and creates more hospital beds for those suffering from mental illness, and diverts them from hospital emergency rooms.

Provisions in the budget focus on Vermont’s fiscal health and move the state into a stronger financial position. We held the rate of budget growth to half of one percent. Investments are made in state pension funds that will save Vermont taxpayers over $100 million in interest payments. All of our reserves are filled, further guarding us against recession. Strong fiscal management protects our bond ratings, ensuring that local government dollars are well invested.

Every year, the Legislature must also pass a bill making adjustments to the state property tax rates, which provides financing for school budgets voted on at town meeting.  In addition, this year we had to react to the impact of the Trump tax cuts which would have resulted in an additional $30 million in tax revenue if we hadn’t acted.

Among this year’s noteworthy accomplishments, the income tax changes simplify Vermont’s tax code and make the code fairer for low and middle income taxpayers, working families and seniors.  The bill expands the Vermont Earned Income Tax Credit (EITC), which is generally viewed as our most effective poverty reduction program. Given the annual budget difficulties we face as a state, these investments are remarkable. Some highlights:

  • Expands the exemption of taxable social security benefits for single filers with less than $45,000 in adjusted gross income and married filers with less than $60,000 in adjusted gross income.
  • Eliminates itemized deductions and creates a new Vermont standard deduction equal to $6,000 for single filers, $12,000 for married couples and $9,000 for heads of household
  • Creates a new Vermont personal exemption equal to $4,150 per exemption, an exemption which benefits families
  • Collapses top two income tax brackets and lowers all personal income tax rates by 0.2%
  • Expands the Vermont Earned Income Tax Credit from 32% of the Federal EITC to 36%
  • Creates a 5% tax credit on the value of charitable contributions up to $20,000
  • Creates a Vermont Tax Structures Commission and a Staff-to-Student Ratios Task Force

In addition, average residential property tax rates were held flat with last year’s rates and the non-residential rate increased by 4.5 cents.

Although the budget and tax bills passed with tri-partisan support, the Governor vetoed both bills—twice—and pushed the state to the brink of an unprecedented state government shutdown. After weeks of discussion and debate, we were able to find agreement with the Senate and the Governor at the end of June to fully fund our local schools, pay down some of the state’s long-term debt, and hold residential property tax rates level.

Creating Flexibility in Special Education

The House Education Committee’s major work culminated with the passage of H. 897, the special education bill. The bill will allow schools to use their allocated state aid for special education dollars in more flexible ways with a goal of educating students who require additional support more effectively and efficiently. Schools will be unshackled from the intensive bookkeeping that goes along with today’s special education reimbursement system. Ultimately, after five years, all schools in Vermont will be allocated a block grant of special education money based on their total population of students. The bill also emphasizes Vermont’s obligation to students on Individual Education Programs, and each student’s right to a Free and Appropriate Public Education.

Minimum Wage & Paid Family Leave

What does it take to live in Vermont, and what does it take to enjoy life in Vermont? Study after study has shown, simple (but difficult to achieve) solutions include higher salaries, better health care, less stress, excellent child care and education, and the ability to make ends meet without stress. S.40 and H.196 work hand in hand in providing more tools for Vermonters to seek a better life. S.40 will raise the minimum wage to $15/hour over six years, and H.196 will create a new Paid Family Leave insurance program, that will provide Vermonter families with infants up to 12 weeks of bonding leave, and Vermonters taking care of their families with up to six weeks of leave for care. This benefit will cost employees less than two cents an hour for every $10 an hour they make — more than affordable for every employee in Vermont. These two bills complement each other and will provide working and middle class Vermonters with more economic flexibility than they have ever had. We’re extremely proud of standing up for working Vermonters with these bills, and are deeply disappointed the Governor vetoed both bills.

Voter Checklist Protection

H.624 increases the protection for Vermonter’s personal data contained in the statewide voter checklist. When the President Advisory Commission on Election Integrity asked for voters’ personal information, the outpouring from Vermonters contacting the Secretary of State’s Office was by far the greatest for any issue seen since Secretary Jim Condos took office. Virtually every person asked that their individual data be protected. Some individuals even requested that they be completely removed from the voter checklist. Vermonters should not have to choose between protecting their privacy and their freedom to vote.

While our Secretary of State chose not to turn over voter checklist data to the commission, H.624 now expressly prohibits public agencies from knowingly disclosing the statewide voter checklist to any foreign government or federal agency or commission for the purpose of:

  • Registering voters based on their information contained in the checklist
  • Publicly disclosing the information or
  • Comparing that information to personally identifying information contained in other federal or state databases

This puts us on a stronger footing to deny foreign or federal intrusions into state election data now and into the future.

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