The Legislature is about a third of the way through its 2025 session, with little bill activity so far beyond the mid-year budget adjustment (see more below) and the introduction of Governor Scott’s budget proposal for next year.  Much of our focus has been on analyzing and comparing the state’s existing education delivery, governance and funding systems with the governor’s high-level proposals for overhauling the way we operate and pay for public schools. 

  Nearly every House committee has been involved in this process.  The Agriculture, Food Resiliency and Forestry Committee has been looking into two topics that have an impact on education funding and property taxes.  The first, statewide Universal School Meals, was enacted two years ago to ensure that no child went hungry during the school day.  That legislation has been held up as a national model for maximizing federal assistance and enjoys broad popular and legislative support across the political spectrum. Governor Scott has opposed the program, however, noting that it increased the property tax rate, and proposed repealing it in his budget recommendation. Our committee has taken new testimony over the past few weeks showing the positive impact of USM on alleviating child hunger and improving learning.  Perhaps more to the point of our review, we learned that the impact on property taxes is minimal or non-existent, while families struggling to afford healthy food for their kids benefit financially and nutritionally.  Our committee voted unanimously to keep feeding all school children at no cost to parents and remove the proposed repeal in the House version of the budget.

  We have also been looking at the state’s Use Value Appraisal program, which allows land that is being actively used for agriculture and forestry to be assessed at a lower value.  This program, which is designed in part to protect Vermont’s landscape and discourage sprawl, has a small but measurable impact on the property tax rate, adding about 4 cents.  We will be continuing our review of the program in the coming weeks.

  The legislature and other elected officials in Montpelier have also been working to assess the potential impact on the state’s private and public sectors of the Trump administration’s ongoing funding reversals, tariffs, terminations and deportations.  The threats are numerous, but a couple of general things to note: as an industry, agriculture, which relies heavily on federal support, international trade and immigrant labor here and across the country, is particularly vulnerable.  Also, about a third of Vermont’s $9 billion state budget itself is federally funded—largely healthcare, transportation, and education—and we are already feeling the impact of frozen/rescinded appropriations.  Attorney General Clark has joined several lawsuits brought by multiple states, Treasurer Pieciak has set up a task force to examine the impact on individual citizens and organizations, and the governor is reviewing the impact of tariffs on consumer prices.  If you have a related story or concern to share, please let me know.

  With growing concerns over the risk to public health, our committee has taken testimony from the State Veterinarian’s office and Health Commissioner Mark Levine on the threat of Avian Flu to both farm animals and people.  Dr. Levine outlined the precautionary steps the state has taken to monitor for outbreaks, and emphasized that the danger to humans is currently very low.  To date no cows in the northeastern U.S. have contracted the virus, although a half dozen backyard poultry flocks in Vermont have been infected due to contact with wild birds. 

  As mentioned above, the Budget Adjustment Act is an annual review designed to keep state revenue and expenses in balance as we finish up the fiscal year in June.  Unbudgeted expenses incurred so far this year include flood-disaster recovery funds and rising healthcare costs.  Fortunately, consistent with recent years, Vermont’s strong economy has resulted in about 3 percent more revenue than state economists expected us to have when the budget was built last spring. 

  After covering the unbudgeted expenses and extending the emergency housing program through June, there would still be about $70 million carried over into next year.  Several uses have been suggested, including a one-time offset of education property taxes while work continues on overhauling the funding system, or as a small hedge against federal funding disruptions (noting again that federal funds account for about $3 billion of the state budget, and it is not clear how much of that is secure).

  Speaking of property taxes, April 15th will be here before we know it, and you may have started getting your paperwork together.  If you own your home, please make sure that your tax preparer files the homestead property declaration (HS-122) and Property Tax Credit (HS-144) with your state income taxes.  The HS-122 is required to be filed annually and in a timely way, and failure to do so can result in significant expense.