MONTPELIER, Vt. (WCAX) Gov. Phil Scott unveiled a plan Tuesday to prevent a property tax increase this year using one-time funding to patch $58 million dollar hole in the state's Education Fund. The governor campaigned against using one-time funds, but he also promised Vermonters no property tax increase. Now with eight days left in the legislative session, he's asking lawmakers to act fast on major policy changes.
Administration officials say Vermont's public school system was designed for more than 100,000 kids, but today there are just 70,000.
"Vermont has great schools, it has great teachers, it delivers a good education, but our demographic challenges are contributing to a K-12 system that's inefficient, it's outdated and it's really unaffordable," said Administration Secretary Susanne Young.
Gov. Scott wants lawmakers to enact a statewide health contract for teachers. He also want to raise the student to staff ratio in order to reduce tax assistance based on income and spend less on special education. He says those fixes will provide long-term savings for Vermonters.
Senate President Pro Tem Tim Ashe, D-Chittenden County, says democratic lawmakers share some of the governor's cost-containment goals. "We will see in the coming days as they come before our committees whether there's some meat on the bones," Ashe said.
But to close the $58 million dollar hole in 2019, the governor wants to use one-time money. "That $58 million we will put into the Education Fund and thus allow a stable tax rate as the governor has committed to," said Finance Commissioner Adam Greshin.
The administration plans find the money in various places, including $19 million from a tobacco settlement, $20 million from an anticipated general fund surplus this year, and $7 million from the general fund reserve. Additional money will come from other government funds, labor savings, and carryover education funds. It will offset a seven-cent increase in the property tax rate.
Ashe, and House Speaker Mitzi Johnson, D-South Hero, say the money Scott wants would better serve Vermonters elsewhere. "The two biggest departures are a massive use of one-time money, which puts us in a bigger hole next year, and destabilizes the budget we've worked so carefully to craft reserves for," Johnson said.
"Overall, it really raises a couple fundamental questions. The first is, should we use $58 million of one-time money, effectively in a political gimmick," Ashe said.
Legislative leaders say they'll spend the next several days hearing from administration officials before making decisions.