Speaker reflects on state budget crisis

Rep. Shap Smith visits Brattleboro, reflects on biennium

BRATTLEBORO — New water regulations, energy issues, property taxes, education reform, shrinking a $100 million budget gap...

Between meetings with economic development organizations at The Brattleboro Retreat, Speaker of the House Shap Smith on April 13 ticked through the issues tackled by the House in the waning days of the legislative session.

“I feel good about how the House has handled many of the issues,” he said.

Smith said he sees legislators as having a renewed sense of working together this session, slated to end early next month.

The state's problems loom large enough that many lawmakers have set aside their differences, he said. They've opted instead for digging into the task of preserving Vermont's vitality.

Despite what he sees as good work on the budget in the House, Smith said he remains poised to tackle additional financial challenges in future sessions.

Vermont needs to walk a more sustainable budget path, he said. This session's budget reductions can't simply be a one-time fix.

Like Vermont, many states face fundamental restructuring of their economies and budget shortfalls, Smith said.

Smith disputes allegations of the Legislature's “out of control spending.”

In response to such comments, the Speaker said he asked staff for data on the percentage of state spending compared to Vermont's gross state product. According to Smith, current state spending sits 1 percent lower than it did a decade ago.

The state has remained “pretty consistent” with what it spends, he said.

Growing the economy

Taking an optimistic slant, Smith said people should realize Vermont has opportunities to grow its entrepreneurs.

Smith pulled out his smart phone to find a piece written by economist Art Woolf earlier this month.

“Right,” said Smith tapping the phone's screen. Vermont's personal income per capita growth is finally above the national average.

Reading from Woolf's article, Smith said that, for six years, the state's personal income per capita has exceeded or was even with the national average.

It's a new acolade, said Smith. Since the federal government started tracking the data in 1929 until 2008, Vermont never surpassed the national average.

Smith toured Brattleboro businesses including Against the Grain and Hermit Thrush Brewery during his visit.

Brattleboro is “the gateway to Vermont,” he said. It has multiple opportunities to thrive.

Yes, the region faces challenges around the closing of the Vermont Yankee plant, Smith continued. But the closing also creates an opportunity to diversify the wider economy with new businesses.

This will happen through focusing on growing the number of entrepreneurs and retaining the area's quality education, he said.

When asked about what the state was doing to close the gap between what many feel is a high cost of living in Vermont and wages, Smith gave the question extensive thought.

Finally, he said, “What really can be done at the state level?”

The state can put its support behind companies paying good wages. It can monitor its spending, Smith said.

“Vermont has always faced the challenge of being a pretty poor state,” he said.

Low wages still a problem

Wage issues, however, exist nationwide, Smith continued.

Referencing a New York Times article by Patricia Cohen, “Working, but Needing Public Assistance Anyway,” Smith pointed to the number of working families on public assistance.

According to the April 12 article, almost three-quarters of people receiving aid aimed at helping those in poverty belong to a household with at least one employed family member.

Lower paying jobs don't pay enough, Smith said.

What issues facing the state would Smith prioritize?

Priority number one: figuring out how to create a social safety net that encouraged those who can to re-enter the workforce and thrive. In Smith's view, successful transitions back into the workforce were critical to the vitality of the social safety net, as are Vermont's investments in its human service programs.

The next priority would be to develop an economic development policy that encouraged economically vibrant downtowns. Smith stressed that the policy needed to support communities statewide, not just focused development in northern Vermont.

Finally, Smith said he wanted Vermont to have the best K-12 education system in the country and, ideally, the world.

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