2015 Session Ends on High and Low Notes

Another legislative session came to an end late Saturday night on the 16th, and the final results were mixed. Did we heed the calls for education and healthcare reform or address structural flaws in our tax system, taking bold and decisive actions to right the listing ship? It depends on who you ask and how much their political career depends on a favorable answer, but I’d say we still have a lot of work left to do. One of the biggest challenges in our legislative system, in my opinion, is that lawmakers have little time to devise complex solutions to systemic problems and often can’t even agree on what the roots of the problems actually are. Each body of the legislature has about eight weeks to pass their bills over to the other body, where they can be rewritten from scratch. Some ideas and proposals are given much committee time and deliberation only to be abandoned in the end, while others are proposed at the last minute, not fully fleshed out, and tacked onto must-pass bills with fingers crossed that they don’t make matters worse. In the end-of-session flurry, most major bills are finalized in committees of conference that consist of three reps and three senators. When they reach a deal the bill is brought to the floor for an up-or-down vote that can’t be amended. In this manner many proposals that weren’t given due consideration in committees of jurisdiction or with floor debate become law, for better or worse.

Some of the session’s most touted accomplishments – balancing the budget, passing a water quality bill, developing a new renewable energy standard and coming up with new ways to incentivize school governance changes – are being criticized for either going too far or not far enough, which I suppose is to be expected. Compromise often leaves neither party satisfied.

The budget was balanced through a mix of budget cuts and new sources of revenue. Itemized deductions were capped at 2.5 times the standard deduction, a minimum tax of 3% is applied to taxpayers making over $150,000 per year as a percentage of their adjusted gross income, and the state sales tax is expanding to cover soft drinks (but not candy, unfortunately). We will have another budget gap to address next year.

The education “reform” bill includes new incentives for districts to merge and retains small school support as long as schools can demonstrate good educational and fiscal management. The spending caps that initially passed the House would have punished many schools and were removed by the Senate. However, the final compromise included a new excess spending penalty for schools spending over a certain percentage increase. Unfortunately, this will have the effect of raising property taxes in many towns that are not overspending by any objective accounting. I did not support this bill and voted “No”. Campaign pledges to adjust or replace the funding formula were barely given the time of day. There seems to be an institutionalized mindset in Montpelier that small schools are the problem that needs to be fixed, and funding mechanisms are imposed on the existing economies of scale to pressure smaller schools into consolidating with their neighbors though there is little evidence that this will save money. I will be working with other legislators representing smaller schools over the summer to develop a better strategy going into next year. After all, Vermont is a small state covered with small towns whose schools are often the glue that holds communities together. Consolidation and closure may be necessary in some cases, but there are many small schools providing high quality educational opportunities while being fiscally responsible. We shouldn’t penalize them because we think that bigger is better in all cases.

On the healthcare front we passed a weak and watered-down bill that barely “keeps the lights on”. By raising the cigarette tax we will have just enough to make small investments in Medicaid subsidies and primary care and increase Medicaid reimbursement rates. We are also (finally) allowing people to enroll in insurance plans directly with providers and bypass the infuriating Vermont Health Connect system. An amendment that I successfully tacked onto the healthcare bill would have tasked the Healthcare Reform Oversight Committee with focusing on the high cost that obesity and related diseases are imposing on employers and the healthcare system in general. This was cut out in final negotiations, however, which is troubling because obesity is estimated to cost the state hundreds of millions every year and we can’t rightly reform the healthcare system without addressing one of its biggest cost drivers. Maybe next year…

Some of the other things I was working on crossed the finish line intact or nearly intact. Healthcare pricing transparency, solar siting standards, relaxed regulations for small farmers, first-time homebuyer credits, and broadband internet improvements passed through in one form or another. A child protection bill, S.9, includes a  provision that prioritizes the safety of the child over the traditional practice of reunification with family when that isn’t always the safest option. We are also moving towards a budgeting process that considers less than 100% of projected revenue to account for shortfalls in actual tax receipts. Why we weren’t already doing this is a mystery to me, since budgeting for more than we would later take in was partly responsible for the budget gap we faced this year. H.35, the “water quality bill”, moved through my committee as a must-pass law to prevent the EPA from imposing expensive regulations and to address ongoing water pollution from farms, centralized wastewater treatment facilities and development. My concern is that unless we boldly transform our agriculture and wastewater practices we will continue to pollute faster than we can clean it up. I voted not to remove the philosophical exemption from vaccinations for public school attendance because the result will be that parents will either check the religious exemption box (no proof of church attendance or tithing necessary!) or homeschool, and we will fail to achieve our public health goals while also possibly driving up property taxes by lowering student enrollment numbers.

