(Host) Vermont has the prospect of getting as much as a billion dollars from the federal economic stimulus package.
That’s set off a fierce debate at the Statehouse over whether painful cuts need to be made in next year’s budget.
As VPR’s Bob Kinzel reports, it’s made a cloudy budget picture even more uncertain.
(Kinzel) The debate is happening because it’s likely that Vermont will receive several hundred million dollars more from the federal plan than state officials originally projected.
Most of the additional money is targeted to education and health care programs. These are the very areas where Governor Jim Douglas has proposed significant cuts in next year’s budget.
The governor says he’s concerned that Democratic leaders want to fill in these budget gaps with the new federal money.
Douglas says that’s a bad idea because he says the state will face even larger problems when the federal money runs out in two years.
(Douglas) “I’ve heard others say, `This is manna from heaven. Basically, our problems are no more. We’ve got a huge amount of federal money that solves all our problems and we don’t have to make any tough decisions.’ And what I’m explaining is those decisions will be even more difficult several years from now than they are today. We need to put these programs and our state government on a sustainable track we need to make tough decisions now."
(Kinzel) Senate President Peter Shumlin has a very different point of view. He says the new federal money gives the state some extra time to make thoughtful decisions about the budget.
(Shumlin) “What this package allows us to do is breathe, stop panicking, don’t make decisions that make the economy worse in Vermont. But how do we collectively and thoughtfully advance programs that help Vermonters in these difficult times while still addressing the long-term structural problems we face in the budget deficit."
(Kinzel) The conflict can also be seen in the governor’s plan to eliminate 660 additional state positions. Douglas says the new federal money doesn’t change the need to make these cuts.
(Douglas) “That’s what Vermonters are doing all across our state and they expect state government to use the same kind of fiscal responsibility to get on a sustainable track of spending and exercise that kind of restraint."
(Kinzel) But Shumlin says cutting 660 state employees makes absolutely no sense at this time.
(Shumlin) “One has to question how prudent it is to throw fuel on a fire. We have layoffs across the state, unemployment rising perhaps to double digits, the biggest trouble in our economy right now is unemployment. And yet state government is choosing to join the rest by laying folks off in this difficult time. I do not think it’s prudent to lay off 660 additional state employees."
(Kinzel) Shumlin says Democratic leaders will unveil an alternative to the governor’s budget cuts once the details of the federal stimulus package are finalized. That’s expected to happen by the middle of February.
For VPR News, I’m Bob Kinzel in Montpelier.