In Budget Speech, Gov. Scott Asks Lawmakers For State Control Over Local School Budgets

Jan 24, 2017

In what would amount to unprecedented legislative intervention in local education spending, Republican Gov. Phil Scott has asked lawmakers to wrest control over school budgets so that his administration can fund an array of child care programs and higher-education initiatives.

Scott will pursue legislation this year that would force every school district in the state to prepare zero-growth school budgets for next year’s spending plans, meaning no increase at all from the previous year.

And in future years, budget growth would be tied to changes in student enrollment. If the student population declined by 3 percent, then the budget would have to be cut by at least 3 percent.

Audio & Full Transcript: Gov. Phil Scott's Budget 2017 Address

"Believe me when I say I know these are incredibly strong measures,” Scott told a joint meeting of the Legislature. "But over the last 20 years student counts have continuously dropped, costs have continued to rise faster than our ability to pay and property taxes have become one of the biggest contributors to our crisis of affordability."

Under Scott's plan, no town would vote on its budget on Town Meeting Day in March. Instead, those votes would be delayed until May 23.

"Believe me when I say I know these are incredibly strong measures." — Gov. Phil Scott

"This gives local school boards three additional months to develop level funded budgets. And finally, I'm asking the Legislature to move quickly on these actions to give school boards time to make these adjustments," Scott said.

The governor's plan would also mandate that all teachers pay 20 percent of their health care costs. The statewide average for teachers is roughly 15 percent.

The overall plan will save roughly $53 million in state K-12 education funding. The money would then be redirected to increase spending on early education, child care, higher education, and teacher retirement programs.

At a budget briefing, Administration Secretary Suzanne Young said the plan is a fair approach.

“We know it is a heavy lift. We know we are asking a lot,” Young said. “We're not asking them to do anything that we are not asking the state to do in their funding and their budgeting."   

"We know we are asking a lot. We're not asking them to do anything that we are not asking the state to do in their funding and their budgeting." — Administration Secretary Susanne Young

And Young says it's legal for the Legislature to impose these mandates on local school boards.

“School districts are creatures of statute,” Young says. “They are created as municipalities by state law, and when you look at it, towns are too."  

It did not take long for critics to begin sounding the alarm over Scott’s education proposals. After listening to the budget address Tuesday, Chittenden County Sen. Philip Baruth, the Democratic chairman of the Senate Committee on Education, summoned this metaphor.  

"I would say my first reaction was, it was like being offered a gorgeous buffet lunch, but you know that in order to eat it, your kids are going to go with two meals a day rather than three," Baruth says.

That buffet, to stick with Baruth’s metaphor, included nearly $10 million in new funding for child care and early childhood education, and a $4 million funding increase for Vermont State Colleges, which haven’t seen a bump in over a decade. It also featured new money for a host of grant programs to innovate public classrooms. 

To enjoy the new spending, however, Scott's plan means lawmakers will have to mandate zero growth in local school budgets, and require teachers to pay more for their health care. For Baruth, it makes the offerings less appetizing.

“We were being told, 'No new taxes or fees, and you can have these great new programs.’ But in order to pay for them it will be the K-12 system that will take massive cuts,” Baruth says.

Baruth was among a number of Democratic lawmakers expressing concerns about a budget address that calls for major legislative intervention in local education spending.

"We value local control in this state, and now we have a governor who has proposed a dictum from the state as to how much schools are going to spend." — Rep. David Sharpe, House Committee on Education chairman

“We value local control in this state, and now we have a governor who has proposed a dictum from the state as to how much schools are going to spend,” says Bristol Rep. David Sharpe, the chairman of the House Committee on Education. 

Besides being an attack on local control, Sharpe says Scott’s zero-growth budget mandate on schools is a blunt-force instrument on a complex education system. And he says it could exacerbate funding disparities between districts. 

“If you’re a low-spending school, you locked into low spending. If you’re a high-spending school, you’re locked into high spending,” Sharpe says.

The Vermont-NEA wasted little time registering its concern. A press release from the teachers union arrived in reporters’ inboxes before the speech was over. It warned that Scott’s plan would harm local communities “by firing educators and crippling communities’ investment in their children.”

Martha Allen, president of the Vermont-NEA, said in an interview after the address that there’s only one way districts would be able to meet the budget mandate. 

“Folks are going to lose jobs,” Allen says.

Allen says the directive would also likely force the closure of schools. She isn’t alone in that assessment. Asked Tuesday whether the Scott’s budget proposal would shutter local schools, Administration Secretary Young said: “It very well may. It very well may.”

Lawmakers will have to decide quickly whether Scott’s plan has any chance. Town Meeting Day school budgets will go to print shortly. And they’ll need guidance soon on whether to proceed as planned, or prepare instead for a vote in May.

Education officials will be asking Scott to address some difficult questions before lawmakers proceed with the proposal. Jeff Francis, head of the Vermont Superintendents Association, laid out some of those questions in a press release.

“With respect to level funding school budgets, and with the obvious point that school districts invest about 80 percent of their budgets in personnel, does Governor Scott have an estimate of how many school employees might lose their jobs in the next school year?” Francis said.

“Furthermore, if school budgets are to be funded at FY 2017 levels, is a vote by the electorate even required? Would this proposal usurp the democratic process?”

"If the governor wanted boards to level-fund budgets, he should have made that a central piece of his election campaign." - Geo Hongiford, Vermont School Boards Association

Geo Honigford, president of the Vermont School Boards Association, said in a written statement that Scott’s proposal to delay Town Meeting Day “and have board go back to the drawing board is a slight to the hard work and dedicated hours already put into the budget process by hundreds of local school board members.”

“If the governor wanted boards to level-fund budgets, he should have made that a central piece of his election campaign,” Honigford said. “Bringing this proposal forward after most boards have completed the difficult task of budgeting shows disregard for the elected officials overseeing Vermont’s public school system.”

Honigford says boards already have their hands full with merger talks spurred by the last big piece of education reform to come out of Montpelier, called Act 46.

Scott’s plan, according to Honigford, “ignores the work underway to right-size our districts, and will distract boards and their negotiations teams from their efforts to achieve savings for taxpayers through changes to employee health care plans.”

Administration Secretary Susanne Young on Tuesday said there’s never a convenient time for a proposal of the scope and impact Scott is seeking. But she says the fact that most teacher contracts are coming up for renegotiation this year makes it an opportune moment to institute the mandatory 20-percent health care contribution.

The Vermont Republican Party issued a statement lauding Scott for a budget address that “takes important steps in making Vermont a more affordable place to live, work and raise a family.”

But Scott’s education plan could have severe implications for small school districts in Republican strongholds. Asked after Scott’s speech Tuesday whether he was prepared to support the zero-budget-growth mandate, House Minority Leader Don Turner said: “I would want to look at the impact. But I know we have to do something a lot different than we have been." 

Caledonia County Sen. Jane Kitchel, the Democratic chairwoman of the Senate Appropriations Committee, said she worries about the impact of Scott’s proposal on local property-tax payers. 

Scott’s plan would shift all kinds of new line items onto the education fund, including higher education expenditures, for instance, and pre-kindergarten costs. And the education fund is paid for mostly by property taxes.

Scott says the zero-growth mandate on school boards would prevent the new education-fund obligations from spiking property taxes. But if lawmakers pass a budget in early May that relies on zero-growth school budgets, and towns don’t deliver, then, Kitchel says, “in fact that will translate into a property tax increase.”

Update 6:17 p.m. This story was updated to include more detail of the budget proposal, and reaction from lawmakers and others.