MONTPELIER — Gov. Phil Scott and lawmakers came up short once again Thursday in their quest to find common ground on a major fiscal issue that, once resolved, will allow the legislative session to come to a close.
Democratic House and Senate leaders Wednesday evening tweaked a proposal put forth by Senate President Pro Tem Tim Ashe and offered it up as a compromise to the Republican governor. But Scott said it wasn’t something he was prepared to accept and planned to offer a counter proposal.
Lawmakers have been engaged in a standoff with Scott for the past several weeks over how to save up to $26 million annually in the state’s Education Fund.
Democratic leaders in the Legislature and the governor agree that savings can be achieved from changes to the health insurance plans offered to teachers by the Vermont Education Health Initiative. VEHI is offering a new slate of plans to Vermont teachers beginning in January that have lower premium costs but higher out-of-pocket expenses. That change is driven by a provision in the federal Affordable Care Act that will tax high-end insurance plans that many teachers currently have.
Scott is proposing to use nearly $50 million of the $75 million in savings from lower premiums to offset the higher out-of-pocket costs, leaving an extra $26 million.
The governor and Democratic leaders in the Legislature are at odds over how to achieve those additional savings. Scott has maintained that the only way to ensure the savings is by requiring all teachers to negotiate directly with his administration for one statewide teacher health care benefit — rather than with school boards at the local level — and requiring teachers to pay at least 20 percent of the insurance premiums.
Democratic leaders in the Legislature, as well as the Vermont NEA — the union that represents most teachers in the state — insist Scott’s plan will infringe on teachers’ collective bargaining rights.
On Thursday, Ashe and House Speaker Mitzi Johnson, D-South Hero, released a proposal that would withhold $13 million in Education Fund payments to school districts. That represents the health care savings from the remaining six months in the 2018 fiscal year budget.
Under the Democrats’ proposal, local districts would have to achieve the health care savings because the state will not pay the difference. But local districts that do not achieve the targeted savings could look to cut teachers or programs for students if they do not achieve the health care savings through negotiations with the teachers union.
Rep. Janet Ancel, D-Calais, said the $ 13 million savings mandated in their proposal would reduce property tax rates by 3 cents.
“ What this proposal would do is lower that average residential rate to $1.49,” she said. “That would be real savings that taxpayers would feel in fiscal year 2018.”
“All of the money is going to go back to taxpayers’ pockets, which, frankly, is where it belongs,” Ancel added.
The Democrats’ proposal states that having teachers pay 20 percent of their premiums “can” help achieve the savings. Scott told reporters he wants to change the language to mandate that teachers pay at least 20 percent.
“ I’m saying it should be a ‘shall’ to make sure we realize those savings,” Scott said.
The governor said his counterproposal would use the framework crafted by Democrats and would not require teachers to negotiate with his administration directly. His counterproposal would dictate the terms that teachers must accept, however.
“It will be a statewide contract of some sort, but by putting the language where we put the plan in place with the 80- 20 … that would get us to the same place,” he said.
House Minority Leader Don Turner, R-Milton, said the governor’ s counterproposal seems to infringe on collective bargaining rights.
“That’s a collective bargaining issue,” he said. “I don’t know if we can do that, either.”
Johnson told reporters Thursday that the Democratic proposal will ensure property tax savings.
“I think we’ve taken our conversations with the governor and tried to name and address some of the governor’s concerns without, in the waning days of the session, trying to rework very complicated labor law. We’ve been able to put together something and put it on the table that says, ‘We’re going to save property tax payers money,’” Johnson said.
Johnson said she was unsure if the House would move forward with a vote on the Democratic proposal. Ashe, however, told members of the Senate that the chamber will vote on it Friday, regardless of whether Scott approves. That could lead to a veto by Scott, forcing lawmakers to come back next month to continue working on a compromise.
Turner said time is running short and lawmakers need to decide soon if further negotiations with Scott can be productive.
“If it goes on much longer I think you’ll probably just see some movement to push things through and force the governor’s hand to veto … and then we’ll come back in June,” he said.
“I don’t think you can take too many more days of this everybody sitting around doing nothing stuff, because people get frustrated, emotions run higher,” Turner said. “It’s not productive, so I don’t think there will be too many more days of this.”