After delibreations and taking testimiony for the first 8 weeks of the session, we worked until 9pm the other night to finish work on our legislation to Protect Children from the Hazards of Lead Paint. The complicating factors are to protect children, educate the public and oversee necessary work-all with little or no extra funding. There is a large HUD grant Vermont received last fall and there is also a regular allotment from CDC (Center for Disease Control) and these funds will be used. Another change from the 1996 legislation is mandatory screening of all 1 and 2 year olds. This is the age children are most suceptible to this permanent damage.
H.352- Protecting Children from Lead Hazards builds on current law and actually makes it easier for those in compliance to remain so. For those not incompliance, this bill provides the muscle lacking in the previous law that will enable us to help parents protect their children.
This bill is part of a collaboration of other efforts that will help bring about a comprehensive array of services to protect our children from an irreversible lifelong affliction that doesn’t have to happen. There’s the $5.8 M HUD grant for the Housing and Conservation Board . The bill being written to keep toys that have Lead I them away from our children. There’s the efforts of towns like Burlington and Bellows Falls and many in between. This bill becomes another piece of larger efforts to create a whole greater than the sum of its parts.
The bottom line is, children need protection. If a product is put on the market for sale, it needs to safe-especially for our children. That’s why there has been such focus on rental housing and child care.
We heard extensive testimony during deliberations in writing this legislation. We heard from 21 different witnesses , took testimony for 24 hours and deliberated as a committee for another dozen hours before producing the legislation before you. And, that is on top –or alongside- the underlying bill based on the work of your House-General Committee.
H.352 protects Vermont children from the permanent damage of lead poisoning. This bill allows us to practice fidelity to that traditional Vermont value of taking care of our children, the most vulnerable Vermonters and the future of Vermont.
A Challenging Budget
The legislature is committed to building a budget that helps Vermonters meet the rising costs of basic necessities such as home heating, housing, getting to work, health insurance, and childcare. We will try to do this in a way that does not put greater pressure on property taxes, and does not shift costs to those who pay for health insurance.
Meeting these goals will be difficult in this tough budget year. In January, we learned that revenues would be $14 million lower than expected in the coming fiscal year, FY2009. We face a $20M deficit in state funds in Medicaid; a shortfall from the federal government in Catamount, as well as in Medicaid special education funding; and the ongoing need to meet our retirement fund obligations, to fund the Education Fund, and to keep up with demands in human services.
The draft budget which Governor Douglas proposed significantly under-funds hospitals, reduces payments to physicians, and increases premiums for many who receive their health care through state programs. These proposals all would result in shifting costs to Vermonters who have health insurance.
The House will also address the proposals in the governor’s budget that shift costs onto the property tax, such as the $4M cut to the town bridge program. When the state doesn’t pay its share of local road projects, towns have to choose between paying more of the cost of repairs through property taxes or leaving town bridges in disrepair, and paying higher costs later. When parents can no longer afford the higher premiums the governor proposes for Dr Dynasaur, the local property tax becomes the last resort for absorbing the cost of required special education services.
The governor’s budget proposal shorts the Vermont Housing and Conservation Trust Fund by about $6 million. These cuts will result in 183 fewer new units of affordable housing and 21 fewer farms conserved. Affordable housing is a critical need for Vermont’s economy. The conservation of farms often helps Vermonters pass working farms along to the next generation of farmers, preserving Vermont’s agricultural landscape.
These are just a few of the challenges facing the budget writing Appropriations Committee this year. The House will look for ways to avoid shifting costs onto the property tax or shifting health care costs to those with insurance.
Campaign Finance Reform
The Campaign Finance Reform bill, S.278, places reasonable limits on the influence of money in Vermont’s political races. Following guidelines spelled out in a recent Supreme Court decision, it establishes reasonable campaign contribution limits to political races for the Vermont legislature, governorship, and for other statewide offices. Contribution limits promote accountability and public trust because they encourage candidates to reach out to a broad base of supporters. They ensure that elected representatives will be accountable to voters rather than wealthy donors.
These limits for contributions from a single source are: State Representative - $250, Senate - $500, Statewide Office - $1000, Governor - $1000. These limits are per race so, for example, a State Representative who has a primary and a general election could raise $500 during that election cycle from a single source.
Political parties can give more to the candidates: State Representative - $1000, Senate Candidate - $2000, Statewide Office - $5,000, Lt. Governor - $10,000, and Governor - $30,000.
