With a new legislative session begun on January 3,2018, many questions are on the mind and tongues of Vermonters across the state. Governor Phil Scott sat down with the The Bridge to discuss several issues confronting his office, the legislature, and the voting public in the new year. Excerpts from that interview follow here:
On the New Tax Bill from Washington
The Bridge: When I interviewed a couple of local legislators a few days ago they were saying, “We don’t know what Washington, D.C. will do.” In other words, they are worried about how the just-passed tax bill will affect Vermont.
Gov. Scott: The tax proposal has passed Congress and the President has signed it. It’s over 500 pages long, and it includes a lot of policy. There’s going to be some winners and losers. We’re trying to contemplate what that might mean for Vermont. We have our tax commissioner and others taking a look. It’s not just a tax bill. It crosses many different agencies. We’re trying to pull it apart and come to some conclusion as to what it may mean. Our goal is to see that Vermonters are not harmed in any way. There may be more winners than losers.
Priorities for the New Year
The Bridge: Looking ahead to the new session, are our priorities the same as they were a year ago or have they changed?
Gov. Scott: Grow the economy, make Vermont more affordable, and protect the most vulnerable. Those three very simple principles guide us in every decision we make on a daily basis, whether we’re contemplating a new position or currently moving a program forward–we ask those three questions.
Last year, with the budget we passed, we did not raise taxes and fees. We kept Vermont affordable, all the while making investments in our economy. Last year’s budget satisfied all three of those principles. So we’re continuing to build on the work we’ve done and hope to do more.
As part of the budget we will be able to make investments in housing which I think is critical–a $35 million housing bond that we believe will leverage another $65 million in other funds to make it the largest single investment in housing throughout our entire geographical network that Vermont has ever seen. I wanted to make sure we focus on affordable housing for our workers. I think that’s critical as we try to move the “affordability needle” and grow this economy. We need more workers.
Three Critical Numbers
The Bridge: Can we quickly review the numbers we are facing? I know some of the numbers are grim.
Gov. Scott: Let me run through those three numbers: six, three, one. Those are the three numbers that keep me up at night. Six, every morning that we wake up, on average, we have six fewer workers in the workforce. That’s about 2,200 fewer workers every single year. That has to do with the demographics of the retiring workforce and workers leaving the state. That’s problematic.
The “three” represents three fewer students in our educational facilities than we had the day before. That’s about 1,300 fewer students every single year. When you look back over 25 years, it’s about 301,000 fewer students. Let’s talk about the “one.” That one stands for nearly one baby born exposed to addiction every single day. To be more exact, there are some 300 babies born in Vermont each year exposed to addiction.
Let me go on to talk about staff to student ratios in Vermont schools. There are actually something like 76,000 students now in our K‒12educational system whereas once there was about 106,000.We spend about $1.6 billion to educate these 76,000 students. We are one of the highest per pupil spending states in the nation because of the smaller population of students. You look at the staff to student ratio. Right now we average about four staff members [for each student], one of the lowest ratios, if not the lowest ratio in the country. When saying “staff members,” I include bus drivers, maintenance people, teachers–it’s across the board–all of them.
We were once around six to one. That’s our challenge. I’ve said at one point if you could magically throw that switch—which is not possible—and change that ratio to five to one, you’d save $100 million. And we would still be the lowest in the country at five to one.
We have a shortfall in the education fund in some respects. Our tax commissioner is responsible for issuing a letter saying what our tax rate would be in December. If we do nothing, if we take no action at all, we could see upwards of nine cents of tax rate increase, if wedo nothing. I personally think that’s unacceptable. We have to do something.
The Bridge: There was a bit of a struggle at the end of the last  session. As I recall there was talk about a statewide healthcare package forteachers.
Gov. Scott: We had an opportunity at that point to save $26 million if every teacher was on the same health care plan. That was met by some resistance
in the legislature. In fact, I vetoed the budget over that issue. We did come to an agreement. It wasn’t what I wanted. It wasn’t what they wanted. We found a way to save $13 million over a three-year period. The legislature thought that some of the negotiations would come to the same conclusion and that local school board would be able to save a little bit of money on their own. It doesn’t look as if that’s going to be the case.
As a result of the agreement we had, we put together a commission made up of people I appointed and the legislature appointed. They just voted last week. And they came to a conclusion that a statewide teachers’ contract for health care would be best for Vermont. And we might save money by doing so. We’ll bring that forward and see what the legislature thinks because the contract will open up again in another year.
The Bridge: I have been tracking highway reports this year from the Vermont State Policeand there are some pretty distressing highway statistics. Am I wrong in this?
Gov. Scott: There have been more highway deaths this year.
The Bridge: Highway deaths are up from 2015 and 2016?
Gov. Scott: That’s right. If you go back a few years there were years with more highway deaths than this year. And that’s not acceptable either. We’re seeing a trend nationwide, I believe, personally, anecdotally, [deaths] due to distracted driving. I see how people are choosing to spend their time while they’re driving. Many times it’s not steering and paying attention to the road. It’s doing other things. It’s talking on the phone. It’s texting. But we are seeing an increase nationwide.
The Bridge: There was a slew of accidents around August 11.
Gov. Scott: There was a spike around that period. I brought the commissioner of public safety in–and we put together a plan. Commissioner Lynch put in a plan to increase the amount of enforcement around Vermont where we were seeing the most crashes. I think it did curtail some of the increase, which is good news. But we’re still seeing deaths on our highway, and we’re still seeing “unbelted” drivers.
The Bridge: Practically 25 percent–less than one-quarter of highway deaths involve “unbelted”drivers.
