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The regular session of the 2003 legislative session ended in an orderly fashion on Friday, May 30th. This first half of the biennium was considered by most to be a productive one for the new administration which saw most of its high priority items - including educational funding - addressed.
During the session, I recorded nearly 150 pieces of legislation of potential interest to education policy makers. That list is quite inclusive and includes many bills that deal with children or students but that are outside the direct purview of VSBA members. Fortunately, legislation approved since January comprises only a small fraction of those bills introduced. This final Legislative Update summarizes in some detail bills directly affecting schools and school leaders and mentions briefly other new legislation more peripheral to the operation of schools.
I encourage you to remain in contact - or get acquainted - with your legislators over the next six months letting them know of your accomplishments and the challenges you face. Invite them into your schools this fall so they will have a deeper understanding of public education in Vermont when they are once again faced with decisions concerning education in 2004.
State Funding for Education
For education policy makers and most legislators, one the most important initiatives this session was education funding. For several years, legislators and their constituents have considered many possible modifications to Act 60, but until this year the urgency to make substantive change has not forced the necessary compromise. The straw that may have been the final one was the result of one of the unintended consequences of Act 60 - an outcome brought about by the failure of the state to implement appropriate land evaluation methods when a statewide property tax became the major part of the education funding formula. Rapidly rising property values across the state pushed everyone's property tax bills to levels that created a very strong and united voice for change.
Act 68 (H. 480) Education Funding -
When this session began, both the House Ways & Means Committee and the Senate Finance
Committee took testimony from all who wanted their voices heard on the subject of Act 60 and
compiled lists of goals that they hoped legislative changes would address. So what has Act 68
accomplished?
Most of the significant changes in Act 68 take effect in FY2005 (starting July 1, 2004). Those changes that take place earlier are noted below. One major difference between Act 60 and Act 68 is that starting in FY2005, Vermont properties statewide are divided for purposes of school taxes into two separate grand lists.
The residential grand list consists of all property that is considered part of a homestead owned and occupied by a Vermont resident which includes the principal dwelling and all contiguous land "without regard to any road which intersects the land." Note that the definition of homestead is changed as of FY2005 from the Act 60 definition of a residence and two acres. Excepted from the new definition of homestead are any detached (from the home) buildings used for business purposes as well as the current law that exempts up to 25% of the floor space of the principal dwelling that is used for business purposes.
Under Act 60, homeowners had to declare ownership of a homestead only for purposes of qualifying for income sensitivity. Now all residents who own and occupy a primary residence in Vermont are required to register their homesteads and there are penalties for failure to do so properly. The homestead tax rate will apply only to those for which a declaration has been made. That effective rate is $1.10 (still adjusted by the CLA) and it translates into a per equalized pupil base education payment (formerly the block grant) of $6,800 in FY2005. That base figure will be adjusted for inflation yearly using the index for government goods and services - the same index used currently. The residential rate will vary directly with local school spending. For example if a district spends 10% more than $6800 per pupil ($7480), the effective residential tax rate will equal $1.21 which is 10% more than $1.10. This direct relationship between spending and tax rate should serve to make residents more attentive to the budgets for which they vote.
In an entirely new provision, Act 68 defines excess spending, and residential taxpayers will pay double for the amount of spending that falls into this category. In FY2005 excess spending is defined as spending per pupil in excess of 135% of the statewide average. The threshold drops to 130% in 2006 and settles in at 125% in 2007 and thereafter. Education spending (pre-K – 12) is calculated as follows: starting with the budget adopted by a school district, add any union school assessment (if applicable), technical center payments and any deficit from previous year; then subtract any local non-property tax revenues and all state categorical grants (transportation, special ed, small schools, etc.) and all federal revenues. The result of this calculation is a district’s education spending which when divided by equalized students is the district’s per pupil spending. (16 V.S.A. §4001(6)) For purposes of determining “excess spending,” capital construction costs are removed from the calculation.
The non-residential grand list will consist of all property that is not declared and determined to be a homestead. The effective tax rate (again, modified by the local CLA) on non-residential property starting in FY2005 will be $1.59. Unlike the residential rate which will change with changes in school spending, the non-residential rate can be modified only by the General Assembly.
For FY2003, average statewide property tax was $1.72. Had Act 68 been in place this current year, the residential tax rate would have been an estimated $1.35 - a savings of $.37. For non-residential taxpayers, that decrease would have been approximately $.13 ($1.72 to $1.59). In most districts, property taxes will be decreased for most taxpayers.
Income sensitivity under Act 68 remains largely intact with a few important differences. As before, those eligible for income sensitivity are households with under $75,000 income. Those households with more than this amount of income may calculate income sensitivity on housesites up to $160,000 in value. Act 68 introduces new terminology in this area. While the residential property tax is assessed on the new definition of homestead - all property surrounding a primary residence - income sensitivity is provided only on a residence and two acres (as under Act 60), and that is now defined as a housesite.
