Debate Over Act 46 Spending Caps May Leave School Boards In Limbo
Lawmakers return to the Statehouse Tuesday, and it's likely that one of the most controversial issues of the session will involve education spending and property taxes.
Democratic leaders in the House and Senate are at odds over the future of spending caps that are part of the state's new school district consolidation law.
The spending thresholds were put into the law as a way to stabilize property tax rates. They discourage school boards from increasing their budgets for a two-year period by imposing significant penalties on towns that exceed these caps.
The caps are temporary, because backers of the new law believe consolidation efforts will lead to cost effective budgets in the future.
A number of school boards are very upset with the spending thresholds. They say that their health care costs are going up almost 8 percent next year, and they feel that they will have to make cuts in other parts of their budget to avoid the penalties.
Because of this situation some lawmakers are calling for a tweak to the spending caps.
House Education chairman David Sharpe is backing a plan to give school boards a little more wiggle room with their cap to reflect the increase in health care costs.
“It's a difficult administrative process to just exempt the health care costs,” Sharpe says. “But we think that the increases in health care costs can be covered by an additional 0.9 percent increase in the spending threshold."
"We think that the increases in health care costs can be covered by an additional 0.9 percent increase in the spending threshold." - Rep. Dave Sharpe, House Education chairman
That approach is not sitting well with Washington Sen. Ann Cummings, who is the chairwoman of the Senate Education committee. She's sponsoring a bill to totally repeal the spending caps.
"We have put almost every school in the state into the penalty phase, so property taxes are going up, which was not the idea,” Cummings says. “I think we took a stab at it, it didn't work, and it's time to go back to square one."
But Rep. Sharpe thinks the repeal plan is a terrible idea.
"If we take the lid off completely before larger school districts are formed, we may see significant increases in property taxes across the state, and that's not what we want to see,” he says.
"I think we took a stab at it, it didn't work, and it's time to go back to square one." - Sen. Ann Cummings, Senate Education committee chairwoman
However, Sen. Cummings isn't convinced that Vermont has an education spending problem.
"I think the jury is out to whether schools are over spending,” she says. “I think in some areas we have concerns that property tax pressures have actually caused us to reduce the quality of education."
There's yet another approach advocated by some lawmakers: Do nothing. Leave the caps in place just the way they are. That's what House Minority leader Don Turner wants to do.
"I think that we have to let the law play out. It's going to take some hard work, heavy lifting from school boards and school districts to do that, but Vermonters can't afford these ever-increasing costs of education that are just unsustainable,” Turner says.
"I think that we have to let the law play out ... Vermonters can't afford these ever-increasing costs of education that are just unsustainable." - Rep. Don Turner, House minority leader
Many school boards are watching this debate closely because they need to finalize their budgets by the end of the month. To do that, they need to understand the status of their spending caps.
But legislative leaders say it's unlikely that a solution will be adopted before Town Meeting Day, and that could leave many school budgets in limbo.