Vermont Business Magazine The House on Wednesday passed theEducation Finance Reform Bill, H.911on a vote of 85-54. The bill provides a comprehensive restructuring of the Education Fund; updates the Vermont personal income tax code to streamline it with the federal changes; and eliminates taxable Social Security benefits from for low and middle-income Vermonters. However, it does not have the support of Governor Phil Scott, who said Wednesday night at the Best Places to Work in Vermont event in Burlington that the bill has nocost containment measure and simply shifts some of the education expense from the property tax to a new personal income tax.
The bill received bipartisan support in each committee, with a 9-2 vote in the Ways & Means committee, a 9-2 vote in the Education committee and a 9-2 vote in the Appropriations committee.
“It’s been nearly two decades since Vermont restructured how we fund our schools,” saidHouse Education Committee Chair, Representative Dave Sharpe in a press release. “In that time, our schools and school districts have undergone many fundamental changes. It’s time to find a new solution that upholds our support for great public schools while increasing local accountability and ensuring all Vermonters contribute their fair share.”
Representative Janet Ancel, Chair of the House Committee on Ways and Meansstated, “As we knock doors each year, we hear that property taxes are too high and that the system is too complex. The House Ways and Means Committee spent several weeks analyzing the current education finance system and considering whether we could identify changes that would improve the system. We identified several goals: (1) reduce reliance on the property tax and move instead to a more direct reliance on income which is a better reflection of ability to pay, (2) simplicity (3) transparency, (4) equity - meaning fairness to taxpayers and to students - and (5) better connecting voters to the decisions they make when voting on school budgets.
“Our plan moves us away from relying so heavily on property taxes to pay for education towards a graduated income tax. By lowering the average homestead property tax rate by 10%, we’re making it easier for people at all income ranges to live in Vermont. The plan dramatically improves the transparency and accountability of education funding for Vermonters.”
“This bill is a win for public schools,” addedHouse Speaker Mitzi Johnson. “Vermont boasts some of the best schools in the country and we know that young families look at that when deciding where to put down roots. In reducing all residential property taxes and more closely tying school budgets with property taxes, we’ve reduced property tax burdens AND provided comprehensive cost containment.
“It’s a win-win for Vermonters that we’ve coupled these property and income tax updates with a plan to further protect Vermonters from a tax increase due to the new federal tax code. Our plan makes numerous changes, including expanding the earned-income tax credit, further helping bridge the income gap and help families move beyond poverty. The plan lowers each of Vermont’s marginal tax rates for personal income taxes by at least 0.2% and eliminates the tax on Social Security benefits for low and middle income Vermonters, ensuring our aging population is more able to live in dignity, not poverty.
“If the Governor does not support this bill, it means Vermonters’ property taxes will increase by 5.4 cents, it means the state is not providing tax relief to low and middle-income Vermonters who receive Social Security benefits, and it means the Governor is lining up with the President and Republicans in Congress and allowing the federal tax changes to heap $30 million in additional taxes on Vermonters. This bill is a positive step for Vermont and we cannot afford inaction. Veto threats jeopardize property tax relief and I urge Governor Scott to support this bill.”
And the governor does not support it.
Scott said yesterday: "Asking Vermonters to pay a portion of property taxes from their paycheck is not the way to provide relief or lower costs. Yet, that is precisely what the Legislature proposes to do in H.911 without addressing the affordability challenges so many Vermonters face.
“Reducing property tax bills only to make up the difference by collecting more from Vermonters’ paychecks, is not what they’ve asked for and it is not relief."
H911https://legislature.vermont.gov/bill/status/2018/H.911
Legislator comments on the record in order of appearance on both the failed amendment offered by Rep. Scheuermann of Stowe (Yeas, 51. Nays,
90.) and final passage of the bill (Yeas, 85. Nays, 54):
Reps. Gage of Rutland City explained his vote as follows:
“Madam Speaker:
We need to tie school spending to taxes paid for accountability sake, cause
and result. No longer should one town subsidize another. Unfortunately that
didn't happen today.”
Rep. Graham of Williamstown explained his vote as follows:
“Madam Speaker:
I voted yes on this amendment for lower property taxes that people in this
state have asked for, for a long time.”
