Research & Publications

The latest: Ed funding reform

Earlier this year, the Governor introduced a sweeping proposal to reform public education in Vermont and the House endorsed a similar plan in early April. Now it’s the Senate’s turn to come up with their own plan.

But neither the House plan nor the Governor’s plan address the two biggest problems we face in education funding:

• unfairness in who pays school taxes
• the biggest cost drivers out of districts’ control like teacher healthcare and inflation

And both plans are proposing some big structural changes that raise serious concerns:

• reverting to a foundation plan
• dismantling democratic participation in schools
• state-imposed school and district consolidation
• eliminating income-based taxes and doubling down on property-based taxes

Vermonters did not ask for another overhaul of our public education finance and governance system; they asked for tax relief. Our schools and communities are still reeling from the pandemic and the last decade of major changes imposed by the governor and legislature: consolidation, special education reform, and pupil weighting changes. The state has not provided any evaluation of the outcomes of those reforms, but there has been a lot of confusion and chaos and negative unintended consequences.

How to make school taxes fairer this year and beyond

The two most pressing problems in public education are the unfairness in who pays school taxes and the cost drivers out of schools’ control. Current proposals in Montpelier won’t solve either of these problems. We can provide immediate tax relief to thousands of Vermonters by updating income sensitivity and ultimately moving to income-based taxes. And we can address the cost drivers without slashing school budgets, forcing consolidation, or taking away Vermonters’ say in their schools.

The economy grew, but the labor force shrank

Vermont produced $45.7 billion in goods and services last year. That was a 2.3 percent increase in the state’s gross domestic product, after adjusting for inflation. The increase was better than the previous year, but the smallest increase among the New England states.

Meanwhile, Vermont total personal income reached $45.5 billion in 2024. That represented a 4.9 percent increase from 2023, but the smallest increase in the New England states and smaller than the country as a whole.

Education reform redux

Now that the House has passed an education reform plan, it will be easy to get bogged down in the minutiae that differentiate it from Gov. Phil Scott’s “Education Transformation Proposal.” But before Vermonters get lost in the weeds debating these proposals, they might want to ask themselves if they support the radical change that both plans represent:

-Are they ready to abandon the idea that taxation for public education should be based on residents’ ability to pay and that a person’s income is the fairest measure of that ability?
-Are they ready to take control of education spending away from local voters and cede it to the Agency of Education?

House Ways & Means Committee Testimony—April 3, 2025

Homestead exemptions perpetuate unfairness – testimony by Steph Yu:

Since the 1970s, the state has been moving towards basing school taxes on income because the value of your primary residence is not a good measure of your ability to pay. For low- and middle-income Vermonters with mortgages, the value of the primary home overstates their ability to pay because their home equity is less than the home value. And many taxpayers have other debt so may even have a negative net worth. And at the high end, the primary residence is a small share of their wealth and understates their ability to pay. Any homestead exemption structure perpetuates the regressivity of the current system—meaning that higher-income taxpayers pay a smaller share of their income in school taxes than middle-income Vermonters.

Women power Vermont’s social services

The news this Women’s History Month is that women and men share an equal presence in the Vermont workforce. But the workforce is highly segregated by sex. Both men and women work in occupations where one sex accounts for at least two-thirds of the workers.

Many of the state’s social services, such as education and healthcare, rely on women’s labor. Women fill roughly three-quarters of Vermont’s more than 28,000 jobs in educational instruction, including tutors, librarians, teaching assistants, and teachers at all education levels. They represent a similar share of jobs in healthcare, office and administration, and social services occupations, including counseling, social work, and therapy.

House Ways & Means Committee Testimony—March 26, 2025

Good Public Schools & Fair Taxes – testimony by Steph Yu:

The most pressing problem with education funding isn’t how much we spend.

The two biggest problems we face in education funding are unfairness in who pays school taxes and cost drivers out of districts’ control like teacher healthcare and inflation.

There are two ways in which how we pay for education taxes are unfair now:
1. The richest Vermonters pay a smaller share of their income in school taxes than low and middle-income Vermonters;
2. Income sensitivity has gotten out of whack for many low and moderate-income Vermonters, leaving them facing tax cliffs that can double their bills from one year to the next. This is because the thresholds determining income sensitivity have not been updated in decades.

Teacher health insurance, inflation, and rising demand for special education services and mental healthcare for kids are biggest cost drivers in school budgets and are outside of school districts’ control.

These aren’t school funding problems; they’re societal issues.

Rainy days are beginning; Vermont should prepare for federal cuts

The federal government is making massive cuts to government functions that Americans—and Vermonters—count on and is planning to make more cuts. Layoffs of federal workers, funding freezes, tariffs, and cuts to government programs, including public benefits for those most in need, could threaten the well-being of Vermont’s people and its economy.

