Vermont state government is organized into nine functions of government. These are:
These definitions are not unique to Vermont. All of the states use similar definitions. This makes it possible to compare apples to apples amongst the several states. Briefly, the functions of government listed above include the following activities:
General Government: This function of government contains the appropriations for the Judicial and Legislative branches of government. Further, it includes that portion of the Executive branch of government which provides support to the balance of state government (including the Judiciary and Legislature). Examples are: personnel, financial operations, buildings, and purchasing. It is also something of a "catch all." Other examples of appropriations within this function of government are: Property Tax Relief, Current Use Value Appraisal, etc.
Protection to Persons and Property: This function of government contains the appropriations relating to the law enforcement community. This includes the Department of Public Safety, the Defender General, the States Attorneys and Sheriffs. Also included are several miscellaneous appropriations, such as, the Military Department and the Fire Service Training Council.
Human Services: This function of government contains the appropriations which concern social policy. Included are public health programs, mental health programs, day care, foster care, aid to needy families with children, Medicaid, general assistance, aid to the aged blind and disabled, etc.
Employment and Training: This function of government is primarily federally funded and is concerned with job placement for the unemployed. Also, the Department of Employment and Training gathers vital statistics concerning employment/unemployment, average hourly wages, gross state product, etc.
Education: This function of government contains the appropriations for K-12 education, higher education, and the operation of the Department of Education.
Natural Resources: This function of government is concerned with environmental protection and the operation of our state parks.
Development and Community Affairs: This function of government contains appropriations relating to the creation of affordable housing and the promotion of economic development. Recently, this function of government assumed the responsibility for operation of the Interstate Welcome Centers.
Transportation: This function of government contains appropriations which support the operation of the Department of Motor Vehicles and all air, rail, and surface transportation activities. This includes the engineering and construction of roads and bridges.
Debt Service: This "function of government" contains the appropriations necessary to make the required, annual principal and interest payments on the state's bonded indebtedness.
A function of government will contain all the appropriations for an agency of the executive branch, e.g., General Government contains the appropriations for the Agency of Administration. Three functions of government have no agency super structure; these are Protection, Education, and Debt Service. All other functions of government contain appropriations for an agency.
Within a function/agency, appropriations are organized into departments. Commissioners of departments of state government, also known as the "appointing authority," have duties and powers described in Vermont Statutes. A small department of government may have a single appropriation, however, departments generally have multiple missions and responsibilities. Therefore, a department will typically have several discrete appropriations specific to each division of the department.
A division may operate several programs. The general assembly does not appropriate to the program level of government. Details of intended program expenditures are given in the Governor's budget submission to the general assembly. This submission, numbering in the hundreds of pages, fills two file cabinet drawers and contains a description of each program's basis in statute, the past year's accomplishments, the up coming year's goals, staffing levels, and expenditure targets. [A more in depth treatment of the Governor's budget submission is beyond the scope of this discussion, the Joint Fiscal Office provides a complete set of budget documents for use by the members. These documents are located in the public area outside of the Legislative Lounge.] Suffice it to say that, while the legislature does not appropriate to this level of government, it expects and requires the executive branch to fulfill the objectives set forth in the detailed submission.
Within each appropriation, be it a department or division of government, there may be as many as four expenditure categories and up to nine funding sources. Vermont state government's accounting system assigns a unique account identification number (AID) to each expenditure category within every appropriation. Therefore, actual disbursements many be monitored on a monthly basis during the course of the fiscal year.
The expenditure categories are as follows:
Personal Services: If an appropriation supports employees who are paid through state government's payroll system, there will be a personal services expenditure category. This category will provide funding for wages and the employer's share of benefits. Also, if the department or division intends to contract for non-employee personal services, the funding will be included in this expenditure category.
Operating Expense: Any appropriation which contains a personal services expenditure category will also contain an operating expense category. Conversely, if there are no state employees, there will not be an operating expense category. This AID contains funding for two basic types of expenditures: consumables like paper, electricity, subscriptions, telephone, etc., and durables like computers and copy machines. The operating expense budget for each unit of government is unique to that departme nt or division. Items included in the budget will vary greatly depending upon whether the division occupies rented quarters or a state owned building and the condition (age) of its equipment.
Grants: This expenditure category contains the funds that will be disbursed in pursuit of a department or division's program mission. Grants may be made to individuals, e.g., Medicaid, and general assistance, or to municipalities, e.g., town highways grants and state aid to education.
Other: This is an unrestricted expenditure category. As the name implies, funds contained in this category are not otherwise classifiable. Generally, the other category is used for disbursements that support a program, but which do not quite fit the grants definition. An example is the Use Value Appraisal Program. Another example is the legislature's own budget.
The sources of funds which support appropriations are:
General: Unrestricted general state revenue.
Transportation: Earmarked state revenue from specific sources.
Fish and Wildlife: Earmarked state revenue from specific sources.
Federal: Federal revenue, typically distributed according to a formula and usually earmarked for specific programs.
Special: State revenue, typically derived from fees and often earmarked.
Bond: State revenue derived from the issuance of general obligation bonds and restricted as to use.
Trust: Highly restricted state revenue from sources such as the state employee retirement trust fund.
Revolving: Funds which are not new revenue from any source. These "funds" represent an expenditure authority which may or may not be adequately financed in any given fiscal year. An example is the State Information System revolving fund. This unit of government sells its services to other units of government and receives payment in exchange. If successful, payments into the revolving fund will equal disbursements from the fund. In any event, expenditures in support of this unit of government may be made, up to the limit of the appropriation, even if it results in a deficit or surplus in the fund.
Transfer: Funds which are not new revenue from any source. These "funds" represent a transfer from one unit of government to another. The original source may be general, transportation, federal, etc. An example is the Fire Service Training Council which receives transfer funds from the Department of Public Safety.