Governor, lawmakers look to set ground rules for VEHI savings negotiation

MONTPELIER — As a June 21 veto session nears, Gov. Phil Scott and lawmakers are mired in negotiations over how negotiations should proceed on Scott’s desire to push all Vermont teachers into a uniform health care benefit to save money.

Scott said at his weekly news conference Wednesday that legislative leaders reached out to him late last week about setting up a meeting to rekindle negotiations on his teacher health care savings plan. But Scott indicated he wasn’t interested in meeting with the group of lawmakers Democratic legislative leaders proposed.

Gov. Phil Scott (Times Argus/Stefan Hard)

“It’s about the process at this point, just trying to set up a way for us to move forward so we’re not wasting our time and we have the right people in the room,” Scott told reporters. “We’re going to respond to them in writing and set some guidelines as to how I think this negotiation should work. They had an idea on how they wanted it to move forward and we’ve got some other ideas.”

Scott said House Speaker Mitzi Johnson, D-South Hero, and Senate President Pro Tem Tim Ashe, D-Chittenden, wanted 11 lawmakers included in the negotiations — including some who would participate by phone.

“That seems a bit unwieldy and I think we should have a little bit narrower focus on what the issues are rather than have so many people there,” the governor said. “I just think it needs to be strategic, it needs to be something that’s efficient and maybe get to solutions.”

Lawmakers adjourned the 2017 legislative session in the early hours of May 19 after completing work on a state budget and property tax bill. But they failed to find agreement with the Republican governor on his late-session request to save up to $26 million in the Education Fund by having teachers negotiate on a statewide basis for health care benefits.

Scott has promised to veto both the state budget as well as a bill that sets property tax rates, known as the yield bill, which help fund the state’s public education system. Legislative leaders pitched several alternative plans to the governor in the waning days and hours of the legislative session that sought to achieve the savings he is seeking, but they were rejected. Those plans all preserved the tradition of having teachers bargain for their health benefits directly with their employers — local school boards.

Because of a pending tax on high-end health insurance plans under the federal Affordable Care Act, the Vermont Education Health Initiative, which provides insurance plans to Vermont teachers, is offering a new slate of plans to all Vermont teachers beginning in January that have lower premium costs but higher out-of-pocket expenses.

Scott’s plan looks to save money by requiring all teachers to pay at least 20 percent of their health care premiums. He would use nearly $50 million of the projected $75 million in savings from lower premiums to offset the higher out-of-pocket costs, leaving up to $26 million in savings.

Scott said he believes a statewide negotiation or contract is the best way to ensure the savings he is seeking because it would lead to uniform health benefits for all teachers.

“From my perspective, I believe that that’s the way you maximize the savings — that they’re all the same. But maybe there’s a different approach. I’m willing to listen. From my perspective, that’s the way you achieve that,” he said.

Sen. President Pro Tem, D-Chittenden, and House Speaker Mitzi Johnson, D-South Hero, speak to reporters earlier this month. (VPB/Neal Goswami)

Before those details can be resolved, however, lawmakers and the governor must first determine how they plan to negotiate. Peter Sterling, Ashe’s chief of staff, reached out Friday to the administration to set up a meeting with lawmakers this week. He included a list of 11 lawmakers that would participate.

But the meeting has yet to take place. Scott said Wednesday he wants the negotiating group to be more exclusive and include the “deans” of the House and Senate in addition to legislative leaders and the governor and his staff.

The deans, Rep. Alice Emmons, D-Springfield, and Sen. Dick Mazza, D-Grand Isle, were included in the failed negotiations at the end of the legislative session. While Emmons was included in the group of 11 lawmakers proposed by legislative leaders, Mazza was not. Mazza, although a Democrat, is longtime political ally of Scott’s.

“Sen. Mazza has been a voice of reason, as well as Rep. Emmons,” Scott said. “I think that’s important, having their voices in the room.”

The administration sent a letter to legislative leaders Wednesday outlining its parameters for the negotiation. The administration said it wants the Legislature to offer a counter proposal because the administration was the last side to present an offer before lawmakers adjourned. It also wants negotiations to be public.

“We suggest that we make this phase of negotiations available to the public. We believe Vermonters have a right to know what ideas are being offered and by whom,” Secretary of Administration Susanne Young wrote in the letter. “In addition, we believe we could iron out the few remaining details more efficiently — and with more accountability to the people we serve — if we agree to a meeting schedule and a deadline for reaching an agreement that is shared with the public. However, if this approach is not one the Legislature can support, we request that you propose ground rules for keeping the public informed.”

Meanwhile, local teacher unions and school boards continue to negotiate health care benefits for next year. School districts that reach agreement before a deal is reached between Scott and lawmakers would be excluded from any statewide savings. Scott said local districts should consider postponing their own negotiations until the future of teachers’ health care benefits is clear.

“I would offer that you might want to hold off a bit and see how the negotiations work out,” the governor said.

Scott also reiterated Wednesday that he would not allow the new fiscal year to begin on July 1 without a budget and property tax bill in place. Although he will veto both, he said he would eventually sign them if necessary to avoid a government shutdown.

“We’ll come to resolution, I’m confident of that, and if we have to forego (the savings), so be it,” he said. “I believe that most Vermonters, most Vermonters I speak with, understand the merits of doing this.”

Read the administration’s letter to legislative leaders below:


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