SmartTranscript of House Appropriations - 2025-04-08 - 3:10PM

[Chair Robin Scheu]: Good afternoon to the House Appropriations Committee. It is Tuesday, April eighth twenty twenty five. It's just after three ten PM, and we have come back to, vote on h four fifty four, and then we'll have, Emily Burn come and talk to us about some federal funds stuff. And then we'll have Sarah Clark and Adam Greshen in about more federal funds. Well, I think before we, take our vote, I just wanted to mention that I misspoke when I said that two hundred thousand was gonna go to the State Board of Education. That's how we had in the request that because we were looking at in our budget. But in fact, in this bill, it goes to the agency of education for the state board of education. So it's a little roundabout way, but that it's actually being appropriate to the agency of education. So I just wanna clarify that since I didn't say it correctly when we were on live before. But the numbers are still the same, and the purpose is still the same. Alright. So I would entertain a motion to, pass out h four fifty four favorably. [Vice Chair James Harrison]: Is there a motion [Chair Robin Scheu]: to do so? So moved by h four? [Clerk Trevor Squirrell]: Correct. Four point one. [Chair Robin Scheu]: As passed out of [Clerk Trevor Squirrell]: As amended by house education, clerk amended by house lead. [Chair Robin Scheu]: Oh, thank you. That's why we have a clerk. Then what? [Speaker 3 ]: When he's talking. [Chair Robin Scheu]: Yes. Alright. Is there any further discussion at [Representative David Yacovone]: this point? [Chair Robin Scheu]: We we don't need a second, but you're welcome to second for form's sake. [Representative Thomas Stevens]: We don't need it all. [Chair Robin Scheu]: Alright. So hearing no further discussion at this point, why don't the clerk call the roll, please? Representative Lindley? [Clerk Trevor Squirrell]: Yes. Any consent? [Chair Robin Scheu]: No. [Clerk Trevor Squirrell]: May I also make a a a note here? Lynn, this will be your second of three times to do remote voting. You understand that? [Chair Robin Scheu]: I understand. I don't pretend to be a remote We we have we have to market now, so thank you, Trevor. [Clerk Trevor Squirrell]: Representative Harrison. Yeah. Representative consent, Scott. No. [Representative Michael Mrowicki]: I I have some unanswered questions just from here as well, which I'll address outside of here. [Speaker 3 ]: I'll send it [Representative Michael Mrowicki]: off for right now. [Clerk Trevor Squirrell]: Representative Roche. Mhmm. I have a lot of it. It's not Representative Roecky. Yes. Representative Mike Rowe. Yes. Representative Squirrel. Yes. Representative Stevens. [Representative Thomas Stevens]: Yes. [Clerk Trevor Squirrell]: Representative Jack Boney? Yes. Representative Schott? Yes. Vote is seven four. Okay. [Chair Robin Scheu]: Great. Thank you. And, Mike Maricki has education. I guess it could have been either, Mike, couldn't it? But I think well, there's something actually education thing. I think it's really [Representative Thomas Stevens]: It it feels like education's [Representative Michael Mrowicki]: paid. Well, [Chair Robin Scheu]: because it's it is. It's where the where the appropriations are. It's not it's not a tax appropriation or would be it's not smooth it's migrated and it's not tense let's differentiate you've got two things right it'll be very all right thank you all very much Trevor. One of them. Hi. Trevor will send the thing to Nigel, and you'll get your thing to send back. They know that this this is coming. So, thank you all. We're done with that for now, and we're gonna segue into federal funds. And, Emily, you got at least a moment to take a breath? [Clerk Trevor Squirrell]: Hello. [Chair Robin Scheu]: Thank you, guys. Thanks. Alright. By the Zoom, right, Erin? [Emily Byrne]: All right. So for the record, Emily Byrne from the Joint Fiscal Office here just to talk a little bit about federal funds. Some of these slides you saw before, although between when you saw them the first time and now, you didn't pass the budget and the budget adjustment again. So, [Chair Robin Scheu]: you know, [Emily Byrne]: a lot's happened. But but, generally so the chair and in conversations with us, we have with the joint fiscal office, we've [Representative Thomas Stevens]: sort [Emily Byrne]: of talked about there's a lot going on at the federal level. A lot of things are changing every day. And just to the extent you have a little bit of downtime between now and when the senate finishes their work on the budget and then come back to reconcile the two things. That it might be a good idea to spend some time sort of thinking about federal funds. You know, they represent about three billion dollars of the appropriations that, the state makes. And just looking, you know, spend some time talking to departments, talking to the agency administration about where federal funds are used in state government, how they're used, not necessarily to think about, like, you know, the doomsday scenario, if you will, of a lot of them going away, but just to sort of get a better understanding of what the baseline is. In if, when, in case there are changes at the federal level in terms of what funds are coming to state governments, they say you have a better baseline understanding of sort of where they're going, what they're used for. You can react accordingly. I think that, you know, the challenge will be if there are changes, the timing that they come in and sort of what programs are impacted and how do those programs kinda fit into the other priorities in state government. And, you know, there'll be a lot to think about. But [Chair Robin Scheu]: sort of [Emily Byrne]: getting that baseline of, like, where they are, how they work, how state government is funded with them, and how who the subrecipients are, who the people that are receiving these funds is just, like, an important thing to understand. And if, you know, like, if nothing happens, it is just a good thing to understand in terms of, like, how state government works and where money is moving and what government is providing for people on behalf of the feds. So [Chair Robin Scheu]: It'll make us smarter. [Emily Byrne]: Yes. So this is just sort of like a general thing about the, you know, federal funds where you recall, I didn't update it for f y twenty six since that's still in flight, but the f y twenty five has passed budget. Was about a third federal funds and about two thirds of state funds. Right? And that's everything from the general fund to the ed fund to special funds, trust funds, etcetera. And then this chart, this is the state versus federal funds by sort of area of government, if you will. So you can see in Medicaid, that's where we get the biggest chunk of federal funds. It's a little bit over they pay for over fifty percent of the Medicaid program in Vermont. And, yeah, you can also see that the and transportation is another one. It's like, you know, there's both the when you like, looking at this chart, supposed to sort of think think about it in two ways. Right? Both sort of the size of the bars. Right? So that kinda gives you the total dollars, but also in the sort of percentage of the program. Right? So, like yes. [Representative Michael Mrowicki]: Go ahead. So if I'm reading this chart, approximately a billion and a half in Medicaid. Yes. And how much is it in education? [Emily Byrne]: Education. That's a good one. It's about the hundred and fifty million. So in the education