Wrap Up

Recommitting to Vermont, Seizing the Opportunity
How to Use the Crisis to Make Vermont Work for Everyone

September 30, 2010 | Capitol Plaza Hotel | Montpelier, Vermont
Public Assets Institute & Voices for Vermont’s Children

Public investment in people and infrastructure is the best short- and long-term strategy for Vermont–a way to help pull us out of the current recession and build a state that provides prosperity for all Vermonters. The best research already tells us what works. So why hasn’t much of it been translated into policy––and how can we make sure it will be?

At this year’s conference we reviewed the research about public investments, delved into the key reform efforts already under way, and explored how we can work together to seize this opportunity to bring greater prosperity to all Vermonters now and in the future.

Breakout Session Wrap-up

The breakout sessions at the conference this year allowed more time for small group discussion. Conference participants attended one of three groups: education, economic security, or state revenue. During the morning breakout sessions, presenters provided information and discussed reforms being considered in each of the three core areas. In the afternoon, the breakout groups reconvened to discuss the opportunities that these reforms provide in both the short- and long-term to make Vermont a state that works for everyone.  Below is a summary of what happened in each group including actions items as reported at the closing session of the conference.

Education
Reporter: Jack Hoffman

The group took no formal votes, but there was general support in the Education breakout sessions for moving away from the property tax and exploring an expanded income-based system for funding education. The group also called for greater efforts to increase public awareness of the growing disparities in school spending and how that correlates to student performance. Finally, the group stopped short of recommending a moratorium on Challenges for Change, but expressed strong opposition to the way the Vermont commissioner of education assigned budget cuts to local school districts to meet the savings goals for fiscal 2012 established by Challenges for Change.

There were four presentations during the morning Education breakout session:

• Jack Hoffman, an analyst with Public Assets Institute, presented an overview of recent trends in education spending and described how Vermont’s continuing fiscal problems are likely to result in shifting more education costs from the General Fund onto the property tax. (See Vermont Education Spending: The Facts)

• Nicole Mace, research analyst for Voices for Vermont Children, outlined the widening achievement gap between students from upper- and middle-income families and those from low-income households.

• Shelley Mathias, principal of the Morrisville Elementary School, reviewed the findings of her recent doctoral thesis on the connection between student performance and the amount Vermont schools spend on instruction. According to her research, there is a positive correlation between spending and test results.

• Frank Perotti, superintendent of Springfield School District, and Shelly Mathias described the problems they have now in meeting the needs of all students, especially those from low-income families, in the wake of recent spending cuts. They also talked about the disconnect between the budget targets determined in Montpelier, the budget pressures schools already are confronting, and the reality that teachers and administrations face every day in the classroom.

Economic Security
Reporter: Barbara Postman

There was a lively discussion in this breakout session.  It was widely acknowledged in the group that we know what works to ensure that every Vermonter has access to economic security, but that a shift in state policies are causing low and moderate income people to lose ground, especially since the start of the recession. There was agreement that we need to build public and political will to reverse the downward slide.

The group brainstormed approaches and actions and developed three overarching objectives necessary to a sustained effort. The three objectives are:

• Get power – Influence decision makers to shift the state’s direction so we can realize the vision of a state that works for all Vermonters.
• Make a Plan – Organize grass roots, community leaders and state coalitions who agree that state policies are critical to protecting citizen’s economic security to help make these policies become the priorities of the state’s leaders.
• Connect the Dots – Tell the story of this vision for Vermont, describe and explain the effect on Vermonters’ well being of policy changes and budget cuts over the past three years, and detail the solutions necessary and possible to achieve the vision of prosperity that all Vermonters can share.

Carlen Finn, Executive Director, Voices for Vermont’s Children facilitated a panel and discussion on Vermont’s economic security. Each panel member gave a summary of some key policies and programs, explaining current needs, current funding and policies, and anticipated future needs.  All agreed that the state must find revenue to maintain and expand key services and programs that have been proven to work in order for the state to work for all Vermonters.

Sheila Reed–Legislative and Community Advocacy Coordinator, Voices for Vermont’s Children, spoke about economic supports such as TANF. She explained that the real value of a TANF grant has been reduced by over 40% since 1980 when the grant met 100% of the standard of need for families.  Without this key support, it is children who are bearing a large part of the burden of poverty.  Belief in and commitment to key economic supports for our lowest income families has also eroded and we need to address this challenge.

Barbara Postman – Policy Coordinator, Voices for Vermont’s Children spoke about the importance of early care and education for the future of our children and our state. Programs such as the child care subsidy and public support for pre-school provide families with child care while parents are working and help assure that children receive quality early care and education.

David Tucker – Deputy Director of Programs, Central Vermont Community Action spoke about the increasing demands on agencies such as CVCAC that provide direct services to Vermonters in need.  There are more people hungry and homeless and who have increasing difficulties with meeting basic needs.

Julie Lowell, Case Manager/Advocacy Coord., COTS spoke of the growth of the homeless population throughout the state.  She detailed the reduction in resources provided by the state and how a growing number of people in homeless shelters are families with children.  There is no greater need for individuals than a stable place to live.

State Revenue
Reporter: Paul Cillo

After hearing a presentation about the work of the Blue Ribbon Tax Structure Commission and discussing possible actions to reform Vermont’s tax structure so that it produces adequate revenue to fund ongoing state services and supports prosperity that is accessible to all Vermonters, the State Revenue group voted that the following three recommendations were their top priorities:

• Lower the sales tax rate and broaden the sales tax base
• Broaden the income tax base and lower tax rates by using adjusted gross income rather than taxable income for calculating state income taxes
• Enact a temporary surcharge on upper income brackets to raise needed short-term revenue

The group also noted that it was important that the public be better informed about tax issues especially with information that dispels current tax myths (e.g., tax flight, highest taxes in the nation, etc.) with data.

The group heard from Michael Costa, Director of the Blue Ribbon Tax Structure Commission, during the morning State Revenue breakout session.  Michael reviewed the Commission’s current work in four tax areas:  personal income, sales, property, and corporate income.  He made it clear that the Commission’s recommendations would be revenue neutral, that is, they will not raise more revenue than current law.  Michael’s presentation covered the following:

• Vermont’s recent tax reforms and creation of the Commission;
• How perceptions about Vermont’s taxes square with reality; and
  Because income tax rates are based on taxable income rather than adjusted gross income, they look high.  School taxes on housesites can be thought of as adjusted property taxes or as income taxes for 70% of Vermonters.

• Proposals that the Commission is considering.
  In general, the Commission has been exploring proposals that would expand the base of key Vermont taxes allowing the state to lower its rates.

The Commission will be conducting public hearings around the state in November and has set a goal of delivering its recommendations before the end of the 2010.