In Vermont, 89.3% of all money available for K-12 schools comes from the state, the second-highest proportion in the country after Hawaii, according to a recent policy brief from the Congressional Research Office.
Elementary and secondary schools in the United States are funded through a mix of local, state, and federal dollars. But most states rely much more heavily on local revenues – usually property taxes – than Vermont does, which has almost entirely eliminated local funding for public education.
During the 2015-16 school year, the most recent data analyzed in the Congressional Research Office brief, U.S. schools received, on average, 44.8% of their funding from local sources. Vermont schools only received 4% of their revenues from localities.
Education funding reformers have long complained that relying on local taxes reinforces inequality, because wealthier communities can spend more lavishly on their schools.
“A good formula needs to be progressive and broad-based. And a local property tax is not progressive, and it is not broad-based,” said Bill Mathis, the managing director of the National Education Policy Center at the University of Colorado Boulder and a member of the Vermont State Board of Education.
Since the 1970s, states across the U.S. have been subject to a slew of education funding lawsuits that have sought to equalize funding. In Vermont, a 1997 state Supreme Court decision in Brigham v. State led the Legislature to enact Act 60, a landmark funding reform, that same year.
In Vermont, school budgets are now divorced from the local tax base even though each district’s voters approve spending plans. That’s because local budgets are funded through the statewide education fund, which is fed from statewide property taxes as well as a slew of other levies, including sales taxes.
But while Vermont’s education funding is often touted as one of the fairest systems in the country, the state is under significant pressure to continue pursuing education funding reform to address declining enrollments, concerns about budget pressures in the state’s most rural districts, and cost-efficiency.
Lawmakers have commissioned a study, due out this November, that will examine whether the state should restructure the way in which pupils are weighted in Vermont’s education funding formula.
As a check on spending, each district’s local property tax rate is tied to how much local schools spend per pupil. But those pupil counts are weighted, to account for things like poverty, special education status, and race – all factors that impact how expensive it can be to educate a child.
“That’s the main thing that I’ve got my eye on right now,” Mathis said.