The Governor's Budget: Of Words and Numbers
|
|
Governor James Douglas in file photo. |
Toolbox
By Louis Porter Vermont Press Bureau - Published: May 24, 2009
MONTPELIER — The differences in the approaches to the state budget by legislators and Gov. James Douglas may be more than a difference of money.
"One lawmaker said it was a difference in philosophy and perhaps that is true," Douglas said this week.
Nowhere are those differences in philosophy starker than when it comes to education funding and property taxes.
Lawmakers say that the governor's proposal would be an unfair tax hit on families earning between $75,000 and $90,000 a year and would damage local control over schools
Douglas administration officials said their proposal is a necessary brake on education spending that has not taken the same kind of reductions as state government and human services over the last year.
The governor's proposal would move additional costs into the Education Fund — including teachers' retirement costs and early education costs — and place a firm cap on education spending for the fiscal year that follows this one.
"Given the investment in education that taxpayers have made in Vermont and the current woes that taxpayers are having in the economy that level funding education spending for one year is reasonable," Tax Commissioner Tom Pelham said. "Especially when many programs funded by the General Fund are seeing not level funding but cuts in their budgets."
That proposal from the Governor would mean that for one year schools would not be able to spend more than they will on a per pupil basis this year. The administration would consider some flexibility in that cap, if lawmakers would prefer it, if the additional spending was raised on local property taxes, Pelham said.
Lawmakers proposed a different mechanism. Their budget would have provided the same amount of funding from the state to local schools next year as in the current year as well, but without a hard cap on spending.
"We made significant concessions meant as compromises to the administration," said Speaker of the House Shap Smith. Those compromises included level-funding the state money for schools in fiscal year 2011 (which begins in July of 2010) and lowering the amount of General Fund money transferred to the Education Fund, said Smith, a Morristown Democrat.
There are also problems with such a cap — a similar proposal was offered by the administration several years ago — said Rep. Janet Ancel, D-Calais. For one thing it may run afoul of the Brigham decision on school funding equity, she said. For another it puts severe constraints on a school districts' ability to run its own budget, said Ancel, a former tax commissioner, former chairwoman of the House Education Committee and current vice chairwoman of the House Ways and Means Committee.
"It takes away local control," she said. The Legislative approach instead warns school districts a year in advance that the amount of state money can expect will be frozen.
"The decisions about keeping budget down really ought to be where people are most familiar with the issues and know what the willingness to support schools and that is with local boards and local voters," Ancel said.
A one year cap on spending — although the administration would also consider a flexible cap that would allow several hundred dollars of spending per pupil — is reasonable given how much the state spends on public education, Pelham said.
After all Vermont spends an average of $14,300 per pupil, while the national average is less than $10,000 per student, Pelham said. Meanwhile, the state has the highest teacher to pupil ratio in the country, Pelham said.
Lawmakers also said a Douglas proposed reduction in the state's income sensitivity program — that is the provision that allows most residents to pay their property taxes based on their income — would hurt middle class families and lower property taxes on non-residential properties instead.
Now those earning a household income of as much as $90,000 can qualify. The governor would reduce that upper limit to $75,000 a year.
That would result in 13,000 households paying an average of $600 more in the current year, Smith said.
"That will dramatically impact property taxes and I don't think there is any way you can argue that it won't," Smith said.
Ancel added that although the average effect of that change on the households will be $600 on some it will be much greater.
"There are communities where the impact is going to be quite a bit more than that," she said.
But administration officials said that their revised budget proposal would lower property residential and non-residential tax rates by a penny more than the legislature's budget would. Many non-residential properties — including commercial space, camps and land are owned by Vermonters, administration officials added.
Although that would not come close to undoing the change in income sensitivity for those affected it does lower tax rates in the current year more than lawmakers would, they said.
And the expansion of income sensitivity and other measures have somewhat masked the cost of schools, Douglas said.
"Vermonters need to know what the true cost of our education system is," he said.
The Vermont-National Education Association, the union for teachers in the state, said Wednesday that although it had some objections to the state budget passed by lawmakers it prefers it to Douglas' proposed alternative.