The agency of education. Mostly at the agency and, like, the title one grant the title grants. [Representative Michael Mrowicki]: Grants that go go straight to the school. So what's the total in education? Do you know? [Emily Byrne]: A federal funds? Three hundred and fifty four million? Million in the FY twenty five. [Representative Michael Mrowicki]: And then the last the other big one was transportation. How much is that? Yeah. [Emily Byrne]: It's better it's easier to look at that on this chart. [Representative David Yacovone]: It's the three. [Emily Byrne]: Almost five hundred million. [Representative Michael Mrowicki]: Million. Excellent. Okay. [Emily Byrne]: So in the this column, the sort of federal share, that gives you a little bit more I did change that number. But I the one that's a little tricky is the education one because if you look at, like, all of the education money, it includes the ed payment. Right? But if you I try to make try to note that. Right? If we take the ed payment and teachers' retirement out of it, there's about four hundred million dollars going to education, sort of state funds, general funds, and federal funds. And then of that, about eighty eight percent of it is federal funds. The the, you know, the other places where there's a lot of federal money, the Department of Labor has a lot of federal funds for the UI program. Certain areas in the protection area have a lot of federal funds, and, housing has some has a bunch of federal funds in it. So there's federal funds kind of everywhere. And the the presentation that I gave back in February, we can resend that around. That dives into a little bit more detail by department in [Chair Robin Scheu]: terms of what the breakdown of federal funds are. Emily, there is nothing here. Tom just made a point. [Emily Byrne]: I don't see agriculture. They are in the way this and so this is organized by the budget. Right? And agriculture is considered a protection. [Chair Robin Scheu]: Under protection. [Emily Byrne]: It's under protection because it's a regulatory function. So the agriculture I don't have the agriculture detail in front of me. That's gonna be on the in the presentation I gave before. We'll send that back around in terms of but ag is another He takes a lot [Chair Robin Scheu]: of federal funds. [Representative Thomas Stevens]: Grants, some loans, and very little little staffing to the to the state, but still, it's just a lot of [Chair Robin Scheu]: Mhmm. [Representative Michael Mrowicki]: Lot of money for for farmers. And there's one of the bars that says protection. [Emily Byrne]: Yes. Protection. Yeah. So that's the the section of the state budget that includes everything. So that's [Chair Robin Scheu]: It's the b two hundred section. [Emily Byrne]: B two hundred. It's two hundred section. It's a big umbrella and includes everything like the judiciary and the attorneys and the defender general, the state police, and then, like, regulatory functions. So the Department of Financial Regulation is sort of considered a protection function. The secretary of state's up Utilities. The Public Utilities Commission. [Chair Robin Scheu]: Any of your two hundred numbers in your budget portfolio will show up here. Yeah. So does cannabis. Thank you. Mhmm. [Representative Thomas Stevens]: And maybe I'm jumping the gun to a larger conversation, but you had listed off at the very beginning. Your preface just sort of saying alright. So let's say any of this gets cut. You know, one of the things that I keep harping on, like, that I don't see or that I don't know about is is scenario planning. Each of these has a bunch of dominoes underneath these dominoes. Right? So if one of these goes Medicaid, for instance, says, oops, five hundred million is gone. The our or at least JFO, and I'll have the same question for the administration. Are we doing the scenario planning of what is it gonna take? It's not gonna be just four hundred or five hundred million dollars that we can we have to know what silos that money is going for. We have to know that will this affect hospitals, will this affect doctors, will this affect, you know, the that community, same with the education. So I'm just curious, like, how how deep are each of are you able to get to [Chair Robin Scheu]: Yeah. [Representative Thomas Stevens]: In the in the thinking of what how are we gonna react? [Emily Byrne]: Yeah. And so we haven't done really any scenario planning at this point. I think because the, like, pieces that are challenging and we've done a lot of thinking and talking about scenario planning. But I think what's really challenging about trying to do a scenario planning when you have no idea what the lever that's gonna be pulled is. Right? Like, is we don't know if it's gonna be a change in the match rate or a change in the eligibility or a change in the, you know, what how that what that will look like. What that looks like is gonna drive the decisions that you make. Right? [Representative Thomas Stevens]: Right. It's I just think the art the art of scenario planning is practice. Mhmm. And and and it sounds like your brains are keeping you up at night anyway thinking about what what those are gonna be because that's I'm right. You're absolutely right. You're never gonna know until it's an you're never gonna know if there's a Spanish inquisition, you know, and COVID. And or COVID or, you know, something of and so I appreciate that, you know, not that you're up all night thinking about it, but I am. And I just wanna make sure that we hit the ground with the idea instead of being surprised that we're at least prepared with sharpened pencils. [Emily Byrne]: Yeah. And I think that's sort of part of what this exercise is, right, is to get all of you thinking about, right, like, where you know, if where it comes, when it comes, sort of what what are the what are the things that, like, we really can't as government, we really shouldn't stop doing if the federal government walks away, and what are the things that we would scale back, and what are the things that, you know, we would do differently if we're, you know, somebody not do it at all anymore, depending on what happens. Right? [Chair Robin Scheu]: Thank you. Yeah. [Emily Byrne]: So these are sort of Emily's random thoughts on federal funds that I thought would just be sort of good table setting before starting to hear from agencies and departments and other entities. But so a lot of times when we talk about federal funding, there's match requirements. Right? And so that sort of built into the state budget occur currently. Depending on the type of federal grant will impact, you know, what the the match is. And I think meant to say this at the beginning, but I think if you've seen one federal grant, you have seen one federal grant. Right? They're all they're all different rules and match rates and all that kind of thing. You know, some of them are older, they're younger. They just they're all different. I brought this is my silly prop, if you will. This is a these are two books I brought with me that I have carried with me since being at the Agency of Education, but is this is the administrator's handbook. I know it's called the EGR, which is the updated education department's general administrative regulations. And it includes both how you implement federal funds for, you know, based on two CFR two hundred, which is the uniform guidance, and then what, you know, the Department of Education says you have to do. And it's, like, not a short like, this is a lot of very fine print and a lot