Vermont’s political leaders have pledged to work closely this upcoming legislative session to address high property taxes, but they’re revealing little about the policy solutions they’ll advance come January.
Republican Gov. Phil Scott and Democrats who control the legislature are keeping their cards close to their vests and have declined to lay out their ideas for preventing another sharp increase in property taxes to fund education.
The state tax department last week projected that those rates could rise 5.9 percent in 2025, absent legislative action. That would be on top of the 13.8 percent average increase that homeowners saw this year. If the projection were to hold, the education chunk of property taxes — which constitutes three-quarters of most homeowners’ bills — will have soared 33 percent in three years.
After Democrats took a drubbing at the polls in November, Senate President Pro Tempore Phil Baruth (D/P-Chittenden-Central), said he planned to dedicate the first week of the session to listening closely to Scott’s ideas.
Last week, Scott declined the invitation. His team would be happy to outline the issues facing the education systemc, but they aren’t going to offer their proposed solutions during the first week, as Baruth suggested they do.
“We’re not prepared to do that,” Scott said. Building the state budget is complicated work, he said, and must be done holistically with a wide range of issues taken into consideration. He said his goal is to avoid any tax increase and possibly offer a tax cut.
“We’re happy to talk about the problems we see and maybe talk about some of the dozens of proposals we’ve made over the last eight years,” he said.
“I want to assure you that real, meaningful change is coming.” House Speaker Jill Krowinski
House Democratic leaders were equally vague about the strategies they might embrace, stressing that there won’t be a single policy solution.
“I want to assure you that real, meaningful change is coming,” Speaker Jill Krowinski (D-Burlington) vowed during a Statehouse press conference last week.
Krowinski is facing a rare public challenge to her leadership from Rep. Laura Sibilia (I-Dover), who has the backing of some Democrats rattled by their steep election losses that many attribute to the property tax hikes. Krowinski nevertheless received the strong support of her caucus on Saturday as the contest heads toward a January 8 vote in the House.
Last session, the legislature established the Commission on the Future of Public Education and charged it with strategizing potential ways to make the education system both more affordable and more equitable. The 13-member group of legislators, state officials and education leaders has met regularly since July.
Its first charge was to draft a report by December 15 with “preliminary findings and recommendations, including short-term cost containment considerations for the 2025 legislative session.”
But Peter Conlon (D-Cornwall), chair of the House Education Committee and a member of the commission, said the body has had time only to gather ideas, not to analyze them sufficiently. As a result, its report, expected to be a week late, will include some potential strategies — but not recommendations.
“What you’re going to see on that list is not a lot of new ideas,” Conlon said. “These are ideas that have been around for a long time.”
The commission is still waiting for some of the data it requested in August from the Agency of Education on district budgets, health care costs, enrollment and teacher salaries. During meetings this fall, commission members regularly voiced concern about the challenges of delivering substantive recommendations by December.
The commission reviewed a 26-page draft version of its report at its December 2 meeting. It contained a table outlining potential action that breaks ideas into several categories, including changes to the education fund and aid formulas, health care costs, and school size.
Only two ideas were listed as having a “high” impact on school costs: establishing optimal school sizes and merging small schools and school districts. Modifying staff-to-student ratios — that is, increasing the number of students per staff member — would have “medium” fiscal impact, the draft report says.
Only one potential strategy has a dollar amount attached to it: placing a wealth tax on millionaires. That would raise $70 million. Downsides include the risk of driving high-income people from the state.
Krowinski said she was “relieved” that another double-digit property tax increase is not forecast but stressed that a mix of short- and long-term solutions are still needed.
“Look, there is no one policy change that will fix the problem before us,” she said at her press conference. “It will take a variety of changes to make a difference.”
She said she was hesitant to put any individual solutions forward now because she wants to preserve the spirit of cooperation and collaboration that is crucial to the effort’s success.
“My concern is, as soon as we put ideas on the table, people might get nervous and concerned and afraid and step away,” she said.
Krowinski made clear that lowering taxes isn’t her only goal, or even her main one. Most of her statements put children before taxes.
“We must be united in our mission to make sure that our public schools have the resources that they need to support our kids at a price Vermonters can afford,” she said.
At another point, she noted that policy changes about class size need to be weighed carefully because they might affect rural schools in the Northeast Kingdom differently than they would schools in a city like Rutland.
“It’s important that we fully understand that implication on our kids’ education. They are our priority here,” she said.
House Republicans have said they want to limit property tax increases to no more than 3 percent. Senate Republicans are angling to cut taxes.
Rep. Scott Beck (R-St. Johnsbury), who will represent Caledonia County in the Senate next session and was recently elected GOP minority leader, said he wants the property tax system to become simpler and more transparent. He also says local tax rates should more closely reflect district finances.
“I don’t want to sugarcoat this. This is going to be difficult for all of us.” Gov. Phil Scott
In January, Scott will likely revisit two ideas that lawmakers rejected last year. He proposed to cut the $20 million universal school meals program, which provides free meals to all students regardless of family income. He also proposed drawing down the entire $47 million education fund stabilization reserve to further buy down property tax rates. Reserves would be replenished over five years through spending cuts.
Treasurer Mike Pieciak threw cold water on the latter idea, saying it could hurt the state’s bond rating. Baruth called it financially irresponsible.
This time around, however, Scott said he hopes that having a willing partner in the Democrat-controlled legislature will help “hold taxpayers harmless,” though he warned sacrifices lie ahead.
“I don’t want to sugarcoat this,” he said. “This is going to be difficult for all of us.”
Staff writer Alison Novak contributed reporting.
The original print version of this article was headlined “High Stakes | Vermont leaders have pledged to address education property taxes — but they aren’t showing their cards”
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This article appears in Dec 11-17, 2024.
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