Ed Cost Containment & Tax Proposals

With Town Meeting just one week away the pace of activity at the State House has increased. Legislators are engaged in the task of establishing priorities. What one person sees as a necessity, another sees as a luxury. With increasing costs and the federal share of many programs reduced, it will become difficult for State and Local governments to meet the increased need for necessary services. Towns and school districts find that it will cost more just to provide the same level of services as they have in the past. School budgets and Town Highway budgets are the ones most at risk in tight budget times. The budgets of administrative agencies (Transportation and Human Services are examples) are developed by the executive branch and can be increased or reduced by the administration. They are funded from a variety of taxes. Voter approval is not needed. Town Highway and School budgets require voter approval. When reductions are made or level funded for necessary services to reduce costs at the state level, these services are often picked up by Town and School budgets and funded by the local taxpayer. This cost shift also allows some to say that they have reduced taxes and to blame local official for spending too much. I urge you to attend your Town and School District meetings to learn about their efforts to spend your tax dollars as efficiently as possible.

The House Education committee will meet in an unusual Monday session to respond to a floor amendment and will consider two distinct plans to address school cost containment. The first is the two-vote threshold that artificially splits a school budget into two parts. A voter will have to vote yes on both parts to support the budget that was recommended by their local school board. This was what the Committee of Conference recommended and was adopted on a Saturday last spring as a compromise between the House plan to lower the high spending threshold and the Senate’s absolute caps plan. This plan does not give local school boards the respect they deserve and places local budgets at risk regardless of the care of that board.

The second is to lower the high-spending threshold that was already in effect. The evidence the Education committee heard last year concerning this plan was that 1) the rate of increase of education spending had been declining 2) that local school boards had developed responsible budgets that their districts approved 3) that the increase in school spending was less than that for all other areas of government and 4) that the major cost drivers: Fuel, Insurance, and Special Education were not within their direct control. The Education Committee will make their recommendation to the full House on Thursday of this week.

The House Ways and Means Committee is investigating alternative methods to finance education. One is to remove all residential school taxes but includes no mechanism to replace the $158 million dollars no longer collected. Districts would be required to raise any revenues above a given amount on their own tax base making it more difficult for the less wealthy district to provide the same opportunities for their students as the more wealth districts. The second is a to shift to an income tax rate to be adjusted yearly to raise the dollars to fund school budgets. The implications of this change will be explored. Hearings will be held March 13, 2008.

Please let me know how you feel about these or other issues. I also invite you to come to Montpelier to see the legislative process in action. I can be reached during the week in Montpelier by calling toll free at the State House 1-800-322-5616, by E-mail at ggilbert@leg.state.vt.us, or at my home answering machine at 849-6333.

Gary Gilbert
State Representative
Franklin 1
Fairfax/Georgia