Budget turmoil is top issue
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Government looks to reinvent itself
By Jesse Roman
Fasten your seat belt for one of the most fascinating, important and historic legislative sessions in Vermont history.It starts Jan. 5.
A year from now, it’s possible that the state government as it’s existed for decades will be sharply altered. State departments will be streamlined and modernized; budgets will be slashed; school, court and health-care systems will likely be revamped. The state’s energy situation could look much different.
Facing a $150 million budget shortfall in the next fiscal year, and another sizable deficit the year after, nearly all the key players in Vermont government agree: The status quo is unacceptable and unsustainable.
Early next week, lawmakers will receive a secret, unprecedented plan to restructure state government. The plan was developed this fall by a private, out-of-state consulting firm called Public Strategies Group, which worked with a public committee of legislators and Douglas administration officials.
According to Sen. Susan Bartlett, D-Lamoille, the plan calls for sweeping change and restructuring of many state agencies. The proposal will save $30 million in the next fiscal year, and significantly more in the years to follow, said Bartlett, who chairs the Senate Appropriations Committee.
“We’re starting over from scratch; this is exactly how we fix this,” Bartlett said Monday in an interview. “I think folks understand how serious this is. We need to exhale and lead by example. If we do not make big structural changes this year, programs will die — strangled by a lack of money.”
The restructuring plans are bold but logical, and have been kept very close to the vest by people developing them, Bartlett said. Only a handful of legislators and other state officials have seen the draft. Bartlett’s appropriations committee won’t even see it until next week, just a day before it’s announced to the public.
Those who have seen the plan take deep breaths, Bartlett says.
She expects the Legislature to work quickly to adopt the changes so department heads can start making the changes required.
“My sense is that Vermonters understand that we need to make the hard choices, and they are looking for people willing to do that,” Bartlett said. “I’ll be pushing for those structural changes; hopefully the (restructuring) bill will get through real fast, or I’m afraid it will completely bog down.”
A reinvention
House Speaker Shap Smith, D-Morristown, and Rep. Heidi Scheuermann, R-Stowe, agree that cutting around the edges won’t get the state government out of its fiscal plight.
“We’re in real trouble, and it’s going to be very difficult, given the position we put ourselves in last year,” Scheuermann said, referring to the 2010 state budget. “What I hope for is that we look at state government … strategically, across the board. We need to cut programs that don’t work and fix departments that are inefficient.”
Scheuermann said the Commission on Judicial Operation — which went through the entire court system and found structural inefficiencies that, if fixed, could save millions — is an example “of how the process needs to work.”
Smith said he expects the court commission, the Education Transformation Policy Commission — which is looking at improving education while slashing costs — and the Public Strategies Group plan, and others, to be part of the broad plan to cut state spending.
With the thousands of people potentially affected, and Montpelier’s notorious tortoise-like pace, can all this be done in 2010?
“As with any instance where you have to make fundamental changes that cut against the status quo, we’re going to meet significant resistance,” Smith said in an interview Monday. “But my colleagues in the House see these challenges as an opportunity to move Vermont forward on a financially stable path.”
“There will be pain,” Bartlett said bluntly. “Revenue is (projected to be) the same as 2005; that means spending needs to be what it was in 2005. You have to look at every school, every hospital, every agency and say, ‘Spending needs to be what it was in 2005 — if you can’t do it, we will, because the money does not exist.’”
People feel effects
Bartlett says the Public Strategies Group plan will save about $30 million and a hike in the federal Medicaid reimbursment will reduce the budget shortfall by $40 million to $50 million. But even so, the state still needs to save an additional $70 million to $80 million to balance its next budget.
“It’s going to be challenging … but one thing we have to remember is we don’t provide services in isolation. Services touch individual people,” Smith said. “When we talk about reductions, we’re talking about people possibly not receiving as much health care, not as much mental health services, affordable housing, or education. That money we spend touches real people. We need to keep that in mind. …
“At the same time, we realize that we have finite resources and we need to allocate them the right way.
“I expected my two-year term as speaker to be difficult and challenging, and I haven’t been disappointed.”
Scheuermann said that, while restructuring is badly needed, so is economic growth .
“We need concentrated economic growth. Every bill should be analyzed on how it will either create more jobs or put more jobs in jeopardy,” Scheuermann said. “We failed on both counts last year.”
Next week: Local lawmakers look at energy and health care.
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