S. 278 is similar to a bill passed last year by the legislature, but vetoed by the governor. To compromise with the governor in this year’s bill, the House Government Operations Committee accepted his recommendation to allow contributions of up to $1000 for all statewide office holders, including the race for governor, thereby making contributions for all statewide races equal. The House Government Operations committee was less comfortable with the governor’s recommendation to have no contribution limits at all to candidates for statewide or legislative offices from state political parties. The committee felt that unlimited contributions from parties would undercut the whole purpose of the bill -- that unlimited money potentially corrupts the political process.
The bill also rigorously addresses specific guidelines laid out by a recent Supreme Court ruling on how to regulate the influence of money in politics in Vermont. It is designed to withstand any constitutional challenge by striking the appropriate balance between free speech and other interests of the public.
We believe that passage of this bill will strengthen the democratic process in the state and take strong steps towards ensuring the voices of all Vermonters are part of the process, rather than just those of wealthy donors. In so doing, we will build on the same tradition of direct democracy that we follow when we do our good civic work at Town Meeting.
Energy
Substantial progress has been made on the energy front this session with passage of S.209 -- the Energy Efficiency and Affordability Act. Given that Vermonters are spending over $800 million more on fossil fuels today than just four years ago, this is good news. S.209 advances innovation, energy independence, economic development, and job creation.
Factors related to supply and demand continue to escalate our fossil fuel costs. These costs, related to the global marketplace, are not within Vermont’s control. We cannot curb the growing fuel demand of industrializing countries like China and India; nor can we influence worldwide supplies, which have not only reached peak reserves, but are declining. Skyrocketing home heating fuel costs place a heavy burden on Vermonters who are already struggling to make ends meet and on businesses that are trying to remain competitive.
Electric rates are also on the rise, albeit not as dramatically as fuel costs. For now, Vermont is protected by long-term contracts with Hydro Quebec and Vermont Yankee—contracts that have cushioned us from the crippling increases that other states are experiencing. However, these contracts, which supply two-thirds of our electricity, begin to expire in just four years.
S. 209 encourages in-state renewable energy generation by expanding net-metering, growing farm methane projects, increasing goals for energy production through Vermont's farms and forests, and increasing goals for electric utilities' use of renewable energy. It expands weatherization services to low income Vermonters, and allows Efficiency Vermont to expand their work beyond just electricity and to provide comprehensive efficiency services for all fuels. It also establishes new programs, managed by the Department of Public Service that will offer efficiency services for Vermont businesses and household of all incomes.
Funding for these programs comes from two regional energy conservation funds and from increased revenues that are generated as a result of the increase in fuel prices. The state presently charges a one-half percent tax on heating fuel -- a measure that would continue under S.209. The additional revenues generated as a result of rising fuel prices would be used to support an expansion of the weatherization program.
Health Care
Even in this tight budget year, the Legislature understands that taking the next steps in health care reform must be a high priority. Too many Vermonters still don’t have health care coverage and many more struggle to afford the coverage they have. Although Vermont has good quality care, there is more that we can do to improve the overall health of our citizens.
The House Health Care Committee has two overarching goals for the current biennium: (1) Ensure the success of the Health Care Affordability Act of 2006, and (2) Take next steps in health care reform. We will soon be proposing next steps that will build on the solid foundation of our previous work. To this end, our priorities include:
• Sustain what we’ve done. The overall goal of health care reform is to slow the rise in health care costs in order to make health care more affordable for all Vermonters. Controlling costs requires transforming the way we deliver care for people who need the most health care services – those with chronic conditions. System transformation requires that we continue to implement the Blueprint for Health: Chronic Care Initiative and our work on health information technology.
• More people covered. The health care reform legislation set a goal that 96% of Vermonters would be covered by health insurance by 2010. With this in mind our priorities include at least maintaining our new health insurance product, Catamount Health, and, if possible, finding ways to allow more people access to this insurance. Under consideration are shortening the 12-month uninsured waiting period, and the preexisting conditions exclusion for Catamount.
Although Catamount Health was a good first step, we know that we must continue working toward the goal of ensuring that every Vermonter has quality health care they can afford.
To that end, the committee is exploring affordable coverage options for small businesses and for the underinsured, including the creation of a new insurance product that would be available for these groups. The concept would build-in incentives for people to improve their health -- incentives that would result in premium savings.
The committee is also exploring the other recommendations of the Health Care Reform Commission, and will likely produce a bill that will contain a number of these recommendations. For a complete list of the recommendations, go to:
http://www.leg.state.vt.us/CommissiononHealthCareReform/Recommendations_as_passed_by_HCRC_12-4-07.pdf. To find out if you qualify for Catamount Health or the Vermont Health Access Program, please call 1-800-250-8427.
