In a bid to revolutionize the landscape of education, Vermont leaders took a bold step forward with the enactment of Act 127, a piece of legislation that aims to reshape the state’s educational system, particularly in rural areas. Passed by the Vermont legislature in 2022, this act stands as an opportunity for change aimed at addressing long-standing challenges faced by rural schools and districts.
Act 127 emerged as a response to the growing concerns surrounding the sustainability and quality of education in Vermont’s rural communities. Its inception stems from the recognition of state legislators that these rural areas face unique obstacles - declining student populations, limited access to resources, and difficulties in attracting and retaining educators.
The primary aim of Act 127 is to bolster educational opportunities in rural regions by redefining pupil weights. Stated simply, the law is meant to direct education money toward schools and students who need it most. Act 127 better recognizes that certain groups of students need more educational resources. These categories include low-income students, English Language Learners (ELL), and students in small or rural districts which typically have a smaller tax base.
Different students require different resources and support for successful learning. Pupil weighting is a concept that came from Vermont Act 60 which itself was enacted in 1997. This law set parameters that included factors like student poverty and English as a second language. As time progressed it was apparent those original student weights weren’t up to snuff. The state quickly sanctioned a study that wrapped up in 2019 that found pupil weights were insufficient to support schools with a high number of students in those historically underfunded categories.
Act 127 provides adjusted and modernized pupil weights intending to create a more equitable education landscape across Vermont. Students who are identified in those underfunded categories, who typically require increased resources and support, are ‘weighted’ more heavily than students who are not identified as fitting those categories.
School Funding in Vermont
Vermont’s education funding system, which is the money the state pays to each school district, comes from one pot of roughly $2 billion. Though only a part of the statewide education budget, school budgets are developed at the local level, based on district needs. The amount it takes a district to educate a student is then part of the town education property tax rate.
Historically, Vermont’s education fund is comprised of revenue from various sources such as property, sales, and meals and room taxes. As stated above, these funds are then redistributed to Vermont school districts based on the school budgets as developed locally.
How Act 127 Functions
Under Act 127, homestead taxes are protected from one year to another through FY2029. This five-year transition period caps a school district’s homestead property tax rate at a maximum of five percent per year increase. This means a school district’s tax rate will not increase by more than five percent before the Common Level of Appraisal (CLA) is applied.
If a district’s spending per pupil causes a jump of more than five percent in the district’s homestead tax rate, the increase will be capped at five percent and the state education fund will make up the difference.
Again these caps exist for up to five years to allow for a school district’s natural tax rate, based on updated student weights and needs, to equalize at a reasonable rate.
These five percent tax caps are ONLY in effect as long as a district needs it, and if school districts stay UNDER a 10% increase in per pupil spending limit compared to the previous fiscal year. If districts surpass this 10% limit, they are subject to a ‘Tax Rate Review’.
It is important to note, Vermont Career and Technical Education Centers are NOT subject to Act 127.
What Does this Mean for Lamoille North?
With new adjusted student weights, rural school districts, like Lamoille North, have an opportunity to take advantage of increased funding from the state. A deep dive into our student data has uncovered an increased number of students who can be placed into the more heavily weighted categories and therefore Lamoille North has an opportunity to see a bump in state funding for all LNSU schools, with minimal impact on the district tax rate.
As the Lamoille North Modified Unified Union School District Board, Cambridge Elementary School Board, and our voters evaluate the proposed budgets for fiscal year 2025, it’s essential to acknowledge the potential offered by Act 127. This legislation allows for the continuation of vital learning experiences while maintaining important social/emotional supports for our students. Lamoille North is dedicated to growing healthy and safe learning environments.
Simply stated, these initiatives can be achieved without imposing excessive impacts on local taxpayers.