Federal money tough to pin downJuly 23,2013By PETER HIRSCHFELD
Vermont Press Bureau
MONTPELIER — Economists for the state can forecast with surprising accuracy the tax revenues expected to flow into the treasury over the next fiscal year.
But predicting one of the largest sources of funds to Vermont’s $5.2 billion budget — federal revenues — has proven a more difficult task. And despite a recent analysis done by experts for the Legislature, pinning down the federal funds on which the state so heavily relies is still something of a guessing game.
“There are just so many unknowns at this point,” said Steve Klein, chief fiscal officer at the Legislature’s Joint Fiscal Office.
“And there are a lot of political choices that are going to get made that are totally outside our control.”
Official state revenue forecasts, the most recent of which arrived Tuesday, are historically reliable, deviating by only about 2 percent on average over actual revenues. That record of success gives lawmakers a high degree of confidence in the $1.56 billion in general fund revenues forecast to flow into Montpelier over the next 12 months.
Getting similarly reliable estimates for money flowing from the federal government is more difficult. But Klein said one thing is clear: risk for Vermont is to the downside.
In a report titled “Federal Funds — Reductions Today and Tomorrow,” Klein surveyed the federal landscape in an attempt to divine how decisions in Washington, D.C., will affect Vermont. From health care and transportation to grants that support human services, Klein said Tuesday that federal funds coming into Vermont will likely shrink in the coming years.
“And one area where that could be extremely noticeable is in transportation,” Klein said.
The reauthorization of the five-year federal transportation bill will likely overhaul a state-by-state allocation formula that has until now been favorable for the state. Vermont gets $2.85 cents from the feds for every $1 in gas tax it sends to the federal treasury, a ratio Klein said he expects will narrow in the next five-year bill.
Projected declines in federal discretionary spending, according to Klein, also imperil some of the federal dollars coming into
Vermont. Non-defense discretionary spending supports everything from assistance for low-income populations and energy investments to public safety grants and environmental protection.
As a share of gross domestic product, according to Klein’s report, non-defense discretionary spending is expected to drop by a third over the next 10 years, from 8.3 percent to 5.5 percent.
The reductions will come at a time when Vermont is more reliant on federal funding than at anytime in recent memory; federal funds now account for 46 percent of Vermont’s non-education budget.
For the complete story, see Wednesday's Rutland Herald.
- Most Popular
- Most Emailed
- RICHARD'S POOR ALMANACK: On this day 1739, 'Richard Palmer' identified in prison at York Castle as the notorious outlaw DICK TURPIN; IN 1836, Battle of the Alamo begins near San Antonio de Bexar, Texas; 1896, the Tootsie Roll invented by LEO HIRSCHFELD.
- RICHARD'S POOR ALMANACK: On this day in 1472, Orkney, Shetland islands put up as collateral by Norway to Scotland in lieu of dowry for MARGARET OF DENMARK on her marriage with JAMES III, king of Scotland; 1962, JOHN GLENN first American to orbit Earth.
- TOMORROW'S HEADLINES TODAY: City mayoral candidates debate campaign issues; Hartford, Conn., woman still missing; Neal Goswami reports attempts to legislate suicide; local woman loses 100 pounds through TOPS program.
- RICHARD'S POOR ALMANACK: On this day in 1878, JOHN TUNSTALL murdered near Lincoln, New Mexico, by the outlaw JESSE EVANS; in 1930, ELM FARM OLLIE first cow to fly in aircraft, first to be milked airborne; 1955, nuke test WASP; '79, snow in Sahara.
- TOMORROW'S HEADLINES TODAY: Rutland Herald News Editor Alan J. Keays and staff writer Gordon Dritschilo discuss stories planned for the February 18, 2015, edition of the newspaper: Winter budgets maxed, legal marijuana, Springfield bank job, USPS slowdown
- RICHARD'S POOR ALMANACK: On this day in 1249 AD, ANDRE of LONGJUMEAU is dispatched by LOUIS IX of France to meet the KHAGAN, ruler of the Mongol Empire; in 1804, during 1st Barbary War, STEPHEN DECATUR scuttles the pirate-held USS Philadelphia in Tripoli.