Rep. Read of Fayston explained his vote as follows:
“Madam Speaker:
I come from a rural, high-spending district, yet I voted yes. People want
local control and this was our opportunity to provide our constituents with
what they are asking for, independence and control over their own decisions.”
Rep. Smith of Derby explained his vote as follows:
“Madam Speaker:
I have a obligation to my constituents. I stand behind my promise to my
constituents to do everything that I can to reduce their property taxes.”
Rep. Turner of Milton explained his vote as follows:
“Madam Speaker:
Its disappointing that the majority of this body just voted against a 40 cent
reduction in the education homestead property tax.”
Rep. Wright of Burlington explained his vote as follows:
“Madam Speaker:
We have talked about the need for serious, bold reform for too long on
property taxes and education funding reform. Today was a lost opportunity to
re-connect voters to local spending decisions, to simplify the system and to
reduce property taxes by an average of over 42 percent.”
Rep. Young of Glover explained his vote as follows:
“Madam Speaker:
That was weird. If and when we raise 120 million dollars in income taxes
to reform our education finance system, let's make sure we get it right. This
wasn't it.”
Rep. Colburn of Burlington explained her vote as follows:
“Madam Speaker:
I appreciate the work of the Ways and Means and Education committees on
this complex issue and the many improvements this bill puts forward – most
notably a shift to income tax as an education funding mechanism. I represent a
district that has cut its school budget significantly year after year, while
struggling to meet the needs of a large number of students learning new
languages, living with poverty and trauma, and with special education needs.
I’m concerned about the impact of this bill on these students through the state
mandated cost containment measures on local processes. When school boards,
superintendents, municipalities and teachers unions around the state all share
these concerns, I think we have more work to do to get it right.”
Rep Gannon of Wilmington explained his vote as follows:
“Madam Speaker:
I want to thank the House Ways and Means committee for their thoughtful
and hard work on this bill. However, the cost containment tax formula will
negatively impact many rural school districts, like the school districts in my
district, and will not lead to lower K-12 costs statewide. My school districts
should not have to wait for the outcome of litigation against the Agency of
Education to resolve the inequities that exist in our education finding system.”
Rep. Long of Newfane explained her vote as follows:
“Madam Speaker:
I voted yes to support H. 911. It responds to the ongoing statewide request
to reduce property taxes, refocuses the education fund on PK-12 education and
eliminates the tax on social security for low and middle income Vermonters.”
Rep. Lucke of Hartford explained her vote as follows:
“Madam Speaker:
It is a step forward from current education funding practice here in
Vermont, lowering property taxes. It is progress. H. 911 removes several non
PreK-12 costs from the education fund, it provides tax relief to Vermonters
receiving social security benefits. H. 911 begins the reform process, creating
an framework and initial step that will allow for the time and opportunity,
hopefully in the next biennium, to effectively develop the type of bold change
that must happen in Vermont for our communities and schools.”
Rep. McCoy of Poultney explained her vote as follows:
“Madam Speaker:
As with any tax change of this magnitude, there are winners and losers.
According to the Tax Department and JFO analysis, some of the biggest
winners in this plan are several high spending districts who will enjoy the
removal of the excess spending threshold. This is, of course, the opposite of
what the bill claims to do, which is to increase the consequence of high
spending.”
Rep. Poirier of Barre City explained his vote as follows:
“Madam Speaker:
I voted yes because my community will see a reduction of 19 cents under
H. 911. This bill is the only train leaving the Montpelier station.”
Rep. Stevens of Waterbury explained his vote as follows:
“Madam Speaker:
I voted yes. Maybe I’m naïve, but I would think a bill that returns $30
million to Vermonters because of the mistakes in the incomprehensible
Republican tax bill last december, and one that makes a substantial reduction
in property taxes, and one that will give municipalities a better understanding
of how their property taxes are used, would have been an unanimous vote. I’m
proud to vote for a bill that finally changes the direction of the titanic we call
education financing.”
Rep. Till of Jericho explained his vote as follows:
“Madam Speaker:
I vote yes. H. 911 reduces residential property taxes by 15 cents on average.
That is a significant reduction for my constituents. While I wish we had been
able to end the income sensitivity program which so confuses taxpayers and
complicates our system, H. 911 begins the process of removing expenses from
the Education Fund which are not under control of our school boards.
Hopefully in the future we’ll find a way to remove the current use expenses
from the Education Fund.