Protecting Water Quality (Riparian Buffer Zones)
The House Natural Resources Committee is working on legislation to protect the quality of the water in our rivers, lake, and wetlands. House Bill 549 would protect these resources by establishing buffer zones along their edges.
The areas of land along a body of water are nature’s first line of defense and are important for ensuring that nutrients and pathogens running over land surfaces during rain events are filtered, thereby reducing the amount of sediment flowing into the water. This buffer protects water quality and ultimately human health.
The bill allows certain activities within the riparian buffer zone -- many of which are subject to environmental review under other provisions of law – including regulated farming, forestry, existing uses as of July 1, 2010, linear public transportation facilities, control of non-native species, railroad activities and facilities regulated under federal law, construction of electric transmission projects, development subject to Act 250, routine and emergency repair of utility lines, trail construction and maintenance, and stairways or paths of no more than 6 feet leading to a lake or stream.
Municipalities would be given flexibility to change the width of the buffer zone to recognize existing development, to honor downtown or village center designations, or to be in line with historic development districts.
H 549 would require the Agency of Natural Resources (ANR) to develop flood hazard area maps for the streams of the state. Flood hazard maps would include riparian buffers. Municipalities would be enabled to adopt flood hazard maps that identify appropriate exemptions from the buffer requirement. ANR would be authorized to adopt additional rules to regulate activities within buffers and to issue certain permits.
ANR would also be authorized to adopt certain rules as necessary regarding uses within the riparian buffer zone and municipalities would be allowed to regulate certain activities within the buffer, including development; the storage of hazardous materials, and other practices that impact water quality.
Housing
The Housing Bill
All Vermonters should have a safe and affordable place to call home. This is the goal of the Legislature’s housing bill. This bill focuses on the demand for new affordable housing at all income levels while ensuring that growth remains in character with our traditional rural landscape. There are also unique challenges of our aging rental housing stock addressed by this bill.
Creation of new housing would be encouraged by providing incentives and easing state permit rules for development in community centers, including designated downtowns, village centers, new town centers, and growth centers. To qualify for these special incentives, a project must include a percentage of homes that are truly affordable for working Vermonters as defined by the Vermont Housing Finance Agency.
Additional housing tax credits and property transfer tax reductions would be made available for qualified buyers of affordable homes. At the same time, the rural character of our state would be protected with an Act 250 update.
Preserving existing housing is as important as the creation of new housing. The legislature is committed to making sure that rental housing meets basic health and safety standards. For landlords, the bill would clarify existing law and foster development of financial resources to assist with repairs. The goal for tenants is to ensure that they have safe and inhabitable homes.
The Governor offered a different housing proposal. His version relaxes Act 250 requirements, but without adequately focusing growth, which could lead to sprawl. The governor’s plan did not place as much focus on affordability. Additionally, his version would divert school taxes to use for housing development incentives. This idea met with little support in a legislature intent on reducing the pressure on property taxes.
The Lead Bill (54 words) Editor’s note - This can be combined with the article above or reworded slightly and used on its own.
Another bill moving in the House would address the regulation of lead paint in older homes. The problem of lead paint and its potential health affects on children is significant. Children with high lead levels in their blood may suffer from problems with brain development, which potentially contributes to future increased special education costs.
The Worker's Comp Dilemma
Vermont is a facing a dilemma between addressing the needs of those injured on the job and the pressure on businesses to cover the significant costs of these accidents and related expenses.
The House Commerce Committee has many bills under consideration to reduce this cost. They fall into three categories.
The first approach would be to reduce benefits due to injured workers by reducing the amount of money paid as a wage replacement, or by shortening the number of weeks for which that stipend is paid. Other benefit reduction methods would increase the deductible amount before medical bills are covered or would reduce the amount of vocational rehabilitation for the injured worker.
The second way to save money is to reduce the number of accidents, and therefore, reduce the number of claims. Some bills being considered are aimed at increasing the safety programs offered to businesses and workers, and/or requiring that various workplace safety measures be taken to reduce injuries.
Third, and finally, cost saving can be achieved by increasing the number of workers covered, thereby increasing the amount of money available to pay claims and spreading the costs among a larger pool of workers.
Our efforts are focused on this third method. It is becoming clear that many workers are being misclassified and fair premiums are not being paid. For example, if a construction company classifies an upper-story steel worker (a dangerous job with an expensive premium) as a ground floor window installer (a far less dangerous job with a much lower premium); the program is being cheated out of a fair premium. When this happens, it puts a company that is honestly classifying its workers at a serious disadvantage when bidding on contracts, thus driving up costs for everybody else.
