That surplus will be placed into the state’s rainy day fund, which is used to avoid future deficits. This comes at a time when many states are emptying their rainy day funds, raising taxes and still face deficits of millions and — in some cases — billions of dollars.

Vermont Administration Secretary Michael Smith said credit for the budget balancing should be shared by the Legislature, former Gov. Howard Dean and Gov. James Douglas.

"We responded early to the deficit, starting with the previous administration,” Smith said. “We started early to put the brakes on spending."