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Our education funding system is broken

By Eva Frankel and Heidi Spear

(This letter was sent to Governor Shumlin)

Your directive to look to school board members to contain spending and address ever-increasing tax hikes flies in the face of what you extol as our "common set of values: community, hard work and fairness." The complexity and manipulations of our funding formula, the rising tide of mandates, the contraction of our economy and the concentration of education funding burdening are the root causes of the untenable situation many taxpayers face. When your grand action to right the ship is to throw community members and carefully developed school budgets under the bus instead of tackling real reform, you do not reflect any of these values.

At the Ed Funding Symposium last week, it was acknowledged that many of our legislators don't even understand our education funding system. Many taxpayers don't either. As some panelists at the symposium noted, the complexity of our system is a problem. There is total obfuscation of clear measures of efficiency that undermines people's ability to gain insight into costs and their reasonableness relative to other schools. The initiation of any meaty dialogue on efficiency or lack thereof would have to cover how we aren't measured on actual spending per actual student but by a derivative construct of the funding formula with highly manipulated equalized pupil counts and net revenues that vary tremendously by town, based upon poverty and access to other grants. Add to those highly confusing elements of our system the lack of knowledge of the ins and outs of federal and state mandates, teacher contracts and special education obligations, and Town Meeting is the very last place where real efforts to promote cost-effective delivery of quality education should rest. Given the circumstances, the only opportunity to improve on school board members' difficult public service work would involve constructive reform from you, the House and Senate and our new secretary of education.

Let's get down to facing brutal facts, governor. Whether a school board is disciplined and right size staff or not, taxes will go up significantly. Last year, a real and representative example in our supervisory union of a budget increase of 2.2 percent translated to a 9.2 percent tax increase. In recent years, budgets held to zero growth or even contracting resulted in higher taxes nonetheless. The reason being that no matter how much restraint a school community and their school board shows locally, other districts spend more and the burden of taxation continues to grow. The variety of factors that feed into the tax rate formula that fall outside of local spending choices substantially limits the local means to stop, or even for voters to comprehend, the rising tide of taxes. Our funding formula has created a full-blown "tragedy of the commons" and you and our legislators need to fix that problem.

Regardless of how spending is driven ever upward by the formula itself, spending increases are most often not resulting from local profligacy. The biggest driver of cost increases is unfunded state and federal mandates, including recent ones that you and the Legislature have sent our way. Common core implementation, multiple learning pathways, added staffing for events where concussions might occur, early education universal choice ... the list goes on. While in some instances you have managed to obtain federal funds for students in poverty and for special needs populations, there are no new revenue sources for delivering these services for the rest of the population. There was plenty of frustration on this count expressed at the symposium as well, and it can't be news to you how your choices impact these budgets.

One can't be honest about the challenges of education funding in Vermont without facing the other brutal fact that our leadership is allowing for the increasing concentration of education cost burdening. Our state tops the list on education funding tax burdening and the impact on one-third of our taxpayers is truly unsustainable. Your remarks on transfers from the General Fund and minor increases in other funding sources ignore the reductions made in the recent past and the withdrawals from the Education Fund to meet corrections obligations. Simply put, too few people pay far too much. Many people can't afford to stay here or can't justify the premiums to live here when making a good living is so challenging and the chance to save so greatly reduced. Our levels of property taxes, on top of income and other taxes, make it very hard for people to save for college or retirement or live here during retirement. The pain and frustration that is felt by some in our communities is amply reflected at Town Meeting and it is justified. While the funding formula systemically undermines restraint through a tragedy of the commons, it then concentrates the burden of education funding on a mobile segment of our society to the point that we risk their very presence here. Seriously, we should be conducting exit interviews.

These are real problems that come to roost for school board members who work very hard to make every dollar count for children across Vermont. Suggesting that increased costs and unreasonable tax increases result from unobserved school boards and folks not engaging in budget reviews on Town Meeting Day is insulting and patently misleading.

Rather than pitting community member against community member, what we need from you, the Legislature and the Agency of Education is management and accountability for actual spending in education delivery, simplification of the funding formula, incentives that reward cost containment efforts and real insight into how to optimize staffing and outcomes while fulfilling our state and federal mandates. We school board members should not be your scapegoats for real problems, while you avoid doing the work of championing and delivering constructive reform.

Every year that you, your team and legislators in Montpelier fail to act, you further divide our communities and make the job of delivering top-quality education across Vermont more difficult. We respect the recent work of Tax Commissioner Mary Peterson on the matter at hand. We look forward to the leadership of Secretary Rebecca Holcombe. We hope that with these resources, we can finally see the leadership and reform we so desperately need. The question that remains for us, given your very disturbing remarks on the subject, is whether you will leverage your team and have an impact, or just pass the buck yet again?

Spear is chair of the Fayston School Board. Frankel is the chair of the Waitsfield School Board and the Washington West Supervisory Union board chair.


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