Positive developments include the formation of Communication Union Districts (CUDs, yes, CUDs) that will allow providers like ECFiber easier access to capital for expanding true fiber-based broadband, investments in workforce training and development, a minimum standard of paid sick time, same day voter registration, forester licensing, and strengthened substance abuse treatment options.

In the 2016 session I will continue to work on some unfinished business, including healthcare and education reform, addressing the potentially unconstitutional double taxation of retirement benefits accrued out of state, expanding local meat production, decentralized wastewater treatment alternatives, pesticide regulation, and water quality.

Please contact me anytime during the off-session to ask questions or make suggestions. I can be reached at info@teozagarforhouse.org and 234-9125.

April 20, 2015 – Gun Rights & Regulation

Last week I witnessed the most emotional and heated debate on the House floor since I took my seat four years ago. S.141 is a bill relating to the criminal possession of firearms and the restriction from possession on those adjudicated by a court to be a temporary danger to themselves or others. The bill began as S.31 and originally included a “universal background check” provision that was later discarded.

S.141 would make it a state crime for someone convicted of a range of offenses defined by existing federal law to possess a gun. This law is already enforced (some would say loosely) by a small number of federal agents in Vermont. However, state law enforcement officials have asked for more tools to help address increasing rates of drug and drug-related crimes without having to rely on the feds.

The Vermont Federation of Sportsmen’s Clubs, a state affiliate of the NRA, provided feedback to the Judiciary Committee and helped to improve the bill. Earlier in the session they successfully lobbied the Senate to remove universal background checks from S.31. I find it encouraging that 2nd Amendment advocates and the lawmakers who would be expanding regulation of firearms would work together in such a productive and civil manner. This is something Vermont can be proud of. VFSC worked hard to reach a compromise and ultimately decided not to oppose the bill, although they wouldn’t support it either. Both sides of the divisive issue claimed victory when the bill passed.

During the floor debate, strong opposition was partially couched in the language of “slippery slopes” and “camel noses under the tent”. In my experience the only slopes in government are uphill with lots of friction, and I cannot imagine any possibility in a future Vermont where gun registries or confiscation are imposed on law-abiding citizens by state government. Just imagine how that would backfire. And about that camel, you could say it’s already in the tent since most of the provisions in S.141 are already enforceable under federal law.

Some members protested the “stigmatization” of the mentally ill and the possibility that people in need of mental health treatment (including veterans with PTSD) would not seek help for fear of losing their gun rights. But the bill is very explicit about how someone’s name would be added to the federal NICS background check system. Only through the due process of a civil or criminal proceeding whereby a court adjudicates someone to be a danger to themselves or others is a name submitted to the national database. There is also a process by which someone can have their rights reinstated by petitioning the court for relief from disability upon recovery. Seeking treatment or being actively engaged in treatment for mental health conditions does not set someone on a path to having their 2nd Amendment rights revoked. We who should know better do a potentially harmful disservice by perpetuating this myth and not correcting misunderstandings. I hope the representatives who opposed the bill will at least be able to set the minds of any of their constituents going through mental health challenges at ease, and encourage them to seek help without fear of losing any of their rights.

Rep. Sam Young of Glover spoke of his brother’s suicide after suffering with paranoid schizophrenia for years. Involuntarily committed by his family, Sam’s brother would have been on the “no buy” list had this law been in place. His family had asked the local gun shop not to sell their son a gun, but he only had to go to the neighboring town to buy one. He was found in the woods more than a year later. Sam explained his support for S.141 by saying, “Sometimes we do things for political reasons. Sometimes we do them for personal.” Some say that Sam’s brother would have found another way to kill himself if he hadn’t been able to buy a gun that day. But in light of evidence to indicate that when a suicide is prevented a repeat attempt doesn’t always follow, who are we to tell Sam or anyone else who has lost a loved one in similar circumstances that their family member “would have just found another way”?

