Category: State Budget

Cutting Into Muscle

Posted on April 3, 2009

In three months the state will begin FY 2010 with a budget deficit of $200m+ and the administration and legislature are counting on Vermont’s share of the stimulus package to bridge any major gaps, along with budget cuts and layoffs. To strategically address the immediate deficit issue and position ourselves for future sustainability, a reduction in the size of state government is necessary. How it happens is a function of thoughtful stewardship and innovative thinking on the part of agency heads.

 

In one case, the Agency of Human Services, which employs 3,500 people, was told to cut $6.8m (or roughly 285 positions.) Secretary Hoffman and his team are working hard to hit that budget amount with as minimal impact on workforce or service delivery as possible. So far, he’s identified 5% of his staff positions for elimination, or 195 people. For a front-line agency that sees the clash between economic crisis and human suffering, and where caseloads are skyrocketing, that’s a tough assignment. Nonetheless, Hoffman, whose experience in the financial sector and tenure in corrections, is an experienced and capable leader; one who understands the risks from both sides of the challenge.

To date, proposals from the state employees’ union have not yielded the kind of savings necessary to avoid further workforce layoffs within the state workforce of 8,400+. But cut we must, otherwise the four constituents of state government ~ citizens, businesses, employees, and other levels of government ~ will suffer death by a thousand paper cuts. It is in everyone’s best interests that the union negotiators and administration find creative ways in which to achieve cost savings and avoid layoffs. Keep talking and sharpen those pencils.

All the Problems Are Short-term

Posted on January 26, 2009

At the Roundtable’s membership meeting in mid-January David Coates, one of Vermont’s most respected statesmen and the 2006 recipient of the Roundtable’s Vision Award, presented “Dangerous Trends and the Need for Action” to the membership. At the onset, Coates framed his remarks by saying that there are no long-term problems; Vermont’s problems are all short-term and require immediate attention.  Then he launched into a presentation of heavy commitments – mandatory expenditures and unfunded liabilities- that Vermont has on its books: debt service, retirement plans, other post-retirement benefits, and education funding. Taken in their totality the figures were staggering and implications alarming.

In addition to the data, which couldn’t be disputed, Coates identified various structural issues that prompted the audience to wonder about the fairness of current law and the sustainability of these commitments. Because several programs ~ long held sacred cows ~ are not readily transparent at the local level, including the residential rebate program, education fund, and state employees’ retirement fund, Coates suggested that the state conduct stress testing to illustrate the urgent need for action. And because Vermonters don’t fully understand the complexity or implications of all these funds in the aggregate, there is no informed and objective debate that includes more than the vested interests.

The Roundtable will begin a series of presentations of this information to a variety of audiences throughout the state. Coates’ slides will be posted to the Roundtable’s website at www.vtroundtable.org.

No Joy in Mudville

Posted on January 26, 2009

As the Governor concluded his seventh budget address, he admitted that “there is no joy” in making cuts of such magnitude at such a challenging time in our state’ history. Clearly, many of those programs targeted for his axe have been priorities of his administration over the previous three terms.  And he knows full well the consequences of such proposals, if acted upon by the legislature. Vermonters are justified in worrying.

 

However, we have inflicted some of this pain upon ourselves. Our ever- expanding view of the state as beneficent provider has now met head-on with the incontrovertible evidence of Vermont’s fiscal instability and structural deficiencies associated with mandated expenditures and unfunded liabilities. So, now the budget process begins and we must keep our eyes on the ultimate goal to get through this storm intact and positioned for the future.

 

You know, somewhere between the cranky beginning of the ninth month of pregnancy and the exhausted smile when it’s over, the mother-to-be moves beyond denial and realizes with exquisite clarity that there’s only one, messy, and very painful way out. Members of the administration and legislature involved with the budget process have reached that point of clarity as well, and we need to support their efforts to find common ground around uncomfortable decisions. 

 

When there’s no money – no alternative – priorities become clear. Businesses and families deal within that framework every day. State government is now in that same space, and there is no joy at all. For a copy of the Governor’s budget address click on the Roundtable’s homepage (www.vtroundtable.org) .