The President’s Budget And Vermont
Analysis Prepared By The Staff Of Senator Patrick Leahy Of Vermont
 Feb. 7, 2005

Programs of Interest to Vermont:

Economic and Community Development

• Community Development Block Grants (CDBG) – Used by states to help towns and cities promote community and economic development and build affordable housing. 
  • FY 2005 Vermont Allocation:  $9.73 million this year statewide -- $1.04 million for Burlington and $8.69 million for the rest of the state.
  • FY 2006 Bush Request:  The President proposed eliminating the CDBG program – in its place combining 18 federal programs into a consolidated community development initiative with a 40 percent cut in total funding.  If the CDBG distribution criteria are retained, Vermont will lose $3.9 million in funding.  However, if new criteria are developed all of the $9.73 million in funding to Vermont is in jeopardy. 
     
• Manufacturing Extension Partnership (MEP) – A nationwide network of not-for-profit centers in nearly 350 locations nationwide, the sole purpose of which is to provide small and medium sized manufacturers with the help they need to succeed. 
  • FY 2005 National Allocation: Congress appropriated $109 million
  • Vermont Manufacturing Extension Center received about $400,000
  • President called for a 57 percent cut, to $46.8 million, for MEP in his FY 2006 budget.
     
• Amtrak – The backbone of national passenger rail service.  There are two lines running to Vermont, the Ethan Allen Express and the Vermonter. 
  • FY 2005: Congress appropriated $1.2 billion to Amtrak. 
  • President’s budget includes nothing for operating subsidies and about $360 million for capital expenses in the Northeast Corridor (Washington to New York to Boston.) 
  • For Vermont, this would mean the Vermonter (with 252,238 passengers last year) and the Ethan Allen Express (with 108,192 passengers last year) would cease operations, cutting off transportation options for Vermonters and reducing the number of tourists able to visit the Green Mountain State.

First Responders

• Office of State and Local Government Coordination and Preparedness (SLGCP) – Critical state and local missions supported through these grants include the preparedness of first responders and citizens, public health, infrastructure security and other public safety activities.  While these programs vary considerably in their size and scope, they all contribute to making the nation more secure against the threat of terrorism, as well as other natural and man-made hazards. 

FY 2005 National Allocations:  $1,695,000,000

• $1,100,000,000 for formula-based grants (State Homeland Security Program)
• $400,000,000 for Law Enforcement Terrorism Prevention Program grants
• $15,000,000 for Citizen Corps
• $180,000,000 for Emergency Management Performance Grants

President’s FY 2006 Request: $1,240,000,000 (27 percent reduction)

• $1,020,000,000 – State Homeland Security Grant Program
• $0 – Law Enforcement Terrorism Prevention Program
• $50,000,000 – Citizen Corps Program
• $170,000,000 – Emergency Management Performance Grant Program

• - $6,754,415 – State Homeland Security Grant Program
• - $3,383,424 – Law Enforcement Terrorism Prevention Program
• + $275,613 – Citizen Corps Program
• - $84,455 – Emergency Management Performance Grant Program

The Administration’s FY 2006 request would repeal the first-responder grant program all-state minimum (Leahy formula) of  0.75 percent per state and replaces it with awards based on a relative evaluation of risk, need and applications, with each state or territory receiving no less than 0.25 percent of the total.

• Office of Domestic Preparedness FIRE Grants – Competitive grants awarded directly to local fire departments around the country.  Departments use the funds for equipment purchase, safety training, fire prevention programs, and vehicle acquisition. 
  • FY 2005:  Congress appropriated $715 million to the FIRE Grant Program
  • The Bush budget reduces that amount to $500 million. 
     
• Edward Byrne Memorial Justice Assistance Grants Program – This program consolidates the old Local Law Enforcement Block Grant program and the Byrne Formula program.  Funding under this program is available for: law enforcement programs; prosecution and court programs; prevention and education programs; corrections and community corrections programs; drug treatment programs; and planning, evaluation, and technology improvement programs.  The formula used for distributing funds under this program allocates 50 percent of funding based on population, and 50 percent based on violent crime rates.  The formula allocates 60 percent of funding to states and 40 percent to local governments.
  • FY 2005 Allocation:     $634,000,000
  • Vermont (FY 2004):     $2,067,462
  • President’s FY 2006 Request:  Elimination

Agriculture, Environment, and Energy

• Milk Income Loss Contract (MILC) Program – The Bush Administration’s budget extends the MILC program for two years while not making any changes in the current formula.  The program will continue to pay out when the price of milk falls below $16.94 in Boston and payments will be made on the first 2.4 million pounds of production. 

