December 2, 2009

State Property Tax rate May Increase

The Burlington Free Press reports on Tax Commissioner Westman's letter to the Legislature notifying them that Vermont's property tax rate (funding education), based on property levels and funding levels will rise approximately $0.02 next year to $0.88 per $100. valuation (residential).

Education spending has the potential of creating a taxpayer revolt as they see education costs continuing to increase in the face of declining enrollment. Add to that the dire underfunding of state employee and teacher pensions and post-retirement benefits, and we have a very serious problem.

This is the question that every person currently serving or running for state office or local school boards should be asked now and in the run-up to the 2010 elections:

What is your plan to constrain education spending?

"The recession means more families qualify to pay their school taxes based on their income rather than on the assessed value of their property, which decreases revenues.

Lawmakers used federal stimulus dollars to help cover some of the annual allotment of general taxes (such as income and sales) for education. When this funding runs out, the annual transfer from the General Fund could jump $60 million -- just when other demands are expected to exceed General Fund revenues by many millions.

Westman noted that the Douglas administration has offered ideas to constrain the growth in spending on schools, but lawmakers rejected most of the proposals. The administration recently offered another set of options to school officials, and a legislative committee is expected to make recommendations, too.

"It is important to see what we can do on the spending side," said Ancel, who serves on the study committee looking at school funding."
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