Gov. Phil Scott delivered the 2026 State of the State address on Wednesday, January 7, 2026. Find the full transcript below.
Full text of Gov. Phil Scott's State of the State speech as prepared
Mr. President, Madam Speaker, Members of the General Assembly, Mr. Chief Justice, Honored Guests, and my fellow Vermonters:
The opening of the second half of the biennium gives governors the chance to report on the State of the State, reflect on what we’ve done, and what we still have to do.
For two hundred and thirty-five years, those elected have gathered to do the work of democracy.
The building, the town, and the season may have all changed, but our purpose has not. We’re here to solve problems and help people.
Unfortunately, across much of the country, that basic principle has been lost. And with it, faith in government itself.
When conflict is chosen over cooperation, division over decency, and outrage over outcomes… people lose trust.
They stop believing their voices matter, and too many wonder if their government still works for them.
But here’s the good news: Vermont can be the example.
We can fiercely debate the issues but do it in a way that’s civil and respectful, so we get better policy – not better campaign material.
This is entirely in our hands. We don’t need to be asked to do the right thing. We just need to do it.
***
In thirteen days, I’ll present a budget that reflects an important reality.
One-time pandemic recovery funds are gone and federal support is uncertain.
While politics in Washington keep fear and anger high, families are dealing with the ever-increasing cost of living and a tax burden that rises faster than their paychecks.
So they’re looking to us for relief.
That means being honest about the hard choices we have to make, focusing on what’s within our control and what matters most.
This year’s spending package has required difficult decisions, but it sets clear priorities, proposes smart investments, and it will be funded without new taxes.
My team has prepared thoughtful proposals in the areas of housing, energy, healthcare, and public safety and we’ll share some of them with you right after this speech.
These issues are incredibly important to our future, and we’ll address each of them with purpose.
But today, I want to talk to you about our most critical challenge: education reform.
Because this session, we have the opportunity and the obligation to continue this transformation in order to build the best public education system in the nation – at a cost taxpayers can afford.
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Last year, we took a historic and long overdue step forward.
Act 73 was the result of good policy work, compromise, and importantly, a willingness to admit the old system no longer serves Vermont.
Because of your courage, it’s finally possible to build something better.
But that progress is not guaranteed. We’ve seen this movie before.
Act 60 focused mostly on funding rather than the system itself.
Act 68 only addressed the property tax burden, not the growth in spending.
Act 46 made small changes to governance but avoided dealing with quality and outcomes.
What’s been missing is the political will to address the problem with a comprehensive approach.
Because how it’s organized, where resources are prioritized, and who is accountable for results are all intertwined.
When costs rise and pressure builds, the approach has been to find that quick and easy fix. Throw more money at it, wrap it in duct tape, and hope it all holds.
And every time the result is higher costs and higher taxes, while student outcomes fall short and gaps in opportunity widen between regions.
This is the reality of the old system, and previous attempts to keep it afloat.
But things changed for the better the moment the majority of you had the resolve to pass Act 73 which does so much more than just rearrange the deck chairs.
It will expand pre-K so our youngest students have a solid foundation.
It will increase equity so everyone is offered a wide range of courses and programs across the state.
It will expand CTE so more kids have access to the trades and the great careers that come along with it.
It will increase salaries for teachers who are paid less than their peers in more affluent areas.
Act 73 will deliver the targeted support students need and build a structure to carry out other reforms to provide universal afterschool programs, focus on stronger literacy, create accountability, increase quality, and much, much more.
When you passed this law last year, you took a stand for your constituents who said “enough is enough.”
And you chose a better future for our kids, and for that, I thank you.
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But the real work begins today because now, we have to follow through.
Here’s what we’re up against: Vermonters are set to spend $2.5 billion on pre-K through 12. When I became Governor, it was $1.6 billion.
We all know the impact on property taxes because you get the bill in the mail and see it in black and white. But we don’t get a bill for all the other ways we contribute to the Ed Fund.
For example, every dollar from the sales tax and lottery goes to the Ed Fund, as well as a portion of both the rooms and meals and purchase and use taxes.
Which means about $800 million above and beyond property taxes goes to education.
Remember those tough budget decisions I mentioned earlier?
Here’s something to think about: I’m sure some of you would like to provide more support for childcare.
Others would like to give more funding to their towns to take care of the roads.
And you know me… I’d like to see us lower taxes and build more housing for working Vermonters.
