Editor’s note: Jon Margolis is VTDigger’s political columnist.
[A]t first glance, this looks like rather a blah session of the Legislature.
Yes, there was a good deal of ballyhoo over final approval of legal marijuana, what with Vermont being the first state to do it by legislature instead of by referendum and all that yackety-yack.
But that was just cleaning up unfinished business from last year. Besides, it wasn’t much of a political risk. Sixty percent of Americans – meaning probably close to 70 percent of Vermonters – support legal pot, according to a new NBC News-Wall Street Journal Poll. Elected officials tend to respond positively to big majorities.
And, yes, there are ideas floating around that get some attention because they enrage one faction or another. A carbon tax. Raising the minimum wage. But none of that is likely to pass because Gov. Phil Scott has made clear he would veto them, and there are not enough votes to override.
So back to blah, which might be popular these days. When Peter Shumlin was governor, both he and legislative leaders often talked about making Vermont a nationwide leader in dealing with problems such as health care, climate change and income inequality.
Some Democrats still talk that way. But there is evidence – starting with Scott’s election in 2016 – that many and maybe even most Vermonters want to forget about national leadership and just take care of what has to be done at home, as inexpensively as possible.
A recipe for blah. The Legislature will adopt a budget. Thanks to Scott, it will include no tax increases, meaning it will include no major new initiatives. It isn’t that there won’t be debate, dissent, turmoil, and even some animosity in the House and Senate these next three months or so. Whenever elected officials are confined together under one roof, egged on by pressure groups, observed (and sometimes egged on) by reporters, they will get into squabbles and the squabbles will be newsworthy.
That doesn’t mean they will be very significant. The governor proposes modest, targeted spending increases, such as free tuition at public colleges for members of the National Guard, and modest revenue decreases, including tax cuts for some Social Security recipients.
Whether or not these are good policies, they don’t affect very many people. There are approximately 4,000 Guard members, not all of them going to college. There are almost 150,000 Vermonters who get Social Security benefits. But some are exempt from state income taxes on their Social Security income now, and some who are not exempt would not save anything under the governor’s plan.
For most Vermonters, then, whatever the Legislature seems likely to pass this year would appear to be barely noticeable. Perhaps that’s all to the good. But at least on the surface, it does make the session kind of blah.
Now look below the surface. All kinds of stuff is going on. Most of it isn’t in the form of legislation, at least not yet. But it is very un-blah. Some of it is downright revolutionary, with the potential to make changes almost all Vermonters would notice.
Start with some of Scott’s ideas, and for now let’s ignore his ambitious, if possibly unrealistic, scheme to gather up phosphorus pollution and sell it at a profit. Instead, focus on the Jan. 18 communication Scott’s administration secretary, Susanne Young, sent to the Legislature outlining proposals to reduce spending on education.
One of them would create a school consolidation commission “to consider whether all schools with extremely low student populations…remain viable.” If a school is deemed “non-viable,” the proposal states, “the commission will consider the most cost-effective way to consolidate schools…”
That means a state agency would decide which schools to close. Its decisions would seem final. A good idea or a bad one, that’s a major change in a state that has always valued small towns and local control.
As change, though, the Scott proposal may be timid compared to a Democratic plan to alter the way the state pays for public education. The House Ways and Means Committee is contemplating a scheme to reduce property taxes by adopting a new income tax.
Right now, this is more than just a vague idea. It has enough specifics that, according to Rep. Janet Ancel, D-Calais and chair of the Ways and Means Committee, it is being analyzed by the Joint Fiscal Office. But it is not yet a bill, with an official (or even un-official) summary of its provisions, leading to some initial confusion about just what it would do.
What it would do is create a new income tax that would piggy-back on the existing income tax, but with all revenue from the additional version earmarked for the education fund. Households would be exempt from paying on the first $47,000 of income.
The revenue from the new income tax would allow school property taxes to be cut by about a third, Ancel said.
This is a financing plan, not a spending strategy. So it would not directly produce the kind of spending cuts Scott wants. But it would do away with the “income sensitivity” provision of the current statewide school tax (because the new income tax itself would sufficiently link the system with a taxpayer’s ability to pay), meaning it might inspire voters to insist on lower budgets from their local districts.
This appears to be one reason the first objection to the plan came from the political left. The blog of the liberal Public Assets Institute said the proposal would “take Vermont back to the days when only wealthy communities could afford to pay the property taxes necessary to support a good education.”
Expect at least as much opposition from the other side of the spectrum. In Vermont and elsewhere, income taxes are far more progressive than property taxes. So any plan that replaces property tax revenue with income tax revenue is likely to increase taxes on the wealthy while lowering them for the not-so-wealthy. As word of the proposal spread around the Statehouse last week, one veteran Republican was already worrying that its passage would inspire more wealthy Vermonters to “move to Florida.”
Maybe, and, maybe not, and maybe it won’t even pass. But it’s an idea that has the support of the House majority leadership, perhaps because anything that reduces property taxes is bound to be popular. So this proposal has potential, a potential to make changes almost all Vermonters would notice.
Who knows what other world-shattering notions lie underneath the blah?