of these are all the things I flagged. And then I was there when issued up. Like, this is version number four, and it's significantly larger. And looking at, like yeah. So this is you know, like, implementing federal funds is complicated. This is my favorite note that I found that I wrote when I worked at AOE that says, if it walks and talks like a sub grant, even if we call it, it it is even if we call it a contract. That was an important thing. But, anyway, but, anyway, it's complicated. There's a lot to it, and it depend like, every federal fund has a different this isn't sort of applies to all the US Department of Ed money, but, you know, every funding stream sort of has its own set of rules along with the sort of general rules that apply to how you implement it. And right to the extent, right, like, we have a small f federal system. Right? Every the federal government has said, we wanna accomplish this thing, but we're gonna leave the bureaucracy at the states. We'll let the states do it on our behalf, and we will audit them and monitor them to make sure they're doing the thing that we ask them to do within the rules that we have set up. But that some grants have more flexibility in terms of what the state is allowed to do with the money versus others where it's very prescriptive in terms of this is how you're gonna commit it. So to that end, some of them have match requirements. Right? And the federal government says, you know, we kick in a dollar, you kick in fifty cents, and then we'll call it a deal. And that's just, you know, an important thing to think about because those that match is sort of embedded within the state budget. I'm thinking through if there are changes to those federal funds, what does that mean for the availability of match? And the one you hear a lot about is the the FMAP, the Medicaid federal Medicaid assistance percentage. A lot of federal grants have, you know, what we talk about is maintenance of effort. So meaning the, the extent state government was providing that service prior to the federal government providing, you have to continue to provide that service and continue to provide the same level of service using your state funds going forward. It's also sometimes, it's talked about as a sort of supplement versus supplant. Right? You can't use the federal dollars to supplant state dollars that are providing the same thing. The federal dollars are used to sort of supplement the programs that the state is providing. The single audit colleagues from the administration have come in. I know they're gonna speak more to the single audit and the CEVA, but the single audit is the sort of, review that the state has to go through of how it spent its federal dollars to make sure it's in compliance with, like, these types of rules. A lot of times federal fundings have small state minimums or per capita allocations. In Vermont, we talked a lot about small state minimums and this were a benefit associated with getting a small state minimum. In many cases, if the federal grant was calculated on the per capita basis that is used to help to give funds to states like New York and California, Vermont would not have enough money to operate the programs. So I can't remember. It depends you know, again, it depends on the grant. It depends on sort of how it was set up, but that some of the smaller states, Vermont, Wyoming, South Dakota, get sort of a minimum amount of funds to operate the programs. Those small state minimums, though, depending on the program, depending on sort of what's going on, the minimum hasn't necessarily changed at all. So in some instances, you have a small state minimum that's been the same for years, for decades, and sort of we're operating. Right? It's doing more with the same nowadays. Rules on administrative use of the funds. So I sort of talked about there's lots of rules on how you whether or not you can buy food or how you what, like, the rules around travel are, and there are just lots of administrative rules. But, you know, we've talked about with internal service funds that the federal government sort of recognizes that there's administrative costs to operating programs on their behalf. And there are positions often funded in those you know, we've also have all these sort of cost allocation plans across state government that operate differently that allow state government to sort of draw on those federal grants to use federal funds to do the sort of base operating of state government. And we talk about that a lot when we talk about these sort of internal service funds and how federal funds are used for the internal service programs and sort of it's a way to make sure that the federal government pays its share of things, like fee for space or human resources or finance management. Similarly, like, just as, you know, like, to keep in the back of your head, right, federal grants, they're really contracts with the states. Right? That comes with terms and conditions, and we have to sort of follow those terms and conditions and allow the state and federal government to sort of and they get negotiated. Right? Thinking about just, like, different types of federal funding. So there's, you know, categorical grants. The categorical grants are more of the, like, hey, states. Do a thing, and we'll pay our share of it. So some examples. Right? Like, the the WIC program or the title one, funding that goes to schools for low income kids. There's also block grants where that's where the federal government says, hey. Do a thing, and here's a pile of money, and go do it. Right? Block grants tend to have a little bit more flexibility generally than the sort of categorical grants. An example of this is TANF or the CPDG grant at ACCD. There are also competitive grants, which in my head is more of the, like, the federal government says, like, hey. We've got a pile of money, and we want someone to do a thing. Anybody want it? And then states or municipalities or, nonprofits, whoever can go and apply for those funds and then do a thing for a certain period of time. One that I pulled off of the JFC list recently was we got some money to do LIDAR mapping. You know, it's a one one off kinda thing. It's not like that sort of continuous thing. And formula grant and categorical and formula grants overlap. Sometimes the categorical grants are, you know, allocated by formula. But, you know, Medicaid is sort of the big thing that we think about when we think about formula grants. And that as long as we're, you know, doing the thing that qualifies, they we get the money to reimburse us. There's no, like I shouldn't say that. There may be a we can we can't just spend forever, but there is a, like [Chair Robin Scheu]: Sort of ongoing. [Emily Byrne]: Reimburse as long as we incur the costs. So in thinking about, like, reviewing federal funds and some of the conversations that you're gonna have, right, thinking about, you know, if there's a state match that's required, or is there a maintenance of effort that's required that if there has to be a change related to a federal program, sort of how does that impact whether or not you know, if a federal program goes away and there's state match associated with it, we still have the state match that could be redeployed elsewhere. You know, thinking about are there positions funded with the dollars that are implementing those programs and how those positions sort of are doing federal programs versus other things, learning about who the sort of beneficiaries and subrecipients are. Right? Sometimes a a subrecipient could