MONTPELIER — The Scott administration will present its plan Thursday to cut $12.6 million from the state’s General Fund and $3.5 million from the Transportation Fund to balance the state budget after a revenue downgrade was issued last month.
Administration officials will meet with the Legislature’s Joint Fiscal Committee Thursday. The plan relies primarily on the expected generation of new revenue, some budget cuts and some reversions, or reallocating previously unspent funds.
The administration’s budget rescission plan comes after economists for the administration and Legislature issued a revenue downgrade in July. The General Fund was downgraded by $28.8 million, including $16.3 million that is expected to be paid out in the form of corporate income tax refunds during the 2018 fiscal year. The state’s Emergency Board approved the administration’s plan to address the cost of the corporate tax refunds in July.
Under state statute, the administration is required to submit its rescission plan for both the General Fund and Transportation Fund and seek approval from the Joint Fiscal Committee because the revenue downgrades for each fund exceeded 1 percent of the total state budget. For the General Fund, 1 percent represents about $15 million. For the Transportation Fund, 1 percent is about $2.7 million.
According to the rescission plan, the Scott administration is counting on $3.5 million in new revenue from the Department of Financial Regulation. Another $275,000 in revenue will come from the Secretary of State’s Office.
The Department of Public Safety is facing an $860,000 budget cut. The plan calls for a $433,000 base cut that will continue in future years and another $426,830 in one-time cuts for the 2018 fiscal year.
The Department of Vermont Health Access, which oversees the state’s Medicaid program, will also see significant impacts. The administration is seeking a $1.6 million reduction in outpatient costs and a $4.5 million reduction in total costs for the Medicaid program based on a revised forecast.
The administration is looking to balance the Transportation Fund following a $3.5 million downgrade in July by transferring $1.1 million from Central Garage Fund that pays for equipment replaces. That will reduce the equipment fund by 14 percent.
The administration expects to save another $1.4 million on diesel fuel costs. The Agency of Transportation’s Aviation Division will see a $300,000 reduction in its $17.7 million budget. Another $457,000 in savings will come from reductions in discretionary spending such as travel and job vacancies.
The Joint Fiscal Committee will meet Thursday morning and hold a public hearing on the administration’s rescission plan in the afternoon.
Read the Transportation Fund rescission plan below:
Read the General Fund rescission plan below: