Next Governor’s Biggest Challenge: Balancing The Budget

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(Host) Perhaps the biggest challenge facing the next governor is balancing the state’s budget.

Vermont already faces a potential $110 million deficit. And as the state struggles to regain its financial footing, it’s unlikely that new revenues will pour in anytime soon.

The two major party candidates have different ideas on state spending. But as VPR’s John Dillon reports, the details of both of their proposals remain elusive.

(Dillon) Democratic candidate Peter Shumlin went to a Waterbury child care center earlier this month to criticize his opponent’s budget proposals.

With toddlers playing in the background, Shumlin said Dubie’s plan to limit budget growth to 2 percent across the board would end up hurting a state health care program called Doctor Dynasaur. The program covers children 18 and under.

(Shumlin) "To impose a 2 percent cap on budgets will result in children being removed from health care access through Dr. Dynasaur that Howard Dean, Gov. Kunin and I fought so hard for."

(Dillon) Brian Dubie says Shumlin is wrong to scare people about potential cuts. Dubie says he’ll spare the health care program from the budget axe.

(Dubie) "They’re smart investments. They’re not only the right thing to do, they’re also smart investment. Dr. Dynasaur is a great program to continue to support."

(Dillon) But beyond a commitment to protecting Vermont’s signature child health program, neither of the candidates’ budget plans is very heavy on specifics.

Both of them promise to balance the budget. But neither has a plan that adds up to the total cuts that probably would be needed.

Shumlin promises, for example, to save $25 million dollars in state contracts. And he says he can eventually cut $40 million from the Department of Corrections by investing money in housing and offender treatment programs.

(Dillon) Dubie has been openly scornful of Shumlin’s proposal, even suggesting it would mean violent criminals would get out of prison. Shumlin denies that.

A centerpiece of Shumlin’s budget savings plan is a single-payer government financed health system.

(Hogan) "Well, that’s not a quick fix."

(Dillon) Even a single payer advocate like Con Hogan questions how quickly the reform could be adopted because a federal waiver is required.

Hogan is a former human services secretary for Governor Howard Dean. He’s an expert in health policy and has written extensively on single payer. He’s also a Shumlin supporter.

(Hogan) "If the current studies bear any fruit, and it looks like there’s over time substantial moneys saved by changing how we finance health then again you’re looking at least a three maybe a five year process."

(Dillon) Republican Brian Dubie says he’d wait a year before implementing his 2 percent cap on budget growth. He would wait because the budget crisis facing the state is so severe that he can’t promise that he’ll avoid cuts next year.

Dubie has mentioned some programs that could be cut, such as funding for land conservation. And he’s said that he’d trim about $1 million dollars from a state interactive TV service.

But he’s also promised to boost spending on programs for business. This week Dubie spoke to a business audience and said he like to expand the state Vermont Economic Development Authority, which loans money to companies.

But if Dubie spends more money on VEDA, he’ll have to cut elsewhere to keep the budget within 2 percent growth. Where exactly those cuts will come from is not made clear.

Essex Orleans Senator Vince Illuzzi is a republican who serves on the Appropriations Committee. He says Dubie’s budget cap alone may not be enough.

(Illuzzi) "I don’t want to support or criticize any plan that’s out there now… And whether it’s an across the board spending cap or targeted cuts to specific programs or a combination of the two, there is no question we’re going to have to go there in the next fiscal year."

(Dillon) Dubie says that in the early 1990’s Gov. Howard Dean level-funded budgets. So Dubie says it can be done again.

But Con Hogan – who worked with Dean on those budgets – says times are very different today.

(Hogan) "Back in those days, they hadn’t made the cuts that have now been made. So it will be even more difficult now than it was then."

(Dillon) Hogan says whoever is governor will have an extremely difficult task. He says the state will be starting the third straight year with a budget shortfall – and with little prospect that federal stimulus funds will make up the difference as they have in the past.

For VPR News, I’m John Dillon in Montpelier.


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