The General Assembly adjourned the 2015-2016 biennium on the evening of May 6, having passed an education tax rate bill, funding for a special education pilot project, tweaks to the Open Meeting Law, and broader exemptions from school construction aid repayment. This yearâ€™s legislative session was dominated by the General Assemblyâ€™s consideration of marijuana legalization, which ultimately failed to garner enough support in the House to become law. The conclusion of this biennium was most notable for the number of legislative leaders who will not seek re-election this year. House Speaker Shap Smith, Senate Pro Tempore John Campbell, Lt. Governor Phil Scott and several House committee chairpersons will not return to the State House, at least not in their current roles, next year.
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The following bills affecting education passed in 2016:
â€“ Establishes the non-residential tax rate, homestead property dollar equivalent yield, income dollar equivalent yield
â€“ (S.233) Repeals the Allowable Growth Rate for FY18, adds .9% to districtsâ€™ FY17 AGRs, exempts low spending districts
â€“ Changes special education funds reimbursement rules, creates pilot program for 10 supervisory unions
- Establishes a bill of rights for children who are deaf or hard of hearing
â€“ Eliminates the requirement to repay school construction aid upon sale of a school building until 2020
â€“ Lowers the minimum required foot-candles standard for lighting in new school construction
â€“ (H.747) Clarifies the State Treasurerâ€™s authority to intercept state funds when a district defaults on repayments to the Municipal Bond Bank
- Prevents large employers from entering Vermont Health Connect.
â€“ Amends the Open Meeting Law
The following bills were the subject of substantial testimony by our organizations but did not pass
â€“ Amends the Mandated Reporter statute
â€“ Removes certain dual education and clinical licenses from the Agency of Education and transfers that authority to the office of Secretary of State
â€“ Legalizes and regulates recreational use of marijuana
â€“ Makes suspension and expulsion as a last resort in student discipline cases
â€“ Amends the definition of bullying to include conduct by adults
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House Rates/Yields Pass Along with Compromise on Spending Thresholds
, the yield bill, was the second-to-last bill passed in the 2016 session. It sets the following tax rate and dollar equivalent yields:
|Dollar equivalent yield on homestead property
|Dollar equivalent yield on income
|Non-residential property tax rate
For much of the last day of the session, the Senate and the House were at impasse over whether to apply $18.8 million in unallocated surplus funds to lower property tax rates for FY17, or to save some of those funds for FY18. The House demanded that all the money be applied this year, while the Senate was pushing to apply only two-thirds of the money, saving the rest to smooth out next yearâ€™s property tax rates. The more surplus funds that get used, the higher the dollar equivalent yield, translating to lower property tax rates in the year they are applied. The two bodies finally agreed to compromise on the House-passed tax provisions (using all available surplus) and the Senateâ€™s preferred cost containment provision.
The House-passed yield bill lowered the excess spending thresholds in FY20 from 121% of average statewide education spending per pupil to 119%. In 2013, the legislature established the current excess spending threshold at 121% of FY 2014 average statewide education spending per pupil, plus an annual inflation factor. The compromise reached by the conference committee eliminates the provision that would have further lowered the thresholds to 119%, and changes the anchor year to FY 2015 average statewide education spending per pupil. The final yield bill also adds a new exemption to the excess spending thresholds: funds budgeted for dual enrollment and early college programs. This will be the twelfth exemption on the list
of expenses not counted as education spending for purposes of determining whether a budget exceeds the threshold.
Also in the final yield bill are several studies. First is a study of the implementation of S.175
, which proposes an education tax on income, rather than property value, for all payers. Second is a study of the implementation of H.846
, a bill proposing an education funding formula that levies excess spending penalties on all districts with above-statewide average education spending, while extending tax relief to all districts with below-statewide average education spending. Third is a study of whether newly-merged school districts can have one common level of appraisal among all member towns.
Finally, in section 9, the yield bill addresses concerns raised by the Agency of Education about the potential for a school district receiving Act 153/156/46 tax incentives to drastically increase education spending while only experiencing a five percent increase in their tax rates. No district to date has passed a budget that appears to take advantage of this feature of the so-called five percent provision.
