State education funding report prompts reps to ‘kick up dust’
Former state Rep. Ann Manwaring of Wilmington talks with her successor, state Rep. John Gannon, D-Wilmington, during a break at a forum on education funding in Dover on Jan. 18.

State education funding report prompts reps to ‘kick up dust’

Lawmakers ask citizens to support efforts to address school-funding inequities that persist 20 years after the landmark decision to equalize educational opportunities in Vermont

DOVER — Audience members clutched cups of coffee as weak, pre-storm sunlight shone through the tall windows of the Town Hall.

Despite short notice and the early-Saturday meeting time, more than 20 people traveled from towns such as Dummerston, Newfane, Wilmington, Stratton, and Townshend to discuss a report on education funding.

According to recommendations in the 150-page Pupil Weighting Factors Report, issued Dec. 24, 2019 by Secretary of Education Daniel M. French, the state needs to adjust how it calculates the cost of educating students.

Among its findings: Vermont's education funding formula has led to inequities for some of the state's vulnerable children.

“Our financing system is unconstitutional,” Rep. Laura Sibilia, I-Dover, told the audience. “I'm looking for people to make the justice argument [to the Legislature].”

The weighting calculations in question are part of the state's education funding system, commonly referred to as Act 60.

The legislation went into effect in 1997 after the state Supreme Court ruled in Brigham v. State that Vermont's education funding system was “constitutionally deficient” because it denied students equal access to educational opportunities.

At the time, most school funding was raised through local property taxes. Wealthier towns could afford more robust programing. Poorer towns could not.

Act 60 sought to remedy those deficiencies through a statewide funding formula.

Unfortunately, it seems, the formula had flaws.

One of the flaws mentioned in the report was that some of the weights used to determine the costs related to student needs - such as English as a second language - predated Act 60 and lacked scientific rigor.

Rep. John Gannon, D-Wilmington, said he wants the Legislature to take action on the report this session. Yet, implementing the changes could prove difficult, he acknowledged.

“The hard part is who wins and who loses and who understands what's happening,” he said.

Sibilia said when she read the study, which cost approximately $300,000, she felt a deep sense of relief to finally have a data-driven report analyzing the state's funding formula.

She has said that she believes that all Vermonters are responsible for providing equitable educational opportunities for all students. And she has also questioned how well the state's funding formula reflects the economic realities of educating vulnerable students.

“The good news is, we were right” about the formula, Sibilia told the audience. “The bad news is our kids have really been hurt over two decades.”

Weights and measures

The AOE contracted with researchers from the University of Vermont, Rutgers University, and the American Institutes for Research, who found that the state's current weights “fall far short of appropriately adjusting for the cost” of educating students who are classified as economically disadvantaged and English language learners (ELL).

Vermont adjusts the actual count of the student population in each town based on these factors. The result is what the state calls the “equalized pupil count,” which, in theory, uses these adjustments, or “weights,” to amplify the pupil count to stream extra funding to towns and districts that are educating vulnerable populations.

Some of the weights used to calculate a school district's equalized pupil count - which then factors into a school district's per-pupil spending - predate Act 60. The researchers noted they could not find any empirical data on how the longstanding weights had been derived.

The report recommended adjusting the state's formula to better reflect the cost of educating poor and ELL students. Researchers also recommended potentially replacing the state's existing Smalls School Grant with weights that factor for school size and population density.

A third recommendation was tweaking the state's secondary school weight to include middle-and secondary-level adjustments. Doing so could “better align” the weight with current educational policy, the researchers advised.

They also presented different models on how to fund special education services, such as providing a one-size block grant.

Following the submission of their report to the Legislature, researchers made presentations earlier this month to the Senate Education, House Education, and House Ways & Means committees.

Rep. Carolyn Partridge, D-Windham, who has served on the Windham Elementary School's board, noted that the current system has meant that small towns with high poverty rates “have been shortchanged for 20 years,” she said. “And had their taxes potentially higher.”

She hopes the Legislature moves forward with the report's recommendations.

Rep. Kelly Pajala, I-Londonderry, represents towns with a variety of circumstances. For example, Stratton does not operate a school and instead offers school choice for students in all grades.

The report's recommendations will affect each school community differently, Pajala said.

When it comes to concerns that the current funding system is “unjust or unconstitutional,” Pajala said, “I don't have to be convinced of that.”

'A zero-sum game'

Former state Rep. Ann Manwaring of Wilmington also attended the meeting.

Manwaring spent many years questioning the mathematical mechanics in Act 60. In her opinion, the state's formula fails to reflect the challenges that schools in poorer communities are facing.

With the data in the new report, “We finally have a credible and substantive body of knowledge in which we can act to remedy the inequitable results of our current education finance system which has resulted in inequitable results for all students,” she said.

For taxpayers, the funding system has also been unfair, she said.

Many communities have overpaid under the funding formula and received fewer opportunities for their students. Meanwhile, other communities have underpaid and received more opportunities.

Despite Act 60's attempt to increase educational equity, according to Sibilia, the current system favors communities that can achieve higher economies of scale and that have lower costs in general.

