Keelan: After flood, harvest failures and scandal payout, time to rethink ’24 state budget

Gov. Phil Scott (left) is smiling after Subaru of New England donated $250,000 to flood relief yesterday, but most of the rest of the state’s economic news is terrible, and the flood is only part of the problem. Time for the Legislature to revisit the big-spending budget it passed this spring, columnist Don Keelan says.

by Don Keelan

I am somewhat of a novice in analyzing the Vermont State budget, especially for the Fiscal Year 2023/24. I know several adverse events have occurred within the State since the budget was developed and adopted. I believe Governor Scott should recall the Legislature to take a new look at the $8 billion-plus document. 

The 2023 Legislature comprised a super-majority of Democrats and Progressive members who firmly believed this was the year to remove all constraints on the State’s treasury and fund programs dear to them for years. 

The small Republican sector of the House and Senate could do very little to stop ‘the runaway train,’ and the Governor’s veto was a blank bullet. With the spending programs shielded, the money flowed. Mother Nature’s impact and other extraordinary factors were not anticipated when the budget was developed. 

Don Keelan

By April, approximately all of the maple industry tree taps were pulled; the season was over except to hear the results. Several months later, the results were reported. The maple syrup crop was disappointing: the 6,350 million taps, down from last year by 300,000, resulted in 2,045 million gallons of syrup which is a 20% decline from 2022, according to a detailed report in Vermont Business Magazine’s July 2023 issue. 

Then, May arrived, and a ‘killing frost’ did as its name describes, killing most, if not all, of Vermont’s apple crop and scores of other fruit, flowers, and plants. The damage was so widespread that the State declared many areas ‘a disaster area’ so federal funding could assist with the dollar loss. 

More bad news for Montpelier in early July when it heard that the prior four months of State revenue from personal income tax collections didnot meet expectations, according to VBM. What can be expected going forward if this is the last four months of the fiscal 22/23 year? 

The State has been through worse crises, but it seems to worsen. In late June and early July, the Attorney General agreed to settle the lawsuits filed against the State for its negligence in the Northeast Kingdom’s EB-5 scandal. The reported payout amounted to $16.5 million. Whether this vast cost to the State will come from the General Fund or insurance, this writer does not know. Nor does he know if it was even budgeted. But it is real. 

On June 22, 2023, the Legislature returned to Montpelier, and after only a few hours of discussion, they congratulated themselves on overriding the Governor’s veto of their huge and historic spending plan. Exactly 20 days later, Mother Nature had her plan. Much of the State was devastated by 12 inches of rain, including outside the front door where the Legislature had convened three weeks earlier. State Street became a river. 

The devastation to Vermont’s manufacturing, retail businesses, nonprofit and government buildings, and the agricultural sector was only exceeded by the 1927 Flood. It will take years and tens of millions of dollars to recover if it is even possible. 

Affected Government operations will recover over time; however, many businesses, just now getting over the Covid pandemic losses, will not and will be gone forever. Even long-time operated farms face the same future. 

How these disasters will impact the State’s financial well-being continues to be evaluated and undoubtedly will take months to do so. If that is the case, it is time for the Legislature leaders to return to Montpelier and rethink the spring spending spree they unleashed on the State. The State, its citizens, and businesses might be ‘Vermont Strong’ (and tough), but they are not rich when sending dollars to Montpelier.

The author is a U.S. Marine (retired), CPA, and columnist living in Arlington, VT.

Categories: Commentary

3 replies »

  1. Although I agree wholeheartedly with you I doubt any of our so-called representatives of the people will. After happily patting themselves on the back for passing the biggest spending budget for the people they will go full steam ahead with the rush of power to completely bankrupt the state without batting an eye! Really, Conservatives are stupid for trying to save money for a rainy day right? Pun intended!

  2. Not one of our “leaders” has been heard making the sound and sensible point(s) raised in this piece. Life happens, Vermont. Time, indeed, to depart fantasy-land and deal with reality.

    PS And, send the $16 M bill for the EB 5 scandal bill to Ariel Quiros’ good buddy – Shifty Peter.

  3. Another rehash of everything we already know.

    What “we” really do need to know is how to defeat the VT Supermajority by flipping the Legislature in 2024.