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.MORE IN This Just InDearest farm, with your well-worked fields full of food, I love you. Full Story
- Most Popular
- Most Emailed
- TODAY'S WEATHER MINUTE: Rutland Herald content editor Rich Alcott shares local weather information and easily digestible news tidbits: When all the big mammals are rubbed out and a faint geologic memory, rats the size of human beings will stalk the Earth.
- TOMORROW'S HEADLINES TODAY: National survey ranks Vermont kids' well-being in second place, Springfield takes up anti-loitering ordinance, Rutland debate taxis, Fair Haven woman is arrested in Rutland for prostitution.
- TODAY'S WEATHER MINUTE: Rutland Herald content editor Rich Alcott shares local weather and news: Research scientists say schizophrenia and marijuana use linked. Are marijuana smokers schizophrenic or are schizophrenics more disposed toward marijuana use?
- RICHARD'S POOR ALMANACK: On this day in 365 CE, eastern Mediterranean rocked by high magnitude earthquake and tsunami, in 1865, Davis 'Little Dave' Tutt meets Wild Bill Hickock in Springfield, Mo., to settle differences.
- TODAY'S WEATHER MINUTE: Rutland Herald content editor Rich Alcott shares local weather information and easily digestible news tidbits: Pesticides in soil and ground water are killing not only honey bees and other useful insects, but songbirds as well.
- TOMORROW'S HEADLINES TODAY: Judge issues deposition order in for city police corporal's lawsuit against the department, market for marijuana-laced edibles en fuego in at least two states, West Rutland truck fire consumes all driver's earthly possessions.