Speaker Mitzi Johnson Wants Property Tax Reform Plan To Pass This Year

Feb 9, 2018

A proposal is being developed representing the first major change to education financing in Vermont in over a decade, and House Speaker Mitzi Johnson says she's committed to making it a reality.

Under this proposal, property tax rates would be cut in half.

"I am doing everything I can to move this bill through." — House Speaker Mitzi Johnson

The plan shifts some of the funding for education from the property tax to a new income tax.

"I am doing everything I can to move this bill through,” said Johnson.

The income tax rate would not be tied to local spending decisions and a person's first $47,000 of income would be exempt from the tax. Johnson says this is a more understandable approach than the current system.

"What we're trying to do is to create a much more transparent, much simpler system,” said Johnson. “We want to make a payment system fair to kids and fair to taxpayers.

"And we still want to honor what we have now in a system that is based on an ability to pay."  

But Gov. Phil Scott says he's disappointed that the plan doesn't include any specific cost containment measures.

"Doing it alone, without any cost containment is a non-starter for me." — Gov. Phil Scott

"Readjusting the formula, which — I don't mind having that conversation,” said Scott. “If it's combined with something else maybe I'd be receptive — but doing it alone without any cost containment is a non-starter for me."  

Johnson says linking the property tax rate to local budget decisions will help keep costs lower.

"Over time, in years two, three, four, five, I think it creates a little more cost containment and a stronger link reconnecting voters with school budgets with their taxes,” said Johnson.  

Scott has presented lawmakers with a menu of cost containment options including a plan to create a special commission that would have the authority to close schools that are deemed to be too small.

"The reality is there are going to be schools that will be closed down," says Scott.

"I think it's just inevitable when you look at it,” the governor explains, “there's got to be a way to determine that."

Johnson says the average growth rate in school budgets this year is just over 2 percent. She says this is a clear sign that many local school boards are working hard to restrain their budgets.

"I think school boards themselves are doing an excellent job this year of containing those costs," says Johnson, "and leaving that control in local communities about what their best decisions are for their children."

The House Ways and Means Committee, which proposed the plan, is expected to vote on it by the end of February.