Rep. Chip Troiano, a Vietnam veteran and criminal investigator, spoke of his own struggles with combat-related PTSD and decades of working for the legal rights of the mentally ill. He forcefully corrected multiple suggestions that the bill was an attack on the mentally ill and that it would prevent people from seeking treatment. Those claims by the opposition were not repeated after he sat down.

Some opponents of S.141 painted supporters as shills for “Bloomberg money”. I personally received from Gun Sense Vermont an unsolicited check for $100 before last year’s election and my name appears in the Gun Sense donor database on the Secretary of State’s website. It was one of three unsolicited donations I received from different groups, and because I don’t accept donations from lobbying groups I voided the checks. I don’t know if any of Bloomberg’s money went to Gun Sense or not, but outside money is used on both sides of most lobbying efforts on any given issue in Montpelier all the time and everyone knows it.

Persistent violations of our Fourth Amendment rights (by warrantless wiretapping, data capture and online surveillance by government and corporations) are seldom, if ever, met with as much public protest as perceived challenges to 2nd Amendment rights, and our 4th Amendment rights have been actively violated for quite some time. But the abstract discomfort we feel about our telephone calls or emails being monitored is less visceral than the concern about losing a piece of private property that does provide a measure of safety. I also understand a citizen’s concern when they look around the world and see unarmed populations being routinely exploited, threatened and abused by corrupt militarized dictatorships – our allies and trading partners among them. In a world full of bad actors with nearly a billion guns in circulation, a law-abiding American citizen must always reserve the right to bear arms. But we should be just as vigilant and vocal about other violations of our rights that may be less noticeable.

So why did I vote for S.141 if it wasn’t a quid pro quo for the lobby money I didn’t ask for and didn’t use? As a gun owner and recreational shooter wary of human government and human nature, and one who represents a considerable number of hunters, veterans, sportsmen and collectors (family and friends included), I searched the bill for any word, line or phrase that did anything to threaten or negate my 2nd Amendment rights or those of my constituents. I came to the conclusion that S.141 struck the right balance between public safety and individual freedom.

The least controversial section of S.141, and the one where both sides readily found common ground, was the inclusion of a Vermont version of the New Hampshire Gun Shop Project. Started by a gun shop owner who discovered that three guns sold from his shop in the span of a week were used for suicides, he decided to become proactive. He reviewed his shop’s surveillance videos for any indications that the people who bought guns and later killed themselves were exhibiting signs of emotional distress. Collaborating with mental health advocates and professionals, Ralph Demicco of Hookset, NH helped develop a series of printed materials to educate and inform other gun shop owners about the warning signs to be aware of in people who may be suicidal. Materials also include prominently displayed signs with phone numbers for suicide prevention hotlines. Since the project’s inception in 2009 more than 50% of gun shops in New Hampshire have voluntarily chosen to participate. I spoke with Ralph Demicco a couple months ago and he told me the story of a woman who came into his shop to buy a handgun. He had a feeling that something wasn’t quite right and simply asked her, “Are you sure you want to buy a gun today?”. She broke down in tears and confessed that she was in fact severely depressed, had ceased treatment, and was considering suicide. He happened to know her therapist and reconnected the two of them that day. She did not make a subsequent attempt to take her own life.

The Vermont Gun Shop Project is something that started to evolve outside of the legislative process earlier in the session when members of the Vermont Federation of Sportsmen’s Clubs began communicating with the Vermont Suicide Prevention Coalition about starting a program similar to New Hampshire’s. The provision in S.141 would simply have the Department of Mental Health report back to the legislature on the progress that’s been made by these groups by January 31, 2016. This is one endeavor of which it can truly be said that if it saves just one life then it’s worth doing.

April 6, 2015

Last week the House passed H.361, an education reform bill. The bill includes many intentions and action steps aimed at addressing education governance (in the form of Integrated Education Systems of at least 1,100 pre-K to 12 students), education funding, and education quality. It also includes many studies and reports. No major changes to the existing funding formula are presented.