While we may not know the scale of these cuts, the timeline, or where cuts will occur, this crisis needs attention. To address funding gaps and ensure that families can meet their basic needs, now is the right time for the legislature to craft its response to federal actions before the end of the legislative session, which is rapidly approaching.

The long arm of DOGE reaches into Vermont

More than 3,000 Vermonters are caught in the on-again, off-again firings and layoffs of federal employees by the Trump administration and the Department of Government Efficiency (DOGE). It is challenging to keep track of who has a job and who doesn’t, or even of which departments still exist.

During the first two months of Trump’s second term, DOGE ordered mass layoffs of federal agency employees. Federal judges reinstated the workers in 19 agencies, including the Department of Education and the Department of Housing and Urban Development, and temporarily paused firings. But uncertainty remains as to whether the reinstatements will hold and how long the pause will last—if, that is, the administration complies with the court orders.

Leslie Black-Plumeau Joins Public Assets’ Board

Montpelier – Leslie Black-Plumeau, Research and Community Relations Director at Vermont Housing Finance Agency (VHFA), has joined the board of the Public Assets Institute.

A nonpartisan nonprofit in Montpelier, Public Assets is Vermont’s independent research organization on state budget, tax, and economic issues and the source for timely and in-depth state fiscal and policy analysis.

Leslie’s work at VHFA includes overseeing the agency’s research, data, communications and public engagement activities. She has 25 years of professional experience in program evaluation and public policy research in the areas of housing, human services, and community development. Her work has most recently been focused on Vermont, and she has a broad understanding of housing issues and HUD programs as a result of her many years of experience in Washington, DC as a Congressional housing and community development program evaluator.

Press conference: Keep the Public in Public Education

Public Assets is part of a coalition of students, parents, teachers, and community members who support public education. The group gathered at the statehouse on Tuesday, February 25 for a press conference and sledding party. Press conference speakers included: Susan Clark, author and community facilitator; Liz Schlegel of the Alchemist Foundation; Jamie Kinnarney, Superintendent of the White River Valley Supervisory Union; Vermont 2017 Teacher of the Year and Montpelier Representative Kate McCann; Harwood Union High School Tenth Grader Harmony Belle Devoe; and Bekah Mandell, Communications & Development Director at Public Assets Institute.

What Congressional budget reconciliation means for Vermont

If you’re following the national news, you’ve probably heard that Congress is in the midst of the budget reconciliation process. What is reconciliation, and how will it impact Vermonters?

Reconciliation is a budgetary process Congress can use to fast-track changes to federal spending and revenues. For lawmakers in the majority, it is popular and effective because it requires only a simple majority in the Senate—51 votes—rather than the 60 typically needed to advance legislation.

There are restrictions on what’s included in a reconciliation package. Under a rule adopted in the 1980s and named after the late Senator Robert Byrd (D-W. Va), each provision of the bill must: …

Migration: Millennials and the wealthy moved in. Most Vermonters stay put

Recently released IRS data from tax filings in 2022 provide new information about people moving in and out of Vermont. For the third year in a row, the state continued to see more filers enter than leave. Two of these years of growth occurred during the COVID pandemic—2021 and 2022. Over half of those arriving in 2022 were millennials—the generation born between 1981 and 1996—and a quarter of all new filers had incomes of $100,000 or more.

House Human Services Committee Testimony—January 29, 2025

Affordability and equity in Vermont – testimony by Julie Lowell:

Before I share with you some of our research today that looks at Vermont’s economy and how Vermonters are doing, I want to ground this conversation in state statute. With everything happening federally right now it’s more important than ever to understand the stated purpose of our current system, where it does well in supporting people, and where we need improvement.

In 2012, Vermont passed the People’s Budget Language, calling for the state’s revenue and spending policies to address health, housing, dignified work, education, food, social security and a healthy environment.

As you will see from the data I’m going to share, much of which comes from our annual State of Working Vermont report, we are doing better in some of these areas than others.

House Ways & Means Committee Testimony—January 29, 2025

From Steph Yu’s testimony: We’ve been working on education funding for over 20 years because public education is the biggest thing the state does and the most visible tax Vermonters pay. I want to start by defining what we see as the most pressing problems in the education funding system, then raise some questions about some other concerns we’ve been hearing.

Our primary focus has always been on how we pay for schools. And we see two major problems with the current distribution: low and middle-income Vermonters are paying more of their income in school taxes than the highest-income Vermonters; and many moderate- and middle-income Vermonters face tax “cliffs” that cause big tax jumps from one year to the next regardless of whether school spending goes up in their district. Changes in how much we spend will not fix either of these problems.

