2011 Legislative Update: Week 17 (5/2 – 5/6)

by Jeff Wilson

The 2011 legislative session glided smoothly to a close on Friday (5/6), with very little rancor, suspense or confusion. In fact, our very own Bob Stannard was quoted on the front page of Saturday’s Rutland Herald as saying that “the differences got worked out I think more smoothly this go around than anything I’ve ever seen”. A number of bills were passed into law during Week 17, but most of the action focused on wrapping up conference committee work on the five big bills outlined below. Once a joint conference committee issues its report to work out differences between the House and Senate, that report can only be voted up or down by each respective branch, it cannot be amended. Here’s the rundown of House action on the major bills of the session:

Transportation Bill – The conference committee report on this legislation was approved by a voice vote on Wednesday (5/4). The spending authorization on transportation is slated for $554 million in the next fiscal year (FY 12). With the expiration of Federal ARRA money, this year’s proposal is down about $41 million from FY 11. Most of the budgeted funding will be used for paving, road construction, bridges and local highway aid. However the plan also appropriates roughly $165 million for public transit, rail, aviation and a number of other non-highway items.

Health Care Reform Bill – The conference committee report on this bill was adopted by the House on a 94 – 49 vote (Wilson voting yes) on Thursday (5/5). In the short-term, this legislation positions the State to comply with the requirements of the new Federal health care law. In particular, the bill calls for the establishment of a health insurance exchange; one that would include at least two insurers. Longer term, I view this legislation more as a strategic planning document than a hard and fast program spelling out any specific system-wide change. The bill establishes the five- member Green Mountain Care Board, which will define a new universal benefits plan for Vermonters and develop recommendations to the legislature on financing. Although it is possible that a new system could be up and running in 2014, most folks in the know are now saying that the Federal government probably won’t grant the necessary waiver for an early start-up. That would mean that a single-payer plan, or something similar, couldn’t get off the ground until 2017.

Capital Bill – The conference committee report on the Capital Bill was approved by the House on a voice vote on Thursday (5/5). This legislation, largely funded by general obligation bonds issued through the Treasurer’s Office, is the vehicle the State typically uses to address its long-term building and infrastructure needs. To take advantage of near record low interest rates, and to front load funding for some important projects, this year’s capital bill is comprised of a two-year spending plan, instead of the normal one year authorization. In all, the bill calls for an expenditure of $155 million; $92 million in FY 12 and $63 million in FY 13.

The Miscellaneous Tax Bill – The conference committee report on the tax bill was adopted by the House on Friday (5/6) on a vote of 94 – 48 (Wilson voting yes). In order to balance this year’s state budget, this legislation raised $24 million in new tax revenue. The tax package consists of increases in the so-called health care-related “provider taxes” that are used to leverage additional Federal Medicaid funding. For every $1 raised in these taxes, the state receives $1.60 in Federal aid. Under the final plan, additional provider taxes will come from a 38 cent tax increase on a pack of cigarettes, increased taxes on hospitals/nursing homes and a new .08% insurance claims assessment. Moreover, my “E-Fairness bill (leveling the sales tax playing field between e-commerce and our local retailers) made it into the final version of the tax bill. Unfortunately, due to the opposition of the Governor and Senate, the law, although on the books, won’t become effective until fifteen other states adopt a similar statute. Oh well, only another nine to go.

The Budget – The conference committee report on the “big bill” was approved by voice vote in the House on Friday (5/6). This is remarkable, given that at the start of the session, it was thought that balancing a budget with a $176 million gap between revenue and expenses would result in a long, drawn out donnybrook. Although it was far from easy, everyone pulled together and worked out a spending plan that attracted very little in the way of pronounced conflict or dissent. The budget bill cuts human service spending by about $38 million, reduces the general fund transfer to the education fund by $23 million and relies on the $24 million in new taxes and some one-time revenues to close the gap. In all, the $4.7 billion FY 12 budget is about 3.6% lower than the current year.

With the conclusion of the session, this will be my last weekly report. I’d like to take this opportunity to thank the Manchester Journal for its civic-minded cooperation in faithfully printing this update throughout the session; from January through May. I found my work this year very rewarding. I truly enjoyed serving on the Ways and Means Committee, along with some very capable colleagues. All-in-all, it was a good year.

– Jeff Wilson, Manchester, Vermont, State Representative

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