Editor’s note: This article is by Olga Peters of The Commons in Brattleboro, a VTDigger media partner.
[L]ONDONDERRY — Three lawmakers stood in the Flood Brook Union School before a full house of taxpayers, educators and parents. The topic and a favorite local frustration? Education reform.
The legislators braced for an angry crowd.
The main question was: How much local control do communities really have over their school budgets?
The lawmakers told the audience they have more say than they think.
The state’s education system has received renewed attention in recent years. That’s because the cost of educating students continues to rise while student enrollment drops.
Last year, Smith organized an education reform group to draft plans for curb education spending. In the last legislative session, lawmakers passed Act 46, which is designed to consolidate school governance by 2020.
Smith said rising education spending has been a challenge for the 14 years he has served in the House. Addressing the issue is tough, he said, because it affects local communities.
Structural challenges
“Yes, our funding system needs to be fixed,” Olsen said. But changing the funding mechanism at this stage “will not fix the underlying structural challenges” Vermont schools face.
According to Olsen, Vermont spends a larger percentage of its gross state product, 5.2 percent, on education than other states. The national average is 3.4 percent.
And the education property tax has little to do with the value of property in a given town, he said.
Per pupil spending drives the tax, Olsen said, because the local education tax rate increases in proportion to how much schools spend on each student.
One of the primary factors driving up per pupil spending costs is student enrollment.
Olsen described the state’s declining school populations as a “generational shift.”
Young people nationwide are moving to urban areas and fewer children are enrolled in rural schools. Vermont’s tax base is eroding as young people leave and the population ages, Olsen said.
According to Olsen, 80 percent of spending goes toward teacher salaries and benefits.
In broad strokes, the higher the student-to-teacher ratio, the less a school spends per pupil. As student numbers decline, as they’ve done about 20 percent statewide, per pupil spending increases, he said.
“We have a system that’s out of balance,” Olsen said.
Sharpe attributes the growing cost of education in Vermont to high staffing levels — not teachers’ earning power.
Vermont teachers earn the lowest wages in New England except for Maine. They also earn less than the national average, Sharpe said.
If the state increased the student to staff ratio from an average of 4.67:1 to 5:1, Olsen said, taxpayers could save $74 million a year. That’s approximately $0.07 on the tax rate.
Schools could improve staffing ratios by better managing teacher retirements, Sharpe said.
“All the voters and all the school budgets across the state are reflected in our tax rates,” Sharpe said.
Changing school governance
The current education funding structure was established in 1997, with a revision in 2003. The state attempted to equalize the amount spent on schools regardless of a town’s wealth. That initial aim was met. Inequality in education opportunities between schools, however, still exists.
“Despite equalized education financing, we have some real disparity in opportunities offered students,” Olsen said.
Enter Act 46 which asks communities to provide equity of educational programs and promotes the sharing of resources through a variety of consolidation options like combining school districts or consolidating schools.
Sharpe said Act 46’s goals are to ensure equality of educational opportunities between schools, the quality of programing, and financial sustainability for taxpayers.
According to the presenters, the new law keeps much of the decision making at the local level as Vermont has done for almost 100 years.
Act 46 encourages schools to combine boards and restructure governance at the supervisory union level.
“We’re trying to look at education in a more holistic nature,” Sharpe said.
Under the state’s current legislation, it is difficult for schools to share resources like one music teacher for multiple schools, or to combine student population between schools that are geographically adjacent but are operated by different school districts, said Sharpe and Smith.
Smith added, “Based on the feedback, not everybody agrees with this direction.”
Some of the measures under Acts 60 and 68, like small school grants, have “created a false economy,” Olsen said. They have disconnected the taxpayers from the actual costs of funding their schools.
Act 46 gives incentives to schools that merge in some form and changes how the state awards small school grants and counts students for certain subsidies.
The law also alters the penalties schools pay for excess spending.
In the past, schools were dinged for spending more than 123 percent of the state average per pupil spending level. In FY17 and FY18, the excessive spending penalty will be temporarily replaced by a mechanism that will penalize districts that increase per pupil spending above a growth threshold.
According to Olsen, schools will be allowed a fixed amount of growth in their budgets from one year to the next. Higher spending schools will have less wiggle room to increase spending, while lower cost schools will have more flexibility.
“Think about what you can do,” Olsen said. “Think about this [Act 46] as a blank canvas.”
Initial cost savings from Act 46 will be tiny compared with the $1.5 billion Vermont spends on education, Olsen warned. It’s the savings realized in 10 or 20 years that will make the difference.
“This law is huge, it’s sweeping, it’s not perfect,” Olsen continued. “We as legislators recognize that.”
Olsen urged everyone in the audience to get involved in determining how their schools move forward.
“We as local communities control our own destinies,” he said.
The last time Vermont changed it school governance was in the 1890s, Smith said. “I think it’s worth having the conversation every 120 years.”
“This bill is about change,” Smith said. “Change is difficult.”
Comments from the audience were civil. Many thanked the lawmakers for the presentation. Still, people stood in the back of the room and whispered. They asked each other, so taxes will still go up, then? Where will we be sending our kids to school after all these changes?
Duane Hart, a former school board member from Mountain Towns Regional Education District, warned lawmakers not to give the audience “false hope” that if they trim the budget their tax rate will drop.
There’s still a disconnect between local spending and statewide decisions, he said.