Study calls for major changes in Vermont’s education funding formula

Rep. Kate Webb, D-Shelburne, chair of the House Education Committee, takes notes during a tour of an Early Childhood Program in Barton last month. Photo by Glenn Russell/VTDigger

A long-awaited, mammoth new education funding report recommends substantial changes to the way Vermont funds schools and calculates local property taxes, particularly where poor students, rurality, and English-language-learners are concerned.

But whether lawmakers have the appetite – or capacity – to tackle such a major reform anytime soon is another question entirely.

In Vermont, voters decide locally how much their schools will spend when they greenlight – or nix – the budget crafted by their school board at the ballot box, although nearly all funds come from the state’s education fund. To control costs, the state calculates local property taxes based on how much a district spends per pupil, based on a weighted formula that is intended to account for the fact that certain types of students cost more to teach.

But the state’s current weighting system for poor students and English-language-learners is more than two decades old.

The weights are essentially “historical artifacts,” said study co-author Tammy Kolbe, an associate professor of Educational Leadership and Policy Studies at the University of Vermont.

“That’s the best, nicest terminology I can use for them,” she told lawmakers Wednesday during a joint meeting of the House Education and Ways and Means committees. “We could find no evidence that they were empirically derived.” 

Lawmakers commissioned the study in 2018 to answer two questions: How should Vermont retool its weighting formula? And, as it prepares to transition to a block-grant system for funding special education, should it make adjustments to how those grants will be calculated?

On the first question, the nearly 100-page report, which was prepared by researchers at the University of Vermont, Rutgers University and the American Institutes for Research, recommends poor students and English-language-learners be weighted substantially more heavily than they are now. 

It also noted a “uniform frustration” across the field about the state’s small schools grant program, and recommended ways to incorporate additional weight into the formula to account for a school’s size – if the school were located in an area with particularly low population density.

But both researchers and lawmakers acknowledged that defining what should count as a geographically necessary small school posed a thorny policy decision.

“I’m thinking you can’t get from point A to point B in the winter because the mountain pass is closed. You guys seem to be thinking about density of the population,” said Rep. George Till, D-Jericho, who sits on Ways and Means.

George Till
Rep. George Till, D-Jericho, speaks on the House floor. Photo by Glenn Russell/VTDigger

School officials frequently complain that the state’s early college program puts high schools in a tough spot, because participating students are completely removed from a district’s pupil count. The report did not recommend a particular weight for early college program students. The authors of the report heard widespread concern about the matter from stakeholder interviews. There is consensus that high school students who are attending college classes should at least count for a fraction of a full-time student, since they still used advising and extracurricular resources at local high schools.

Researchers also emphasized in their report that simply weighing certain students more heavily might not translate to districts spending more. Some communities, they cautioned, might choose to take the extra taxing capacity and simply reduce taxes.

Ways and Means member Rep. Peter Anthony, D-Barre City, echoed that concern. Some districts are loath to build higher-spending budgets, even if the impact on tax rates would be negligible, because they’re worried voters wouldn’t support the measure.

“I’m not sure people understand, ultimately, what it costs them when they look at the warrant,” he said. “It’s the frustration of being a low-spender, and forever being a low-spender. Unless we can get over the ‘It won’t pass’ problem.”

Lawmakers could bypass the weighting system by giving school districts with certain concentrations of students that need additional support extra revenue in the form of grants. But targeted grants tend to be more administratively burdensome, researchers said.

Tammy Kolbe, education professor at UVM and chair of student-staff ratio task force
Study co-author Tammy Kolbe, education professor at the University of Vermont. UVM photo

As for special education, researchers found inconclusive evidence that adjustments need to be made at this time. Vermont is transitioning from a reimbursement model for special education to a block grant, where districts receive a flat amount based on headcounts at their schools. Legislators last session delayed the the reform’s roll-out by a year, and the block grant won’t actually take effect until fiscal year 2022.

A block-grant model assumes that concentrations of need are basically consistent across districts. Lawmakers have been worried that the block grant might inadvertently underfund – or overfund – certain schools, if special education needs were in fact unevenly spread out.

The share of enrolled students with disabilities varies dramatically across districts, the researchers found, with some districts having fewer than 2% of the student population identified for special education while others had more than 30%. And the report also found a moderately strong correlation between special education identification rates and poverty.

But researchers cautioned that correlation is not causation, and that higher identification rates in poorer districts might not actually exist because of greater need. Kolbe, in her remarks to lawmakers, also noted that many stakeholders had expressed concerns about the block-grant model. More accurately weighing poverty in the general education formula would likely alleviate those reservations, Kolbe said.

Tackling a sweeping education funding overhaul would be major lift in any year, but doubly so in the second year of a biennium, when lawmakers tend to be focused the prior session’s unfinished business. 

Sen. Phil Baruth speaks at a Senate Education Committee meeting
Sen. Phil Baruth, D/P-Chittenden, speaks at a Senate Education Committee hearing last February. Photo by Glenn Russell/VTDigger

Still, Sen. Phil Baruth, D/P-Chittenden, who chairs the Senate Education Committee, said he intends to try to do just that. A top priority this session, he said, would be to pass something out his committee changing the weighting formula based on the report’s recommendations. 

“I think it’s an extremely important thing. And I was sent here to do extremely important things that make the system work in a better, fairer way,” he said.

But even if Baruth can get a proposal through the Senate, House lawmakers appear to have little appetite to move particularly quickly.

Rep. Janet Ancel, D-Calais, who chairs Ways and Means, said an exploration of education funding is “a conversation that we absolutely have to have.” But maybe not right away.

Rep. Janet Ancel, D-Calais, chair of the House Ways and Means Committee. Photo by Glenn Russell/VTDigger

“(The report has) given us a lot of information to use to challenge the way we’ve been doing business. But that doesn’t mean that we are necessarily going to act on it immediately or even in the next couple of years.” 

Rep. Kate Webb, D-Shelburne, Baruth’s counterpart in the House, said the report spelled out a compelling argument that the existing system was constructed “more by compromise than scientific evidence.”

But she echoed Ancel and struck a similarly cautious tone about acting with haste, and she noted that such a tax overhaul would necessarily create winners and losers.

“The impact, if this were just implemented this year, would be dramatic and traumatic,” she said. 

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Lola Duffort

About Lola

Lola Duffort is a political reporter for VTDigger, covering Vermont state government, the congressional delegation and elections. She previously covered education for Digger, the Concord Monitor in New Hampshire and the Rutland Herald. She has also freelanced for the Miami Herald in Florida, where she grew up. She is a graduate of McGill University in Canada.

Email: [email protected]

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