Editor’s note: This oped is by William J. Mathis, of Goshen, a long-serving school superintendent and currently the Managing Director of the Education and the Public Interest Center (epicpolicy.org)
In a strange bi-partisan trio, Bill Clinton, Trent Lott and Newt Gingrich won the 1997 Doublespeak award for the “Balanced Budget Agreement,” jointly raving that it “put America’s fiscal house in order.” Actually, since it cut taxes and increased spending, it had exactly the opposite effect. As Newsweek economics columnist Paul Samuelson said, the deal showed “an enormous contempt for the public’s intelligence and integrity.”
In Vermont, the governor’s budget message and legislative statements show exemplary facility with home-grown Doublespeak! Politicians avoiding the “Tax” word proclaim there are no tax increases in the governor’s plan. While loudly thumping tax cuts for capital gains, non-residential property, and a penny reduction on the residential property tax, Gov. James Douglas is seen as not raising taxes.
An examination of the Joint Fiscal Office’s analysis shows, instead, that the greater part of the state’s budget deficit would be shifted to hidden property tax increases.
Here’s how:
Douglas described the income sensitivity protections against excessive property taxes as poverty aid to middle incomes. Setting aside this inaccurate version of history, it boils down to a $24 million tax increase on middle income Vermonters. Likewise, the so-called one cent savings on the statewide property tax (when it should have been a two cent increase) just means the same money is tacked back on when tax bills are set.
Receiving great ballyhoo under the gold dome, the governor and Legislature count a $38 million “savings” in the Challenge for Change report. The numbers and targets in this report, which is on the Joint Fiscal Office Web site, have no foundation. Wrapped in shop-worn platitudes, the numbers appear pulled from the air. Yet, legislators and the administration are banking these phantom savings. Hiding behind a $100,000 study, state leaders magically divined that of the $38 million savings, $6 million could come from special education and another $11 million from administration.
Of course, both of these heavily mandated state and federal functions just don’t disappear with a magic wishing wand. Look for this report to be used as a rationale for the state to later cut state aid.
The education fund would be shorted $18.4 million, another $10.4 million in retirement obligations would be shifted to the education fund, and the state would seize an additional $6.9 million in Medicaid funds generated by local school services. (This seizure is called a “redirection” in doublespeak).
Three million in the corrections education system would again be shifted from state funds to the education fund. Likewise, another million dollars in adult education would come from the education fund.
Adding to this litany, the state has approved $40 million of construction projects but has no money to fund their obligations. The solution? Shift the commitments to the education fund at an additional $5 million per year.
But that’s not all!
Funds to support our smallest schools would be phased out. That’s another $3.5 million property taxpayers would have to swallow next year. Further, the state now pays all the costs for students they place in local schools. The plan is that local districts would now have to pay 40% of these costs. In doublespeak, that is called “sharing.” That would add another $800,000 to school costs.
In towns with enrollment declines, the state has historically cushioned the resulting shock of lowered state aid and increased property taxes. Douglas, calls this tax protection “paying for phantom students,” and proposes it be eliminated. That would increase your property tax by an estimated $8 million. Shifts from human services, the continuation of cost-shifts from last year, and benefit reductions also add to the total.
Certainly, times are difficult for Vermont and for the nation. School districts are doing their part by holding the line with two percent increases last year and near zero for the coming year. Yet, it is double-speak, to claim that taxes are not being raised while surreptitiously increasing school taxes – and blaming the schools for their profligate ways. Paraphrasing Paul Samuelson, it shows enormous contempt for the public’s intelligence and does nothing to enhance the integrity of our political leaders.