Section 9 states that the General Assemblyâ€™s intent in Acts 153/156/46 was not to limit fluctuations in a districtâ€™s tax rates regardless of the spending decisions in the new district. It also stipulates that once a member townâ€™s tax rate hits the unified districtâ€™s tax rate, the five percent provision no longer applies. The bill requires the Agency of Education, the VSBA, the VSA and the VT-NEA to report to the General Assembly in December 2016 on a way to calculate tax rates for member towns that are different from the unified rate.
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Special Education Billâ€™s Pilot Project Saved by Conference Compromise
In its consideration of H.859 the Senate Education committee removed a section providing for a pilot project of up to 10 supervisory unions to receive consulting services on the delivery of special education. That study was funded with a $200,000 appropriation out of the Education Fund in the House bill. A committee of conference was appointed between the Senate and House, and the members were able to come to an agreement that allocates $75,000 now, with a possible $100,000 from the likely year-end reversion of special education dollars to the Education Fund. (Each year the reversion is approximately $2-3 million with a large portion of that excess coming from over-allocation of funds for special education.)
The bill impacts special education services in two ways. First, it changes the law to require that special education funds be disbursed from the State to the entity that incurs the special education cost â€“ in most cases that will be the supervisory union. Current law requires funds to be disbursed to school districts. Since Act 153 of 2010 requires special education services be provided by the supervisory unions, concerns have been raised about the inefficiency of a system that disburses funds to school districts. The changes made in H.859 recognize that some special education costs continue to be incurred at the school district level; namely, the cost of some para-educators. The bill allows districts to continue to receive special education funds in those circumstances.
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January Amendments to Allowable Growth Rate Codified as Act 65
On January 29, 2016 the House gave final approval to a slate of modifications to the allowable growth rate (AGR) provision of Act 46. On that date, the General Assembly was under pressure to reach a compromise regarding which changes to make to the AGR before the deadline for warning school district budgets, which fell on on January 31st
The Senate passed a total repeal of the AGR in early January. Then, a procedural move resulted in the need for a midnight session in the House in order to pass a compromise provision. The final outcome was a set of four changes (outlined below) to the AGR for FY2017 and repeal of the AGR for FY2018.
exempts any district with FY2016 education spending per equalized pupil below the FY2016 statewide average spending per equalized pupil. The FY 2016 per pupil figure is $14,094.73. Second, it raises each districtâ€™s threshold by 0.9 percentage points, increasing the per pupil amount any district can spend before exceeding its AGR. Third, the Act directs the Agency of Education to apply the threshold calculation that is most advantageous to the district, either the initial AGR of August 2015 or the recalculated AGR of mid-January. Finally, it changes the penalty for any district exceeding its AGR. The original provision required a dollar-for dollar penalty; Act 65 creates a 40 cent penalty for every dollar spent above the threshold.
The AGR will not be applied to FY2018 budgets.
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Bill Creates the Vermont Deaf, Hard of Hearing and DeafBlind Advisory Council
will create an advisory council of 16 members, including counselors, audiologists, designees of the VSA, VCSEA, the Department for Children and Families, and the Agency of Education to identify existing and needed education opportunities and family supports. The council will also assess the loss of services since the Austine School for the Deaf and the Vermont Center for the Deaf and Hard of Hearing closed. The advisory council will be administered by the Department of Disability, Aging and Independent Living.
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Bill Gives Schools Exemption from Aid Repayment Upon Sale Through 2020
will exempt districts from the obligation to repay state aid for school construction. When a school building is sold, current law requires the district to repay a portion of the state construction aid it received. The percentage of state aid that funded the construction of the building is the same percentage that the district must refund to the state from the sale price.
Under H.529, all building sales will be exempt from the repayment provision until 2020. The bill is intended to provide more flexibility to districts seeking merger over the next four years under Act 46. The bill is not expected to greatly impact state funds for school construction aid, because these funds have not been available since 2007.
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H.280 Updates School Lighting Standards for New Construction
, a bill that was passed by the House in the 2015 session, passed the Senate this year. It aligns the State Board of Educationâ€™s rules on classroom lighting in new school construction with national lighting standards, which decrease the minimum required foot-candles from 50 to 20. The change will apply only to new construction projects funded with state construction aid, funds that have not been available since 2007.
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