Letter to Legislators: Education Reform & School Consolidation

Dear Members of the Vermont General Assembly,

We urge you to prioritize and refine the work of the Act 73 Task Force. Their start towards evidence-based education reform is the right direction for Vermont. The shift toward shared services and away from top down, state mandated mega districts is clearly the most effective plan to date, but it does not yet go far enough to meet the scale and urgency of our affordability crisis.

We share the strong public opposition to forced mergers and small school closures that the Task Force heard. The data does not support this type of consolidation and there is considerable risk of losing time, energy, and political capital implementing the wrong fix for our education challenges.

We also agree that learning happens in classrooms, not in the 52 central offices that exist today. To maximize cost-savings and minimize student disruptions, we need to look there.

Specifically, here is what we are urging you to do…

1. Confront the current fiscal reality with urgency

Excessively high staffing levels have led to the second highest cost per student in the country, while at the same time student outcomes are worsening.

Education spending has risen by roughly 47% since 2019, and current projections show that it is not expected to slow down in FY2027. Taxpayers cannot sustain these increases, and one-time funds to artificially buy-down property taxes will not be available in perpetuity. Asking current stakeholders to voluntarily restrain spending is unlikely to change this trajectory.

To bend the cost curve starting in FY2027, the Legislature should:

• • Institute a freeze on school budgets to arrest the rapid increase in education spending (excluding special education costs). While it may seem aggressive, doing so still only holds the property tax increase around 6%. This creates a bridge in FY2027 until the new foundation formula goes into effect in FY2028.

• • • • This would need to be passed quickly when the Legislature convenes in January in order to give school boards time to adjust their budgets before town meeting day.

• • Follow this freeze with a fair foundation formula that:
    • Establishes a clear, statewide per pupil commitment,
    • Uses regional cost of living adjustments(e.g., housing costs) so compensation can be competitive where it needs to be, and
    • Is grounded in the Picus–Odden adequacy work and other evidence, rather than ad hoc pressures.

Budgets with real ceilings work in every other sector of our economy. They can work in education, too, if we give school boards clear limits and appropriate support.

2. Follow Vermonters’ priorities, consolidate systems not communities:

More than 5,000 Vermonters engaged with the Task Force. They overwhelmingly asked policymakers to:

• • Maintain local schools and elected school boards,
  • Avoid another round of forced district mergers and school closures, and
  • Focus on collaboration and efficiency instead of “one size fits all” consolidation.

Rural communities have good reasons to be wary. When schools are pulled out of small towns, negative consequences follow. Experiences from other rural states show that young families stop moving in, property values fall, and the tax base shrinks—sometimes bending the statewide cost curve in the wrong direction. Further, we know from our neighbors in Massachusetts that community vitality and public school performance are closely linked.

The Task Force listened to these concerns and proposed a model that preserves community connections while encouraging cooperation and cost-savings.

3. Learn from past mistakes.

Act 46's forced mergers resulted in lawsuits, resentment, and minimal or no savings. The Task Force's approach avoids these pitfalls by encouraging voluntary cooperation and incentivizing mergers where communities want them. It also bypasses the diseconomies of scale from consolidations experienced here in our state and have been documented in other states.

As 21^st century Americans, we are conditioned to believe that bigger is better. When it comes to Vermont Education, the evidence does not support that notion. The data says that bigger school districts do not perform better on either a cost or performance basis.

