[A] plan to reduce the state budget for the current year looks to reductions in Medicaid spending, increased revenue from licenses and more.
The governor’s proposal to cut spending in the current fiscal year by $12.6 million will go before a panel of lawmakers Thursday morning.
The proposal was posted on the non-partisan legislative Joint Fiscal Office website Wednesday.
The state is seeking to trim the budget after economists last month released updated projections for state revenues. The new estimates predicted that revenues will come in $28.8 million lower than expected in fiscal year 2018.
More than half of the downgrade will be met by using one-time money from reserve funds to pay $16.3 million in refunds the state owes to corporate income tax payers. The Emergency Board approved that plan in July, leaving the administration to put together a proposal to find the remainder.
In the Scott administration’s rescission proposal, the largest portion of the reduction — $6.2 million — comes from the Department of Vermont Health Access, including $4.5 million in savings from a reduced projection on what Medicaid is expected to spend this fiscal year.
The rescission proposal also counts on $3.5 million in increased revenue related to relicensing. An additional $275,000 will come from increased revenue from the Secretary of State’s Office
The administration proposes to reduce the Department of Public Safety budget by $860,330. Part of the cut comes because the state can bring in additional federal money related to disaster mitigation and recovery, according to Adam Greshin, commissioner of the Department of Finance and Management.
The proposal also uses $40,000 from the Agency of Commerce and Community Development that was appropriated to review contracts related to the EB-5 foreign investment program.
Greshin said the state’s EB-5 program is “on hold” and the money is not being used for that purpose.
Many items in the rescission proposal relate to carrying over money that was not spent in the last fiscal year or saving money because of vacancies in the state workforce.
In total, said Greshin, the proposal uses slightly more than $1 million that will only be available one time.
“Most of this we believe will be either ongoing savings or ongoing revenue,” he said.
The administration also put forward a proposal to reduce the state’s transportation budget for the current fiscal year in light of a $3.5 million revenue downgrade.
The proposal includes reducing the central garage budget by $1.1 million and counting on $1.2 million in lower costs for diesel fuel and salt. The proposal also cuts funds appropriated for improving aviation facilities.
Lawmakers on the Joint Fiscal Committee will meet Thursday to vet the proposals and take public testimony.