House General Committee Testimony—January 10, 2025

Watch Julie Lowell’s testimony on Vermont’s housing landscape–Affordability and equity in Vermont housing.

Low-paid workers stretched to meet basic needs

A recent report by the Joint Fiscal Office shows that Vermont’s 2024 livable wage was nearly $19 an hour—exceeding the state minimum wage by almost $5. Vermont defines livable wage as the hourly earnings necessary for a single person working full time and living in shared housing to meet their basic needs. The gap was the largest in a decade, making it harder for workers to make ends meet.

Statement on Gov. Phil Scott’s Jan. 28, 2025 Budget Address

Gov. Phil Scott said again today he would reform education by doing more with less. We’re hearing understandable concerns about his plan. While we don’t know all the details yet, we’ve heard this promise before—and don’t have a lot to show for it.

Here’s what we do know: Vermonters want good schools and fair taxes.

Right now, low- and middle-income Vermonters pay more of their income to support schools than the richest Vermonters. And the biggest cost drivers in recent years, like healthcare and inflation, are out of school districts’ control. Until we address those underlying problems, any changes won’t do much to help kids, communities, or taxpayers.

State of Working Vermont 2024

Vermont has one of the highest gaps between wages and costs in the country. This mismatch leaves many Vermonters struggling to afford their basic needs.

The state has made some improvements on affordability in recent years, but in other areas policies have fallen behind. Targeted investments would make a big difference for Vermont families’ economic security. In fact, under Vermont statute, the purpose of the state budget is to address Vermonters’ need for health, housing, dignified work, education, food, social security, and a healthy environment. And Vermont has the resources to honor these obligations and make the state more affordable.

The latest State of Working Vermont Report analyzes U.S. Census and other data including costs, income, and wages to look at how Vermonters are doing and pinpoint the areas where the state can make reasonable policy improvements to help more all residents afford to meet their basic needs.

Gladdish tidings: Incomes rose, but so did unemployment

Vermont total personal income rose to $43 billion in 2023. Adjusted for inflation, that was an increase of 6 percent over the previous year, the highest among the states.

Personal income, a key economic indicator, includes salary and wages, business income, interest and dividends, government benefits such as Social Security, employer retirement contributions, and other income. It does not include capital gains.

Personal income is an aggregate measure; it doesn’t tell us how individuals are faring. But Vermont also scored well in 2023 on a measure that does. Census data released in September showed a rise in Vermonters’ median household income of 5.4 percent, after adjusting for inflation—also the largest percentage increase in the country. Half of households earn less than median, and half earn more.

Property tax relief for Vermonters: three-part plan

First things first: Vermonters need property tax relief

Policymakers need to focus on the urgent school funding priority: providing our kids with a quality education while delivering property tax relief to middle-class Vermont homeowners. These taxpayers were hit hard this year, experiencing abrupt school tax increases. In three steps, the Legislature can make the system much fairer and simpler for taxpayers, providing needed property tax relief for next year—fiscal 2026—and addressing the longer-term issues of school costs and tax fairness in subsequent years.

New businesses created the lion’s share of jobs in 2023

Vermont added about 1,600 net new jobs during the 12-month period ending March 2024. Almost 70 percent of those jobs came from new businesses.

After a record rise in the wake of the pandemic, the pace of job growth slowed, especially among existing private sector employers, with the biggest decline taking place during the year that ended in March 2024.

Ed Funding 101 (and what happened in FY25)

Vermont has one of the most equitable education funding systems in the country. It hasn’t felt that way lately, because there are pockets of inequities that hit some taxpayers and some districts more than others.

Public Assets’ Executive Director explains the fundamentals of our public education funding system.

Public education is one of the most important things the state does and there is a lot we can do to make the tax system simpler and fairer without losing what’s equitable about it, while ensuring that Vermonters can make good decisions about their schools.

Economic Security 101

What do we need to do to make Vermont affordable for all? Public Assets Director Steph Yu explains: we know Vermont has the resources to make the state affordable for everyone who lives here. Some of the solutions will take time, but there are also some that we can implement right now that will immediately improve family economic security and make sure that Vermont is affordable for all.

Public programs lifted 3,000 Vermont kids out of poverty

New Census data offer proof that federal and state governments can significantly reduce child poverty. Almost 9 percent of Vermont’s kids lived in poverty, according to the three-year average of the federal official poverty measure for 2021-2023. However, the Supplemental Poverty Measure (SPM)—which factors in state and federal government programs such as universal school meals, food and utility assistance, and the child tax credit—came in 3 percentage points lower, at less than 6 percent for the same period.