The Scott administration unveiled a new plan Monday to curb costs in the public education system by cutting payroll in local schools.
Gov. Phil Scott has spent the first 15 months of his tenure calling for “cost-containment” in a K-12 school system that now costs taxpayers more than $1.6 billion a year. With property tax rates set to rise by 5.5 cents next year, if lawmakers do nothing, Scott says the Legislature needs to take a more forceful role in spending decisions that have historically been left to local school districts.
On Monday, Scott’s commissioner of the Department of Finance and Management, Adam Greshin, presented lawmakers with the administration’s most detailed plan yet this year for how it thinks the state should go about reducing education costs — and it involves a new financial penalty on districts with some of the lower student-to-staff ratios in the state.
“So this would be a five-year plan that I think progressively over the five years we would be able to see an impact,” Greshin said.
Public schools in Vermont employ more than 18,000 workers. But the number of people working in a given school district isn’t necessarily a function of the number of students enrolled there.
Some districts have one staff person for every three students. Others have one staffer for every seven kids.
Scott’s plan would set a target ratio — one staff person for every 5.5 students. Greshin said districts that fail to meet that ratio would see some potentially stiff financial penalties.
The lower the staff-to-student ratio in a given district, the steeper the penalty it would face.
"This seems like a significant shift for us, heading in this direction, for Montpelier frankly to be taking over the staffing of our buildings, and I'm really struggling with that." — Newfane Rep. Emily Long
If all districts cut the number of staffers needed to comply with the new ratio, and avoid the tax penalty altogether, Vermont would reduce education costs by about $45 million in fiscal year 2020.
Greshin said he doesn’t think districts would shave the nearly 1,000 positions needed to achieve that number. But he said the new financial disincentive would keep costs well below what they’d otherwise be.
“The history of, for example, the excess spending threshold would tell you that school districts respond to incentives and penalties,” Greshin said.
Greshin presented the proposal Monday to the House Committee on Education. Several members, like Shelburne Rep. Kate Webb, registered immediate concern with the idea.
“Where I struggle with some of this proposal is it seems like it’s focusing on a symptom as opposed to what’s underlying the reason that some areas have low or high staff ratios,” Webb said. “We at the state I think are probably wiser to focus on the 'whys' — what’s driving those ratios, and addressing what it is that driving those ratios.”
Newfane Rep. Emily Long said she thinks the proposal interferes in spending decisions best left to local districts.
“This seems like a significant shift for us, heading in this direction, for Montpelier frankly to be taking over the staffing of our buildings," Long said, "and I’m really struggling with that."
Bristol Rep. David Sharpe, who chairs the House Committee on Education, said he isn’t ready to oppose the governor’s plan: "I try to keep an open mind about whatever the administration brings forward."
Sharpe said there are far too many unanswered questions, however, to move forward with the concept this year.
For example, there’s no analysis on whether districts with higher ratios have a disproportionate number of students with high needs, or whether districts with higher student-to-staff ratios even have higher per-pupil costs.
Sharpe said private schools often boast about their low student-to-staff ratios.
“Are we putting our public schools at a disadvantage? Are we handicapping them more than we should, or not?” Sharpe said.
"We need to do something this year. We need to have a sense of urgency." — Commissioner of Finance Adam Greshin
Jeff Francis, with the Vermont Superintendents Association, said controlling student-to-staff ratios is a worthy public policy goal. But he said the administration’s one-size-fits-all approach ignores the unique circumstances that drive staffing levels in individual districts.
“I think that this approach really results in the potential for divisiveness, when really what is required is everybody coming together to work together,” Francis said.
Greshin, however, said with property tax rates set to go up by 5.5 cents next year, time is of the essence.
“We need to do something this year," Greshin said. "We need to have a sense of urgency."
Greshin said the proposal wouldn’t begin taking effect until fiscal year 2020, which would give school districts a year to figure out how to adjust staffing in light of the new penalty. And Scott has said he’s willing to use one-time money to avert a property tax increase for the coming tax year.
But Scott and Greshin say lawmakers need to pass legislation this year that will ensure cost containment in the future.
As for where the administration plans to come up with the $40 million in one-time money needed to avert a tax increase next year?
“We’re working on a plan," Greshin said, "but I’m not ready to talk about where we’ll find it yet."
With only about two weeks left in the legislative session, that uncertainty about where the money would come from — and how it might affect other areas of the state budget — is of concern to many lawmakers.
“I don’t have a money tree in my backyard that produces one-time money or an annual crop, so I have no idea where this money’s going to come from,” Sharpe said.