However, as is the case with every other USDA program that directly pays producers for commodities, there would be a 5 percent reduction in checks that go to the producers.  If, for example, a producer is eligible for a MILC check of $100 under the current formula, the farmer would then get a check for $95.00 after the 5 percent reduction. 

• Environment – The Environmental Protection Agency, Forest Service, Interior Department and Army Corps of Engineers all would see budget cuts.  EPA’s overall budget would be cut 6 percent; hit hardest is the Clean Water State Revolving grant fund, cut 33 percent -- $360 million less than last year’s budget.
   
• Lake Champlain – The President’s budget for Lake Champlain falls far short of what is needed to protect and restore the lake, including requests for only $955,000, which is much less than the $11 million per year authorized by The Great Lakes and Lake Champlain Act of 2002 and still considerably less than the $5 million the Vermont and New York delegation requested in FY06 in a recent letter to EPA.
   
• Renewable Energy – The President’s budget also includes a $30 million dollar cut (38 percent) to research for renewable bioenergy, an area of interest to Vermont farmers and others in seeking to develop a biofuels industry for such things as biodiesel.
   
• Conservation Programs – The Administration has cut more than $500 million nationwide from working lands conservation programs that help farmers affordably protect the environment and work their land by promoting use of farmland for agricultural production and habitat protection instead of development and sprawl.  All of these conservation programs were included in the 2002 Farm Bill.

Specifically, the Bush budget cuts $200 million for the Environmental Quality Incentives Program (EQIP), one of the primary federal programs which farmers use to control phosphorus runoff going into Lake Champlain.  

The Bush budget also proposes to eliminate funding for Senator Leahy’s Agriculture Management Assistance program (AMA), which is a $20 million dollar program that is targeted to help traditionally underserved states by funding locally developed conservation programs, as well as by providing organic certification cost-share assistance.  

• Low-Income Home Energy Assistance Program (LIHEAP) – The President’s budget proposes $1.8 billion for the regular LIHEAP program and $200 million for contingency funding.  For fiscal 2005, LIHEAP received $1.88 billion in regular funding and $297.6 million in contingency funding.  The Bush FY2006 budget proposes an $80 million (4.3 percent) decrease in regular funding and a $97.6 million (32.8 percent) decrease in contingency funding. 
  • Vermont:  The state will receive about $13.2 million in LIHEAP funding this year.  Based on Vermont’s percentage of the FY 05 funds (.63 percent), Vermont would likely see approximately $1.26 million less next year.

Education and Social Services

• Education – One out of every three of the programs targeted for reduction concerns education.  The President has proposed the elimination of 48 education programs, cutting $4.2 billion, while significantly under-funding No Child Left Behind programs and Title I funds for low-income schools. 
  • Title I:  Under the proposed Bush Budget Vermont falls $24 million short of the level promised for Title I under NCLB meaning that 7500 Vermont children would be denied promised services.
    • VT FY 2005 Allocation:  $29.2 million
    • President’s Proposal FY 2006:  $30.7 million
    • Promised VT Allocation for FY 2006 under NCLB:  $54.8 million
  • Perkins Vocational and Technical Education Program
    • National FY 2005:  $1.3 billion                              
    • VT FY 2004 Allocation:  $4.2 million
    • President’s Proposal FY 2006:  Eliminated
• Community Services Block Grants (CSBG) – The Community Service Block Grant program provides funds to states for a range of services to address the needs of low-income individuals.  CSBG funds are used for activities to help families and individuals achieve self-sufficiency, find and retain meaningful employment, attain an adequate education, make better use of available income, obtain adequate housing, and achieve greater participation in community affairs. 
  • Total CSBG Appropriation in FY 2005: $641,935,000. 
  • VT FY 2005 Allocation: $3,380,125. 
  • VT Share as a Percentage of National Expenditures: .00526 percent
  • President’s FY 2006 Request:  Elimination

• Congress has authorized and appropriated a rising level of funding for the Boys & Girls Clubs of America in each of the last eight years because of the clubs’ proven role in discouraging youth gangs, drug abuse and youth violence.  The President’s budget plan reduces funding for Boys and Girls Clubs by $15 million – from $85 million to $60 million – and completely ignores the five-year authorization for the Boys and Girls Club grant program enacted by Congress under legislation co-authored by Senator Leahy and signed by the President in 2004.  In Vermont and across the nation, Boys & Girls Clubs are a proven and growing success in preventing crime and supporting children.  In FY 2004, the Boys & Girls Clubs of Vermont were awarded $1,185,000 in national grants.  

Veterans

• The Administration’s budget is significantly less than what major veterans associations determined would be a healthy funding level in their annual Independent Budget.
• The President’s budget request also asks some veterans to pay onerous enrollment fees and much higher prescription drug costs.