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Editorial: Put the onus of education spending where it belongs

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Posted on March 6, 2014 |
By Angelo S. Lynn



Following 34 school budget defeats across the state on Town Meeting Day, the most since 2003, Gov. Peter Shumlin displayed an uncharacteristically tin ear Wednesday by suggesting school budgets woes rested in the hands of local residents.  

“As we saw in communities throughout Vermont on Town Meeting Day, local control over school budgets is alive and well,” Shumlin said in a written statement. “Vermonters are clearly frustrated by high spending, high property taxes, and the complexity of the statewide education funding system. In a number of communities, voters scrutinized their budgets and per pupil school spending, and asked school boards to go back and make adjustments. Vermonters know that their property taxes are too high and expect action to reflect that concern, locally and at the state level. We are all in this together, and in Montpelier we will redouble efforts to improve the system to get better outcomes for our kids at a lower cost.”

As a political ploy, the governor’s comments were likely meant to promote his goal of consolidating school governance. The governor would have been better off to stay quiet and lay low as Vermonters across the state digested just what it is about the current educational finance system that has taken a large part of the school budget out of local control and created a disconnect between local spending and escalating tax rates.

At Monday’s legislative breakfast in New Haven, Rep. David Sharpe, D-Bristol, explained a big part of the problem — the state imposed a 7-cent increase on the statewide education property tax rate caused by a projected $77 million increase in spending statewide. Of that $77 million, Sharpe explained, $10 million is relegated to increases in special education and a few other items; $20 million is a reduction in federal funding (previously financed by President’s Obama’s stimulus measures); and roughly $47 million is in increased spending across all school districts.

Admittedly, $47 million is a lot of money, but then again, according to state figures, state education spending in 2014 was estimated at $1.215 billion; $47 million represents an increase of about 3.865 percent — in other words, just slightly above inflation. (See link at http://education.vermont.gov/documents/EDU-Data_2014_Per_Pupil_Spending_....)

If you factor in teacher salary increases, health care costs, and energy costs, keeping school budgets curtailed at under 4 percent each year would likely require many districts to implement programming reductions, let alone making necessary improvements and innovation. That $47 million might be trimmed to 3 percent annual spending increases, or just under $40 million annually, but that’s not going to drive down tax rate increases at the rate the governor is suggesting and it will further affect the quality of student experience.

It is a zero-sum game. We can use education spending smarter to get better results, but we can’t slash budgets year after year and expect to maintain educational excellence. In other words, this budget year has revealed more clearly than ever that the answer to long-term cost containment does not lie in beating up local school boards to spend less. There just aren’t enough dollars there to play that game for long.

***********

But let’s back up for a moment.

Of the 34 school budgets that were defeated — including Vergennes Union High School, Ferrisburgh Central School, and Neshobe Elementary School (Brandon) in this area — half were defeated because of circumstances that did not reflect increases in local spending exceeding 2-4 percent increases, according to Stephen Dale, executive director of the Vermont School Boards Association. Of the other 17 schools, spending increases ranged between 6 and 30 percent. Just for the sake of argument, let’s concede those 17 schools, out of 246 communities, defeated school budgets because local spending was too high.

It is also true that 209 school budgets were passed; 12 have not reported and 19 towns hold budget votes at a later date.

The last time this many school budgets were defeated was in 2003, when 41 school budgets were rejected. That was just before Act 68 was passed in the Legislature as a reform measure that tweaked Act 60. That ‘tweak’ eliminated the hated “sharing pool” from the state’s wealthiest communities.

Today, legislators and citizens across the state are once again stewing about the need to change the way the state funds education. Among many of the state’s communities that have property wealth, changing the system is essential. And even among other districts that feeling is mutual.

At Monday’s legislative breakfast, Rep. Harvey Smith, R-New Haven, said if the state leaves Act 68 unchanged, it will “suck the financial life out of most of us.”

But consider this: Since Act 68 was passed, the Legislature has:

• Opted to fund the Income Sensitivity Program within the Education Fund. That program finances the property tax rebates for low-to-middle income families. As Rep. Cynthia Browning of Arlington points out, the program costs the Education Fund $150 million annually, but it is really a program that supports home ownership, she says. The money is not used to educate our children.

• The state also has opted to fund the Current Use Program through a tax exemption within the Education Fund. The program subsidizes agriculture and forestry at a cost of $50 million annually, and is open to the participation of those who own 25 acres or more of undeveloped land. It also is not money used to educate our children.

• Finally, the state reduced the General Fund transfer to the Education Fund by $27 million several years ago as a way to reduce income taxes, which finance the General Fund, and put pressure on property taxes to keep education spending lower. The result of that shift, according to Browning, is statewide property taxes are roughly three cents higher today than they otherwise would have been had the Education Fund not been raided.

The point is apparent: If legislators and the governor expect local boards to work to contain school budgets, they need “skin in the game” too. Full reform of the funding mechanism is a complex process, but folks in Montpelier could  begin by using the Education Fund to fund only education, and find other ways to achieve the goals of the Income Sensitivity and Current Use programs.

That’s not likely to happen anytime soon, but it does redirect part of the problem to where it rightfully belongs: not purely and simplistically on the backs of local school boards, but on legislative and gubernatorial policy decisions that are tangential, at best, to the task of educating our children.

Angelo S. Lynn

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