MONTPELIER – The governor gave his budget address, in which he proposed a 9.4 billion budget. While this does not raise any taxes rates or fees, it was my hope he would have offered a level funded or even a reduction in annual spending.
Vermont has a spending problem, not a revenue problem. Since 2019 and the flood of emergency Covid-19 money, our state spending has increased from $5.9 billion to $9.4 billion. In other words, state government has given itself a 40% raise over that period. Did you get a 40% raise to pay the taxes necessary to cover this increase?
To continue this level of spending and spending growth, the legislature has, over those years, created a new payroll tax, a new sales tax on cloud-based software, a new tax on short term rentals, instituted higher DMV fees, added renewable energy mandates to our electric bills, and of course, allowed property taxes and school spending to rise by double or triple inflation rates pretty much every year, all of this over the governor’s vetoes. This is unsustainable. It is what is at the bottom of our affordability crisis. We must and can spend YOUR money more efficiently, while letting you keep more of what you earn to pay your bills.
We can do better. Comparing Vermont to New Hampshire, their FY27 budget is $8 billion to serve a population of 1,405,100 at a cost of $5,700 per person. Vermont’s FY27 is 9.4 Billion to serve 650,000 at a cost of $14,462 per person. The latest National Report Card scores show that Mississippi students are now performing better than Vermont students on math and literacy while they spend less than half the amount per student that we do.
Right out of the box two Republicans proposed two bills to help reign in the school spending. Rep. Galfetti (R-Barre Town) proposed a three-year freeze on education property taxes at 2026 level for 2027-2029. The General Fund would cover the shortfall of the Education Fund in some manner. Rep. Feltus (R-Lyndon) proposed the state should begin using the Foundation Formula for educating children in the state in 2027 regardless whether the governance issues have been resolved. The school districts would get a fixed amount per student and schools would have to run the schools on money they receive.
Sen. Baruth (D-Chittenden Central) drafted a bill that proposes to limit the growth in each school district’s per pupil education spending in fiscal years 2028 and 2029 to a specified allowable growth percentage of the district’s prior year per pupil education spending. Both house bills are in Ways and Means, and they do not appear to be getting any traction to discuss. The senate bill is in Finance and there has been some testimony taken.
Instead of cutting taxes and spending, what we are seeing is a bunch of bills to raise more taxes and spend more money: a 30¢-per-package tax on all retail deliveries, such as Amazon, UPS, even fuel deliveries; a tax on sweetened beverages (S.238); another surcharge on short term rentals; and, of course, we’re looking at another 6-12% property tax increase. The governor has proposed a buy down of the property tax increase, with surplus dollars, but the amount is still to be determined. Growing the economy is the smarter way to increase tax revenues rather than continually raising taxes.
In the House Energy & Digital Infrastructure Committee where I serve, we have taken testimony from the Agency of Natural Resources on the Climate Action Plan, extension of the sunset on the siting of telecommunication communications tower via the Public Communications Commission 248a process, the governor’s Clean Energy Standard, which would save Vermont ratepayers several million dollars if passed, and discontinuing the use of copper telephone lines as we convert to fiber throughout the state.
Richard Bailey represents Lamoille-2 District, including the towns of Belvidere, Hyde Park, Johnson, and Wolcott, in the Vermont Legislature.
