(Host) Governor Peter Shumlin has proposed a budget for next year that reduces over all state spending by $25 million. It’s the first time in a decade that total state expenditures have gone down.
The Governor balances the budget, in part, by making roughly $44 million in cuts in a variety of human service programs.
We have two reports tonight starting with VPR’s Bob Kinzel.
(Kinzel) Here’s the basic problem facing the Administration. Over the last 3 years, Vermont received almost half a billion dollars in federal stimulus money that was used to balance the state budget. But now the governor says that money is gone.
(Shumlin) "What we face in this budget is the reality that the hundreds of millions of dollars of stimulus funds that were allocated by the federal government to cushion the blow of the worst recession in American history are now gone."
(Kinzel) The Governor says it’s important to balance the budget without resorting to new taxes or tapping into the state’s Rainy Day Fund.
(Shumlin) "I am committed to making the painful choices today that will help ensure that we are not back here next year making more drastic cuts."
(Kinzel) The proposed budget reduces state spending by $25 million at a time when mandated budget pressures on Human Service programs are increasing by $100 million.
To deal with this budget gap, the Administration is proposing new taxes on hospitals, dentists, nursing homes and managed care organizations. The plan also cuts funding for regional mental health programs by 5% and it reduces services for low income elderly people.
Administration Secretary Jeb Spaulding says all these groups need to share the pain of a tough budget.
(Spaulding) "I guess what we’re saying is ‘look, we’re all in the same boat together unless we get control of these health care costs we’re going to be cannibalizing each other year after year. So join the effort’."
(Kinzel) The Administration also wants to turn the Catamount Health Care program – a program that provides state subsidies for private insurance policies – into a state run program.
Participants would see their deductibles rise from $500 a year to $1,200, and reimbursement rates for health care providers would be cut significantly. Doug Racine is the Secretary of Human Services.
(Racine) "I think this is part of the governor’s effort to move us towards a single payer system. Catamount was set up as a private insurance package that was part of the negotiations that led to Catamount a few years ago. Governor Shumlin would prefer having that population in a public program."
(Kinzel) The governor did propose some new initiatives including; $13 million in state bond money to expand broadband throughout Vermont, more money for early education programs, and $4 million for a workforce training program.
He also vowed to cut the state’s recidivism rate for non violent offenders by beefing up local community programs.
For VPR News, I’m Bob Kinzel in Montpelier.