Act 60 reform signed into law

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(Host) Governor Jim Douglas on Wednesday signed the new Act 60 reform bill into law. The governor says the proposal is the first step in the effort to help reduce property taxes across the state.

VPR’s Bob Kinzel reports:

(Kinzel) Douglas was set to sign this bill in his ceremonial office at the Statehouse but he changed his mind at the last minute when he learned that over 150 delegates from Girls State were meeting in the House Chamber. The governor decided that it would be a great idea to give the delegates a first hand look at how Vermont’s political process actually works.

As Douglas walked into the chamber he received a standing ovation from the delegates. The governor signed the bill at the desk of the House clerk, a table that sits directly in front of the speaker’s podium.

The new law creates a two-tiered property tax rate system – one for residents and one for businesses. It eliminates the sharing pool of Act 60, it raises the state block grant for each student and it increases the sales tax from 5% to 6% to help reduce property tax burdens.

The governor told the delegates that he expects the plan will cut property taxes in many towns on average by about 20%. Then he pulled out his pen and signed the bill into law:

(Douglas) “Well I hope this will make a real difference in terms of how we pay for public education and relieve the burden of the property tax. I am delighted that you’re all here to see this signed. So now we’ll make it the law of the state.” (Sound of cheering.)

(Kinzel) House Ways and Means Chairman Dick Marron (R-Stowe) thinks the changes will benefit many communities. But he says it will be critical for all towns to implement cost containment measures to help keep spending under control:

(Marron) “I think it will work. I think it also gets at the argument that we were providing too much property tax relief and we’re going to really encourage spending. Vermonters are going to have to discipline themselves on their spending at the local level and we hope they’ll be able to do that. At the same time it means the school boards are going to have to present realistic budgets to their voters.”

(Kinzel) Vermonters will not experience immediate tax relief because the major parts of the bill don’t go into effect until July of 2004. However the sales tax increase will go into place this October.

For Vermont Public Radio, I’m Bob Kinzel in Montpelier.

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