We Are One Town: Could Proposed Governmental Cuts Impact Cavendish?

As we enter the time of year where town, state and federal budgets are being prepared, it’s important to note that Cavendish is in a unique situation as in addition to a new President, we have a new state governor and town manager.

It is hard to escape the barrage of news media about the President’s proposed cuts and the speculation of what it might mean. There are a lot of questions and trying to answer them has rapidly become a significant source of frustration for many.

Cavendish Connects recognizes that there are differing viewpoints on the current state of affairs and we ask that users of the Cavendish VT Facebook page be mindful of the comments they leave. This is a public forum and not a private Facebook page. It is a monitored site and we do remove comments deemed inappropriate.

There are residents working on various aspects of the proposed changes, such as the impact of the repeal of the Affordable Care Act, environment etc. If you are interested in participating in this process, please e-mail cavendishconnects@gmail.com and we will put you in touch with the appropriate individuals.

Cavendish Connects works to provide factual information in as timely a way as possible. We recognize that people have different viewpoints, yet, we are one town and we must work together as significant change is coming. To that end, the following post addresses basic information about how dependent our state and town may be on federal funds and the potential impact if they are cut.

How dependent is Vermont on Federal Funds? As it turns out, quite a bit. While the state ranks about 21st, out of 50 for both state resident dependency and state government dependency (2016’s Most & Least Federally Dependent States) this only tells part of the story.

VT is a“net importer” of federal money, for every dollar sent to the government, we receive $2 back. In other words, of a state budget of $5.7 billion, 35%,or $ 2.2 billion dollars from the feds is spread through all state agencies, towns, cities and to individuals.  Be it for highways, libraries, school lunches, law enforcement, wildlife, public health, mental health, housing and much more, every Vermonter benefits from the federal dollar in some way.

Medicaid is the single biggest governmental benefit to VT, $1.1 billion, which includes many human services beyond upfront health care-water testing, food stamps, housing, addiction services, corrections, mental health, public health and much more.  VTrans receives about $300,000 million dollars for roads, bridges, and even public safety. Federal money pays at least part of the compensation for about 4,200 state employees. The list goes on.

What happens if VT looses some of its federal money? There are some built in buffers-five percent reserve in the education and transportation funding; a “rainy day fund” of about $6 million; the governor’s caseload reserve etc. However, these are stop gap measures and will not sustain existing programs for very long. For example, the state receives about a billion dollars in funds for Medicaid. A five percent reduction will result in millions of dollars being lost.

The chair of the Vermont Senate Appropriations Committee has said that if Congress makes dramatic changes to federal funding that would impact the 2018 fiscal year budget, there would likely be a special session of the Vermont Legislature.

How dependent is Cavendish on Federal and State Funds? Since Cavendish does not provide a lot of human services, we are limited in the areas that could be impacted. However, the town receives over $100,000 from the state for highway maintenance, which includes costs for equipment, staffing etc. What percentage of that funding is federal in nature is unknown, but many of the state agencies the town deals with receive their funding from the government and then it is “trickled down” to us.

What town projects could be impacted: The Depot Street Bridge replacement and the repaving of 131-have been delayed already and could be pushed even further out due to reconfiguration of state funds.

At the upcoming town meeting, voters will be asked to approve funding for much needed upgrades to the waste water treatment plant. Low cost loans and grants that would help to defray the costs could be significantly impacted.

We could see a reduction in highway costs, which would require a reconfiguration of how this aspect of the town is run.

In addition to the municipal projects, it is unclear the impact cuts would have for the school, library, environmental and energy projects, as well as a wide array of social service programs. The “Rob Peter to pay Paul” will certainly come into play. While everyone will be impacted in one way or the other, some of us will definitely be impacted more than others.

To learn more about this topic, we recommend listening to The Money Flows North: Vermont’s Federal Funding