While the Committee on Education put forward some sound and necessary measures to respond to changing demographics and economic pressures, there was one particular provision in H.361 that became a lightning rod, a bargaining chip, and a display of the games often played in the halls of the state house. On the campaign trail last year one statewide candidate submitted a proposal to cap the education property tax rate to ease the burden on taxpayers. The proposal was quickly picked apart since it would do little to address the factors that contribute to increased spending, would have blown a hole in the Education Fund, and tied the hands of school boards during their difficult budgeting process. It also didn’t take into account changes in the cost of living, healthcare and energy prices, facility needs, or fluctuations in enrollment that could come up hard against imposed budget caps. A new spending cap proposal in H.361 uses a different mechanism to attempt to control property tax hikes but could potentially have a similar effect of forcing punitive and damaging budget cuts on schools already struggling to control local tax rates while trying hard not to reduce educational opportunities.

The caps were originally proposed to regulate school budget growth by no more than 2% over the previous year’s equalized per pupil spending, but there was “vote erosion” among members who opposed this hard cap. This forced the committee to draft a compromise to secure enough votes to pass the bill the day before it came to the floor. The new proposal would make a statewide spending cap come into effect for 2018 and 2019 only  if in 2016 total statewide spending increases by 2.95% (which it did last year). At that point, a statewide imposition of variable caps would be triggered – constraining all district budgeting according to the higher of either the education (total budget) or per-pupil spending in the previous year. Depending on how much a district spends in 2016 per pupil or in total, allowable future growth would be within the range of 1-4%. In Barnard, for example, the allowed growth in either our total spending or per pupil spending would be 1.85%. If the town approves a budget in excess of that growth rate it will be deemed by the state to be a failed budget and the board will have to go back to the drawing board. Granted, there are provisions for districts to appeal the cap to the Secretary of Education and safeguards for unexpected increases in special education and maintenance costs, but ask any of our school board members what that cap could mean for our Barnard students.

When one member offered an amendment to H.361 just before the final vote to strip the entire caps section from the bill (something I supported), the motion to reconsider the committee’s triggered-cap proposal was defeated. The Speaker considered it to be a “substantial negation” of the underlying reform bill, denying it the relatively straightforward amendment process that most bills are subject to. In the words of another supporter of the committee bill: “This amendment has the potential to totally unravel this bill”. There was speculation beforehand that the spending caps were only included in H.361 to secure a certain number of votes to pass the bill out of the House, and some of us were told: “Don’t worry, the Senate will take care of the caps”. So was the forewarned “unraveling” one of policy or political posturing?

VTDigger.org reported a sponsor of the bill referring to the caps as: “A straightforward way to communicate the Legislature’s attempt to take pressure off of property taxpayers”. Is communicating an attempt to address property taxes sufficient? There was widespread talk during the campaign and after the election about reforming our education funding system by reducing the reliance on property tax, among other measures, but this appears to have taken a back seat once again to consolidation and governance changes that will take years to realize cost-savings.

I hope the Senate will remove the caps and find a more targeted and dynamic way of managing spending that doesn’t have the unintended (or intended) effect of further destabilizing schools that would be viable and successful but for unfortunate quirks in how education dollars are raised and spent.  There’s no doubt Vermont is experiencing a transition in demographics, economics, and education governance possibly comparable to the time when we went from dispersed single-room schoolhouses to larger centralized schools. But how far away from our communities are we comfortable sending our kids to be educated, and how many kids will there be to educate in the first place? More importantly, what kinds of 21st Century challenges are we educating our children to meet? We still need to ask and answer these questions.

In other news, the budget and tax bills saw plenty of behind-the-scenes dealmaking, with representatives choosing to support the least worst solutions, rejecting the majority decisions altogether, or simply voting to prevent committing “political suicide” or being relegated to “political Siberia”. To their credit, the House Appropriations Committee did an admirable job of balancing budget cuts with the new revenue streams they were handed. An attempt was made to modify tax brackets to pre-2009 levels in response to income shifts, but that was quickly defeated. If an economic system is out of balance because it depends in large measure on a stream of revenue that itself is unbalanced (and according to an analysis by the Pew Charitable Trusts, the U.S. Census, and the University of Minnesota, Vermont has the second highest level of income disparity and middle-class shrinkage in the nation after Wisconsin), it stands to reason that the inputs into the system need to be adjusted accordingly. But if you adjust marginal tax rates on the top earners by reverting to pre-2009 rates you might lose potential donors to your next statewide campaign. And that message trickles down.

