School Finance in Vermont: Balancing Equal Education and Fair Tax Burdens. Discussion Paper 07-01

Federal Reserve Bank of Boston. P.O. Box 55882, Boston, MA 02205. Tel: 617-973-3000; Tel: 617-973-3397; e-mail: boston.library@bos.frb.org; Web site: http://www.bos.frb.org/

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19

Educational Finance; Educational Equity (Finance); Finance Reform; Public Education; Taxes; Tax Rates; State Legislation; Court Litigation

Vermont lawmakers had grappled with the thorny issue of how to finance public education long before the Vermont Supreme Court's 1997 ruling that the state's funding system was unconstitutional. In "Brigham vs. State," the court found that the system in effect at that time violated the state's constitutional guarantee to equal protection under the law and directed the Legislature to establish a system that would afford "substantially equal opportunity" to all Vermont school children. Less than six months after this ruling, lawmakers enacted the Equal Educational Opportunity Act (known as Act 60), under which tax rates and educational opportunities were substantially equalized across school districts by redefining property wealth (for educational purpose) as a state resource. Act 60 and its successor, Act 68, both narrowed disparities in educational funding across school districts. But the issue of who pays for education remains contentious, with calls for further reform driven by the perception that education property tax burdens are unreasonably high and remain inequitable. During this biennium session, the Legislature is expected to consider a range of reform proposals, including repeal of the current system. This paper provides a broad overview of major efforts to reform education finance in Vermont since 1969. Two appendices are included: (1) Additional reading; and (2) Court rulings, legislation, and reform proposals. (Contains 8 footnotes.)

ERIC

2009

ED505615