By Guy Page
Unable to successfully veto expensive legislative energy and school spending bills this spring, Gov. Phil Scott this fall is using his bully pulpit to remind voters that “there’s an election around the corner.”
At his press conference yesterday, Gov. Scott pointed to (at least) threat major hindrances to affordable living in Vermont:
- the Clean Heat Standard law to transition consumers away from fossil fuels providing heat (estimated cost almost $10 billion), and
- the Renewable Energy Standard law passed last year to transition utilities away from fossil fuels providing electricity (estimated hundreds of millions of dollars), and
- School property taxes that will rise at least seven percent next year even if all spending is level funded at the state and local level – which is unlikely.
Governor Scott did not focus yesterday on yet another major driver of unaffordability – Vermont’s unprecedented, nation-leading increase in the cost of housing, which many critics say has been worsened by the Legislature’s failure to ease Act 250 building regulations. Nor did he mention the $6 billion estimate to renovate or replace aging school buildings. Or the huge fees required of property owners under the state’s storm water runoff regulations. He did mention the Legislature’s increase in DMV fees and the enactment of the $125 million (subject to annual increase) payroll tax to support childcare.
Scott clearly hopes Vermonters will take action at the polls in November: “Now that there’s an election around the corner, we’re seeing some legislators having second thoughts. But, I’m concerned about what they’ll do in January when the election is over,” he said at the press conference.
Regarding the Clean Heat Standard, Scott noted that “not only are the costs extremely high, at almost $10 billion, the [Sept 1 NV5 consultants’] report also points to other challenges like workforce shortages and just months before the Legislature will be asked to move forward with this policy, there are still many unanswered questions, like, who actually pays for what.
“However, I did see that Senator Bray, one of the architects of the Affordable Heat Act, said it could add $1.70 to a gallon of heating fuel.”
As reported by VDC this week, Bray told VTDigger he wouldn’t support a CHS adding $1.70/gallon to Vermonters’ fuel bills; Democrat Sens. Thomas Chittenden and Sen. Irene Wrenner (both of Chittenden County) have said likewise, as has Rep. Laura Sibilia (I-Dover), vice-chair of the House Environment and Energy Committee.
School spending increases expected
Even if schools and the Legislature don’t increase school spending by a cent – an unlikely event – local school districts are facing a 7% property tax increase next year on top of the 14% higher tax bill for this year, Gov. Phil Scott said.
In a September 9 letter addressed to “local school leaders,” Gov. Phil Scott gave a preview of his traditional December 1 school revenue letter.
The advance notice may have been appreciated, but the news Scott brings isn’t good for taxpayers.
Education revenue gap of almost $60 million – The good news is that school funding revenue is up by about $10.4 million. The bad news is that the Legislature pre-spent $69 million to buy down spending for the current school year.
“However, Act 183 used $69 million of one-time money to lower property tax rates for FY25, and over my full objection did not include structural reforms or tools to help you mitigate increases,” Scott told local school leaders.
Simple arithmetic shows Vermont coffers will be about $59 million behind projections.
Health insurance premiums estimated to rise $50 million – if school employee health care insurance rate increases are comparable to the commercial rate requests submitted to the Green Mountain Care Board, that increase could create about $50 million of education spending pressure, Scott said.
What this means is that Vermont school boards are already looking at a 7% property bill tax increase even if state and local school spending is level-funded.
“If school spending is flat, and there is no significant change to the revenue numbers or projected grand list growth, these two pressures alone could result in an average property tax bill increase of 7% next year,” Scott said.