be a nonprofit or a hospital or whoever. And then beneficiaries is more thinking about, like, what individuals are receiving WIC benefits or Medicaid benefits. And this one I just put in there because sometimes it's actually another state entity that's a subrecipient of federal funds from an agency or department. So an example might be the Department of Public Safety gets a grant from Homeland Security. And one of the things they want done is, you know, they give money to the judiciary to put some additional security at the courts. Right? So the federal government has one partner that they're working with when they give the grant to the state. But then within state government, because, right, we're all all states are organized differently. The disbursement of those funds among the state may differ. And a lot of times, you'll see that in the interdepartmental transfer line. So there sometimes there are federal funds embedded in an agency within the interdepartmental transfer line. So it's, you know, understanding both, like, what are they taking in, but then also if they're receiving funds from other entities within state government. Understanding if the funding is an entitlement. So whether or not if somebody qualifies, do they get the funds no matter what? So these are just, again, some random Emily things that we've thought about at JFO, and then I thought about related to federal funds. And just a couple resources. This slide, I know we've looked at before, but FFIS provides a lot of good information. They're providing a lot of updates based on what's currently going on in Washington. They have this federal funds per capita summary for all of the states, and this is a good, bit of information about sort of how much federal funding is coming into Vermont. And JFO has put together a website or a page on our website. So if you go to the subjects on our website and then under other subjects, it says federal funds under the Trump administration, and then it provides it has, you know, by those function areas that we talked about that the budget is organized under to the extent we're getting, information, we're posting it on the website. And it's not meant to be a repository for, like, newspaper articles. It's really when there are, official documents, either produced by entities within state government or by the federal government about the state of federal funds that are being posted there. That's all I have at this point. [Chair Robin Scheu]: Do you know if you [Emily Byrne]: have any questions for me? [Chair Robin Scheu]: And this was on our website, and it's very helpful. Thank you for helping us think about how to think about it, which is you know, we haven't really had to we were chatting earlier. You know, most of the time that most of us have been at stake, Gavin, we're saying, oh, yeah. There's federal funds. Great. You know, now we don't have to worry. And that is not the way we need to be thinking right now. So because we haven't had to think about it, now we do, and it's really helpful to have a sense of how we should think [Representative Michael Mrowicki]: about it. [Chair Robin Scheu]: So thank you, Emily. And I assume you're gonna be sticking around for Yes. Next presentation. So secretary Clark and Richard Gresham would like to come table, we'd appreciate it. And can we get copies on it? Erin has made some copies for us. Oh, wow. I only had her pick Just I we just did the one on set up by state agency. I didn't do the other one. Yeah. The best look to have. That's one of the most sense. [Vice Chair James Harrison]: I I lose my computer. Yeah. That was very helpful. Thank you, Aaron. [19 seconds of silence] [Chair Robin Scheu]: I know you've all been missing spreadsheets. I know it's been a week or two, so it's good for us to have a spreadsheet again. Jeez. [Vice Chair James Harrison]: Ready for us to Yes. It's been great. Just introduce yourselves [Chair Robin Scheu]: and take it away, please. [Vice Chair James Harrison]: I'm Sarah Clark. I'm the secretary of administration. [Representative David Yacovone]: Adam Greshen, commissioner of finance and management. [Speaker 3 ]: Welcome. Thank you. [Vice Chair James Harrison]: Yeah. Thanks for having me back this week. I think we're gonna maybe do accomplish two things while we're here today. One, commissioner Greshen is gonna talk about the what data is available right now for you, which, Erin just kindly handed out, as it relates to the schedule of expenditures of federal awards or the CIPA. So Adam will talk a little bit about that. And then I thought it might be helpful I was here, I think, in mid February, talking about how, the administration is approaching the kind of monitoring and assessment of federal action. And I thought we could talk a little bit about where we are from where we were, gosh, almost two months ago that I was here, which is a slightly terrifying timeline. [Clerk Trevor Squirrell]: This is [Vice Chair James Harrison]: I'm buying a plate. So Great. Refresh. [Chair Robin Scheu]: And we'll use this as the basis for, like, what we're getting from the other agencies. So Right. So [Representative David Yacovone]: thank you, madam secretary. So what you have in front of you is affectionately called the CIFA, the schedule of expenditures for federal awards. And just, you know, for a little lighthearted banter ahead of that, if you guys remember, I sat in this very chair a month or so ago on bended knee. I say I was on bended knee. I wasn't sitting in the chair defending my department's budget. And I said that, you know, part of our finance and management team, kind of the outward facing folks were here defending the budget advocating. But the bigger part of the department is actually financial operations, FinOps. And they're more internally focused and kinda hidden away doing a lot of the reporting that's, not only required to make sure we're staying within budget parameters that you guys said, but also, putting out the required federal and state reports. So one of the things that they do, and this is under John Becker's group, is the ACTFAR, which is, at the end of the year, by December thirty first every year, is issued. And the the a number of other reports they do, but the other main report is the CIFA, which is due March thirty first of, the the nine months, basically, from the end of the fiscal year. So the fiscal year ends June thirtieth. Nine months from then is March thirty first. So, by law by federal law, it needs to be issued by then. So, typically, the end of March, I signed this, I think it was two weeks ago. Typically, we'd have it ready by the end of March. To do this report, departments and agencies go to our website and which you can do too. And under finance and management, and you click on reports, and forms, actually, you click on. And there there's a whole bunch of forms. This is part of what we call the act for nine. So I call it the ninth form that we ask people to fill out to make sure that we can get our accurate out in time. And that is the Act for nine is the SEFA report or SEFA form. And this is submitted the information in this report is submitted by departments and agencies to financial operations early September, believe it or not. And that's because by early September, the outside auditor that we hire in this this year, CLA, needs to take this information, look at it, put us through the paces, make sure it's accurate. They do a number of just spot checks. They they take a line or two and follow it up. So in total, though, they spend a number of months on it, and