There’s a hole in the bucket… or two, or three, or four…

In explaining his recommendation for an increase in the state gas tax, Governor Shumlin came up with a creative explanation for why this would not constitute a tax increase. Because gas sales have gone down, “We’re not talking about needing more money than we used to raise; we’re talking about plugging the hole in the leaking bucket…”

If you follow that logic, we should respond to a recession by raising taxes on income and capital gains, because “We’re not talking about more money than we used to raise…”

But I do get his point. As vehicles become more efficient, gas tax revenues decline. Indeed, if we experience the projected large-scale conversion to electric vehicles, we’ll have to create a whole new funding system for transportation.

But the transportation fund isn’t the only leaky bucket around the Statehouse these days. This week, various legislative committees are digging into the details of Shumlin’s budget plan. And they seem to be finding leaks all over the place. Or, should I say, desperate attempts to patch the leaks with the budgetary equivalent of duct tape and Goop. In addition to the ongoing debates over the transition from VHAP/Catamount to the new health care exchange, and a proposed cut in the state’s portion of the Earned Income Tax Credit, we’ve now got downsized revenue projections for the proposed tax on break-open tickets, and questionable cuts to the mental health budget.

And it’s only Wednesday morning! We have at least three more days of budget hearings to go! What fresh hell will they bring?  

Break-open ticket tax. Shumlin wants to spend $17M on energy efficiency programs, and identified the currently untaxed break-open tickets as a revenue source. But the Legislature’s Joint Fiscal Office reports that actual revenues will only be $6.5M. The administration is standing behind its estimate of 173 million tickets sold annually, but the JFO is skeptical, since that would mean every man, woman and child in Vermont is buying more than 120 tickets a year. As Peter “Marathon Man” Hirschfeld of the Vermont Press Bureau notes, that’s “nearly three times the per-capital rate in New Hampshire, 11 times the rate in New York and 35 times the rate in Massachusetts.”

And in this battle of warring estimates, House Speaker Shap Smith is siding with the JFO, and urging the administration to “put forward other ways to fund those [energy] programs, or to decide which programs they think are a priority for funding.” Ouch.

Mental health cutbacks. I’d tell you “I hate to say I told you so,” but actually, me gusta. Last year, in my incessant opposition to Shumlin’s plan for a decentralized, community-based mental health care system, I warned advocates that the success of that system would depend on adequate and consistent funding. And it looks like Shumlin is already starting to renege.

Shumlin’s proposal would close a seven-bed locked facility in Middlesex when the Berlin hospital opens in 2014, and it contains no money for the four less-secure “step-down beds” planned for Rutland and the seven beds planned for northwestern Vermont.

Those “step-down beds” are a key feature in a system that will have significantly fewer in-patient beds. State Rep. Alice Emmons, chair of the House Committee on Corrections and Institutions, told the Freeploid “We’re not even out of the gate yet, and the budgets are being compromised.”

Admininstration officials insist they are not backing away from their promises. Acting Mental Health Commissioner Mary Moulton said planning for the Rutland beds was not complete in time for inclusion in this year’s budget, so they will be included in a later budget. That’s reassuring, not.

And as for the seven northwestern step-down beds, Finance Commissioner Jim Reardon said the administration is taking a wait-and-see approach — letting the new system develop before deciding how many beds are actually required.

Equally reassuring, not.

Sometime this week, the House Health Care Committee may vote on Shumlin’s planned transition from VHAP/Catamount to the new health care exchange. So far, Shumlin has stood his ground on the adequacy of his plan, even though some recipients will be exposed to higher out-of-pocket maximums if they actually, y’know, use health care. Ideas are floating around on how to close that gap, but they would involve revenue increases that Shumlin doesn’t like.

That vote may be an early indication whether Shumlin will get his way, or if liberal Dems and Progs are willing (or able) to force compromises on key issues.


2 thoughts on “There’s a hole in the bucket… or two, or three, or four…

  1. We’re definitely not taking in so much revenue from Shummy’s 400 closest friends.  Perhaps he can be more like Snelling and raise a couple percent on the top marginal rate?

  2. all these things should be part of the solution.  But it’s just so much easier to hike fees and reduce tax credits that primarily affect the working class.  Our legislatures aren’t even allowed to discuss it.

    It’s striking that the Gov is proposing some new programs/services when we still have budget problems.  Dammit, just hold the line on what we have, even if it’s not perfect.  Do what you can to improve the economy, and then let additional revenues fund new programs.

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