by Timothy McQuiston, Vermont Business Magazine Secretary of Administration Sarah Clark released Vermont’s revenue results for March 2025. Only the General Fund exceeded its monthly consensus cash flow target, corresponding to the annual consensus forecast update as adopted by the Emergency Board at its January 2025 meeting. The Transportation Fund and Education Fund both failed to achieve their respective targets.
The consumer- and tourism-related taxes all missed their targets (Meals & Rooms (-1.3%), Sales (-0.4%), Gasoline (-7.1%)), which could be a variance in timing for the winter tourism season winding down, as their year-to-date numbers are all ahead of targets. Meanwhile, the Personal (+1.7%) and Corporate Income (+6.9%) taxes had positive results in support of the General Fund.
The State’s General Fund, Transportation Fund, and Education Fund receipts were a combined $255.3 million, missing the $255.9 million monthly consensus target by -$0.6 million, or -0.2%.
Total General Fund revenues for March were $175.2 million, $4.1 million, or 2.4%, greater than the $171.2 million monthly consensus cash flow target. A combined -$3.8 million underperformance by the Meals and Rooms Tax, Estate Tax, Liquor Tax, Property Transfer Tax and Other category offset the $7.9 million of cumulative gains above target by all other revenue sources.
Revenues in the Transportation Fund missed their $27.5 million March consensus target by -$3.1 million, or -11.5%, yielding $24.4 million in total. A marginal above target performance by the Diesel Tax was offset by a combined -$3.2 million underperformance in all other revenue sources.
Monthly Education Fund revenues of $55.7 million were -$1.5 million, or -2.6%, less than their March $57.2 million cash flow target. A $0.2 million above target performance by the Meals and Rooms Tax was offset by a cumulative -$1.7 million underperformance by all other sources.
It was notable that the underperformance in the Estate Tax was again tied to that source reaching its statutory maximum level of $28.875 million in receipts for the 2025 fiscal year back in January. Through March it exceeded targets by 7%.
According to Budget Director Aaron Brodeur: 16 V.S.A. § 2885(a)(2), “(a) A Vermont Higher Education Endowment Trust Fund is established in the Office of the State Treasurer to comprise the following: (2) in any fiscal year in which a General Fund surplus exists and the General Fund Stabilization Reserve is funded to its required statutory level, funds raised by the estate tax levied under 32 V.S.A. chapter 190 that are more than 125 percent of the amount projected by the Emergency Board in the July annual forecast made pursuant to 32 V.S.A. § 305a.” The 125% threshold has been reached and all estate taxes are now being deposited into the Higher Education Endowment Trust Fund. The monthly targets, therefore, appear to have not been met only because the 125% annual maximum has been achieved.
[The General Assembly established the Higher Education Endowment Trust Fund in the Office of the State Treasurer in 1999 to provide non-loan financial aid to Vermont students attending the University of Vermont, the Vermont State Colleges, and other Vermont post-secondary institutions (16 V.S.A. § 2885). The annual distribution amount is dependent on the investment gains or losses during the prior fiscal year.
[The Fund’s portfolio posted a gain of 10.2% during FY2024, which allows for a base distribution of $1,702,704, representing 5% of the Fund’s rolling 12-quarter balance. Accordingly, each institution will receive the following distribution for non-loan financial aid to Vermont students: 1. University of Vermont: $567,568; 2. Vermont State Colleges: $567,568; 3. Vermont Student Assistant Corporation: $567,568.]
According to Secretary Clark: “As Vermont enters the last fiscal quarter the administration believes the General Fund will meet or exceed target expectations. The Education Fund remains marginally above its cumulative target for the year but is still at risk of underperforming should the economy slow. The Transportation Fund is lagging its cumulative target for the year but still has time to recover. Many variables will determine the State’s year-end financial outcome but the potential impact of federal tariffs on Vermont’s tourism industry could be a factor on whether the Education Fund and Transportation Fund end the year above or below target.”
5.2.2025. Montpelier, VT – Secretary of Administration
