Progressive leaders at the Statehouse are backing a plan to make major changes in the way that Vermonters pay for education. As a first step, they're asking the House and Senate to support a comprehensive study of their proposal.
The goal of the plan is to have most homeowners pay the same percentage of their income to help finance the state's Education Fund.
Currently, under a system known as income sensitivity, about 70 percent of Vermont households pay their school taxes based on their income and not the value of their property.
Homeowners who qualify for this program pay roughly 3 percent of their income to support education. Recently, the income eligibility cap was raised to just over $130,000.
Burlington Rep. Chris Pearson is a lead sponsor of a House bill that he says would lower school taxes for all households that earn less than $200,000 a year.
“Basically, what it would mean is that we would keep the Education Fund whole but we would, in fact, deliver property tax relief,” Pearson says, “something that Vermonters have been very plainspoken that they would like Montpelier to deliver."
Washington Sen. Anthony Pollina is a lead sponsor of a companion bill in the Senate. He thinks it's important that all Vermont households pay the same percentage of their income to Vermont's Education Fund.
“So what we're looking at is saying if 3 percent is fair and reasonable for middle-income people, maybe we should consider that 3 percent should be fair and reasonable for higher income people as well,” Pollina says. “So what we're talking about doing is asking the wealthier people in the state of Vermont to pay a bit more,"
Pollina says tax burdens will be reduced on middle-income households if his plan is adopted.
"Not only will it be more fair but it was raise about $82 million in new revenue which would then be used to lower property tax rates for most Vermonters,” he says. “So we could raise the revenue, make the system more fair and move away from property as the major funding mechanism for schools and that all would be very positive."
Pearson and Pollina both acknowledge that there isn't enough support in the Legislature right now to pass their plan. That's why they are hoping to include a full study of their proposal in this year's education finance bill. That legislation is expected to be on the House floor for debate sometime next week.