The real fault line in this year’s legislature

If you have access to the Mitchell Family Organ, you must check out the latest missive from Peter “Marathon Man” Hirschfeld, captain and crew of the Starship Vermont Press Bureau. The story, “Lawmakers Pondering New Taxes,” nicely encapsulates a trend in the Legislature: widespread dissatisfaction among Dems and Progs with Governor Shumlin’s 2014 budget, especially some of his revenue-producing gimmicks; and a search for creative ideas to raise revenue more effectively or fairly without raising the Gov’s ire.

The story provides a lot of evidence for the notion that the real fault line in the legislature won’t be between the Dems and the GOP; it’ll be between the Governor and legislative lefties.

Last Friday, House Republicans made it clear that They Still Don’t Get It, with their self-immolating stance on a bill that would provide free school lunches for students who now qualify for reduced prices. The bill won’t cost that much money and it’s clearly going to pass, so the only thing Republicans accomplish by opposing it is to look like Ebenezer Scrooge before the ghosts came a-calling.

But still, Republicans on the House Education Committee voted NO. And their clueless vote was cast, not because they actually opposed the bill, but for the sake of a stupid, stubborn idea. House Minority Leader Don Turner:

“There’s a lot of talk about education reform, and it’s all down in bits and pieces,” Turner said. “We don’t want to get caught voting on it in bits and pieces. We don’t have a big picture view of what the whole change is going to cost.”

Well, gee, Don, isn’t it standard practice for the Legislature to tackle multifaceted reforms in “bits and pieces”? Different committees get different bits, don’t they? What did you expect — that the entire package would be delivered as a whole to the Legislature for a single up-or-down vote? That’s kinda-sorta not how legislatures are supposed to work. As you well know.

It’s sad, because in the post-election period, Turner showed signs of a rare Republican leader capable of some self-examination in the wake of the VTGOP’s Titanic v. Iceberg defeat. But this committee vote came right out of the John McLaughry/Lenore Broughton playbook, and it’s the kind of thing that will prevent the party from returning to relevance.

I didn’t mean to take so much time on that vote… but the point is, the Republicans are not an effective minority in the Legislature, and they won’t be as long as they keep trying to reanimate the corpse of last year’s VTGOP. Instead, if there is a legislative debate worth watching this year — a debate that might actually affect government policy — it’ll be between Shumlin’s fiscal conservatism and the more liberal attitudes of many lawmakers.  

Back to Hirschfeld. His article begins by noting that “legislative support for… Shumlin’s new revenue proposals continues to deteriorate,” and then reports:

In the coming days and weeks, Montpelier will see bills that would raise tax rates on top earners, eliminate tax exemptions that benefit the wealthy, add a 1-cent-per-ounce tax on sugared drinks, and double the gross receipts tax on heating oil.

… Leaders in the House and Senate have begun calling into question both the wisdom and viability of Shumlin’s new revenue streams. And legislators eager to retain the governor’s array of new state programs say they’ll come up with their own ways to support the spending.

Hirschfeld unhelpfully points out that the self-described fiscal conservative Shumlin has actually “recommended nearly $70 million in tax increases.” In that context, it’s not hard for Progs and Dems to go looking for better options for raising revenue. And already, they’ve come up with quite a few:

— Rep. David Sharpe (D-Bristol) is the lead sponsor of a penny-per-ounce tax on sugar-sweetened beverages, with the funds going to help ease the transition from VHAP/Catamount to the new health care exchange, plus a stronger anti-obesity education effort.

— Rep. Paul Poirier (I-Barre) has proposed a bill to raise income tax rates on top earners, an idea almost certain to be vetoed by Shumlin. Rep Chris Pearson (P-Burlington) is hoping to bypass the Gov’s no-tax-hikes stance by raising revenue from top earners without raising tax rates. He’s working on “a laundry list of options” that he hopes to present within the next week.

— Rep. Margaret Cheney (D-Norwich) is writing a bill that would raise taxes on heating fuels. This proposal would supplement or replace Shumlin’s idea for a tax on break-open tickets; many lawmakers don’t buy Shumlin’s revenue estimate for that tax, and they’re looking for other ways to fund weatherization and energy efficiency programs.

Lawmakers are also unhappy with another of Shumlin’s revenue work-arounds: a 1% tax on health insurance claims. This tax is a funding mechanism for the Catamount health plan, which will disband at the end of 2013 in favor of the health care exchange. But Shumlin wants to continue the tax anyway. Some legislators disagree, and will be looking for options they like better.

Of course, all of this may be sound and fury, signifying nothing; at the end of the day, the threat of a veto casts a wide shadow even if it’s never deployed. On the other hand, it’s worth noting that House Speaker Shap Smith has expressed significant doubts on some aspects of Shumlin’s budget plan — most notably the $17M transfer from the Earned Income Tax credit to child-care subsidies and the projected revenue from the break-open ticket tax. Plus Smith’s initial reaction to Shumlin’s budget speech in January: “…many of the proposals that have been put forth, people might have some skepticism about.”

If the Speaker lends his weight to the back-benchers’ budget revisionism, things could get pretty interesting under the Golden Dome. And the Republicans will be reduced to the role of spectators booing the home team.  

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