Another way to cheat the system of premium money is to claim that a worker is not an employee but an independent contractor, who need not be covered by a business at all. This drives up costs to all of society in multiple ways, if and when that worker is injured. .
We are looking at ways in which we can protect those good Vermont businesses that do play by the rules, from those few who do not. Reducing the number of misclassified workers and reducing the fraudulent use of the independent contractor status will go a long way to reducing the premium burden for all businesses.
Transportation
Vermonters expect to drive on safe and well-maintained roads, yet Vermont’s roads and bridges are facing a perfect storm of dramatically aging infrastructure, skyrocketing construction costs, and declining revenues. The legislature is grappling with how to fund our significant transportation needs in a difficult budget year.
Vermont has 438 bridges (16% of the total) that are rated as structurally deficient. This ranks Vermont as 44th in the nation, or 8th from the bottom, in terms of percentage of structurally deficient bridges. While a large number of bridges are in need of critical repair, the funds coming into the Transportation Fund are declining, and the costs of construction are dramatically increasing, a rise of 20% last year.
The condition of our state-maintained roads is also declining. Currently, 21% of our state roads are considered to be in very poor condition. If we do not increase our investment in paving, this is expected to increase to 50% in three years. In rural areas, the situation is far worse. In Caledonia County, for example, 81% of the state roads are currently rated as “poor” or “very poor”.
The House Transportation Committee is working toward long-term solutions to this trend of deterioration. One idea is bonding for our most critical bridges. With interest rates on bonds at 6% and construction inflation increasing at 20% it makes financial sense to borrow money, build now, and save the costs we would incur by delaying projects. We can either pay now, or pay more later. We all need to share in the investment in our infrastructure for the future. Also, as we face a national recession, it makes sense to invest in projects that create good, well-paying jobs.
The goals for this year are to: Advance discussion around real economic stimulus through bonding for transportation; reduce the transportation fund transfer to the general fund; and increase funding for town bridge and highway programs in order to reduce pressure on property taxes.
Industrial Hemp: An Agricultural Opportunity, a Business Opportunity
To provide new economic opportunities for Vermont farmers, the House Agriculture Committee passed the Industrial Hemp bill, H.267. H.267 would create, pending changes of federal law, a responsible and secure state program for licensing and controlling the growth of hemp in Vermont. Industrial hemp is a legal crop in virtually every country except the United States.
The hemp plant has many positive uses as a food for humans and as feed and bedding for livestock. It also has a variety of uses for manufacturing. As an agronomic tool, hemp can be grown in rotation with other crops to help eliminate various blights that attack them.
Hemp is not Marijuana
Industrial hemp and marijuana are different varieties of the same plant -- but they are very different. The psychoactive ingredient of marijuana, THC, is present in hemp at levels ranging from only one one-hundredth to one one-thousandth of the levels found in marijuana. In addition, hemp also contains natural ingredients that, when smoked, often cause bad headaches, not a desirable effect of a drug.
To address the concern by Vermont law enforcement that they would not be able to distinguish hemp from marijuana, Saskatchewan law enforcement officials reassured the committee that the two crops look very different. These police officers said that during the decade that hemp growing has been allowed in Canada, the crop "has just not been a problem" for them.
Given all this information, the committee determined that hemp growing was consistent with our goals to help Vermont diversify its agriculture. We passed the hemp bill to help make this plant available to Vermont farmers. Once the crop becomes legal, Vermont farmers will be able to determine for themselves what sort of market opportunities this creates for them.
Education
School Breakfasts
Children who are hungry can’t learn. The House Education Committee has approved a bill that would make breakfasts free for those students who qualify for reduced breakfasts and lunches. Although it is a difficult budget year, we are hopeful we will be able to afford to give this boost to our Vermont children. The bill is currently in the House Appropriations Committee.
Miscellaneous Bill
The Education Committee approved an extensive miscellaneous bill that would accomplish several things. One section of that bill would make it easier for students to attend their regional technical center by reinforcing regional calendars. The adoption of a statewide calendar is unlikely at this time.
The bill makes an adjustment to the suspension of state aid for school construction by not including construction costs that do not receive state aid in the calculation of the excess spending penalty if the district has obtained preliminary approval from the Commissioner of Education. The bill would also relax the timeline for the use of reserve funds for construction.
Last year, significant legislation was adopted to encourage and support development of pre-kindergarten programs. This year’s bill would clarify and expand the ways in which a district may choose to count its pre-kindergarten children in its average daily membership (ADM).
Pregnant and Parenting Teens (44 words)
Approved teen parent education programs help to keep pregnant and parenting teens, including young fathers, in school. A bill approved by the House Education Committee puts in place a permanent funding stream for the educational part of the services provided by these important programs.