then they get back to departments and agencies to check and to ask for corrections. Inevitably, there are corrections they ask for. So the process takes about nine months. So it's it's very time consuming. But the beauty of it is once it's out, we can feel with ninety nine percent certainty that the information is correct. And this information is part of the single audit act, which is, a congressional act, a federal act that requires, recipients of federal awards above a certain threshold. And I wanna say the threshold is, I think, it's less than a million dollars. I wanna say it's, like, seven hundred and fifty thousand dollars So it's not just states, but municipalities, I guess, nonprofits. They all have to submit this, what they call, CIFA, which is part of the single audit act. So that's why we do this. But having, you know, kind of said that in context, it's I mean, admittedly, it's very good to be able to pull this out of our back pocket when we're asked the question, alright. What kind of federal money do you have? So this is really our best, go to sheet. And you can and I I think we're sharing the Excel sheet too. So this can be sliced and diced any number of different ways. We've sliced it by, as you see here, agency. You can also slice it by the, ALN number, which is assisted listing number, which is the latter day CFDA. You know, that's how they track the grants, both federally and in state. You can probably also sort it by federal agency. So in other words anyway, what you could also actually, what I did, the first thing I is I sorted by, size of expenditure because I was curious. Sure. You know, part of the question is, alright, what do we have at risk? Probably the best way to see it is sort from largest to smallest. And guess what? Medicaid's our largest, and second on the list would be our transportation, Federal Highway Aid. So, anyway, so this is sliceable and diceable. But what we have here are, you know, we we sorted by agency. You see the agency within state government, the ALN number, which is the the grant is categorized, and then what the name of it is, what federal agency it came from, and whether it's a direct award or indirect. There are some nonmonetary, which are, you know, I would say, in kind. We also have a a category that will go away at some point, probably in two years, actually, which is COVID or not COVID. And then importantly, the two columns on the right are expenditures and amount passed through to subrecipients. The expenditures is exactly that. It's it's what we spent. It is not what we budgeted. And, you know, for the vast majority of these grants, what we budget and what we expend are pretty damn similar. Most of these grants go, for example, that directly to the Department of Health, they've got a very specific purpose. And that grant funds x number of positions or, you know, subcontracts or whatever it does. But, you know, it it's the cost of administering the program for a year. So we typically spend approximately what we receive. A good example of the contrary would be think about ARPA. You know, in ARPA over, I think, the course of I think we may have received two or three different checks. Yeah. We received over a billion dollars. And, you know, that clearly we haven't spent all. So there'll be a very large discrepancy between what we receive, and what you see on this expenditure report. Over time, they the two should equal. But so this reports on expenditures. And like I said, typically, they're similar, but they're oftentimes not exactly right. [Chair Robin Scheu]: We don't we're missing that column that's that's the amount of the original brand, basically. [Representative David Yacovone]: Yeah. Right. This shows you what we spent. Right. [Chair Robin Scheu]: So what we don't know is, you know, if you're very business innovation for eleven point two million, it was really twenty million and they only have spent eleven. That's the what's kind of a piece we're missing. [Representative David Yacovone]: Typically, yeah, I mean, I'm here to tell you that generally it's similar, but not old. [Chair Robin Scheu]: Except when it isn't. [Representative David Yacovone]: When it isn't. [Vice Chair James Harrison]: When it's an annual allotment. So let's say it's reoccurred every year for the last however many years. Right? So which we have a lot of programs that operate in that Right. Manner. So we would [Chair Robin Scheu]: know that as from this piece of paper. Correct. And so if I were to just go through, again, that dairy innovation one just because I I've highlighted it. So they were they have expenditures of eleven point two million, and then they passed nine point two million to subrecipients. Does that mean that they kept the other two million, or it just hasn't been spent yet? [Representative David Yacovone]: It could be for pay it could be for payroll. You know, it could be for operating expenses. I mean [Chair Robin Scheu]: Or it could [Vice Chair James Harrison]: be unspent so far. No. These are actually expenditures. So that's, I think, what's helpful about the CIFA. It reflects what was actually spent in state fiscal year twenty four. So the way and because I've had some conversations in this arena as it relates to subrecipient payments. So I would say the delta between, in this case, the eleven point two percent and the nine point two percent is probably what they spent on their internal operations, like their staff or operating expenses. It could include contractual payments because that's different than a subrecipient payment. [Chair Robin Scheu]: Right. And we can't tell from here who the subrecipients are. They're just somebody [Vice Chair James Harrison]: Yeah. In organizations. Right, Jim? [Chair Robin Scheu]: Okay. [Representative Michael Mrowicki]: So we don't add these together. No. Correct. Okay. How do we know which of these? I mean, there are some, obviously, that are part of your budget that's presented to us. I mean a lot of departments have federal funds categories but we also broadly here we get we've run fiscal committee to get notifications that you've signed off on that requesting approval that aren't part of the budget and they are, like, like Adam said, for specific purposes and it might fund a couple positions for a temporary period while that grant is going on that they were awarded and get approved. But those don't typically mature outside the budget cycle. [Representative David Yacovone]: So that's why sometimes looking at what's budgeted is not particularly tight information because that's precisely right. What would happen is we get a grant midyear. You guys approve it. I write an excess or sign an excess receipt, and that money is off to the races. That would show up here on expenditure [Representative Michael Mrowicki]: Well, because that's exactly [Representative David Yacovone]: if it was that's right. Well, if it were expended, it would show up here. If they didn't expend it yet, it wouldn't. But if it were expended, it'd show up here, but it wouldn't show up in the budget of that year because You know? They didn't have it. Yeah. So Yeah. You know, there's anyway, yeah, that's how that would work. [Clerk Trevor Squirrell]: Right. Back on the nonmonetary, can you explain how that works if what's nonmonetary? [Representative David Yacovone]: I would probably best refer to that as in kind. [Clerk Trevor Squirrell]: So I might use the word in kind to say I didn't say we're getting a grant and we had a match of twenty thousand dollars in in kind. I did twenty thousand dollars worth where