4. Follow the evidence; don’t get bullied into mega districts

The Task Force, national literature, and Campaign for Vermont’s (CFV’s) own work over the past decade all point in the same, evidence-based direction:

• • Large, forced district consolidations, like those proposed by the Governor, have hypothetical benefits, are not evidence based, and have a poor track record in rural states.
  • One of the biggest risks of consolidating into mega districts is that the leveling-up of staffing contracts will overwhelm any administrative savings. There is a very real risk that mega districts will materially increase personnel costs, thus reducing and perhaps even eliminating any savings obtained by shared services in these new mega districts. This appears to be what happened with Act 46 mergers.
  • Local school boards are not expensive, and they play an important role in Vermont communities. It is the budgets they approve that increase expenses. Act 73 redefines the role of these boards to some degree by providing clear spending constraints within the foundation formula. This shifts the conversation for boards towards working with local school administrators to identify the best way to spend these resources.
  • Regional shared service models, such as BOCES in New York and intermediate units in Pennsylvania, have documented significant savings in administration, special education, transportation, procurement, and professional development without erasing local identity.
    • Our own analysis shows potential annual savings in the hundreds of millions for Vermont.
    • One Vermont BOCES style consortium in the southern part of the state has already reported about 66% savings on the services it has taken on.
    • These services-at-scale need to be mandatory. The Task Force report’s language around Cooperative Education Service Areas (CESAs) remains ambiguous and largely framed as a “roadmap” that “encourages” collaboration. Encouragement is not a plan. Voluntary participation will not materially bend the cost curve. Participation in shared services must be mandatory.

5. Consider our recommendations for FY2027

Building on the Task Force’s work, but giving it real teeth, we recommend that the Legislature:

• • Create mandatory shared service agencies to replace or subsume SUs.

• • • Define in statute a core set of services that must be delivered regionally or statewide beginning in FY2027: HR and benefits administration, payroll, accounts payable and purchasing, core IT and cybersecurity, statewide accounting and data systems (including a uniform chart of accounts and billing codes), and selected special education and professional development functions should be considered.
    • Use a dozen or so regions, not just five, to better match Vermont’s scale and geography. Our recommendation is to center them around Vermont’s Career and Technical Education Centers in order to create a better integrated and comprehensive career development pipeline.
    • The majority of other states have chosen a model like this to achieve cost-savings. It is significantly more effective than our current Supervisory Union structure.

• • Consolidate central offices.
    • Reimagine the roles of Principals and Superintendents so that we can reduce the number of costly and duplicative administrative units in the state.
    • Redefine the Superintendent role to focus on service delivery and efficiency, not duplicating governance.
    • Redefine the Principal role to work more closely with school boards on budgeting decisions and focusing on producing the student outcomes that we, as Vermonters, would expect.
  • Create an Education Savings Task Force responsible for identifying additional mandatory consolidations of services, monitoring implementation of the new shared services agencies, and ensuring that staffing reductions and savings targets are met over a defined timeline.
  • Align incentives with outcomes and transparency.
    • Modernize accounting and reporting so the state and public can clearly see where dollars go and how they relate to student outcomes.
    • Tie any future merger incentives to demonstrable improvements in opportunity and cost, not arbitrary size targets.

More details about how this might work and the benefits of this plan were provided in our position paper from March of this year.

In conclusion, Vermont’s culture of small towns, rural communities, and bottoms up democracy is a strength. It can coexist with, and be strengthened by, modern, efficient, regional and statewide systems that support them. The Act 73 Task Force has provided a useful, evidence-based starting point. Now it is up to you to transform that roadmap into a timely plan that delivers real savings (both immediate and long-term), protects rural communities, and improves educational opportunities.

We urge you to act boldly and start bending the cost curve in FY2027.

Sincerely,

CFV is a nonprofit, nonpartisan advocacy organization comprised of over 20,000 Vermonters and dedicated to the vision of a more prosperous Vermont and growing middle class. They seek to accomplish these goals by reconnecting Vermonters to their government and advocating for more transparent and accountable policymaking.

[1] Ballotpedia notes that “During the 2022-2023 school year, there were 13,194 public school districts. These school districts enrolled 49,618,464 students across all 50 states and the District of Columbia.” This means that superintendents in the US, on average, work with 3,760 students. In Vermont, this number is less than half that (around 1,600 students). This suggests that the state could operate efficiently and effectively with 22 superintendents. Our proposal of aligning Superintendents with tech centers would put the number between 15-17 – still a reasonable scale.