MONTPELIER — House lawmakers have given their approval to changes in school spending thresholds that are expected to both give local school boards some breathing room and raise property tax rates.
For more than a month, House lawmakers have wrestled with the school spending thresholds imposed by Act 46 of 2015, which calls for the creation of larger school districts to both save money and improve educational opportunities for students.
The thresholds themselves, which vary from district to district, were intended as a two-year stop-gap effort to offer property tax relief while districts made plans to merge. However, a number of factors, such as the 2016 roll out of universal Pre-K education and a projected 7.9-percent increase in health insurance costs found many districts struggling to meet those thresholds.
Thursday afternoon, House lawmakers approved a bill that would raise every school district’s threshold by 0.9 percent, and reduces the financial penalties a school district would face for exceeding its threshold by 75 percent.
The bill will also allow a school district to employ the spending threshold that is most advantageous and least onerous between the two figures issued by the Agency of Education: the number released in August or the adjusted figure released last week.
“We worked hard to find a compromise between doing nothing and repealing the caps completely,” said Rep. David Sharpe, D-Bristol, chairman of the House Education Committee, which has spent nearly all of the past four weeks working on a way to — in the popular parlance of lawmakers discussing the issue — “tweak” the thresholds.
Last week, Senate lawmakers voted to tweak the thresholds by repealing them altogether, a proposal that gained little traction in the House on Thursday, when lawmakers defeated an amendment calling for repeal by a vote of 117 to 30.
Lawmakers also rejected an amendment offered by Rep. Paul Dame, R-Essex Junction that cut increases to the thresholds and decreases in penalties, but keep the provision allowing a district to use whichever threshold hurts the least.
“We owe it to the hard-working school boards who did what we asked — who played by the rules — to hold them harmless,” Dame said. “We need to support their hard work by not rewarding high-spending districts with a discounted penalty for not complying with the law.”
Lawmakers defeated Dame’s amendment by a vote of 110 to 36.
Dame and many of his fellow Republicans noted that raising the thresholds and reducing the financial penalties will result in an average increase in the residential tax rate of 2 cents.
“Vermonters have been saying they cannot afford any more increases in property taxes. For this reason, House Republicans supported the cost containment cap in Act 46,” said House Minority Leader Don Turner, R-Milton. “Today, the Democrat majority voted to reduce the high-spending penalty, increase education spending and raise Vermonters’ property taxes.”
The bill approved by House lawmakers only changes the spending thresholds for fiscal year 2017. Sharpe said his committee will have plenty of time to address the thresholds for the following year.
The next step for the bill is a return to the Senate, where lawmakers there can either approve it or vote to enter into a conference committee composed of House and Senate lawmakers, who would attempt to hammer out a compromise.
For the past month, lawmakers have discussed the sense of urgency surrounding changes to the thresholds before Sunday, which the deadline for school districts to warn ballot items for town meeting in March.
While it is unclear if anything will be signed into law by then, a change in thresholds after Sunday would still benefit the nearly 120 school district that approve their budgets by a floor vote in March, rather than by a ballot.