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Follow VPR's statehouse coverage, featuring Pete Hirschfeld and Bob Kinzel in our Statehouse Bureau in Montpelier.

Lawmakers Come Close To Budget Agreement But End Up Even Further Apart After Bitter Debate

The House chamber of the Vermont Legislature
Angela Evancie
After 12 hours of negotiations, a new budget proposal emerged and was approved by the Vermont House just before midnight Friday.

Lawmakers will be back at the Statehouse on Monday to try and find a budget settlement with Gov. Phil Scott. But that job got a lot harder after a bizarre set of events unfolded late Friday night in the House.

When the night was over, just before midnight, chaos, confusion and partisan bitterness emerged on the House floor as Republicans accused the Democrats of twice breaking a promise to lower the non-residential tax rate.

When House members came to the Statehouse on Friday morning, there was optimism that a compromise could be reached with Scott over property tax rates.

When the day started it appeared that a deal has been reached between House Democratic leaders and the governor to phase in a reduction of the non-residential rate over a two-year period.

House leaders thought they had a deal with Scott, but when Senate President Pro Tem Tim Ashe expressed concerns about the deal, the agreement fell apart.

That proposal used one-time surplus money to ensure that there would be no increase in the statewide residential property tax. It also used additional surplus money to phase in reductions in the nonresidential property tax rate over a two-year period.

Scott told members of the House Republican caucus he was disappointed the deal fell through.

"I thought this was something that again could bring us across the finish line and have something that we could all agree to,” said Scott. “So unfortunately again I'm disappointed it was taken off the table."

House Democrats went back to the drawing board and came up with a new plan that reduced the non-residential rate but not quite as much as Scott wanted. They urged the Republicans to support the measure as a way to break the five-week-old stalemate.

But the plan angered many Republicans because they said it reneged on promises made by Democratic leaders to reduce all property tax rates.

As the new compromise came to the floor for a vote, the Democrats pulled the offer.

They expressed concern about using one-time surplus money for ongoing programs of state government, despite agreeing to do so hours earlier.

House Appropriations chairwoman Kitty Toll also said House leaders were in the very difficult position of negotiating with both Senate Democrats and Scott.

"Because we cannot have two dancing partners, we have to have three in order to come to a decision that will allow government not to shut down,” said Toll.  

The Republicans were outraged.

Stowe Rep. Heidi Scheuermann accused the Democrats of not keeping their word.

"How do you back out of this proposal?” asked Scheuermann. “This is a test for the Vermont House and right now we're failing."    

And Burlington Rep. Kurt Wright expressed enormous disappointed with Democratic leaders.

"What an incredibly disappointing vote and day,” said Wright. “My faith in this institution has been shaken to its core."    

Because there was also a lot of confusion about the final vote on Friday night, it's likely that House Republicans will seek another vote on this budget plan later Saturday morning.

The governor said he was disappointed that the bill didn't fully address his concerns, and he said he was withholding his judgment about it.

"I'm going to wait till the final product,” said Scott. “We'll see what the Senate does, and then I'll weigh in at that point."

The approved proposal does include several provisions that are part of Scott's five-year plan to reduce education costs. These include a process to create a statewide health care contract for teachers and a special panel that will look at ways to increase student-to-staff ratios.

The state faces a government shutdown on July 1 unless lawmakers pass a budget by June 30.

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