Legislative Wrap Up 2015
The 2015 legislative session ended on May 16. While some budget issues were not resolved favorably, VSEA members stood strong and fought back hard against the Governor’s proposals to cut services and employees. As a result of members’ hard work, VSEA was eventually able to gain significant ground in the legislature, defeating or mitigating most of the damage VSEA members faced in this challenging budget year.
Where We Started
Vermont lawmakers entered the 2015 session facing a challenging $94 million budget gap, the largest of the State’s now nine consecutive gaps. In his budget address, the Governor demanded $5 million in employee concessions through agreed-upon labor savings. He made the request just months after signing new agreements with seven VSEA bargaining units. In addition, the Governor proposed to fund just 40% of the Pay Act, which meant departments and agencies would have to “eat” or absorb the increased costs associated with funding VSEA members’ newly negotiated cost-of-living-adjustments and steps. The Governor also proposed cuts to the Community High School, the Judiciary, and to Public Safety Answering Points (PSAPs). Each of these proposed service cuts were potentially devastating to state employees and the vital services they provide.
Unfortunately, things grew worse a week after the Governor’s address. State economists, as a result of a revenue downgrade, projected the FY16 budget gap to be $113 million. The unanticipated revenue downgrade led to
a budget-cutting brainstorming. Ideas being batted around at the State House to balance the budget included the wholesale privatization of state government, closing the Vermont Veterans’ Home, shuttering the Southeast State Prison, taking money from the state employees’ health care fund and even requiring state employees to pay to park at their own worksites.
VSEA members were fed up, and they were fired up. Already burdened this year with an 18% health care premium increase due to the State’s previous raids on the State Employee Health Care Fund and still juggling burgeoning caseloads caused by a loss of workers during Vermont’s last recession, VSEA members were adamant this time around that things were going to be different, voicing strong opposition to any talk of reopeners. Meanwhile, the Administration began floating layoff numbers of more than 400 employees. In response—and to their credit—VSEA members launched a public “Fight Back Campaign” to begin educating Vermonters about the value of the public services they receive, and highlight the plight of a state workforce that has still not recovered from the mass layoffs under Governor Douglas. Members also wanted to pound home the message that it’s time for Vermont to generate new revenue from the state’s wealthiest, which would end the continuous and unwelcome cycle of budget cuts and scapegoating state employees.
“Fight Back: Save Our Services”
VSEA’s Fight Back campaign launched with its own webpage and a series of meetings coordinated by VSEA’s Organizing Department. That was followed by a successful “State House Day” on February 17, where VSEA members from across Vermont came to Montpelier to talk with their legislators and educate them about why the Governor’s proposed cuts were so detrimental to many of their constituents. At Lobby Day, Community High School of Vermont Educators and PSAP Dispatchers
were able to speak spoke directly to the Governor about why his cuts would increase offender recidivism and hinder public safety, respectively. VSEA members led a panel discussion on the cuts, and it was attended by legislators who got to hear from individual employees about the importance of the public service they provide. In addition, hundreds of state employees who could not attend the event called their legislators to leave messages of opposition to the Governor’s proposed cuts. The day ended with VSEA’s annual Legislative Reception, where VSEA members were able to continue their budget-cut conversations with the many legislators who attended.
In the days and weeks following, it became clear that the House Appropriations Committee was struggling to find ways to make additional cuts on top of the Governor’s, and it ended up proposing a $1 million cut to the Vermont Veteran’s Home and closure of the Windsor Prison. VSEA continued to lobby hard against these cuts, and the union got proactive, holding a press conference to release a revenue package that included member-submitted proposals to generate approximately $30 million in new revenue from the wealthiest Vermonters. VSEA was hopeful the ideas, if implemented, would counter the Governor’s call for middle-class state employees to balance the budget on their backs. VSEA members’ message remained consistent throughout the session, “No more cuts to state services, raise revenue from the wealthy.”
Even as VSEA members were organizing around budget issues and reaching out to lawmakers about them, some legislators continued to introduce legislation that could have had a significant adverse impact on state employees. For example, a bill was introduced in the Senate that to better protect children from abuse and neglect by making failure to protect a child a crime. As introduced, the language would have put DCF social workers at risk of prosecution in cases where they allegedly “failed to protect a child.” VSEA successfully worked with a number of different groups to get the language stripped from the bill and a compromise was agreed to that enhances existing penalties already contained in law,. The agreement also removes any removing additional crimes a social worker could be charged with as a result of their position.
In addition to successfully tweaking the child protection bill, VSEA also moved its grievance arbitration bill, which permits VSEA members to bargain over whether members can take a “step-four” grievance to a neutral arbitrator instead of to the Vermont Labor Relations Board. This bill passed the legislature without debate and with Administration support.
