Vt. lawmakers scramble to address property tax revolt. Will it be enough?

MONTPELIER, Vt. (WCAX) – As communities across the state continue to shoot down school budgets as part of a property tax revolt, Vermont lawmakers are scrambling to develop plans for both immediate property tax relief and longer term education finance reforms.

“Costs have gone up for all Vermonters — including schools — and we want to make sure we’re balancing that,” House Committee on Ways and Means Chair Rep. Emilie Kornheiser, D-Brattleboro, said Thursday.

Vermont now has the dubious distinction of being ranked as the third highest tax-burdened state — only behind New York and Hawaii — according to the New York Times. And for property taxes alone, it comes in as second behind Maine.

The latest Vermont data shows homestead property taxes increasing 15% and non-homestead taxes increasing 18%. To lower those rates, lawmakers are looking at other tax revenues that can be poured into education, including a new tax on business software and a three percent tax on short term rentals. Rep. Kornheiser’s committee is also advancing the groundwork of longer term reforms including like direct cash payments to districts depending on their size and needs. “We need to make sure that everyone understands how we all are sharing in the collective responsibility for all of our kids, and that’s what our Education Fund does,” Kornheiser said.

But the plan is already getting pushback from school administrators. In a joint letter to lawmakers Thursday, officials from the Vermont Superintendents, Principals, School Boards, and School Business Officials Associations said the bill is rushed, doesn’t address the root causes of why spending is up, and will lead to more failed budgets.

Business groups say the crisis was predictable and can be fixed by growing communities’ grand lists through more housing. “We need to get to a place where we’re not trying to raise new taxes. We need to right-size systems, we need to rethink our tax system, and we need to look at growth very seriously,” said Austin Davis with the Lake Champlain Chamber of Commerce.

Governor Phil Scott says it’s good news that lawmakers are moving forward with structural reforms, but that he worries unfinished work will be lost when a new slew of new lawmakers are elected in November. “They can put this all into place and then next year they can ignore it. I’m worried about that aspect as well,” he said. The governor says he wants lawmakers to prioritize property tax relief this year and that his administration will be releasing it’s own plan as soon as Friday. “From the Vermonters I encounter throughout the state, that’s their biggest concern — ‘How am I going to pay my taxes and how am I going to get through this?’”

The Ways and Means Committee is expected to vote on the proposal Friday. Meanwhile, the Essex Westford School District will be meeting Thursday night to determine what their next steps are.

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