Editor’s note: This commentary is by Neil Nussbaum, of Moretown, who is a Moretown lawyer, lax coach for hire, wannabe economist, and founder of www.hcops.org, a watchdog of his consolidated school board and district administration.
Act 46 is a train wreck. “But what about out-of-control education spending?” you ask. Indeed, the skyrocketing cost of public school systems in Vermont is a huge problem. In fact, before the coronavirus hit, it was half of the existential problem facing our state.
If you have a nail to pound in, use a hammer. Accidentally reach for a fish instead and you’re just going to make a mess. Skyrocketing education spending is our “nail.” But the Legislature reached for the Act 46 fish – big mistake! This is what the hammer looks like:
Abolish disconnected school budget voting
Not so long ago, education spending in Vermont was funded just like municipal spending, by local property taxes. Listers placed values on all town property. The school board came up with a proposed budget, which it brought to the town for a vote in combination with the proposed municipal budget. Once the town approved the combined budget, property owners were each assessed a property tax, based on their proportion of the town’s total property wealth (the grand list). Under this education funding model, there was a direct connection between the budget that we voted on and the amount of: 1) pain felt on tax day; and 2) money spent on schools.
But town grand lists varied widely, leading to the anomalous situation where a “property wealthy” town could raise substantially higher education revenue with a substantially lower tax rate than a “property poor” town. In 1997, the Vermont Supreme Court changed all that, ruling in the Brigham case that: 1) education funding was the responsibility of the state, not the towns; and 2) every Vermont school child should receive equal education dollars. This led to the passage the same year of Act 60, the first “prebate” law. Today, Vermont schools are funded largely by the state’s education fund. Incoming fund dollars are “income sensitized,” meaning that if a property owner’s education property taxes are more than a set percentage of their income, they receive a partial payment from the state to bring the education property taxes down to the appropriate level. And outgoing fund dollars are sent to the school districts based on the number of schoolchildren in the district.
Today’s education funding system is a much more egalitarian approach than the pre-1997 model. The problem with today’s system, however, is that there’s no meaningful connection for property owners between proposed budgets and either the pain we’ll feel on tax day, or the money spent on our schools. We’re left instead with a vague, uneasy feeling that a proposed multi-million dollar school budget that closes schools is just not right, but no ability to understand precisely why.
The solution is to abolish disconnected school budget voting. There are two distinct ways of achieving this objective:
— Return part of education funding to the towns – not 100%, but some proportion of it, say 50%; or
— Give the state full control of education spending levels, and the education property tax rate – under this scenario, Town Meeting school budget votes would be eliminated. Our annual education property tax bill would instead be based on the lesser of: 1) the statewide education property tax rate; or 2) a percentage of our annual income. The amount of money going to our schools each year would be decided by the executive branch.
Rein in salaries
Salaries made up approximately $27 million of the $40 million proposed budget that was voted down in my consolidated district on Town Meeting Day. How can these costs be controlled?
— Decentralize: Centralization creates distance and disconnect between employees and stakeholders. One-size-fits-all collective bargaining agreements tend to rise towards the highest sub-market in the central whole. Decentralization typically brings these costs categorically down.
— Control special education costs: If you walked into a school in my district before the coronavirus hit, you couldn’t help but notice that the school was very well staffed. A significant number of these employees are special educators whose job was created by one of our national disabilities laws. Indeed, special education spending made up almost a quarter of the $21 million in my district’s proposed instructional program budget.
Our national commitment to those among us with disabilities has been one of the great, transformative achievements of our generation. However, it is time to revisit the cost of this commitment. Increasing reliance on technology, relaxing overly expansive mandates, and enhanced oversight should lead to categorical savings.
Decentralize facilities expenses
Back in the day, if the roof in my local school sprung a leak, the principal could call some folks to fix it quickly, at a reasonable price. Now the process involves the central district office, an architect and/or other design professional, and my 14-member consolidated school board. It takes longer and is much more expensive. Just as with salary expenses, reconnecting laborers directly with stakeholders can drive these costs way down.
These changes will not be easy to implement – far from it. But they will, in the end, pound the nail into place, which is a lot better than the stinky fish mess that we have on our hands right now.