One morning last week we were treated during the morning devotional to a performance of traditional Armenian music, which was soon followed by a resolution commemorating the Armenian genocide 100 years ago, during which more than one million Armenians were killed or deported by the Ottoman Empire (the Turks) in what is regarded as the first genocide of the modern era. Coincidentally, the Turkic Cultural Center of Vermont held their annual reception and press conference in the building that very afternoon and gave out samples of Turkish Delight. Strange days.

Money Troubles

The biggest and most challenging item on the Legislature’s agenda this session is the 2016 budget. As you’ve probably heard or read about, there is a $112-114 million budget gap between budgeted expenditures and available revenue.

How did we get to this point? There are some answers, but none of them are particularly satisfying or comforting, and the potential solutions are painful, unpopular, or both.

Budgets are generally based on projected available revenues that come in from different sources, but mostly from taxes (and most of these are from income and sales taxes). When the economists that we rely upon deliver projections of how much revenue we can expect to see in a given fiscal year, we – by which I am mostly referring to the Executive Branch and the House and Senate Committees on Appropriations – are tasked with determining how to allocate the working capital we will have on hand to fund the programs and services managed by the various agencies and departments of the state. In addition to expanding or contracting existing line items in the budget, new services, programs and positions can be created. But the old adage always holds true – you can’t spend more than you take in and expect to have a balanced budget. But if we can’t accurately determine how much we’ll be taking in or how much a given service or program will cost the state year-to-year, how confidently can we budget hundreds of line items and say YES when the roll is called to approve a bill and pass it to either the Senate or Governor for final approval? And at the end of the day, is a balanced budget a healthy one? There is no constitutional requirement that Vermont balance its budget but this has been the practice since deficit spending through borrowing would hurt our credit rating.

The state funds and operates many worthy and necessary programs, such as supports for those with mental health and physical needs, veterans services, rehabilitation of the incarcerated, treatment for the addicted, protection of abused and neglected children, maintenance and repair of roads and bridges, food safety inspection, environmental protections, contributions to the humanities and arts, and promotion and marketing of Vermont’s way of life to attract new residents and taxpayers. Using methods like Results-Based Accountability we make a concerted effort to determine the cost-benefit analysis of these programs, and can then opt to either streamline a program or service to enhance efficiency or boost funding to areas in need. Child protection and opiate interdiction & treatment immediately come to mind as services that could benefit from a lot more funding.

When confronted with a gaping hole in our budget, there are many questions we need to ask ourselves: Are there flaws in the economic modeling we rely on? Should we be factoring in a larger margin of error to account for potential revenue downgrades in the future? Have we been too dependent on one-time funds and federal assistance? Is the money we’re allocating being well-spent? Are we victims of economic malfeasance in Washington (yes!) and/or budgetary mismanagement in Montpelier? What programs, services and positions do we cut in response, and to what extent do we consider raising taxes to plug the hole?

We know for a fact that lower than anticipated income tax revenue plays a large role in our current predicament. According to some fiscal analysts, this is because more and more people (and possibly corporate people too) are using “tax strategies” to minimize their state and federal liabilities. Nothing wrong with that, I suppose, as long as it’s legal. (Then again, not everything that’s legal is necessarily ethical or beneficial.) We also know that there is a larger, more fundamental reason why income tax revenues aren’t as robust as desired –
stagnant wages for the average Vermont worker. And it’s not just a Vermont problem; in 81% of counties across the country, household income for middle-class Americans peaked in the late 90′s and has stagnated or in many cases even declined over the past 15 years. (The performance of the stock market and corporate profit reports stand in stark contrast to this broader economic reality, and the disconnect there breeds a much larger debate; international trade policies and financial deregulation orchestrated by the Clinton administration immediately come to mind as contributing factors to these structural problems, but the blame can also be shared with every President and Congress during my lifetime.) Low wages and stagnant income equates to reduced sales tax revenue since there is less discretionary cash flowing through the system, and the problem is exacerbated. The reduction in the cost of oil is a welcome respite for Vermont, with our high per capita gasoline consumption and reliance on heating oil, but the petroleum economy is volatile to say the least and could turn on a dime.

