COLCHESTER — Hundreds of Vermont National Guard members are back on the job after several days of being furloughed, but Gov. Peter Shumlin and other state officials warned Monday that the continuing shutdown of the federal government will cause increasing problems for Vermont the longer it goes on.
Washington remains largely defunct with no plausible end to the funding stalemate in Congress in sight. Congressional Democrats remain united in their efforts to keep Republicans from using the budget — and the impending debt ceiling limit — to defund or delay federal health care reform.
Shumlin said Monday that he remains behind his fellow Democrats in their effort to thwart the intentions of conservative Republicans in the House.
“They’ve lost that battle. I think Vermonters feel strongly that it’s now time to take Obamacare and make it work, improve it, help serve Vermonters who desperately need affordable health care,” Shumlin, flanked by members of his administration, said at a joint press conference with the Vermont National Guard at Camp Johnson.
The week-old “senseless” shutdown of the federal government is impacting Vermont is several ways, Shumlin said, and the financial impact on the state will grow worse over time.
“I’ve had conversations with other governors and the White House and every day … that this shutdown continues is going to continue to have a more devastating affect on Vermonters, on job creation and on our ability to run the National Guard,” he said.
About 5,000 federal employees in Vermont are dealing with reduced hours or indefinite furloughs, the governor said.
“Many of them live paycheck to paycheck,” he said. “This is putting huge hardship on the hardworking federal employees, particularly the National Guard, who already make a huge financial sacrifice to serve us.”
Major Gen. Steven Cray said about 450 Vermont National Guard members were back on the job after being furloughed for several days last week. But the Guard remains limited in its activities and cannot complete training exercises, he said.
“Let me be clear … that this does not get the Vermont National Guard out of the woods. It does get our technicians and most of our full-time workforce back to work. But what it doesn’t allow us to do with the continued shutdown is there is no money to do any of the training. We don’t have money to buy parts, we don’t have any money to buy fuel, ammunition or any of those things that we need to do to train for our jobs,” Cray said. “That readiness level will continue to drop every day that we are not back to work and able to train.”
A scheduled drill involving as many as 3,000 soldiers was canceled over the weekend.
“Without supplies, without equipment, without fuel, without the training and readiness they need, there isn’t much for them to do once they get here. So, it’s crippling our National Guard’s ability to do what they do best,” Shumlin said.
Meanwhile, the shutdown is delaying the processing of Small Business Administration loans that businesses rely on, as well as the processing of benefits for seniors. Social Security checks are continuing and Veterans Administration hospitals and clinics remain open, but seniors and veterans applying for new benefits may see delays, according to Shumlin.
Depending on funding cycles, some Head Start programs may have to stop operating next month when federal funding is no longer available.
“Those are our most vulnerable kids who we are trying to give a good start to,” Shumlin said.
Additionally, Shumlin said Vermonters will also be impacted by:
Closure of federal offices that handle housing matters, including rental subsidies that help about 14,000 low-income Vermonters;
Closed federal lands during hunting seasons;
The halting of many U.S. Department of Agriculture programs that provide farm loans, market assistance loans, disaster assistance programs and grants for research, education, and extension services.
Secretary of Administration Jeb Spaulding said state officials drew down as much federal funding as possible before the shutdown.
“At the state level, we can cover most of the temporary loss of federal funds,” Spaulding said. “In the short run we can cover the benefits programs.”
But much of the federal funding for assistance programs in Vermont will run out at the end of the month. The state will also need to begin providing payments for low-income heating assistance the first week of November, Spaulding said.
“We don’t have the ability to draw down those federal funds right now. That’s in the ballpark of $17 million. We don’t have the capacity … to backfill that,” he said of the heating program. “If this drags on it’s going to move from disruption to inconvenience and pain for a smaller number of Vermonters to a big time, hurtful problem for Vermonters.”
The Temporary Assistance to Needy Families program, which helps about 16,000 residents including 10,000 children, will run out of funding after Nov. 1, said David Yacavone, commissioner of the Department of Children and Families. The state’s food stamp program, 3SquaresVT, which serves about 100,000 Vermonters, will experience similar problems, he said.
The process of providing benefits begins about 10 days before the start of a new month, however. So the shutdown must end by mid-October to ensure benefits continue, Yacavone said.
Unemployment claims in the state doubled last week because of the shutdown, according to Labor Commissioner Annie Noonan. She said 438 federal employees filed for unemployment benefits, as well as a smaller number of Vermonters who work for companies that do business with the federal government.
“We haven’t seen a spike like that. Our normal initial weekly claims is usually under 200,” Noonan said.
Democratic Rep. Peter Welch, Vermont’s lone member in the U.S. House, told reporters at his own press conference Monday that about 80 conservatives in the House are using “nuclear tactics” in their attempt to stop health care reform.
“This battle right now is not about the budget,” Welch said. “They’ve actually had an immense amount of success on their budget figure. What they haven’t had success on is defunding the health care bill, and that’s the explicit goal of the Tea Party wing in the House of Representatives,” Welch said.
The Senate’s budget figure is $240 billion less than President Barack Obama proposed, Welch said. And it’s only about $20 billion more than a GOP proposal.
A majority exists in the House to pass a so-called clean resolution to fund the government without additional strings attached, according to Welch. House Speaker John Boehner will not allow that to come to a vote, though, Welch said.
“He’s suggesting in recent articles today that he doesn’t have the votes to pass it. I’m confident he does. All the Democrats have indicated they’d support turning the lights back on by passing the Senate budget. A number of Republicans have indicated that,” Welch said. “If the speaker put that on I think we’d have government lights back on in 20 minutes.”
A small number of Republicans are now looking to tie health care reform funds to the debt ceiling — the amount of money the federal government can borrow to pay its existing bills. Officials say the limit must be raised before Oct. 17 in order to prevent the country from defaulting on loans.
Vermont state and federal elected officials say allowing the country to default would result in a disastrous outcome for the economy.
“For the most extraordinary democracy in the world to be behaving like some kind of developing nation is an extraordinary thing to see as a governor. Let’s stop. Enough is enough. This is not time for politics. It is time for rational policy. This crisis will deepen significantly if the debt ceiling is in fact tampered with on Oct. 17,” Shumlin said.
Spaulding said the economy is already at risk because the government is even discussing the possibility of defaulting. The federal government’s credit rating was downgraded last year because of similar talks.
“Just the discussion of a default is serious business,” Spaulding said. “Just having these conversations puts a serious hurt on our economy and on our path to recovery.”
Welch said he believes the fiscal crisis on the horizon will be avoided.
“There’s a lot of Republicans that know this is a dead end strategy. It’s not like you have to go deep into outlier Republicans,” he said. “This is a situation where Speaker Boehner has a tough situation but a simple choice: Is he going to let the Tea Party control the outcome or is he going to do what he’s done in the past, put legislation on the floor that can pass with a significant Democratic vote and some moderate Republicans?”
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