[B]URLINGTON — Burlington residents could face a steep tax increase thanks to a state education budget deficit, officials warn.
School board chair Mark Porter wrote to Burlington residents on Front Porch Forum Monday, citing the $50 million deficit in the state education fund as the main driver for the possible tax increase. Porter, superintendent Yaw Obeng and finance director Nathan Lavery gave a budget presentation to the Burlington City Council Monday.
Lavery said the increase will be at least 7 percent because of pressures from the statewide education fund gap. The hike could be as high as 10 percent, officials said.
“It’s going to be a very, very tough year. We haven’t seen anything like this since the budget got shot down a couple years ago,” Porter said.
Last year’s school budget, which voters approved, was about $85 million. School officials did not provide a total budget amount to the city council Monday night.
Among the other pressures on the district’s budget are renovations at BHS, an increase in salary and benefits, higher health insurance benefit costs and pressures on the school budget. The district also budgeted for a larger number of high school students than are actually attending.
The district is also looking to invest in programs. Officials want to put more money into that supplies, special education support, summer school, and equity and diversity initiatives.
“Before we can even get to the arithmetic, there is a foundational piece in terms of their social, emotional needs that we need to address,” Obeng said.
Porter passionately defended the need for programs that he said would give students an equal chance in life.
“We need these kids to stay in school. If we have to spend some money to get special programs going for them to rescue them, guess what as a community, we do that,” Porter said.
Obeng want to start an international student exchange partnership with local company Spiral. The company is already saying there are students who are interested in coming to Burlington, Obeng said.
“It will add a rich opportunity in terms of cultural sharing,” Obeng said.
The Burlington School Board will discuss the budget in more detail Tuesday at 6 p.m. at Hunt Middle School.
No more personal property tax?
Residents turned out Monday to support a measure that would eliminate Burlington’s personal property tax, which raises about $1.2 million a year for the city. The tax is levied on companies and fluctuates based on the value of businesses assets.
Many towns in Vermont have done away with the tax in recent years, councilors said. Opponents of the tax say it unfairly affects specific types of businesses that may need to use expensive equipment, like breweries.
Dan Ukolowicz, owner of Simple Roots brewing company in Burlington’s New North End wrote to the council about the tax. Simple Roots employs four people and distributes its beer to surrounding stores. He said Monday that of the nearly dozen taxes he pays to various levels of government, this one stands out.
“This tax though I felt is arbitrary and unfair in ways that those taxes aren’t,” Ukolowicz said. The business asset tax costs him about $1,800 annually, he said.
The council voted unanimously for city officials explore the impacts of eliminating the tax, which was tentatively estimated to bring in about $1 million in annual city revenue. That report is due to the council in April.
Part of the task will be to figure out just how difficult it will be to get rid of the tax — since the tax is mandated by the city charter, Burlington voters will likely need to approve its removal and the state legislature will have to approve the charter change.
But some councilors offered a different possible solution: leave it in the charter, but don’t collect the tax. “Even if we have the tax, do we need to enact that tax?” asked councilor Sharon Bushor, I-Ward 1. “That’s the question that needs to be answered in the report back.”
Burlington Telecom increases rates, but not because of sale
In late December, Burlington Telecom subscribers got a letter informing them of a rate increase. With the coinciding sale of Burlington Telecom to Schurz Communications — which was approved by the Burlington City Council on Dec. 27 — some subscribers conflated the two.
The company announced cable subscribers would see a $10 to $14 increase by Feb. 1. The increase has to do with the company having to pay higher prices to carry major networks like NBC, CBS, FOX and ABC, according to the letter.
“This has nothing to do with the sale of BT,” said Stephen Barraclough, Burlington Telecom’s general manager.
Schurz has yet to take control of Burlington Telecom, which will change hands at some point next year after the state Public Utility Commission approves the sale. Barraclough said the company has seen increasing costs but they have found ways to make it work up until now.
“Our costs have increased by over 400 percent in the space of three years. We tried to absorb the costs where we can,” Barraclough said.