What is state government’s response to this current fiscal crisis? Should state employees who negotiated in good conscience for pay and benefits be sent home, temporarily reducing their own share of income tax into state coffers and possibly making them eligible and dependent for a time on state entitlements? Do we cut middle-management positions or plow drivers? Do we cut support services for the blind, our veterans, those with autism, those who can’t afford to heat their homes during a harsh winter like the one we just had, prisoners who want to improve themselves through educational opportunities? Or do we take a hard look at things like raising the rate on capital gains and eliminating certain tax exemptions to blunt the effect of budget cuts and their potentially net-negative repercussions?
As I write this, no proposal for cuts or new revenue is set in stone, but the House will likely take a position by the end of next week and many hot-button items are in play. In the past I have supported our budgets because I believed that they included important investments and I trusted in the economic and budgetary expertise of those with higher pay grades than me, a part-time, amateur, citizen legislator. I believed our budgeting was sustainable and would achieve positive outcomes for Vermonters. Maybe I was wrong.

I welcome your thoughts on this issue.

PO Box 875, Barnard, VT 05031
802-234-9125
tzagar@leg.state.vt.us

Town Meeting Week

Town Meeting is just around the corner and the annual deliberation over school and municipal budgets begins in earnest. Pomfret voters will be deciding whether or not to merge educational services with the Bridgewater School while keeping their school open under a new name. Barnard voters will be considering a moderate school budget increase of about 4% with a reduction in the combined base tax rate of about two cents ($1.67). The House Education Committee continues to pore over proposals for cost-saving, governance changes and funding adjustments and I will have more details about this at Town Meeting.

I will be supporting a bill to explore a reduction in the reliance on property taxes for education funding and a shift to an income tax surcharge. This could serve to broaden the tax base, simplify the formula and better accommodate a taxpayer’s ability to pay. As someone who currently does not own property I do not have a clear sense of how much I am helping to pay for education. If an income tax surcharge means I have to spend more money every year to help fund the education of my friends’ and neighbors’ kids as well as schools around the state, so be it. Education is the most important service a civilized society can provide and it’s in everyone’s best interest to contribute. But obviously the amount that we are spending needs to be addressed alongside funding changes, since we can’t make our system better just by reformulating the way in which funds are raised – especially with a declining population of students and high personnel and healthcare expenditures. Achieving cost efficiencies while maintaining and improving the quality of education will be our biggest challenge this session and it will take the full biennium to work through it.

In my committee, Agriculture and Forest Products, we are spending the week before Town Meeting on an intensive review of H.35, the Water Quality Bill, that passed out of the Fish, Wildlife and Water Resources Committee last week. The 133 page bill addresses revisions to the Accepted Agricultural Practices for mitigating harm to state waters, the certification and regulation of small farms, strategies for reducing pollutant infiltration of waterways, and inspection & enforcement mechanisms for the agencies of jurisdiction. The writing has been on the wall for quite some time that we have a serious problem on our hands that hasn’t been sufficiently addressed in the past. Parts of Lake Champlain are considerably impaired due to agricultural, storm water, waste water and forest runoff, and the problem is not unique to the big lake. Other watersheds are impaired from the same sources. Unfortunately, this effort will require the raising of new revenue for state water quality funds. Our committee stands opposed to the Governor’s proposed fertilizer tax increase and multiple alternative options are being explored – from a 0.05% increase in the Rooms & Meals and alcohol taxes, to a statewide per parcel fee. These decisions will be made in the money committees and debated on the floor. Fortunately, we have access to millions of dollars in federal assistance to help us meet the pollution reduction goals required by the EPA. If we fail to address the problem ourselves the EPA will step in and mandate more expensive and less effective measures.

On a lighter note, 8th grader Elijah Dooley of Barnard recently completed his six-week stint as a Legislative Page, during which time he was responsible for delivering mail to members and carrying messages between members in the House and Senate. He had a front row seat for a lot of legislative action and gained a unique perspective on how people can work together to solve big problems. I hope to see him back up in Montpelier playing a different role in the future.

Earlier this week I visited classes at the Barnard Academy and Woodstock Middle School to talk about how bills become laws and some of the issues we are currently dealing with. I’m always impressed with the thoughtful questions the kids have and their perspectives on how they think the grown-ups are running things. It’s important to get them interested and engaged in the democratic process at a young age, and I hope we don’t leave too many messes for them to have to clean up in the future.

Keep in touch, and I hope to see you at Town Meeting. You can reach me at 234-9125 and tzagar@leg.state.vt.us.