Vermont Legislature SmartTranscripts:

[Rep. Carolyn Branagan]: Yes. Don't agree with you. Raise and means.

[Rep. Emilie Kornheiser (Chair)]: It's a Friday, March 27 at 02:20. We are hearing an amendment to h nine thirty three, which is an act relating to miscellaneous administrative and policy changes to tax law. And I believe, representative Galfetti, you have an amendment for us.

[Rep. Gina Galfetti]: Yes. Representative Galfetti, for the record, madam chair. And I thanked the committee for its time. I took the feedback that you all gave me after my initial property tax freeze on the tax rate to heart in a moment of our brilliance late last night, I came up with this version. I cut it down to a two year freeze. And it's a freeze on the actual tax bill itself. Thank you. So that, as you mentioned, if I froze the rate and things were reappraised, that could result in an increase. This obviously freezes the bill as it sits and has some carve outs if there are some if the property is developed in that two years and improved, there would be a process to figure out the tax rate for an improved property. And likewise, if a property was downgraded, it would have some latitude in there through the administrative process to figure that out. And that's about it. So simple. Thanks.

[Rep. Emilie Kornheiser (Chair)]: I really appreciate the intent of the bill, and I think everyone in this room I know everyone in the whole building and probably the whole state wants us to keep property taxes as low as possible. But this room has really folks around this table have worked very, very hard on that. And the intent language there's intent language in Act 73 that's really explicit about using the changes that we're making to property taxes to lower everyone's homestead tax bills to where the lowest in the state are right now. So very much share that desire, and I've done a lot of work on it. Do you have any idea how much you're talking about general fund we would be using next year or the year? I don't think anybody has

[Rep. Gina Galfetti]: any idea because we don't know how the school budgets are gonna come out. That's the mystery. We don't know if the education reform is gonna be done. And the nice thing about being in the legislature is if we do manage to get some actual granular education reform past this session, we can certainly look at repealing this down the road. But for the time being, given the movement that we've seen in trying to come together to get education reform done, I feel like we owe it to Vermonters to give them the peace of mind that if nothing were to happen this session, their property taxes aren't going to go up in the next two years. I think we owe that to the miners.

[Rep. Emilie Kornheiser (Chair)]: In the most ambitious, expedited timeline that we had laid out in Act 73 and that the governor proposed, if everything went exactly according to plan, we're still a few years out. And I just wanna say that for the record, because I felt like the last few days on the floor, that detail got lost a little bit, and I think that's an important piece. That doesn't take away or add to your bill in either way. I just didn't say it on the floor, and so I'm saying it now because got leftover words this week, I guess. Any questions for representative Gail Fetty?

[Rep. Mark Higley]: I don't have any questions, but I'm going to support this just because of looking more recently at that 40% increase in the property taxes over the last number of years. I just think it's going to signal an effort that we're serious. But anyway, that's why I'm supportive basically. Just acknowledge that that can't continue down that road. And I know we're trying X73 and Foundation Formula, along those lines. But I know for a fact that as our aging population is out there and has a good chunk of the property and land and all that, it's really becoming a burden. I'm to throw my support towards it.

[Rep. Carolyn Branagan]: Can I ask Gina? Of course. Gina, want anything more, if we were to do this, then the way I'm thinking of the bill is that we would have to take the increase that school board's experience, like paying the bus drivers all the cost of living rates and the heat and getting the driveways out, all that stuff, just the increases they have, they have to take that out of the rest of the taxes that we use to fund the Ed Fund. So how would you think that that would work?

[Rep. Gina Galfetti]: Well, I mean, the overages would just whatever bleeds over comes out of the general fund. As this is written, yeah.

[Rep. Emilie Kornheiser (Chair)]: So We're gonna

[Rep. Gina Galfetti]: let representative Brennan get finished. So, but what about the other taxes we use to build the Ed fund? You wouldn't touch those? You'd leave those right where they are? Yeah. I mean, this doesn't change the source of funding for anything in any way. All the sources remain the same. I'm not sure if I understand your question.

[Rep. Carolyn Branagan]: The other sources like purchase and use, getting rid of that by fit, but sales tax and the lottery and all those other things that go into the Ed Fund. I don't think the increase would ever be enough to cover what property tax is. Property tax is about 40% of the whole cost. Right. So if you cap that, we'd have to get the money that schools pay, schools need to pay to keep their schools' buildings open. Right. We'd have to get that difference from somewhere.

[Rep. Gina Galfetti]: The general fund. Scoop it out of general fund.

[Rep. Emilie Kornheiser (Chair)]: Yeah.

[Rep. Carolyn Branagan]: Do we have enough money in the general fund to do that?

[Rep. Gina Galfetti]: Only if we make fiscally responsible decisions with all the programming that we have when we're looking at line items on the general fund. I think the consensus among Vermonters is that it's time for the legislature to start budgeting with the intent to fund what Vermonters can afford, and if that means that cuts have to be made to programs that are in the general fund, I think that Vermonters are ready for us to pull together and do that. And it's not gonna feel great to have to cut programs, but the reality is 633,000 people can only afford so much. And this puts our feet to the fire to live in a budget for the state of Vermont within what we can afford. And that is the reality that every Vermonter is facing, all of us, including myself, that don't have health insurance, that can barely pay their mortgage, but need the state of Vermont to start understanding that that is real.

