The vote: 138 to 0

It was an easy vote in the Vermont House on Friday. Fifteen years ago, it would not have been so.

Without a single nay, the House voted to use future budget surpluses to restore General Fund support for education. For the last three years, the Legislature has cut the annual transfer from the General Fund to the Education Fund, which covers all pre-K to 12 education costs in Vermont. The effect has been to push up property taxes even though local school boards have held the line on spending. Now the House wants to reverse that trend and dedicate half of any future budget surpluses to restore the transfer to pre-recession levels (with an adjustment for inflation).

Why the change of heart all of a sudden? And why was the vote so easy? Two reasons.

First of all, this is an election year, and no House member wants to be branded as voting  against lower property taxes if he or she can help it. This amendment to the annual mid-year budget adjustment bill (H.558) sends a clear message: every representative wants to provide property tax relief.

Second, and more important, this action requires no increase in broad-based taxes, which are commonly defined in Montpelier as taxes that go to the state’s General or Transportation Funds—taxes on sales, income, rooms and meals, and motor fuels are examples, but not school property taxes. The only thing that our elected officials are more afraid of than raising school property taxes is raising broad-based taxes. Governor Shumlin has committed his administration to not raising them.  Given the choice of increasing broad-based taxes or school property taxes over the past few years, the Legislature chose, more often than not, to raise property taxes.

So now legislators get to make a statement that they want to lower property taxes, and they don’t have to raise broad-based taxes to do it—because all they’re committing to is the use of any future General Fund surpluses. No surpluses, no property tax relief.

What may be most notable about this vote, though, is that it reflects a very different dynamic than existed in 1997. In those days, most General Fund aid to public education went to property-poor towns with insufficient tax base to pay for their children’s education at reasonable property tax rates. Most towns, however, did not qualify for this aid, so their elected representatives, not surprisingly, didn’t support the increases, which were often voted down.

Act 60 of 1997 and Act 68 of 2003 changed that. Now every town in the state gets a property tax break when General Fund support is increased, and every town sees higher property taxes when that support is cut. All state representatives and senators are in the same boat, so to speak. And on Friday they were all rowing in the same direction.