House Revenue & Budget Debate:
VSEA members and supporters were a constant presence at the State House throughout the session and throughout the union’s budget fight. Members’ collective efforts provided enough pressure to save the Community High School of Vermont, the Veterans’ Home and the Judiciary. It also convinced House lawmakers to extend the life of PSAPs in that body’s budget. Right up until floor debates on both the revenue and budget bills, VSEA was lobbying the House hard to oppose the Governor’s personnel savings and any layoffs. The Senate’s Ways and Means Committee introduced an amendment to the House’s revenue bill which generated $35 million in new revenue, and that was great, but it wasn’t enough to close Vermont’s $113 million budget hole. With VSEA’s support, 43 House members did attempt to attach more revenue proposals to the budget bill, one advocating to slightly increase the top marginal tax rates on Vermonters earning more than $180,000. This money would offset the Governor’s proposed cuts to state employees and to Vermonters eligible for low-income heating assistance. Unfortunately, a majority of representatives voted not to support the amendment, casting their vote instead for a budget that exacerbates inequality and endangers public services. Members of the legislature’s “Working Vermonters Caucus” also actively campaigned against the revenue bill. Labor-friendly legislators also courageously bucked leadership to nearly succeed in voting down the revenue bill, thereby sending it back to committee, where the committee would be forced to identify more revenue sources if the bill was to pass on the floor. Unfortunately, in the end, House leaders secured the votes of a few Republicans and some thought-to-be worker friendly legislators to support their proposal.
On To The Senate
As the budget bill crossed the aisle to the Senate, VSEA members continued to stand strong in the face of threats and criticism from politicians who were demanding working-class Vermonters shoulder responsibility for a budgetary crisis they did not create. As it became clear the House Appropriations Committee would likely pass a budget that included the Governor’s proposed labor savings and a 40% reduction in Pay Act funding, VSEA’s elected leaders opted to rely on the expertise of frontline workers and staff to identify efficiencies and money waste in state government, in hopes their ideas could help mitigate the potential number of layoffs. VSEA members and staff worked diligently to find mutually agreeable solutions to the budget shortfall without opening the contract, and subsequently their ideas were presented to the Senate Appropriations Committee to include in that body’s budget proposal. The Administration’s support for VSEA’s ideas helped ensure that any resulting savings would go towards preventing layoffs. The Administration was ultimately receptive to VSEA’s ideas, and the union was able reach a deal that found $4.5 million in saving through the combination of a retirement incentive, a reduction in the number of temporary employees, and freezing a raise to highly paid commissioners and other political appointees. The Administration estimated the collaborative plan would reduce the number of layoffs from 450 positions to less than 50. The Senate Appropriation’s committee accepted the plan and ultimately included it in their version of the budget. In conference committee, both sides agreed to include VSEA’s proposals in their final budget.
Where VSEA Members Stand Today
While politicians and some Vermont taxpayers have criticized “out of control spending” in Montpelier, the FY16 budget is actually quite austere, representing a total increase in State spending of just 1.1%. Truth be told, the State needed to see a 3.3% increase in state funds to counter reductions in federal grants to Vermont and to backfill a hole once, but no longer, filled wholly by one-time funds. To date, Vermont has not been completely reckless in addressing its ongoing deficits, as evidenced by the fact that State spending has fallen as a percentage of Vermont’s economy from 11.5% in 2007 to 11.0% projected for FY16. Overall, the legislature took a somewhat “balanced” approach to solving the $113 million problem, cutting $56 million in spending, raising $30 million in new revenue and utilizing $25 million in one-time funds.
Non-Human Services’ budget cuts included:
· Rutland and Derby PSAPs restructuring in October, unless alternative revenue is found;
· The elimination of the State Law Library;
· Shuttering Vermont Interactive Television;
· Reducing funding to Vermont Public Television;
· A steep reduction in working lands grants for value-added agriculture start ups;
· A $ 1 million reduction to DII projects; and
· A $625,000 of savings from the State’s fleet vehicle program.
Actual Human Services cuts included:
· The elimination of State funding for low-income heating assistance;
· Reducing Vermont’s number of out-of-state prisoners;
· Reducing Reach-Up benefits to the disabled;
· The elimination of an opiate-treatment program offered at the Brattleboro Retreat;
· Reducing Vermont Health Connect’s operational costs; and
· The elimination of various grants related to autism, services for the blind, educational programs targeted at AIDS and smoking prevention, and the awarding of housing vouchers to the mentally ill.
Lawmakers much-disputed revenue bill will help correct some deficiencies in the state income tax code, particularly by limiting deductions that allow Vermont’s wealthiest to pay little to no income tax. Major components of the revenue bill include:
· Elimination of the deduction for income taxes paid in the previous year;
· A cap on itemized deductions for mortgage interest, property taxes and miscellaneous expenses at 2.5 times the standard deduction ($31,500 for a couple);
· Wage garnishment from delinquent taxpayers;
· Elimination of the sales tax exemption for soda products; and
· Various fee increases to use government services.
In the end, VSEA members, union activists and community supporters were able to stop the worst of the State’s and lawmakers’ budget proposals through unprecedented engagement and solidarity; petition generation, phone banking, outreach to legislators, and rallies. That said, the victories were bittersweet because the budget still contains up to 50 RIFs, and it lacks the tax reform necessary to end Vermont’s continuing cycle of budget gaps. While the Community High School of Vermont, the Judiciary, Windsor Prison and the Veterans’ Home thankfully escaped the budget ax this year, Vermont’s PSAPs still face an ongoing struggle to collect revenues from towns who utilize their services.
The FY16 budget also includes approximately 60 new classified positions and one exempt position, with the nearly half of these allocated to BGS for the anticipated reopening of the Waterbury complex and a dozen new positions in the Department of Environmental Conservation to support EPA-mandated cleanup of lake Champlain.