Governor Peter Shumlin is vowing to provide property tax relief to homeowners this year.
It was expected the statewide property tax rate for education was going up by 7 cents. But the governor says he’ll take steps to make a significant cut in this increase.
On Town Meeting Day, school budgets were defeated in 35 communities, in part, because of the project increase in the statewide property tax rate.
"No one wants to go home with a seven cent property tax increase so we will try to do some magic to get it down a bit." Gov. Peter Shumlin
In many of these towns, the actual budget increase was quite small, but a declining enrollment base meant that per pupil spending went up at a larger rate than the budget. This factor had a major impact on the statewide tax rate. Shumlin says that the 7 cent increase is simply too much.
“We don’t want the property tax rate to go up 7 cents despite all the local decisions that were made on spending,” Shumlin said. “I can guarantee you there’s going to be uniformity on that, Republicans and Democrats working together. No one wants to go home with a 7 cent property tax increase so we’ll try to do some things, some magic to get it down a bit.”
Mary Peterson is Vermont’s Tax Commissioner. She says there are a number of ways to reduce the residential statewide rate.
Last year lawmakers increased the state’s non residential property tax rate by a cent more than the residential rate. She says this could be done again.
“Because that’s a higher rate to begin with so a penny is less proportionally,” Peterson said. “So you can always be shifting the levers between whose paying within the system.”
Peterson says local spending levels also influence the tax rate. She says the 7 cent increase was based on projected budget increases from last fall. Peterson says the actual budgets came in at a lower amount and she thinks it’s likely that the recent budget defeats will further reduce overall spending.
“So the fact that that spending is lower means that the base rates will have to support less spending,” said Peterson. “Now I don’t know if that’s enough for a penny yet but that’ll be one of the analyses that will be done in these coming days.”
Steve Dale, the executive director of the Vermont School Boards Association, says the governor’s plan makes it clear that both the state and local communities play a key role in determining school tax rates.
“We need to look at tax policy in terms of where the dollars are coming from for education and we were delighted that he indicated that there would be some property tax relief forthcoming,” said Dale.
When the specific components of the governor’s plan are put together, the proposal will be reviewed by the House Ways and Means committee.