[Rep. Carolyn Branagan]: The other idea I had is just to get rid of the income sensitivity.

[Rep. Gina Galfetti]: The problem is Or lower the income sensitivity.

[Rep. Carolyn Branagan]: Think we should really talk about this, but

[Rep. Gina Galfetti]: that we Sally, you might have an amendment there,

[Rep. Carolyn Branagan]: Representative Branagan. Things that I think are actually more. Right. And you know, thinking of all the problems to this, and I I don't see a way to piece it altogether. Okay. I the way that our system works, I think it's the system that's broken. And the system is that if local voters tell the school boards, we want this, and they approve their budgets, that budget comes to us here in this room, boom, on our desks. We got to figure out a way to come up with the money. Right. Right now, we're using property and all these other little taxes to put the eggs on together. So if we have a cap of any kind there, that means we've gotta find some other way to get that money that the voters have told us they want. It's not that they

[Rep. Gina Galfetti]: I totally understand what you're saying, Brad, again. I think that perhaps when the same voters that approve the school budgets see the very real cost to the general fund, when they're improving less the responsible budgetary increases, then that will correlate into more fiscal discipline on school boards.

[Rep. Emilie Kornheiser (Chair)]: Representative Gaffney, do you have a sense of how many positions you need to eliminate from state government jobs in order to cover this?

[Rep. Gina Galfetti]: I don't think we necessarily have to eliminate any state government jobs. I think that's completely speculative. Cut that, sorry. What would I cut? That's not my job. Don't sit on a prose.

[Rep. Emilie Kornheiser (Chair)]: Yesterday, representative Shy was said that this one piece of the budget that was one of the last pieces they were able to squeak in there was I don't know if you've heard this. Was blown away. There's a lot of really emotional stuff happening on the floor this week. This was about folks who are blind and deaf. Did everyone hear this? And we have translators that communicate with finger touches, That was cut from the federal budget, we had to add it to the state budget. The Austin School, which is the school for the deaf and hard of hearing, is in Brattleboro. I feel generally very involved in those kinds of issues. I have no idea about this. That really blew me away. It's like the level of vulnerability that we are to meet people's needs we are covering in the general fund right now and just like barely squeaking through the general fund. It's just very striking to me. Does anyone else have anything they want to I

[Rep. William Canfield (Vice Chair)]: believe there's another bill out there, isn't it, on the Senate side, similar to this?

[Rep. Emilie Kornheiser (Chair)]: Oh, I think you mean S-two 20, Senator Rutland's bill, that just arrived today, yesterday, sometime? We had it for few weeks. Okay. It was scheduled. We were gonna do a walk through of it yesterday, but then we never meet it really. We don't have meeting this committee very much anymore. Have a few amendments, but we're going to look at it next week. And it's, I think, a similar intent to keep property taxes as low as possible, but has a quite different mechanism.

[Rep. William Canfield (Vice Chair)]: I would also say, rent controls, controlling what the cost of our education is by tapping it, those things really, I think over time, show that they're not very effective. I could be wrong, but I think there is a lot of reports on that as well.

[Rep. Bridget Burkhardt (Clerk)]: Really, I mean, as I hate to say it, I agree with you.

[Rep. Carolyn Branagan]: Actually though, every time we've

[Rep. Bridget Burkhardt (Clerk)]: done this, what we do is we create a boom in the year, the cats run out, and we're not addressing the real problems. Though, can I make up a joke? Maybe not. I'm sorry for all

[Rep. William Canfield (Vice Chair)]: the time, so.

[Rep. Carolyn Branagan]: It will be worse. Really special, Kate. No, there's an irony that this might actually go paper chips.

[Rep. Emilie Kornheiser (Chair)]: There is an irony. Thank you, Representative Delphetti. Thank you. Staying with

[Rep. Gina Galfetti]: the committee through the time.

[Rep. Emilie Kornheiser (Chair)]: And we're working on an education bill over the next two weeks, so if you want to be in touch with a member of the committee about a way to integrate of your thinking into that with a longer time frame for testimony, that might be helpful. Thank you. Appreciate it. I'm going to ask for a straw poll of folks who are interested in declining the amendment. All those in the beginning. You can use pretty such. Sorry. No, it's so hard. Everyone that wants to find it unfavorable, please raise your hand. Books, who would like to find it favorable?

[Rep. Bridget Burkhardt (Clerk)]: So we find it unfavorable 930. It's on 9, How 2, do we get an extra number to put it?

[Rep. Emilie Kornheiser (Chair)]: 920. I think Kirby is actually.

[Rep. Gina Galfetti]: Honor your honorary

[Rep. Carolyn Branagan]: member. Thank you.

[Rep. Gina Galfetti]: Appreciate your time.

[Rep. Emilie Kornheiser (Chair)]: Thanks. Thank you, Torchelle.

[Rep. Carolyn Branagan]: That's