MONTPELIER — The Senate gave preliminary approval to its version of the fiscal 2022 budget on Thursday, passing the $7.17 billion spending plan by unanimous voice vote on second reading.
That’s $191 million more than the $6.99 billion plan passed by the House, and $374 million more than the budget Gov. Phil Scott proposed.
The budget proposes $478.5 million in federal American Rescue Plan Act (ARPA) funds — less than the $650 million the House proposed, but not following the Scott administration’s four-year, $1 billion plan.
The proposal also fully funds the state’s annual pension obligation and post-employment benefits, and sets aside $150 million to invest in the state’s unfunded pension liability.
Senate President Pro Tem Becca Balint said the continuing pandemic and its impacts on people “absolutely influences our thinking in regard to how we invest taxpayer dollars and federal funds here in Vermont.” She said the budget seeks to meet immediate needs as a result and starts to address long-term needs.
The Senate plan would leave the state with more than half of the state’s ARPA allocation for use in fiscal 2023 and beyond. The House proposed using $650 million in ARPA dollars.
“We have a once in a lifetime opportunity to invest one-time federal funds towards Vermont’s future in a way that honors what each of our communities need,” Balint said. “The Senate, House, and Administration largely agree on spending priorities, including broadband, affordable housing, and tackling climate change. We can take action in several of these areas now and take time to do careful, deliberate work on others.”
A third reading vote is expected Friday.
The ARPA funds include money to restart the state’s judicial system and address the backlog of civil and criminal cases; invests $115 million in clean water initiatives; $31 million in climate change action; $23 million in scholarships and tuition assistance for “upskilling” Vermont workers affected by the pandemic; allocates total of $53.2 million for higher education, including $41 million for the Vermont State Colleges System’s transformation plan; and $56.5 million for economic development. Also proposed is $101.8 million for high-speed broadband, with an intent to allocate $50 million more if needed.
The Senate’s housing plan uses $40 million in general fund dollars to help fund low and moderate-income housing through the Vermont Housing and Conservation Board. Sen. Jane Kitchel, chairperson of the Senate appropriations Committee, said general fund dollars were used because they can be leveraged to qualify for additional federal funding.
Within the $51 million set of ARPA funds set aside for higher education is $10 million in aid to the state’s private colleges. In 2020, the Legislature allocated CARES Act relief dollars to those schools, but neither the Governor’s budget proposal nor the House’s budget included those dollars this year.
The Senate budget also includes $12.5 million in funding for a bill expanding eligibility for child care financial aid, H. 171. That bill is expected to be taken up by the Senate on Friday.