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Vermont administration says it is monitoring federal orders, urges measured response to potential Medicaid and grant changes
Summary
Sarah Clark, Vermont secretary of administration, told a legislative committee the state is tracking about 45 new federal executive orders, advising agencies to draw federal funds promptly and modeling possible Medicaid funding changes while coordinating with other states.
Sarah Clark, secretary of administration, told the House of Dilipatians Committee on Feb. 15 that the state is carefully monitoring recent shifts at the federal level and is advising agencies to be measured in their response.
“We are tracking about 45 executive orders that have been issued,” Clark said, adding that the administration’s approach is to understand the facts and avoid reacting prematurely. The state also compared the situation to preparations typically made for a federal shutdown and issued guidance to agencies to ensure timely federal draws.
The nut of the discussion centered on fiscal exposure: Clark said the Agency of Human Services draws roughly $110,000,000 a month from federal programs — most notably Medicaid — and that timing or access problems in federal payment systems can create local cash-flow challenges. She cited a recent example in which some Head Start programs experienced a delayed federal payment but ultimately received funds.
Committee members pressed Clark on what concrete scenarios the administration is modeling. Clark warned that federal budget actions now under consideration in the U.S. House and Senate, including possible changes to Medicaid rules or the federal medical assistance percentage (FMAP), could have “significant impact on all states.” She said no specific changes have occurred yet and that the state is coordinating with agency secretaries and the Joint Fiscal Office to assess risks.
Clark also described short-term operational concerns the administration is tracking, including temporary loss of access to federal payment systems after an Office of Management and Budget guidance briefly paused federal draws and later was rescinded. She said access issues appeared labelled as technical problems and, as of her testimony, had been restored.
On reserves and liquidity, Clark told the committee that Vermont’s reserves are “in good shape” and that the state is near statutory caps on some funds, which helps mitigate short-term impacts but does not replace federal funding. She said the administration’s work includes a cross-agency decision-support team modeling other federal actions such as tariffs and supply-chain impacts and emphasized the need to preserve state investments in programs tied to values such as diversity, equity and inclusion.
Clark said the administration is also communicating with counterparts in other states and national partners to share information and coordinate responses. She noted some federal staffing changes are already affecting state operations, citing the recent termination of a USDA regional official whose office state agencies use for programs administered through Rural Development.
Committee members expressed interest in contingency budgeting and asked whether the administration is asking agencies to prepare “what if” scenarios. Clark said cabinet-level discussions are taking place and that the administration is seeking to reserve discretionary dollars where prudent and avoid overreacting before details are known.
The testimony closed with Clark committing to continued communication with the committee and with the Joint Fiscal Office as more information becomes available.