The percent of income remains at 2% for spending at the $6,800 base education payment level. Like the local residential tax rate, the percent of income will rise proportionately to per pupil spending. So in the example above, if spending is 10% more than $6800 per pupil ($7480), those who qualify for income sensitivity will pay 2.2% of their income (10% more than the base 2%). An additional help is provided to those eligible taxpayers who own more than 2 access in the form of a $10 per acre tax credit for up to 5 acres owned in excess of the two acres which are part of the housesite. The General Assembly noted its intent to extend this benefit to up to 25 acres (above the 2 acre housesite) when funds are available.
Currently, many eligible taxpayers pay taxes on the basis of their homestead minus $15,000. This option will be available only to those with income below $47,000 starting in FY2005.
Other provisions of Act 68 provide for the following:
FY2004 (starting July 1, 2003):
Borrowing figures from the Vermont League of Cities and Towns, it appears that projections for non-property tax support under the normal Act 60 assumptions (splinter taxes plus General Fund transfer indexed at 3.5% and using FY01 as a base year) would have risen to $365.6M in FY05 and $377.6M in FY06. Projections by the Joint Fiscal Office for those two years under Act 68 (General Fund support plus dedicated taxes) anticipate $396.2M in FY05 and $410M in FY06. Simple subtraction indicates that in FY05 there will be an estimated $30.6M increase in broad-based revenues and $32.4 in FY06.
The new law requires the General Fund transfer to track with General Fund base spending. While this will provide a benchmark, one can question whether it is the correct one since it is not uncommon for significant state expenses to be booked outside of "base spending."
FY2005 and after
Act 66 (H.464) Appropriations for FY04 -
The “Big Bill” is, as its nickname implies, a very significant piece of legislation containing many pieces only a few of which I will mention here. Specific provisions apply to individual districts and programs and generally those are known by the affected parties and are not mentioned here. I highlight a few areas below.
Earlier in the session, this bill appropriated money from the Education Fund to pay for adult education and literacy for 16 to 20 year olds. After many constituents opposed using Education Fund revenues for purposes outside of pre-K – 12 education, the bill was modified to provide General Fund revenues for this year. The final legislation directs the Commissioner of Education to recommend to the Senate and House Committees on Education and Appropriations a method by which school districts which provide education through grade 12 will contribute to funding adult education for each student who withdraws during the school year and enrolls in a Vermont adult education and literacy program. In the meantime the legislature is directed to appropriate funds annually to pay for such programs. It further directs the Department of Education to pay 20% of the base education payment for each 16-20 year old who has attained at least one skill level in accordance with state or federal standards.
The aim of this legislation is laudable. It seeks to make school districts responsible for the ongoing education and skill acquisition of students who drop out of high school before graduation. While it may be sound to consider funding high school aged students from the Education Fund, using that source of funding for older clients starts to shift costs that have traditionally been human service expenses (funded by General Fund revenues) to the Education Fund. In the special education field, such a shift has already been documented. We will want to be very careful not to create another similar situation.
The bill states the intention of the General Assembly that expenditure of federal 21st Century Communing Learning Funds shall make the funding of licensed after school programs a priority.
$200,000 is appropriated to award grants to technical centers to support innovative program development responding to emerging technologies. Special consideration is to be given to new and innovative agricultural programs.
The law allows students from school districts geographically isolated from a Vermont technical center to attend a technical center in another state.
The State Board of Education is directed to convene the Fiscal Review Panel, funding for which has run out, for up to two meetings to review its purpose and make recommendations as to its future to General Assembly in January.
The appraisal value for farm buildings on farms enrolled in the state current use program is reduced to zero, and the manner in which this is implemented is detailed in Sections 286 - 289a of the new law.
Act 22 (H. 54): Participation in Federal School Meals Programs -
Currently, school districts that operate school(s) are required to participate in the federal school lunch program unless their electorates vote to exempt the districts from the program. This bill expands that requirement to include, also, participation in the federal school breakfast program. Furthermore, it directs all districts not currently operating one or both programs to initiate such programs by July 1, 2004 unless electorates vote by June 30, 2004 to exempt the district from the requirement. Approximately 70 districts fall into this category.
Once an electorate has voted for exemption, that exemption must be renewed annually - not by another vote (which was part of the original bill), but by means of annual consideration by the school board at an appropriately warned regular or special school board meeting including, of course, the opportunity for public comment. Act 22 requires the school board to send a copy of the notice of the meeting to the Commissioner of Education at least 10 days prior to the meeting and to follow up by sending a copy of the agenda and the minutes of the meeting to the Commissioner.
The Commissioner is directed to notify by November 1, 2003 all districts not currently operating these programs about their responsibilities as outlined above. Thereafter, each November 1st, the Commissioner will notify districts that continue to be exempt from the provisions.
