Administration, lawmakers working on $30 million in budget cuts

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(Host) In the next 2 weeks, the Douglas Administration and Legislative leaders hope to have a plan to cut the new state budget by 30 million dollars.

So far, there’s a general agreement to avoid raising taxes and to avoid using the state’s rainy day budget funds.

VPR’s Bob Kinzel reports.

(Kinzel) The cuts are needed because several weeks ago, the state’s revenue forecast for the new fiscal year was downgraded by roughly 30 million dollars.

There are several programs that Administration Secretary Mike Smith doesn’t want to cut. These include public safety, corrections, debt service and property tax relief efforts.

Smith says exempting these programs means that the rest of the state budget will have to be cut by about 5 %:

(Smith) "I cannot pretend that reducing the budget by 32 million will not have an impact, but my job is to minimize the impact and protect services to the most vulnerable Vermonters."

(Kinzel) Smith and Senate Appropriations chairwoman Susan Bartlett agree on several key points as the budget cutting process begins.

First, the answer to this immediate problem isn’t raising taxes:

(Smith) "You’ve got to remember that Vermonters are paying 800 million dollars more in fuel than they did a year ago. That’s equivalent on an annual basis to roughly doubling the personal income tax, the rooms and means tax the motor vehicle purchase and use tax. To swamp Vermonters with more taxes when they’re getting crushed with higher fuel prices is too much for the average Vermonter."

(Kinzel) They also agree that it’s a mistake to tap into the state’s rainy day budget funds. Senator Bartlett says she wants to preserve these funds in case they’re needed in several months:

(Bartlett) "My concern about using the rainy day funds right now is again I really do anticipate another reduction in November so if we use the rainy day funds now and then we have another downturn in November we have no place to go."

(Kinzel) Bartlett recognizes that the entire process could become very political during an election year – that’s something that she says she hopes to avoid:

(Bartlett) "When you have to keep reducing spending like this it’s very difficult and if you put politics on top of it I think it just makes it even more difficult."

(Kinzel) Legislative leaders will meet with the Douglas Administration next week to consider a wide range of possible spending reductions. 

The goal is to agree on a package of cuts that can be presented to the Joint Fiscal Committee on August 19th.

For VPR News I’m Bob Kinzel in Montpelier.

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