As we enter the ninth week of shut down, the Legislative Committees in the House continue to focus on COVID-19 related legislation. As members settle into this routine, most are responding to constituent inquiries and concerns regarding unemployment.
As Vermont moved from a low 2.2% unemployment rate in February to more than 70,000 claims within a few weeks, it became clear that the 30-year old mainframe computer system was not up to the task. Vermonters, many of whom were facing an extended period of unemployment for the first time, found themselves in a strange world of frustrating false starts, delays, false declarations of ineligibility and hours upon hours of inaction.
The system, designed to pick up fraud, quickly turned down applicants, not recognizing that readiness to telecommute, for example, did not mean there was a ready market for one’s services.
Rep. Brumsted and I have spoken to many of you, using a system designed by Legislative leaders to help constituents through the process. If you continue to have challenges please contact either me email@example.com or Rep. Brumsted firstname.lastname@example.org and we will do what we can to help. We have had some successes!
Unemployment, closed businesses and the general shut down of life as we knew it has put unprecedented financial stress on many if not most Vermonters. This has also resulted in lost revenue for the state for both the fiscal year ending June 30 as well as plans for FY21 beginning this July 1.
A proposed supplemental budget for the current year should be up for action this week. The real pain, however, will fall in FY21. It is anticipated that the projected 14% revenue reduction in the General Fund will likely result in programmatic reductions.
Because there is still uncertainly about the use of federal stimulus money, the legislature will consider only a budget for the first three months. Both bills are due to the governor’s desk by mid-June.
Previous crises in our state, such as Tropical Storm Irene in 2011, brought help from the federal government in the form of grants through the American Recovery and Reinvestment Act or ARRA.
These grants were available to repair damages specifically caused by the storm, such as washed-out roads, fallen bridges and broken culverts. The state kept meticulous records to assure the federal government that the funds were used for specified purposes when audited. With $1.25 billion from the Coronavirus Aid, Relief and Economic Security (CARES) Act, will there be enough to solve the current challenges?
Unlike Tropical Storm Irene, we are not fixing broken quantifiable infrastructure. Our primary issue, along with other states, is lost revenue not broken pipes. No part of the $1.25 billion may be used to replace lost revenue or to swap out anything originally appropriated. Use of these funds must be clearly linked.
To that end, committees are looking at those areas that can be directly tied to COVID-19. For example, it is anticipated that schools will be more likely to see children returning to school with toxic stress or regression in skills. Funds could be justified here.
Municipalities, struggling to address emergency education tax borrowing might be able to receive CARES funds to pay for interest. A forthcoming bill would provide for COVID-19 manufacturing grants to help those businesses pivot production for COVID-19 needs such as respirators and masks. There is also some hope that state governments will pressure Congress to provide more options to simply replace lost revenue, thus helping all get back on our feet.