House Appropriations reviews Budget Adjustment Act language; debates transfers, tax extensions and fund repeals

Grady Nixon, joint fiscal office, presented a formatted draft of the governor's recommended Budget Adjustment Act and walked the House Appropriations Committee through language changes and technical corrections on Jan. 29.

"This is the formatted version of the governor's recommended budget adjustment. No language has been added to this from what was presented. This is just the cleanup version," Nixon said.

The committee focused on language sections (the bill's text) rather than the numerical, spreadsheet-driven decisions already under consideration. Nixon said the document begins at section 49 and that earlier numeric sections will be reinserted after the committee completes spreadsheet-based decisions.

Key substantive items discussed

- Miscellaneous one-time appropriations (section 49): Committee staff flagged a handful of changes and formatting corrections. The committee said yes to increasing the Vermont Household Health Insurance Survey general fund appropriation from $400,000 to $550,000 and to adding a $500,000 general fund appropriation for community health equity grants. A previously included $4,000,000 general fund contingent sustainability grant to mental-health and substance-use residential treatment facilities was crossed out in committee discussion and may be relocated elsewhere in the bill depending on decisions.

- Child welfare and child support IT funding (page 2): Nixon identified a $300,000 general fund and $6,660,000 federal fund request for the Office of Child Support mainframe transition planning, and a $5,180,000 general-fund amount tied to the existing CCWIS (Comprehensive Child Welfare Information System) one-time appropriation. Joint Fiscal indicated the administration provided appropriation codes that will be reformatted to match committee drafting conventions.

- Property transfer tax allocation (section 50): The draft amends Act 113 to update allocations of property transfer tax revenues and will reflect prior budget decisions and the committee's choices on where those dollars should flow.

- Telephone tax repeal extension (section 57): The draft extends the repeal dates for the telephone personal property tax and the alternative telephone gross revenues tax by one year after administration and stakeholders said the original timetable was too short to complete the required complex tax valuation and contracting. Committee members signaled general agreement to the one-year extension.

- EMT payment status (section 59): Joint Fiscal staff reported ongoing discussions with the administration about whether a change is a new one-time appropriation or an adjustment to base funding for emergency medical technicians (EMTs) who can be paid for treatment without transport. The committee held this item open pending clarification.

- Transfers vs. appropriations for debt service (sections 75–77): Committee members held an extended discussion of technical language that would change how debt-service payments are handled in statute, converting some statutory "appropriation" language to "transfer" language to align with GASB guidance and interfund accounting. Staff said the change reduces the amount counted under the 5% stabilization-reserve calculation and can save roughly $3.5 million in the near term; members discussed tradeoffs about reserve-building and confirmed similar edits have been done previously. Joint Fiscal noted recent additions to the rainy-day fund that partially offset near-term impacts.

- Repeals and fund housekeeping: The administration proposed repealing defunct funds (for example, the Workforce Education and Training Fund) and making several technical edits (for example, directing appropriations to departments rather than non-state entities such as the Vermont State Housing Authority by directing funds to the Department of Housing and Community Development). Nixon noted statutory language clarifications are being made so appropriations are not directed to non-state entities where statute forbids that.

- Personnel and administrative technical changes: The draft includes a proposal to convert eight limited-service positions in the Office of the Defender General to exempt permanent status without additional funding requests, and technical updates to global-commitment match numbers and pay-act language directing certain receipts to the liquor control fund.

- Technology, ERP and ADS oversight: Members raised continuing oversight concerns about the state's enterprise resource planning (ERP) and ADS information-technology projects. The committee discussed adding human-capital-management work to an existing ERP appropriation, continuing JIT/oversight reporting, and keeping an eye on ADS contracts and the CCWIS consolidation of IT appropriations.

Committee process and next steps

Nixon and staff said they will continue formatting remaining language sections, collate open items into a packet for committee markup, and bring additional draft language later in the week. Ted from AFO was scheduled to join the committee at about 2:15 p.m. to discuss the property transfer tax changes. Several items (including the EMT funding status and certain eBoard-authority changes) were left open for further discussion or were recommended to be addressed in the larger budget process rather than the adjustment act.

No formal roll-call votes were recorded during the Jan. 29 markup portion included in the transcript; members reached informal agreements on some line items and left others open pending follow-up from administration or Joint Fiscal staff.