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The Valley Reporter
P.O. Box 119
Waitsfield, VT 05673

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Act 68 is only a problem for ‘gold’ towns

By Marc Lanser

Ms. Spear's "In My View" essay last week argued that the Act 68 provisions that allow for various offsets to the calculation of Education Spending/Equalized Pupil result in an understating of true expenditures per student and that eliminating such offsets would implicitly result in lowering of taxes for Valley residents.

This is a straw man argument without any basis. Eliminating such offsets would have the opposite effect in that it would raise the Education Spending/Equalized Pupil for all districts, which in turn would either result in higher local district property tax rates to fund the shortfall or, more likely, result in an upward adjustment in the state-mandated base spending rate, with the same result on local property taxes.

Either way, local property taxes would increase, not decrease. The purpose of Act 68 was to refine the definition of per pupil spending, as well as to disincentivize rich towns from "excess" spending on their local schools. As verified in Ms. Spear's cited table, Act 68 has succeeded admirably in these two goals: Education Spending/Equalized Pupils is now quite similar in both receiving towns and "giving" towns; i.e., just what the architects of the law envisioned.

While Ms. Spear takes issue with Act 68's definition of Educational Spending/Equalized Pupil, redefining per pupil expenditures would have no effect on property tax rates in The Valley or any other district in the state, since current expenditures by whatever measure are far in excess of the state-mandated base rate. Local property taxes could only decrease due to either a drastic reduction in local school budgets and/or a decrease in the state-mandated base rate, which could in turn result in a downward adjustment to the Common Level of Appraisal for property taxes statewide.

The fact that larger schools may be spending more per pupil than small schools (depending on the criteria chosen for such calculations) is immaterial to controlling the skyrocketing costs of education and the resultant increases in local property taxes.

Act 60/68 is wildly popular in the state of Vermont, since two-thirds of Vermont towns are "receiving towns" (receiving more money for education than they contribute), while one-third of towns are "gold" or "giving" towns (which contribute more than they receive). Thus, in the state Legislature, representatives from receiving towns outnumber representatives from giving towns by 2-to-1.

Since it is always more popular to use other people's (gold town's) money rather than your own, the prospect for changes to the structure of Act 60/68 will always remain nonexistent due to the self-interest of receiving towns and their representatives. To propose fundamental changes to Act 60/68 is, therefore, futile.

The only solutions to controlling skyrocketing educational expenditures and property taxes are either through the establishment of charter schools, which typically cost $3,000 to $5,000 less per pupil (off the table since such are de facto prohibited in Vermont) or small school district consolidation, which has been shown to result in substantial savings in administrative and other overhead costs. The only well-controlled, published study on this subject, from Syracuse University, which looked at consolidation of rural New York districts, found overall per pupil operational savings of 50 to 60 percent. The table cited by Ms. Spears showing higher costs in large versus small schools is irrelevant to the issue of whether consolidation of small rural districts saves money.

The hard reality is that local residents have only two realistic possibilities for relief from ever-increasing property taxes: 1) Reduce local school budgets to the state-mandated base level; and/ or 2) support legislative initiatives for small district consolidation in Vermont.

Lanser lives in Fayston.


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