Public Assets Institute > Press > Op-Eds > A Welcome Change

A Welcome Change

By Jack Hoffman, VtDigger , March 7, 2011

Town Meeting last week marked the second year in a row that Vermont’s education spending has declined.  And it happened without the angst we all felt last year.

Only three districts rejected their budgets. That’s the fewest in at least 20 years. And based on the anecdotal evidence, many budgets were approved by bigger margins than in recent years.

Another change this year: This was the first time in recent memory that the governor didn’t harangue school boards from January to Town Meeting Day about their reckless spending. Instead of the constant noise about out-of-control school budgets and threats to have Montpelier dictate education spending limits, there was mostly a welcome silence.

When the governor has talked about school boards, it’s been to acknowledge the responsible job they do. Although he hasn’t said it in so many words, Governor Shumlin appears to believe that the voters who elected him in the fall ought to be trusted to decide in March how much they want to spend to educate their children.

The budgets school boards put forward were constrained this year, which no doubt helped them pass. According to preliminary calculations by the Department of Education on the budgets that had been submitted by late February, overall spending was up 0.6 percent and education spending, which affects school tax rates, was down about 0.6 percent.

As we know from recent years, taxes can still rise even when there is little or no increase in spending. For the last two years, the Legislature has cut the annual transfer from the General Fund to the Education Fund. In addition, there was little growth in the sales tax and lottery revenue going into the Education Fund during the recession. Both of those factors shifted more of the cost of supporting schools onto the property tax.

Gov. Peter Shumlin’s budget would restore some of the money that has been cut from the General Fund transfer to the Education Fund, but not all. And he has proposed a permanent reduction in the transfer of at least $23 million a year for fiscal 2013 and beyond. Like his predecessor, the governor is asking local school boards to cut their spending and booking the savings in the state budget. If local districts improve efficiency or find other ways to save money, those savings should accrue to local property taxpayers. Unlike his predecessor, however, this governor acknowledges that a reduction of the General Fund transfer to the Education Fund means that property taxes will be higher than they would have been without the cut.

A way to ease that additional pressure on the property tax would be to have all residents pay school taxes based on income. Now about two-thirds of homeowners pay income-based school taxes on their homes. Nevertheless, the school finance system is still regressive. The typical Vermont family spends a greater share of its income to support our schools than do high-income families.

Moving away from the residential property tax for schools is a discussion Vermont should have—perhaps next fall and winter. In the meantime, we should be grateful that voters here still value education and that we don’t have to fight a governor trying to destroy public education as they are in Wisconsin and Ohio.