House lawmakers have advanced a property tax bill that aims to curb the growth of spending on public education. But Republican critics say the measure doesn’t go nearly far enough. And the debate over education financing in Montpelier this session could carry over into the gubernatorial race later this year.
Just about every politician in Montpelier these days says Vermont’s education spending trajectory is out of control. On Thursday, House Democrats approved legislation they say will help solve the problem.
Rep. David Sharpe, the ranking Democrat on the House Committee on Ways and Means, says the property tax reform bill his committee spent 12 weeks working on this session will rein in spending by altering the mechanism used to penalize high-spending school districts. The provision would, over time, bring down the per-pupil spending figure at which districts begin to suffer financial sanctions.
“So by reducing the growth in that threshold, we expect more school districts will have to work harder at staying under that threshold,” Sharpe says.
The bill would also phase out, over the next six years, an $8 million grant program that helps keep some small school afloat. Sharpe says those measures, combined with others contained in the legislation, will help bring per-pupil spending increases more in line with the rate of inflation.
But Republican critics say the Democratic solution falls well short of the system-wide overhaul needed to slow the rate of growth in property taxes. Rep. Heidi Scheuermann, a Republican from Stowe, led the GOP push Thursday for more sweeping reform.
“The underlying problem is the actual financing system and how it’s put together and how it’s structured, because there’s such a disconnect between what people are voting on, the budgets they’re voting, the money that’s being spent and then their taxes that they end up paying,” Scheuermann says.
Scheuermann has spent her four terms in office pushing for education funding reform. Two weeks ago, she told the Burlington weekly Seven Days that she’s mulling a bid for governor. And if she does opt to challenge Gov. Peter Shumlin, then the education financing issue could become the centerpiece of the 2014 campaign season.
Scheuermann says the existing school financing system, called Act 68, is fatally flawed. She says that no matter how fiscally restrained voters in one school district attempt to be, the statewide financing system means they’ll inevitably foot the bill for voters in freer spending towns.
“It’s like my sister having my checkbook and me being the one who works,” she says. “It doesn’t make sense.”
Scheuermann offered an amendment to the tax bill Thursday that would repeal Act 68 beginning in 2016, and replace it with a yet-to-be developed alternative. House Speaker Shap Smith says the proposal misunderstands the nature of the education spending problem.
“My view is that you’re not going to be able to actually change the growth curve through financing mechanisms alone,” Smith says. “I think you actually have to do some pretty significant governance changes, and you may have to be more prescriptive in what you allow for spending.”
And Smith says lawmakers shouldn’t repeal something as important as the school funding system without knowing what they’d put in its place.
“I think the idea of putting on the table a repeal amendment without an alternative is very irresponsible,” Smith says.
Scheuermann, however, says the Democratic majority owes taxpayers a solid commitment now to change the system in the near future.
“I think it’s irresponsible for us to continue down the road that we’re going – I think that’s what’s irresponsible,” she says.
Scheuermann’s amendment failed in a vote that fell largely along party lines.
The bill also included a 4-cent increase in the statewide residential property tax rate, and a 7.5-cent increase in the non-residential rate.