you get the money from the folks. It would be in kind. So I see, like, a hundred and seven million. That's not happening like that. [Representative Thomas Stevens]: Or it [Representative David Yacovone]: could be food, for example, for a summary BT program. You know, maybe they deliver, you know, a crate of bananas. I don't know. I mean, there's it it could be any number of things. [Clerk Trevor Squirrell]: So the feds could could provide under seven million if agriculture could provide that much in goods. [Representative David Yacovone]: That's right. Or equipment, with public safety, you know, stuff like that. But that's typically why I I understand. [Representative Thomas Stevens]: Go ahead. [Chair Robin Scheu]: Go ahead. [Representative Michael Mrowicki]: Yeah. I suspect I mean, there's some grants that require some in kind Yes. Information to forward if they're gonna receive money to do very specific motions. [Vice Chair James Harrison]: And I think that's one of the items that Emily had on her side for consideration and one that we've been discussing, you know, as you drill in trying to understand our federal expenditures, understanding, like, what's the what's the is there a state match requirement, and what [Chair Robin Scheu]: is it? That's fine. So [Vice Chair James Harrison]: And so maybe I can follow-up. I think Rep Harrison had a question about this report doesn't have the list of the subrecipients, and it doesn't. That's not on the SEPA. But there are some other data sources that that don't necessarily tie exactly to the SEPA and what were the FY twenty four expenditures, but it can give you a sense of, for example, who and what organizations make up that subrecipient grouping. And so on our, and we can follow-up and provide the links to, Erin on our website. It's called Spotlight for Financial Transparency. And so there is a variety of like really detailed information there to include a by fiscal year listing of grants that were issued, in FY twenty four, for example, that's the most recent year where we have information. And what's helpful, about that is that it gives you you can sort it by federal funds and by ALN, formerly known as the CFDA number. You can sort it in that manner, and then you can see all of the subrecipients that received funds from a federal program. So it can give you a flavor, like if we were talking about the Temporary Assistance for Needy Families TANF program, if there were subrecipients being funded by that. It'll give you a sense of who those organizations are and for information because I think it is important to understand that. And that's something at human services. We do, Adam's team publishes that every year. You can see the grants. There's also a listing of contracts. But at the Agency of Human Services, something that we had our own separate, very specific request on our grants issuance that when I was the CFO there, we provided to the legislature every year. So it provides some more deeper details in terms of how we are issuing and to whom we are issuing grants. So I think that may be helpful to the committee [Chair Robin Scheu]: as well. Questions that I have about this? So Okay. So [Representative Thomas Stevens]: it's quite a list. Not sure. I'll I'll find the helpfulness of it eventually. But [Chair Robin Scheu]: the [Representative Thomas Stevens]: so in the case of what's going on, so using agriculture as an example, there have been certain agricultural programs that have already been cut or the funds have been frozen or what have you. Are you tracking those on the same thing for fiscal year twenty five where we know that if and I and I can't say which ALN number is the right number, but let's just say the USDA USDA Food Bank network where I know that that the food bank has, had funds frozen. It is really kind of substantial amount. Are you tracking those in a different document so that if this were up to the minute accurate or up to the minute not accurate, but up to the minute, you know, where a certain amount of funding would be highlighted so that we would be able to see that. Is that is that in your plan to make sure that so that at a press of a button on any given week at the end of any given week, you'll know which funds have been potentially frozen cut, whatever the phrases are. [Emily Byrne]: Yeah. That's a [Vice Chair James Harrison]: great segue to what I wanted to talk about next. So thank you, representative Stevens. And I wish Atlanta. [Emily Byrne]: No. I know what next. It's [Vice Chair James Harrison]: that very, like, communicado. I wish we could press the button and understand this stuff, but we but we can't. But I will say, you know, when I was here back in mid February, I think it was, you know, we talked about what approach we are taking in terms of being sure that we are assessing and monitoring very closely action at the federal level. And I think since I was here two months ago, that that action has certainly picked up quite a bit. But it's still, like, from when an announcement is made at the federal level, trying to understand what the real impact of that federal action will have in Vermont still takes time. But we have instituted a process whereby agencies and departments, as they learn of, I'll say, more of a real impact, They are communicating them up to my office for aggregation, manual aggregation. No button is being pushed, but for manual aggregation so that we are monitoring them all in one place so that not only so that we can understand what's maybe real and maybe not quite real yet, but also kind of across the executive branch with the intended goal of being able to update the legislature, whether it's when you're in full session as you are right now or in anticipation of potential summer work through the joint fiscal committee, and some of the language that I think you incorporated into your version of the big bill. So it hasn't yet been an external document, but I think it's in large part, there's not there's not a lot yet that I would, like, say is a firm line in the sand yet. Even though it sometimes feel like it is, it's still not always clear what the real impact is gonna be. And so as we are managing the operations of state government, we wanna make sure that we, as calmly as possible, assess what we're learning and understanding from our federal partners, so that we'll be able to respond when that time is right. And the reality is, like, when we'll talk about the local foods program at at through the USDA to the Agency of Agriculture, know, I think we did receive termination notices for those, and it's about, I think, one point seven million dollars. [Chair Robin Scheu]: Was that a signed contract, or was that money you were hoping you would it had been agreed to, but not a signed contract? [Vice Chair James Harrison]: I think there was a plan for how we were gonna use those funds, but I don't I I wanna just follow-up to confirm in terms of the obligation status of those funds if it was a signed contract or not. [Chair Robin Scheu]: Kind of interesting to know. [Vice Chair James Harrison]: Yeah. And and I will, for sure, follow-up Yeah. On that. But I raise that as an like, as an there's, you know, one thing that we've learned of. I think folks, there's been some directives coming from the federal government and the library space in terms of, [Chair Robin Scheu]: you [Vice Chair James Harrison]: know, letting go all of the federal staff or putting them on paid administrative leave, more precise, paid administrative leave, all of the staff of the, I think it's Institute