The House conceded to the Senate’s proposal to finance the program with a payroll tax, instead of the corporate and personal income tax that House lawmakers favored.
Vermont is set to receive an additional $120 million annually for its childcare system
The income tax, according to the Senate, would have hit the pockets of Vermonters who may not even require childcare services. The bill aims to increase subsidies paid by the state to childcare providers on parents’ behalf. Currently, income eligibility for the subsidies tops out at $105,000 annually for a family of four. The bill expands this threshold to around $172,000 for the same-sized family. Additionally, subsidies paid to providers will also increase. Families making more than $90,000 annually for a family of four won’t see any major immediate reductions in their overall childcare expenses, but they’ll benefit from the increased revenues that will flow to their childcare providers.
The CEO of Let’s Grow Kids, Aly Richards, who led the lobbying effort on behalf of the legislation, says the bill will infuse the child sector with new funding. Richards adds that it will bring in sustainable revenue to a field that has been starved for resources, as well as address the issue of supply and affordability for families.
The bill’s passage is of great importance, as without the investment, the state’s childcare system would have collapsed, dealing a catastrophic blow to Vermont’s economy
Governor Phil Scott had earlier included a $56 million increase in childcare spending in his budget proposal, which he said Vermont could afford without raising new revenues. However, he suggested he would veto any legislation that includes increases in taxes or fees. The Senate’s 26-to-4 vote suggests it has the votes to override a possible veto. The House, on the other hand, will require at least 100 votes in favor of the bill to do the same. The House is scheduled to give final approval to the legislation in a floor vote on Friday.
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