The Harwood Unified Union School District (HUUSD) Board will meet this week to make plans on how to advance a budget for the coming year. The proposed $50.8 million budget failed after receiving 1,439 yes votes and 2,640 no votes at Town Meeting on March 5.
While the budget failed, a separate ballot item asking voters in the six towns that form the HUUSD to reallocate a $535,000 fund balance to the maintenance reserve fund passed with 2,556 yes votes and 1,497 no votes.
“I am pleased to see that our community values the importance of maintaining our buildings. This is a tough budget year around Vermont for many reasons and we have more work to do. There is a lot of work to accomplish now in the coming weeks to work with a new board in order to draft a budget that will meet with the approval of our towns,” Superintendent Dr. Mike Leichliter said late Tuesday night, March 6.
In percentages, the budget failed 34.7% to 63.80% and the fund balance transfer passed 63% to 36%. The school district includes Warren, Waitsfield, Fayston, Moretown, Duxbury and Waterbury. The six towns have a total of 11,351 registered voters, of whom 4,138 – or 36% -- voted this week.
The board will meet by Zoom on Friday, March 8, at 6 p.m. Several new members were elected at Town Meeting this week and the board will organize itself before taking up the budget. The board meets again on March 13.
At the HUUSD annual meeting on March 4, the eve of Town Meeting, board members, finance director Lisa Estler and Leichliter answered questions about the education funding formula, what budget cutting might look like and more from one of the largest crowds to participate in the annual meeting in many years.
The HUUSD budget is not the only budget to fail this year. Other school districts faced the same potentially catastrophic increases in education taxes as HUUSD voters did thanks to the Legislature repealing a 5% cap on education tax increases under Act 127. Legislators replaced that cap with H. 850 which provided a 5-year diminishing discount for districts negatively impacted by the loss of the Act 127 cap. Three weeks ago, The Valley Reporter published data showing that the impact of H. 850 on local education tax rates, with projections for a 30 to 40% increase, which means local voters facing increases of $570 to $790 per $100,000 of assessed value.
While H. 850 was moving between the House and the Senate, a critical piece of the complex calculation that determines each district’s education tax rate was changed. That piece is the ‘yield.’ The House version of H. 850 included a yield of $9,171 per pupil (and the rate increases of 30 to 40%). The Senate version shows a yield of $9,775 per pupil. That yield could reduce the potential education tax increases from 30 to 40% to 22 to 31.7%, or $417 to $621 per $100,000 of assessed value.
But the yield is never actually determined until later in the spring, after school budgets have been voted on at Town Meeting – or in this year, possibly later, as H. 850 allows for districts to revise and revoke their budgets after Act 127, was modified. The House repealed a 5% cap on education tax increases for districts that kept per pupil spending increases below 10%.
The FY2025 budget for HUUSD was based on the Act 127 cap and an equalized tax rate of $1.51. The House and Senate versions of H. 850 include education tax reductions of one penny per each percent of taxation capacity lost with Act 127. Act 127 creates a way for some districts to increase their taxation capacity, resulting in others losing taxation capacity. HUUSD is slated to lose 9% of its taxation capacity and will get nine cents off its equalized tax rate this year, 100% of its loss. That 100% drops gradually over the next five years.
