Senate passes Act 60 reform bill

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(Host) The Vermont Senate has given preliminary approval to changes in the Act 60 education funding law. The Senate plan would simplify Act 60 and would send more money to towns to pay for schools. The vote on Tuesday sets up a conflict with the House, which has passed a much different plan to provide property tax relief.

VPR’s John Dillon reports:

(Dillon) The Senate bill makes major changes to Act 60, the education funding law that was passed in 1997. The bill would set a base state payment of $7,000 per student. It does away with the local portion of the education tax. And it puts the statewide property tax at $1.38. Windsor Democrat Peter Welch says the bill may help break a legislative logjam over education funding reform.

(Welch) “The fact is that if we’re going to move ahead, we’ve got to act sooner rather than later. This would radically simplify Act 60. There’d be a single statewide rate for the education fund. We’d increase the block grant to $7,000. It would reduce local property taxes in 220 districts. Also, it would return to taxpayers the excess revenues in the education fund that are there as a result of grand list growth.”

(Dillon) The bill provides property tax relief to towns by spending about $24 million more in state aid to education. That money is already in the Education Fund, but it’s now spent on non-school programs.

During the Senate debate, Rutland Republican John Bloomer questioned whether the plan would leave a $24 million hole in the General Fund:

(Bloomer) “This transfer of $24 million is going to result in either the need to make $24 million in cuts to the budget, or raise revenues.”

(Dillon) Welch acknowledged that the budget gap exists. But he says the state must stop raiding the Education Fund to prop up the state budget.

(Welch) “Let me be candid. You’re absolutely right. But the policy question for us is whether we’re going to have the will to address what is a General Fund problem, or we’re going to resort to in effect invading the Education Fund to bail out the General Fund.”

(Dillon) The bill comes up for final approval in the Senate on Wednesday.

The Senate wanted to get its plan out before next week’s Town Meeting Day. But Town Meeting voters still won’t have a clear idea of Act 60 reform, because the House has proposed cuts in the statewide property tax rate, rather than an increase in state aid to education.

For Vermont Public Radio, I’m John Dillon in Montpelier.

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