of Library and Museum Sciences. But as of yet, we have no determinations on whether anything's gonna change related to the federal funds that we receive. And so that's one that we're tracking, but no action at this point, but we're tracking. And I raise those those as kind of two examples is because as we're hearing things, like some are from concrete and others, but as we look to the future, we're gonna have to evaluate everything, you know, across all of state government, but across all of Vermont as well, as we figure out the most appropriate path forward. And so it's important that we are aggregating and understanding the real impact, but making sure we allow ourselves the ability to reflect in a more broad as broad a scope as we possibly can to figure out the best path through. [Chair Robin Scheu]: Dave, [Speaker 3 ]: I'm jumping to different sheets. I lost my place on the first one, but there was a twelve million dollar expenditure for WIC. There was no subrecipient. So I thought I assumed, which I shouldn't, and said, okay. The health department staff themselves are probably handing out those foods, etcetera. They don't subcontract out to a contractor. And maybe that pays a portion of a nurse's staff engaged in a district health office. But where I was going with it was, oh, I wonder if it's better bang for your buck by subcontracting out with a community based nonprofit, family center, what have you. Would you get more for your dollars that way? Would they be less costly? Do you does anybody ever do those kinds of questions, or should we rethink how we do what we do? And I don't even know how those funds are distributed. It could be but there was nothing in the subrecipient line. So I assume that means Yeah. Somebody got the twelve million in resources out to somebody. [Chair Robin Scheu]: Yeah. I think it I think it's Well, Emily, go ahead. [Emily Byrne]: Go ahead. I think one thing that's important about the CIFA and looking at it. So a sub recipient when it comes to federal grants is sort of a very specific thing. Right? At ease of the state has written a grant agreement with that sub recipient. So like if you look at the right. Right. This is the space that I know. Agency of education lines, you'll see that, like, f y twenty four expenditures and then the sub the sub recipient amount is, like, pretty high because all that money is moving into the brand agreement with the school districts. When it's a program like WIC or program like Medicaid, what you're seeing on the CIPA, the beneficiary payments to the moms on WIC is not a subrecipient relationship with the state. It's a beneficiary payment. So, payment. So it doesn't show up in the subrecipient column. So maybe the twelve million dollars you're speaking to isn't just it's a combination of both the costs to operate the program by state government as well as the actual payments going out to Understood. Yeah. The I think that's just an important thing. Right? Like, the state government is spending one point four billion dollars on Medicaid. We are sending close to that [Chair Robin Scheu]: to the health care parameter. [Emily Byrne]: But if you just look at this, it looks like if you're not understanding what that column is specific. [Chair Robin Scheu]: Which is why we need a little bit more information than we this is a great starting point, but that's why we need more information because are they subrecipients? Are they beneficiaries? What was the original amount? That sort of thing. So yeah. Hopefully, that helps. Yeah. [Vice Chair James Harrison]: Thanks, Emily. And and I think I know I understand that the intent is that you're gonna be asking agencies and departments to kinda come in and talk a little bit more about their federal programs in addition to the data. And so I think that that would be a great a great time to, you know, to highlight some of the things as Emily's pointing out in Medicaid. It's really a lot of money that's going out in payments to support Vermonters who are in the program. I think your questions, Representative Yaccarbone, about the WIC program, I can't specifically answer if we've kind of thought about what's the most effective structure. But maybe it's a better conversation to have as you bring in the departments that will have more of that knowledge on how they they administer the programs. [Speaker 3 ]: And going through here, there's there's a lot of, food. You know, there's staff, there's WIC, there's [Emily Byrne]: There's just [Speaker 3 ]: school lunches, etcetera there too. The opportunity, if it exists at all, for the subrecipients who have the best relationship with the family or should have as opposed to maybe no one does. You know, are there ways to consolidate surround work? But anyways, you try to coordinate that in a way that you've got ABC as our main provider and they're in the Ackermany household and they can tell us when things are fiscue or they need a helping hand [Emily Byrne]: Yeah. [Speaker 3 ]: Etcetera, which is which is because there's opportunities sometimes. [Chair Robin Scheu]: Yeah. Yep. Hey, Jim. [Representative Michael Mrowicki]: Obviously, the sector size can be actually very positive, any number of aspects. However, it can be very scary. And we hope for the best and prepare for the worst, I guess. But my question to you is if we get significant reductions and that's hopefully not gonna happen, but if we do, are you asking departments to give us what you absolutely have to have, must have, or services of government versus nice to have that maybe, you know I mean, I I and I'll give you example, and and and and don't take this wrong. Last week, I heard, humanity's lost a operating federal operating grant for five years. K? It's like forty two percent or something of their budget, and it might be devastating to the humanities. I love some of the work that the humanities does. You know, they bring speakers. We've had them in our historical society. Other all good to me, and I and I'm just speaking for me. They may not be a must have for government if it ever came down to that. So other people may have a different view on that, but I don't are you asking your departments to prepare for that if there are significant I don't know how you make up the Medicaid money. I really don't. I mean, even if you wanted to raise taxes, you can't. [Chair Robin Scheu]: There won't be enough. [Representative Michael Mrowicki]: There isn't enough capacity to do that. But but aside from that [Representative David Yacovone]: so we do that every budget cycle in October when we meet with agencies and departments. And years ago, and you probably remember [Clerk Trevor Squirrell]: But do [Representative Michael Mrowicki]: you have stuff in your budget just like we have a few other budget, then arguably, they're nice to have. You know? Must have. [Representative David Yacovone]: And when we go through department budgets, we start with what revenues we have available, and then we start with what expenses we need to meet. And to the extent that there's a hole there, we ask departments to make reductions, to make choices. And at the end of the cycle, we have certain choices that are made. Oftentimes, none of which are good. But usually, I would use the terminology, they are the least bad of the bad. And so that will come out, Jim, inevitably. To answer your question more directly, we haven't yet. We have not asked departments to start going through and telling us, you know, what's nice to have and what they have to have because we don't have enough information to know