H. 911 also removes taxation of social security benefits of middle income
Vermonters. It also returns $30 million to Vermonters that they would have
been paid in Vermont Personal Income tax as a result of Federal tax law
changes.”
ROLL CALL
Yeas, 85. Nays, 54.
Those who voted in the affirmative are:
Ancel of Calais
Bartholomew of Hartland
Beck of St. Johnsbury
Belaski of Windsor
Beyor of Highgate
Bissonnette of Winooski
Bock of Chester
Botzow of Pownal
Briglin of Thetford
Browning of Arlington
Brumsted of Shelburne
Burke of Brattleboro
Carr of Brandon
Chesnut-Tangerman of
Middletown Springs
Christensen of Weathersfield
Christie of Hartford
Conlon of Cornwall
Connor of Fairfield
Conquest of Newbury
Copeland-Hanzas of
Bradford
Corcoran of Bennington
Dakin of Colchester
Deen of Westminster
Donovan of Burlington
Dunn of Essex
Emmons of Springfield
Fields of Bennington
Forguites of Springfield
Gardner of Richmond
Gonzalez of Winooski
Grad of Moretown
Haas of Rochester
Head of South Burlington
Hill of Wolcott
Hooper of Montpelier
Hooper of Randolph
Howard of Rutland City
Jessup of Middlesex
Joseph of North Hero
Juskiewicz of Cambridge
Keenan of St. Albans City
Krowinski of Burlington
Lalonde of South Burlington
Lanpher of Vergennes
Lefebvre of Newark
Lippert of Hinesburg
Long of Newfane *
Lucke of Hartford *
Macaig of Williston
Marcotte of Coventry
Masland of Thetford
McCormack of Burlington
McCullough of Williston
Miller of Shaftsbury
Morris of Bennington
Mrowicki of Putney
Noyes of Wolcott
Ode of Burlington
Partridge of Windham
Pearce of Richford
Poirier of Barre City *
Potter of Clarendon
Pugh of South Burlington
Rachelson of Burlington
Scheu of Middlebury
Sharpe of Bristol
Squirrell of Underhill
Stevens of Waterbury *
Stuart of Brattleboro
Sullivan of Burlington
Taylor of Colchester
Till of Jericho *
Toleno of Brattleboro
Toll of Danville
Townsend of South
Burlington
Trieber of Rockingham
Troiano of Stannard
Walz of Barre City
Webb of Shelburne
Willhoit of St. Johnsbury
Wood of Waterbury
Wright of Burlington
Yacovone of Morristown
Yantachka of Charlotte
Young of Glover
Those who voted in the negative are:
Bancroft of Westford
Baser of Bristol
Batchelor of Derby
Brennan of Colchester
Buckholz of Hartford
Burditt of West Rutland
Canfield of Fair Haven
Cina of Burlington
Colburn of Burlington *
Cupoli of Rutland City
Devereux of Mount Holly
Dickinson of St. Albans
Town
Donahue of Northfield
Fagan of Rutland City
Feltus of Lyndon
Frenier of Chelsea
Gage of Rutland City
Gannon of Wilmington *
Giambatista of Essex
Graham of Williamstown
Hebert of Vernon
Helm of Fair Haven
Higley of Lowell
Houghton of Essex
Jickling of Randolph
Keefe of Manchester
Kimbell of Woodstock
LaClair of Barre Town
Lawrence of Lyndon
Lewis of Berlin
Mattos of Milton
McCoy of Poultney *
McFaun of Barre Town
Morrissey of Bennington
Murphy of Fairfax
Nolan of Morristown
Norris of Shoreham
O'Sullivan of Burlington
Pajala of Londonderry
Parent of St. Albans Town
Quimby of Concord
Rosenquist of Georgia
Savage of Swanton
Scheuermann of Stowe
Shaw of Pittsford
Sibilia of Dover
Smith of Derby
Smith of New Haven
Sullivan of Dorset
Turner of Milton
Van Wyck of Ferrisburgh
Weed of Enosburgh
Gamache of Swanton Myers of Essex
Those members absent with leave of the House and not voting are:
Ainsworth of Royalton
Condon of Colchester
Harrison of Chittenden
Kitzmiller of Montpelier
Martel of Waterford
Read of Fayston
Sheldon of Middlebury
Strong of Albany
Terenzini of Rutland Town
Viens of Newport City