There is no way to sugarcoat it – towns in the Harwood Unified Union School District are looking at education tax increases of 30.1% in Duxbury to 40.4% in Warren.
Fayston residents are facing a 33.4% increase, Moretown residents a 30.5% increase, Waitsfield voters a 39.8% increase and Waterbury voters a 34.3% increase. The budget comes before voters on March 5.
Each town’s projected increase is based on its Common Level of Appraisal (CLA).
BUDGET PROJECTIONS
These are the budget projections from HUUSD finance director Lisa Estler which are being shared with the school board as The Valley Reporter goes to press on February 14. The projections are based on a new piece of legislation in the House, H.850, which repeals a 5% cap on education tax increases (from Act 127) and replaces it with a five-year plan that reduces the impact of education tax increase for districts losing taxation capacity.
Those figures are based on the $50.8 million budget the board approved on January 31. When the budget was adopted, Act 127’s cap was in place and that budget would have resulted in an equalized tax rate of $1.51, up from last year’s rate of $1.44. The actual tax rate varies from town to town due to CLA differences.
With that cap removed, the HUUSD equalized tax rate would be $1.78 which is reduced by nine cents under H.850 to $1.69. The nine-cent reduction represents the 9% of taxation capacity the district is losing under Act 127 which increases some districts’ taxation capacity. Going forward the nine cents decreases by 20% each year until it sunsets in 2029.
NOT APPLES TO APPLES
With the 5% in place, district voters would have seen increases of $72 per $100,000 of assessed value, before CLAs were factored in. Under H.850, in a not apples to apples comparison, district voters will see tax increases that range from $2,001 to $2,779 for a home appraised at $350,000 and $2,573 to $3,573 for a home appraised at $450,000. (See chart).
The $50.8 million budget includes adding $1 million to two reserve funds and adding a $535,000 fund balance to that fund. In advance of the board’s meeting on February 14, Estler provided updated data and tax rates/increases for lower budgets. Keeping in mind that the equalized tax rates that creates the increases that range from 30 to 40% is $1.69.
Reducing the budget by $1 million for the reserve fund drops the tax rate to $1.65 with increases ranging from 27 to 37.1%. Further reducing the budget by removing the $535,000 fund balance drops the tax rate to $1.63 with increases ranging from 25 to 35.5%. The additional reduction of 10 FTEs drops the tax rate to $1.59 with increases ranging from 21.7 to 31.3%. Changing the staff reduction from 10 FTEs to 26.7 FTEs drops the tax rate to $1.51 (which it would have been with Act 127’s five percent cap) with increases ranging from 16.3 to 25.5 percent.
Part of the legislative work that is ongoing this week is looking at how districts that have already warned their budget votes for Town Meeting can revise their budgets and rewarn them for a date later in the spring. School district Superintendent Mike Leichliter said the board would be hearing information about that process at this week’s meeting.
LEGISLATIVE IMPACTS
This scramble to understand the legislative impacts on the budget comes as the school district works its way through the process of proposing a bond to fund critical updates/repairs and renovations at Harwood. That bond amount ranges from $70 to $91 million. In November and December, continuing into January and February, the board’s bond subcommittee held extensive community outreach meetings.
Members of that committee gathered to parse the data and comments received during the meetings as well as in an online survey on February 1. Even before knowing the impacts of the Act 127 cap being removed, committee members were candid in their discussion about whether the bond vote should proceed as planned this November or whether it should be moved to the spring.
If the bond vote is moved, the district still faces repairs that must take place in the next three years, to the tune of $14 million. Currently the district has $2.6 million in its maintenance reserve fund and the $50.8 million dollar budget would have added $1.53 million.