If we had just a fraction of the general fund dollars that have been wasted due to inefficiencies, it would go a long way towards investing in any of those efforts and more – like public safety, emergency shelters, transportation, flood mitigation, school construction, and dozens of other initiatives.
Instead, these other priorities have to compete for what’s left, and this year, there won’t be much – if any – left over.
Because yet again, with the information we have today, we expect education spending to require another $200 million, and another double-digit property tax increase that Vermonters can’t afford.
So, while it goes against the grain and doesn’t actually fix the problem were trying to solve, I’ll be asking you to provide some property tax relief with another band-aid – while we follow through on reforms that will finally change our course.
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These added costs aren’t just numbers in a budget, they have impacts that ripple through the workforce, economy, communities, and our entire state.
They make it harder for young families to stay, harder for working Vermonters to buy a home, and harder for employers to create and keep good jobs.
They force the working class and retirees on a fixed budget to leave, not because they want to, but because they can’t make the math work.
They cripple towns and cities, as they delay maintenance and new investments, because residents simply can’t afford more on their tax bills.
These are the real costs of maintaining a system designed for a Vermont that no longer exists.
So, if there’s one thing you take away from this speech today, it’s this: education transformation is not optional, it’s essential.
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We’ve already taken a critical step forward.
In the next few years, Vermont will join nearly every other state using a funding system proven to produce better outcomes.
But how we fund education is just part of the problem.
And that’s because the old system is too complex for the number of students we serve.
At our peak in the late 90s, Vermont had about 107,000 K-12 students.
Apples to apples, today we educate roughly 74,000, and 80,000 when you include pre-k.
To serve those kids, we have 52 supervisory unions and 119 districts with as few as 200 students, while some of the highest performing districts in the country have 10,000.
And each have their own administration, unique systems, and fixed costs for things like pay and benefits, heating, electricity, and transportation – which all rise over time.
I believe most school leaders are trying their very best. But, the reality is, they have few real options.
Because, while education spending keeps rising, school leaders are also forced to cut courses, teachers, staff, extracurricular activities, and maintenance.
As one superintendent put it last year: “We have no more to cut.”
That’s not mismanagement, it’s math.
And that’s the contradiction of our education system before Act 73. Year after year we pay more to provide less.
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The way our system was built, our approach to funding, and how we run it, has led to DEEP inequity.
Just look at the size difference: some schools have well over a thousand students. Others have less than fifty.
And in those small schools they also offer fewer courses and teachers are stretched thin, often covering multiple subjects and grade levels.
And because our funding formula doesn’t actually provide equity, many schools are underfunded, even though on average we have among the highest per-pupil spending in the country.
Here are some real examples to think about: In today’s system, a student in one district can choose from 102 courses, and in another a student has 73.
That’s a third fewer learning opportunities based only on where they live.
We also have two schools in the same county, one with 700 students and one with a hundred. The larger one offers seventeen foreign language courses, the smaller school has just four.
And there are kids from different districts who take the same course at their regional tech center but don’t get the same credit towards graduation.
This isn’t meaningful local control, it’s significant inconsistency, unequal opportunity, and frankly, it’s just not fair.
So we can and must do better.
***
Following through on Act 73 and rightsizing our system is how we get there.
First, we need far fewer districts each serving far more students.
This change will eliminate duplicated effort and expenses for things like bussing, human resources, and purchasing, which are currently being done across 52 supervisory unions and 119 districts.
Importantly, it will reduce the inequity I just talked about because there’ll be more consistent leadership and accountability.
It also gives leaders more levers to pull, and more students – which means more funding.
Instead of having to cut a teacher from an already-understaffed school, superintendents can look across the larger universe of expenses and resources and make strategic decisions with more options.
It also means paying attention to national averages and best practices.
I know we love our small classrooms, but data shows students in larger classes can, and do, thrive throughout the country.
So, let’s streamline our system so more of the money we spend goes to our kids.
It’s time to let go of what we think is best and act on what the data actually shows is best.
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To do this, the Legislature must prioritize drawing new district lines, and it should be the first order of business for the committees of jurisdiction.
Without this governance change, we won’t give kids the better education Act 73 was designed to provide.
And from my perspective, the recent failure to produce maps was a political strategy to preserve the old system.
Following through is about keeping our word to students, teachers, and taxpayers who all deserve better.
So, I want to be clear, I will not sign a budget or an education bill or tax bill that deviates from Act 73 or fails to fix what’s broken.
***
Yes, it will mean change, and change can be hard.
