NCPA - National Center for Policy Analysis

School Funding Debate Rocks Vermont

December 19, 1997

Does a richer community have the right to spend more to educate its children? Or should states assure that education funds are spread equally among all school districts? That is the hot debate that has recently divided Vermonters. In fact, more than 30 states have fought court battles over the same issue -- beginning with California in 1971.

  • Though courts have split evenly in their decisions, experts say the trend is against local taxing and in favor of equalization.
  • On Wednesday, the New Hampshire Supreme Court ruled that the state's dependence on local property taxes for nearly 90 percent of its school budgets was unconstitutional.
  • While some states such as New Jersey have struggled for years to come up with a viable alternative to local property taxes, only Kansas and now Vermont have passed broad, statewide property taxes.
  • Property taxes will fall in 220 Vermont towns, but will increase in about 40 wealthy towns -- where school budgets will likely shrink.

Residents from the 40 wealthy towns protest that the law will hurt 10,000 Vermont schoolchildren out of a total of 105,000, and complain that equalization will cause excellent schools to become mediocre.

Some economists agree, contending that reducing local control over schools makes people on the low income end even worse off.

Source: Carey Goldberg, "Vermont School Tax Splits the 'Haves' and 'Have Nots,'" New York Times, December 19, 1997.


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