Streamlining and Mandates (122 words)
We are working on legislation that would provide incentives and reduce obstacles for various cost-saving initiatives to help keep school budgets low. We are clarifying and streamlining the steps leading up to a vote whether to create a union school district. We are proposing steps to reduce the burden of state special education audits and are considering the elimination of other mandates and reporting requirements.
Rather than rely on the “two vote” provision of Act 82, we are considering whether to strengthen the existing high spending threshold by reducing it from its current level of 125% to 123% in FY10 and 120% in FY12. The high spending threshold is a well used and successful tool for keeping spending as low as possible.
Improving Community Safety and Saving Millions
We need to change the way we deal with community safety, and there are plans in the legislature to do just that.
Although Vermont has a low and declining crime rate, we are spending money faster than ever on our prison system. In fact, our state government invests more to put people behind bars than we do on sending our children to college. This is a reversal of how we spent our dollars just 15 years ago, when Vermont spent two-to-one on higher education vs. prison.
In addition, more than half of those we let out come right back into our prisons within three years. While repeat customers are good for businesses, no one benefits when we have so many repeat prisoners.
With careful planning and study, the legislature is crafting alternatives to incarceration for non-violent offenders, alternatives that can make society safer while saving Vermonters tens of millions of dollars.
The key is addressing certain root causes of society’s problems, particularly substance abuse and untreated mental health challenges. By redirecting our dollars away from prisons and into community-based programs, we are predicted to save over $50 million in ten years. Just as importantly, we’ll also reduce crime by working to end the revolving door in Vermont’s prisons and jails.
Property Tax for the Education Fund
The Ways and Means committee has been taking much testimony in an effort to make our tax system more fair and predictable. Here are several of the specifics:
Income Tax Proposal (196 words)
The House Ways and Means committee has been exploring the idea of replacing the current income-sensitized property tax system with an income tax. As proposed, this would do away with the education property tax and would place a surcharge on Vermont State individual income tax, based on federal Adjusted Gross Income (AGI) taxed at a rate of 1.82% plus the percentage your school district spends per pupil over the base amount. Based on 2007 data the average per pupil spending would require a surcharge of 2.8% of AGI.
Winners and Losers: All changes in tax policy create winners and losers, in this proposal “on average” homeowners are winners if their homestead value is more than twice their AGI. Losers have modest homesteads worth less than twice their income. Another way to look at this is “on average” those taxpayers who are currently income-sensitized are basically treated the same unless their homestead value is very modest relative to income. Taxpayers between $90,000 and $225,000 AGI are winners and those over $225,000 will pay more taxes, in some cases significantly more. Looking at average statistics are a risky way to analyze but do provide some understanding.
Act 68
Current law provides that roughly two-thirds of Vermonters pay an income-based tax for education and that is reflected by a credit on their property tax bill. There remain, however, several problems. First it is not a simple, transparent system which means it is difficult to explain in detail, but most Vermonters realize that the more voters choose to spend at Town Meeting on education; the more they will pay in taxes, as it has always been. It’s just that now it is a statewide tax much like sales taxes and income taxes so the burden is spread across the state. This makes some taxpayers pay relatively less and others, who are more able to pay, somewhat more. A specific area we would like to address is the sudden jump in taxes when income sensitivity ends at $90,000 of income. We would like to create a slope so the tax is increased slowly rather than the dramatic increase that now exists.
Income Sensitivity Credit
With regard to administering the current income-sensitive credit on the education property tax, we heard many complaints but even more positive comments about the recent improvements to the system. The most persistent urging was to leave it alone with few exceptions and let the system work. If there are real problems they will return next year for improvements. The few changes currently proposed are 1) providing clarity that property tax information is public, 2) establishing that the property sellers are the owners of the credit at the time of the sale, and 3) allowing the state tax department to handle adjustments made after December 31st.
The Lottery Proposal
The governor proposed that half of the residual dollars left after a 40-year lease of the lottery ($25 million) would be applied to a one-year reduction in property taxes. Most oppose the lottery proposal for several reasons -- on moral grounds, because it requires a much higher level of gambling on the part of Vermont citizens, or because expansion of the lottery is better done “in house” than to lease it out. There is also the concern that the use of one time funds to cover ongoing needs is a bad fiscal practice. Lacking an infusion of new money the base rate for the Ed funding tax is: 1.8% on income, $1.36 on non-residential property, or $.87 rate on non income-sensitized residential property. This base rate is, of course, modified by local spending. Last year’s average was 2.8% on income or $1.39 on residential property.