As you know, Act 73 does not call for or mandate school closures. But, we have to be honest, the financial and academic quality benchmarks it puts in place will mean merging some schools and repurposing old buildings.
Here’s the thing, the status quo is already closing schools. But it only happens when a school has faced years of declining opportunities for students.
In 2020 when Black River High School closed it had lost 45% of its student population in just fifteen years, going from 167 in 2005 to just 75 in 2020.
When Windham voted to close its elementary school in 2024 it had just 15 students.
And Rochester was left with two students before it closed its high school for good. Two students.
Think about what they missed out on. Prom, study groups, sports, school plays… the things that make high school, high school.
Yet even in these situations, there were fierce advocates to keep these schools open.
Instead of this slow, torturous, and unmanaged process, let’s move forward with Act 73, so we can manage change thoughtfully, strategically, and with students’ best interests at the forefront.
The opportunities are there for us.
We know there are regions all across the state that have lost hundreds of students over the last twenty years.
But they still operate the same number of buildings, often just a few miles down the road, with the same amount of overhead and administration for far fewer students with far fewer opportunities.
In some places, we see kids from neighboring schools sharing the soccer field, but for some, it would be unthinkable for them to share the science lab,
I know these are difficult conversations, but when we’re talking about a better future for our kids, everything must be on the table.
***
It’s worth noting that Vermont has faced hard choices before.
Every union high school in the state exists because communities decided that providing a better education and saving money mattered more than operating inefficient buildings.
We’ve also merged elementary and middle schools because doing so expanded opportunity for students and saved money.
I saw this in my hometown of Barre. In the mid 90’s, we went from seven smaller schools to one larger one that now serves about 800 students.
It was very controversial and really hard for some. It meant adding a bus system and kids couldn’t walk to their neighborhood schools anymore.
It took a little time to get used to that reality, but a couple of years later, many wondered why it wasn’t done sooner.
Today, Lincoln School, where I went to kindergarten through 5th grade, has been completely restored and is now a senior living facility and still an important part of the community.
And all the other buildings have been repurposed.
I went to 6th through 8th grade at the beautiful old Spaulding Graded School, which was previously the high school, and is now home to the Vermont Historical Society.
And sure, I have great memories from going to both, but those memories, and my nostalgia, shouldn’t hold back the next generation…
Because as a result of those decisions, students had more academic opportunities, extracurricular options, and social experiences.
And teachers benefited from more resources and better tools.
That’s the promise of Act 73 but we MUST follow through.
***
I want to speak directly to teachers for a moment, because I know you often feel like we’re blaming you when we talk about the need to make changes.
So let’s clear the air.
I know you have a tough job, and that the role of teachers has changed dramatically since I was at UVM studying to be a tech ed teacher.
I know you have students with some tough challenges, without the support they need at home.
I know in some schools you have to do more with less, spending your own money to create a better classroom experience, or to make sure students have the supplies they need.
And I know in some districts you’re underpaid and overworked, having to juggle multiple age groups, multiple subjects, and if it wasn’t for you stepping up to run the afterschool drama club, or coach basketball, it doesn’t happen, and the kids miss out.
If we want to build the best education system in the nation, we MUST make sure teachers have what they need in every classroom, every district, and every school across the state.
So, I want to be VERY clear, we can no longer ask teachers to go it alone.
Because we all know – and the data proves – the most important thing we can do for our kids’ education is expose them to high quality, well-resourced teachers who have the tools to grow professionally.
And yes, for some of you, higher salaries,
Today there’s a $22,000 a year difference in our teachers’ average salary from the highest paying to lowest paying supervisory union.
But we can close that gap by following through on the district maps required by Act 73, finally making sure teachers can choose a school based on the good they can do, not the salary they need to live.
***
Better supported teachers are the key to unlocking the best in our kids.
I saw that firsthand when I joined longtime Northfield teacher Mike Gonneville for “Walking Wednesdays.” He knew every kid by name, and you could see he cared about all of them – and they cared about him.
That’s what Dick Flies did for me. He was my tech ed teacher at Spaulding and a big influence on my life.
And, if you want to see someone instantly smile, ask them who their favorite teacher was. I asked my team and here’s what I got:
Andrew Chobanian, American History, Oxbow.
Mary Corrigan, English, Northfield.
Harvey Dorfman, English, Burr and Burton.
Patty Brewer, Social Studies, Mount Mansfield.
Jon Haynes, English, BFA-St. Albans.