whether that's even an exercise we have to do. So but come budget time, yes. Absolutely. We will do that. And I'm frankly anticipating that this coming budget season, with or without loss in federal money, frankly, is going to be challenged based on our economic you know, our revenue forecast and our embedded base spending. So I'm sure that will be an added pressure. [Representative Michael Mrowicki]: Worry about that too, but, you know, I'm too. Everybody knows that I'm a Debbie Downer sometime. Place your life here. [Vice Chair James Harrison]: I think what I would add to commissioner Gresham's comments is, in some ways, there's still a long way to go to knowing what's actually gonna be in the federal budget. And, you know, with driving in in the morning and hearing about where this, you know, US Congress, the Senate is at versus the House, how are they gonna reconcile those differences? And so we don't really know yet what the landscape will be. But that's why I think understanding where we are right now with our federal funds, assessing change as it as it becomes real impacts us, but really working with the legislature to focus on our shared priorities, housing, affordability, [Chair Robin Scheu]: public safety. I mean, protecting [Vice Chair James Harrison]: the most vulnerable, for sure. But focusing on making sure we are operating state government as effectively as we can so that we're prepared for for what may come next. I mean, we can't [Chair Robin Scheu]: we can't dream up all the possible scenarios, and whatever we dream up, it'll be something else. So that's why it's so important for us to understand the complete lay of the land as much as we possibly can. And we're we'll all be thinking I mean, I lie in bed in the morning and say, well, what what if we lose all that then? You know, what are the core functions of government, and who's gonna be most harmed, and how can we be sure the fewest Vermonters are harmed as we go about all this stuff? So and then we just have to be ready, as ready as we can be. Now any other thoughts? So we will be getting agencies in, and other, other state entities that are not agencies. So the treasurer is coming in. Tell you what's happening. I don't know if I have all that. Is there do folks have any more questions for If I may. Say go ahead. [Speaker 3 ]: I'm sorry. Oh, no apologies. I appreciate the balance between not wanting to increase anxiety needlessly against planning thoughtfully. And some of these things may be we like to be say we use words like we should be transparent. Sometimes you want to hold things close to, you know, to the vest. But saying to the director of Medicaid, what if we lose ten percent? What would you do? What if we lose twenty percent? What would you do? Same thing with other you know, you could pick DCF, you could pick Dale. That to me would would, you know, some business office managers and deputies who let you know, you wouldn't have to take the whole workforce at a department and so they're losing sleep, which they may already be, but would be good information to have in your back pocket. And I guess you haven't started down that path yet for you'd prefer not to go there. [Vice Chair James Harrison]: Not specifically. But I do think I think one of the things that you're gonna have a discussion about is the Medicaid program, right, which is the largest program in state government. And they're they're already and I think even as you're every year, you have probably a Medicaid one zero one in this committee, and we talk about discretionary mandatory services. So I think, like, getting everybody's brains wrapped around that in that one program, I think, is is valuable. I mean, you know, this year, maybe you normally get, like, an hour where you get a primer on the Medicaid program. You know, I think Right. Digging into those details a little bit more will will set you We'll put the committee in a in a a better place to understand as if there is change, at the federal level. Not trying to be naive, but [Speaker 3 ]: Appreciate that. [Chair Robin Scheu]: We're trying to educate ourselves. So we are gonna have the Medicaid director, Monica Ogleby, and Ashley Berliner, the director of Medicaid policy, in tomorrow morning at nine to talk about it. We will have AHS back. Another time to talk about the specific, spreadsheet and the budget in response to your grants and that sort of thing, but this is also kind of a deeper dive into this piece that is such a huge part of the federal funding the state receives. So they're gonna come in tomorrow at nine. At ten thirty, the treasurer is gonna be in to talk about cash flow and funding and what they're seeing. And Erin's continuing to work. We are hoping to get agency of transportation in maybe by the end of the week because they've already done a lot of this work. And so that'll give time for the other agencies to get their pieces together, and then they can start coming in next week. That's kind of what our plan is at this point. So any other thoughts or Yeah. Just you wanna share? [Representative Michael Mrowicki]: Personal note, I wanna thank Sarah for playing in the March Madness competition. You're one of the few people that actually ended up below me. [Chair Robin Scheu]: What number were you, Jim? Like I'm [Representative Michael Mrowicki]: fifteen, but I wasn't one seventeen. [Chair Robin Scheu]: Oh, that sounds pretty close. That looks like a rally. Thirty two. [Speaker 3 ]: Well, you know what? That's hard. [Vice Chair James Harrison]: Representative Harrison, you've just given me [Chair Robin Scheu]: all the fuel I need [Vice Chair James Harrison]: to enter next year, and I will start You will be happy again. Tomorrow. It's gonna be amazing. The phoenix rising from the ashes. So just narrowly be you is really all that matters. [Chair Robin Scheu]: Yeah. And and we have that here on camera. So Me too. [Emily Byrne]: May I just say that I am astounded that my performance was not highlighted anywhere in any of the emails having risen like a phoenix [Vice Chair James Harrison]: from, like, one twenty four [Chair Robin Scheu]: to number eleven. Ended up at eleven. Really? You're number one in our county. [Vice Chair James Harrison]: Actually Yes. Actually. [Representative Michael Mrowicki]: Anything about appropriations team at all. [Chair Robin Scheu]: Oh, no. And I wanna say something about appropriation. [Representative Michael Mrowicki]: Be set approach, and that's all that matters. Yes. [Chair Robin Scheu]: We we came from behind. We were [Representative Michael Mrowicki]: After they publicly asked her how House approached Yeah. Doing earlier in this [Chair Robin Scheu]: I came to help them out with the budget. [Representative Michael Mrowicki]: Works like we had had a couple. [Chair Robin Scheu]: I have not gone back to mention [Representative Michael Mrowicki]: Forget about joint business. I mean, [Representative Thomas Stevens]: I did I did hear representative Harris now who came out of the ceremonial office yesterday or, no, today. It just feels like yesterday. Alright. Apparently, the plan is that we'll be it will be here for the World Series. [Chair Robin Scheu]: Oh gosh. So Basically, that's our this one's not a no bad thing. I know. Okay. I think it's. That's a little Arch. Okay. March Madness also happens in April. So thank you both very much for coming. I know we'll be having more conversations. Thank you both. Committee, we are gonna meet tomorrow at nine and talk about Medicaid and now

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