Gov. Scott: It may be a bit higher than 25 percent. We’re trying to get the material together. What are the trends? Or whether something we’re seeing has been going on for some time? We don’t have a primary enforcement law in Vermont (for drivers not wearing a seat belt).It’s a secondary offense. They can’t pull you over. There are some who feel we ought to make it a primary offense. I’ve been resistant to that over the years because we have such a high compliance rate. We need to take a look at the data to see if that’s a trend.
A Carbon Tax
The Bridge: Climate change activists support a carbon tax, but the commission you’veappointed does not support a carbon tax. Why not?
Gov. Scott: It’s no secret that I think a carbon tax would be counter-productive to economic recovery and development. It would have a detrimental effect on our economy. We’re such a small state for us to go it alone. It would place more of a burden on everyday Vermonters, particularly in a rural state where people are driving long distances.
The Bridge: I’ve had some activists who are angry at me because I editorialized against industrial wind. There’s a lot of passion out there.
Gov. Scott: There certainly is, and I believe that passion may be well intentioned. When I took office, many thought I might take a step backwards on our commitment to all renewables by 2050. Climate change is real. There’s no doubt about it from my standpoint. I believe we’re causing that. So we need to do whatever we can to reduce our reliance on fossil fuels in order to counter climate change.
I believe renewables is the answer from a number of different standpoints. If we could be more energy independent, I think a lot of the conflicts we see across the world are due to oil. So I think the sooner we can do that the better.
Technology is changing so that we can accomplish that. I had the good fortune of listening to Elon Musk this summer. He predicts that in ten years half of the cars will be electric. In 20 years, he believes that 90 percent of the manufactured cars will be electric. Think about that transition. We’ll see that in our lifetimes. I believe that’s all for the better because most of the carbon emissions are from transportation. So it is happening. I don’t think the carbon tax is going to make that happen any quicker.
The Bridge: About a year ago you were saying we don’t have a foolproof test for those driving under the influence of marijuana. Yet rumor has it you could well sign a bill legalizing marijuana in the first couple of months of the 2018 session.
Gov. Scott: Let’s take a step back and see what it means. This bill has passed the Senate. It’s on the floor of the House right now. It’s more of a “libertarian” approach. If you grow your own–there are a certain number of plants–then you can consume it in your own home. This isn’t a full-blown commercialization approach. This isn’t part of the tax structure. This isn’t anything close to that. You can grow it; you can consume it. That’s the bill I said I would sign.
The Bridge: They may grow and consume it, but they will still be out on the road.
Gov. Scott: I think they are now.
The Bridge: So that’s OK?
Gov. Scott: No, it’s not OK. But what we’re doing is focusing on behavior on the road. That’s the trick, by the way, when you think about it, impairment on our highways is what we want to prevent whether it’s by drugs, alcohol, heroin, opiates. So let’s not just focus on one. Let’s focus on impairment. That’s what we’re charged to do. I put together a Marijuana Commission to try to address this. We’re watching other states, what they do. Canada is about ready to move forward with legalization. Interestingly enough, Canada, from what I hear, and again this is anecdotal, they may institute a saliva test for THC. We heard in Colorado for instance, they have a limit on the amount of THC in a saliva test. I’ve put a clear line in the sand, I will not support anything on a commercial standpoint, on a retail level without a determination of impairment in some way, whether it’s a saliva test, a dexterity test of some sort, whatever it is, we need to put that into place. Legalization is strictly a libertarian approach.
The Bridge: I’ve been reading various reports coming from Colorado. Both sides are taking the information and saying, “It’s working.” And the opponents are saying, “No, it’s not working.” What are you seeing from Colorado?
Gov. Scott: I probably read some of the same information that you do on both sides of the fence. I don’t want to institute fear. But at the same time we have to pay attention to the data. I believe in science. I believe in data. And I haven’t seen the full extent of any repercussions from legalization in those states as of yet.
We’ve had a five-year window. This is not enough time to determine what effects this may have on society. We are going to be forced into this in some respects because regardless of whatever we decide, Massachusetts and Maine have, and as I have said, Canada is poised and ready. It puts us right in the center. And that’s why I’ve said that impairment is important as well as education of our youth. And the edibles that we’re seeing, that’s very critical, and it’s something I’m aware of in terms of Colorado. They’ve done things a little bit differently with edibles. So we should learn from that.
Raising the Minimum Wage
The Bridge: I’m aware of downtown retailers who are saying, “Taxes are high. It’s tough. I’m running the business. It’s hard to find great workers. Now, they want minimum wage legislation.” And retailers don’t want that. They’re saying, “Please don’t push us again with a $15 per hour minimum wage. Please don’t do that.” Where do you stand on this?
Gov Scott: I’m hearing the same thing from those main street businesses and enterprises. I’m fearful about what that artificial inflation would do to our economy. I think it would have a ratcheting effect across the board. I’ve used this example. “If you instituted a $15 minimum wage, those who are already making $15 per hour are going to want $18, and if you’re making$20 per hour, you are going to want $25. And those who are making $25 per hour are going to want $30.”Now I want to preface this by saying, “I want everyone to make more money.” But to artificially increase wages isn’t going to make a better economy. Because those added costs have to be passed on to someone. Someone has to pay. It could be the increased cost of services. Or the increased cost of the product itself. Or in the case of the small business owner, increased hours. And I’m not sure they can work any more hours.
Because of the position that main street businesses are in at this point. I think 80 percent of the small business owners in Vermont hire fewer than 20 employees. That’s the vast majority of them. And with the pressures they are feeling from Amazon, Walmart, and the online marketplace, this could be the straw that breaks the camel’s back. Are we willing to do that and further splinter our communities?
Governor Scott Discusses Raising the Minimum Wage and More Continued from Page 1 Photo by Michael Jermyn