And, Claire Deslauriers, French, Shelburne.
Here’s the point: Act 73 is not an attack on teachers. It’s a recognition you’re not getting what you need.
It’s a blueprint to make sure every teacher works in a system that supports you, so you can focus on the job you signed up for: helping students reach their full potential.
***
The old system is not only failing our teachers, it’s failing our kids.
Just this past fall, the Boston Globe reported that over the last decade “no state fell as far in early reading as Vermont.”
Ten years ago, we were top five in the nation in 4th grade reading. In 2024, we ranked 37th, and the same pattern repeats across grade and subject.
And if that doesn’t give you pause, here’s another benchmark, from Mississippi.
It’s a rural state like us, but has even bigger challenges, with double the child poverty rate.
Mississippi spends thousands of dollars less per student than we do, and while they educate five times as many kids, they have roughly the same number of districts as us.
Now before you start rolling your eyes and writing this off, you should know today their high school graduation rate is higher than Vermont’s. And, on national assessments they score similar or better.
Less money per student, fewer districts, and equal or better education outcomes trending in the right direction.
Let that sink in.
Mississippi was once at the bottom of the charts, and now, because they were honest about their problem and set clear education priorities and then followed through, they’re making REAL progress.
It’s being called the “Mississippi Miracle.”
And good for them. We should all applaud them for choosing to change course and putting their kids above everything else.
And if you join me, and bipartisan leaders in both the House and Senate, to push through the noise, fear and division and finish what we committed to last year, we can do the same.
***
If we realign our structure, standards, and accountability with the number and needs of today’s students, we can deliver on the real change laid out in Act 73.
In the new system, every child will have access to the same high-quality education.
And with a foundation formula, we’ll guarantee students with similar needs get the same funding no matter where they live.
We’ll have strong early literacy, a full curriculum with arts, sciences, foreign languages, and career pathways. Whether a kid chooses college, the military, public service, or the trades, they’ll all be supported and valued equally.
For teachers, it means equitable pay, professional development, and more time to teach.
For communities, it means schools that attract families, support employers, and add to the economy.
And for Vermont, it means a system that’s financially sustainable, so education costs no longer crowd out all the other important needs.
***
I know the pressure you’re under, with calls to delay, to water things down, or stop this transition all together.
But we’ve been down that road before, and every time we bend to the vocal minority, these problems get worse.
We didn’t pass Act 73 because it was easy, we did it because solving this problem matters.
And what you do next matters even more.
Remember that Boston Globe article I mentioned earlier? The headline was, “New England Schools are failing and nobody seems to care.”
Well, I care, and I know those of you who came together to pass Act 73 care too.
So let’s do what’s hard and follow through this session to deliver on the education promise Vermonters are currently paying for and our kids deserve.
***
In 1892, Governor Levi Fuller signed the “Vicious Act,” consolidating over 2,000 local school districts into about 250, one per town.
Ironically, the goals all those years ago were the same as they are today: equal education, increased support for teachers, and better resources for every school.
You can tell by its nickname the criticisms haven’t changed much either. If nothing else, we Vermonters certainly are consistent.
But they knew then what we know today: a static system will never be perfect, and the work of education reform will never be finished.
Because when it comes to the institution responsible for educating our children, we have an obligation to constantly work to make it better.
And if we get this right, it will improve the lives of ALL Vermonters. Because as I said earlier, education transformation is not optional, it’s essential to growing our economy, to building a strong skilled workforce, to supporting businesses.
It’s essential to revitalizing downtowns and providing more housing in the communities that have been left behind.
It’s essential to making Vermont more affordable, keeping and attracting more people to live here, reversing our demographics, and adding more taxpayers instead of always looking for new taxes.
And there’s no better way to protect our most vulnerable than making sure everyone, no matter what hand they were dealt as a kid, has a path out of poverty and a solid chance to make it in the world.
***
On New Year’s Day just after midnight, the first Vermonter of 2026 was born in Newport at North Country Hospital.
If we’re lucky, she’ll stay here and grow up among the mountains and valleys we love and in communities that still believe in showing up for one another.
She won’t know the debates we’re having today but she will have to deal with the choices we make, or don’t make.
If we have the courage to finish our work, she will enter a local school capable of supporting her from cradle to career, helping her find that pathway to success.
We can give this to every child, in every town, all across the state.
All we have to do is keep our word and push forward into the headwinds that true progress has always encountered, to strengthen Vermont for future generations and change the fate of this brave little state for the better.
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