3.29.2014 – The Shoreland, Revenue, and Budget Bills
Once again this week, we spent many hours on the Floor of the House. Several important bills were debated and passed on to the Senate. The Shoreland Bill; the Budget, also known as the “Big Bill”; and the Revenue Bill, all took significant time to report and debate.
The Fish, Wildlife, and Water Resources Committee worked very hard on H.526, an act relating to the establishment of lake shoreland protection standards, to take into consideration all interested parties. The goals include the prevention of water quality degradation, provision of clear standards regarding impervious surfaces or cleared land, and mitigation of flood and erosion damage.
Agency of Natural Resources (ANR) permits may be required for construction of new impervious surfaces or cleared area (depending on size) in protected shoreland areas. An ANR permit will not be required in towns with shoreland protection ordinances or bylaws in place on January 1, 2015. Forty-eight towns in the state already have such ordinances.
The legislation respects property rights and offers a partnership relationship with communities. It defers to the Acceptable Agricultural Practices; the accepted silvicultural management standards adopted by the Commissioner of Forest, Parks, and Recreation; needed state and municipal transportation infrastructure maintenance, repair, and replacement; and routine electric utility repair and maintenance projects.
Some of the benefits include a cleaner environment and better water quality so that our lakes are more swimmable, fishable, and enjoyable. This promotes economic development through tourism and general recreation. Property tax values are supported, if not improved, as the result of better water quality. Public participation will be part of the rules making process.
It is the job of the Appropriations Committee to make proposals as to how we spend our money; Ways and Means figures out how we will raise the funds needed to make those expenditures. The Administration’s proposal had $34 million in new spending with revenue sources that many in the House did not favor. Working together, the two House committees were able to determine a path that cut spending in that proposal and raised revenue to fund investments that we felt were important to make.
When H.528, an act relating to revenue changes for fiscal years 2014 and 2015, was reported on the Floor, the presenter said there was something in the bill that everyone would dislike. It is a bill that includes a number of elements that raise $23.1 million in General Fund money and $4 million in the Education Fund in FY2014. Adjustments to a variety of taxes are made including an increase in the cigarette tax and a one-half percent increase in the meals tax. The meals tax will also apply to all food bought from vending machines – at this point, some food is taxed and some isn’t.
We eliminate the sales tax exemption on candy, soda, bottled water, and dietary supplements, as well as on clothes valued at $110 or more. An adjustment to the income tax structure, known as a bracket “pull-up,” is made. If you are in the highest income bracket, your next highest bracket will be taxed at the higher rate. The difference in rates is small, 8.8% to 8.9%, but, along with other income tax adjustments, raises over $4 million in FY2014 and $27.4 million in FY2015.
The Big Bill took almost three and a half hours to report and many more to debate. The FY2014 budget presents a huge challenge because this is the seventh year in a row that we have faced a revenue shortfall – this year $50 million. The Appropriations Committee worked very hard to strike the right balance between building a responsible budget and making investments in Vermont’s future. Added to the mix is uncertainty about what effect federal sequestration will have on the state.
Some of the investments we make include an increase in Medicaid payments to providers to decrease the cost shift and lower private insurance costs, funds to ease the transition from Catamount and the Vermont Health Access Plan to the VT Health Connect exchange by providing premium subsidies, and funds for the Low Income Home Energy Assistance Program to offset declining federal money.
We place a limited 5-year cap on the Reach Up program and provide increases to the childcare fee scale to help parents return to work. Higher education increases will go toward scholarships for Vermont students and the Working Lands Enterprise Initiative will get an increase and be funded at $1.5 million. This is great news, given that there were $12 million in requests for the $1 million available this year. We make a prudent investment of over $9 million that will be placed in reserves in the state’s Rainy Day fund, as well as a fund to address reductions in federal funding.
Once again, the House Appropriations Committee, working closely with Ways and Means, has managed to produce a balanced budget that is mindful of hardworking Vermonters as well as our most vulnerable citizens.