Lawmakers face tax quandary upon return
By DAVE GRAM
The Associated Press | March 02,2013
MONTPELIER — Vermont lawmakers left Friday for their weeklong town meeting break with much work remaining and many questions to be answered about the ultimate shape of the state’s finances.
House Speaker Shap Smith said it’s not unusual for the first year of the two-year biennium to start slowly, as new lawmakers get their feet on the ground and newly constituted committees get to work.
“The first year of the biennium before town meeting is really about making sure you’re set for all the work that’s going to happen after Town Meeting,” the Morrisville Democrat said in an interview Friday.
The Senate has dispatched with one marquee issue of the current session, legislation to allow physicians to prescribe lethal doses of medicine to terminally ill patients who request them.
The Senate changed the original bill significantly, passing a much shorter version that focused on making doctors and families immune from prosecution and lawsuits when terminally ill patients end their own lives. Smith said the House is unlikely to take the matter up until early April.
Lawmakers traditionally spend the first week in March in their districts, reporting to constituents at town meeting, the annual gathering of residents to pass town budgets and attend to other municipal business.
When they return to Montpelier on March 12, they will face several key decisions about how to pay for a growing appetite for state programs while sticking as close as they can to Gov. Peter Shumlin’s promise not to raise income or sales taxes.
One of the first orders of business will be for the House Transportation Committee to pass and send to the floor a transportation spending bill that is expected to call for more reliance on a sales tax and less reliance on a per-gallon fuel tax that the state has traditionally used.
Rep. Patrick Brennan, R-Colchester, chairman of the committee, said the panel is expected to approve a 2 percent sales tax on gasoline that would take effect in June. In July 2014, the sales tax would go up another 2 cents on a dollar, to 4 percent.
Meanwhile, in fiscal 2015, the cents-per-gallon tax would drop by nearly 6 cents from its current level of 19 cents per gallon. The upshot would be nearly $26 million more in gasoline taxes collected by the state each year.
The aim is to shore up the state’s transportation fund, which has been hurt by a decline in the amount of gasoline sold in Vermont. That’s down about 36 million gallons a year since 2006. A failure to raise new revenue would cost the state even more, because it would lack the money to attract federal matching funds for transportation projects.
Meanwhile, Shumlin has proposed raising $17 million from a new tax on currently unregulated and untaxed sales of betting tickets sold at some bars and social clubs. The so-called “break-open tickets” call on bettors to rip them open and see if symbols printed on the outside match those on the inside.
Legislative fiscal analysts recently concluded the tax would raise only about a third of what Shumlin hopes.
Shumlin had earmarked the money to pay for subsidizing renewable energy projects, insulating leaky homes and helping low-income residents pay for heat.
Those initiatives currently appear to lack a source of full funding, though Smith said making up for cuts in federal funding for low-income heating assistance would be the top priority of the three.