Because the Governor has been beating up the legislature for inaction on education costs, some legislators think that any bill is better than no bill. The Senate incorporated the governor's proposal to cap school spending in its school cost bill (H.526). We need your help in making sure this harmful plan does not become law. It would lead to lack of local control and cuts in educational quality as communities would be forced to make decisions they would not otherwise make.

Other states have tried property tax caps. The results have been terrible for public services, schools, and children. The idea is to limit school costs by requiring 60% of voters to support any increase beyond 3.5%, with no concern expressed for the failure to address the cost of health care, the cost of heating and transportation, the array of costs affecting schools and everyone else.  The proposed cap is busted by outside budget pressures alone.  School costs can only be addressed by resolving the real drivers of these costs.

The model for Governor Douglas's school spending caps, spoiled the quality of education in Massachusetts and damaged community relationships. Caps in Colorado had such damaging effects on public services generally that even the chamber of commerce there ended up clamoring for their removal.

Vermont is a special place where we look each other in the eye and say yes, we are in this business of life together. Above all, we are responsible for the well being and raising up of our children. We can do a lot better for them and each other than accepting the "Douglas super-majority." It is nothing but recycled policy that has been tried and failed elsewhere.

Education spending represents a long-term investment in our people Vermont. Failure to make necessary investments in education and infrastructure weakens the state. One way to pay for needed investments in education would be to change the 40% capital gains exemption. If the exemption were limited to long-term investments in Vermont, the state would receive an additional $15 - $20 million per year in tax revenues. We lost $69 million in three years (2002 - 2004), and what have we gained from the exemption. It certainly hasn't led to more investment and jobs in Vermont.

Despite all the talk about the burden of school taxes, the burden now is less than it was ten years ago. According to Paul Cillo, president of the Public Assets Institute:

1. School tax as a percentage of personal income has dropped. Yes, school costs have gone up significantly, and with them taxes. But personal income has grown faster. The result: From 1996 -- the year before Act 60 -- to 2006, the percentage of personal income that goes to taxes has dropped from 5.4 percent to 4.9 percent.
   
   2. Most Vermonters are protected from rising property taxes. The income-sensitivity provisions of Act 68 allow people in owner-occupied homes to pay their school taxes based on income, not the value of their homes. Most of these households -- 60 percent -- do so. Even if school property taxes rise in their communities, they aren't forced to move.

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The Real Problem of School Cost Increases?
by Bill Mathis

“Beginning with the federal government, the U. S. Department of Education’s own Inspector General says there are at least 588 state and local compliance requirements in the federal No Child Left Behind Act. ?these mandates are estimated to cost Vermont schools $360 million in new, hidden or displaced costs. To pay these costs, the feds give us $61 million.

...the governor has said Vermont school staffing has increased 22%. The state department of education official records reports a more modest 1.8% increase between 2003 and 2006. ...teacher and aide numbers have gone up less than one-half of one percent. However, data processing staff has increased 126%, and business office clerks have shot up by 33%. What do these new people do? They fill out state and federal forms, count beans and comply with mandates.

...Neither the federal nor state government has distinguished itself on health care reform (although Vermont has taken some steps). Over the last ten years, health costs alone added an average of 1.8% per year to school budgets. Likewise, federal and state special education mandates increased the budget an average of 1.2 points annually. New technology needs, mandates and paper-pushing add another point. If we give teachers and staff a 3% cost of living increase, that adds another 1.8% per year. That’s 5.8% per year. The Governor’s proposed cap is busted by outside budget pressures alone? school costs can only be addressed by resolving the real drivers of these costs.”

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