The unintended result? Communities that have larger school populations and tend to be wealthier have benefited from the Act 60 funding formula, Sibilia said.

Meanwhile, communities that tend to have higher costs, (such as higher rates of poverty), that are more rural, or that are small have “not been able to access adequate resources for their students,” she said.

And there is an irony in this situation.

According to the report, students from economically disadvantaged backgrounds receive better support and achieve better educational outcomes in small - often rural - schools than in larger schools.

The adjusted weights recommended in the report could help bring more taxing capacity to communities serving students who are dealing with challenges such as poverty.

Applying their recommended weights to school budgets using 2018 data, researchers measured the consequence of those recommendations on tax rates.

Large, wealthy towns are likely to feel a tax hit, Sibilia said.

But according to the report, most Windham County communities, however, would see a significant decrease in their educational tax rate.

For example, Athens' tax rate could drop 37 cents per $100 of assessed value. Other tax rates that could decrease include Guilford (13 cents), Halifax (14 cents), Jamaica (40 cents), and Readsboro (47 cents).

Other towns historically considered wealthy “gold towns” under Act 60 - such as Dover, Wilmington, and Whitingham - would see their taxes stay the same or increase by a few cents.

Brattleboro and Rockingham, while in comparison to other Windham County towns are more urban, could also see tax decreases because of the number of students living in poverty.

Two communities that could experience a tax increase are Stratton (62 cents) and Westminster (27 cents).

Sibilia and Gannon cautioned the audience that in a tax sense, the adjusted weights are a “zero-sum game.”

The new weights won't raise more money across the state, the two lawmakers warned; instead, they will redistribute where money is spent.

Sibilia said she has heard the report dismissed as simply shifting costs and changing who are the “winners and losers.”

“There are winners and losers right now,” she responded, noting that right now, the students losing out on opportunities are the ones who need the most support.

She continued, saying that “in addition to their challenges, [students in these circumstances] do not need to be shortchanged on their public education.”

After any shifts are made, however, responsibility will rest with the taxpayers.

Sibilia said she is concerned that if towns that have historically overpaid in taxes receive a tax reduction, they will use that reduction to lower education taxes.

While it appears counterintuitive, communities that receive a tax reduction through the adjusted weights will also have a greater ability to spend more on their schools.

According to Sibilia, the adjusted weights will increase the school's equalized pupil counts. Consequently, schools will have more capacity to spend more money per student before hitting Act 60's spending threshold.

Sibilia wanted to remind communities tempted to pocket the savings that “their students have been denied equitable access to resources through their towns' taxing capacity.”

Speaking up

“Please people, we need your help,” said Sibilia.

The lawmakers asked audience members to contact their representatives as well as members of the Senate and House committees on Education and Ways & Means. They also asked people to testify and share their personal stories with lawmakers.

Gannon, Pajala, Partridge, and Sibilia have submitted four “short form” bills to the Legislature for consideration.

According to the lawmakers, short form bills focus more on ideas or studies than on creating fully formed legislation.

The short form bills include:

Freezing changes to the education tax financing formula until the Legislature has acted on the recommendations in the Pupil Weighting Factors Report.

Adding a poverty weight, population density student weight, and a geographic necessity weight to the formula used to calculate equalized pupils, factors recommended in the report.

To require the Agency of Education to perform a “look back” at data from 2000 to 2018 and “identify the costs in student outcomes related to inadequate funding through inequitable and inadequate equalized pupil weights.”

• To require the AOE or Joint Fiscal Office to calculate the “cumulative under- and overtaxing” that resulted from student equalized pupil weighting from 2000 to 2018.

According to the lawmakers, the timeline for passing bills related to the weighting study is tight, but not impossible. A lot depends on the committees considering the study, they said.

Sibilia said that the Senate Education Committee chair, Sen. Philip Baruth, D/P-Chittenden, has shown support for the report.

“If the Legislature fails to act this year, I believe your towns should hire attorneys and sue or do whatever you can because I believe this is unconstitutional,” Sibilia told attendees.

Gannon, who is also an attorney, agreed.

The current system does “an injustice to rural schools,” he said, adding that special education funding is also part of the equation.

One of the ideas for changing how the state funds special education is by providing one lump sum in the form of a block grant. Gannon believes this approach is “wrong.”

Shaking his head, he said he won't vote for any more education legislation that purports to save money.

“I'm tired of that,” he said.

Sibilia acknowledged that education legislation “is hard” because it involves children, schools, and taxes - all of which Vermonters care about deeply.

She told the audience that she has discussed the study and its implications with many lawmakers - and added that she's made it clear she's going to be “kicking up dust” around adjusting the educational funding formula.

Education funding has remained a perennial hot, frustrating topic in many Windham County towns since the inception of Act 60 more than two decades ago.

Reverberating through the public discussion was the frustration that residents have felt since 1997 - mainly, the sense of disconnect between what they pay in education taxes versus what their students receive in educational opportunities.

“I'm begging you all, consider testifying,” Sibilia said. “You cannot imagine the power of Vermonters' informed voices.”

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