A Brief Introduction to Education Finance

Trying to understand how Vermont pays for its schools can be a difficult task. This Joint Fiscal Office paper from Chloe Wexler, Fiscal Data Analyst, and Mark Perrault, Senior Fiscal Analyst does a great job breaking down the basics. 

Click here to read the paper. 

Takeaways from the report:

  1. Vermont has a unique education finance system – a statewide funding formula coupled with local property tax administration.
  2. School boards set budgets and submit them to voters for their approval, maintaining local control over education spending.
  3. The Legislature sets education property tax rates annually at the level necessary to fund voter-approved school budgets.
  4. To comply with the Brigham decision, the homestead property tax rate is a function of district per-pupil spending rather than property wealth.
  5. The tax bills of homeowners who are eligible for a property tax adjustment also vary in proportion to per-pupil spending.
  6. Since the enactment of Act 68, the nonresidential tax rate has been uniform statewide – the tax rate is not directly related to per-pupil spending.

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