Though the goals of this new law are worth while and the intention well-meaning, some of the implementation conditions of Act 22 are good examples of why school districts and the Department of Education are buried in paperwork and administrivia. Rather than assuming that school districts, once made aware of a new piece of legislation, will carry out their responsibilities, Act 22 creates unnecessary reporting that is burdensome to everyone. One has to question the value of asking districts to send copies of their meeting notices to the Commissioner and then follow up with agendas and minutes. Instead, if any agency of state government or any resident of the community seeks to assure themselves that the district is in compliance, they can simply check the records of the district. This portion of Act 22 may wind up on the list of burdensome mandates that VSBA will be helping to compile in the next several months - see section 43 of Act 68.
Action for School Districts: If you are not currently participating in one or both of the federal school meal programs, you should receive a notice in November of the necessity to have a public vote on the exemption by June 30, 2004 or to have such program(s) in place by July 1, 2004. Each year thereafter, the school board of an exempt district must schedule and include on its agenda a discussion and vote on whether to continue the exemption. Warning of the meeting must be sent to the Commissioner before the meeting and copies of the agenda and minutes sent along afterwards. Those districts currently participating in both federal programs are unaffected by this new legislation.
Act 16 (H. 83): Fire and Emergency Preparedness Drills -
This legislation is a small but important modification of 16 V.S.A. §1481 which directs public and private educational institutions (excluding colleges and universities) to hold monthly fire drills and to document each drill. The nature of such monthly drills are expanded under Act 16 to include all emergency preparedness drills as described in a school's emergency preparedness plan. The fine for failure to comply with the provisions of the law has been increased from a maximum of $20.00 to no more than $500.00.
Action for School Districts: School districts should be aware that their monthly drills now may be used to prepare students not only for actions to be taken in the event of fire but also to practice any other emergency procedures.
Act 12 (H. 147): Renewal Contracts and Service Purchases -
This legislation clarifies the requirements for public bidding, raises the threshold amount and also simplifies bidding requirements. 16 V.S.A. §559 is modified to make clear that local or supervisory school boards must publicly advertise or invite three or more bids for services or items in excess of $15,000 - up from the previous $10,000 - if they fall under these categories:
Furthermore, boards may renew such contracts without a new bidding process IF the annual costs of a new contract do not increase more than the Cumulative Price Index for state and local government purchases of goods and services as of December 1 AND the total contract amount is not more than 130% of the total price of the original contract. Another stipulation is that the renewed contract must allow termination by the board following an annual performance review.
Lastly, Act 12 repeals the limit on the term of transportation contracts as well as the requirement for voter approval for the lease of personal property such as copiers, office and maintenance equipment.
While there was some discussion about whether this legislation opens up the door for abuses in the area of contracting, legislators were eventually convinced that this flexibility would allow school boards better control over their expenses and may cut down on some administration.
Action for School Districts: School boards should be aware of these new provisions which clarify and simplify bidding processes while raising the threshold amount requiring such process.
Act 64 (S. 185) Compliance with NCLBA -
The purpose of this law is to allow the State of Vermont to comply with the early stages of the federal No Child Left Behind Act while not making premature changes to essential pieces of Vermont education law. The bill does essentially 3 things:
It authorizes the state to assess progress of students and schools every year (to comply with NCLBA)as opposed to every two years as required by Vermont's current accountability system. It also authorizes the state to impose consequences as required by NCLBA that are allowed in state law.
The General Assembly expressed its skepticism about the federal law noting that in conformance with a specific section of NCLBA, neither the state nor local districts are required to spend their own money to comply with the law. It expresses the intention to continue to study the law and work with the federal government to determine what permanent changes to Vermont education law will be needed and to avoid having the federal law force the state and local districts to absorb new costs as a result of the federal law.
Secondly, the law addresses - for the coming year only - the inconsistencies between state and federal law with regards to homeless children in order to comply with NCLBA in 2003-2004. The legislature wants more time to work with the federal government to reconcile the differences before permanent changes are made to Vermont law. Act 64 provides the following:
The Committee will comprise four senators of different parties - one each from the Appropriations and Finance Committees and two from the Education Committee and the same representation from the House. The Committee is expected to meet monthly or as needed and to report to the General Assembly in January, 2004 and January, 2005.
Act 63 (H. 457): FY2004 Capital Construction Bill -
This major piece of legislation is the work of the House and Senate Institutions Committees and
contains most of the funding for capital projects in the state. Though one would not expect to find state policy in such a bill, often that is the case, and this year is no exception.
Section 5 contains the capital construction allocations for education and they include the following: (the Department of Buildings and General Services (DBGS) has overall responsibility for vocational center capital projects which is why you will note that funds are appropriated to that Department for these projects)
Section 41 of this bill contains quite extraordinary language mandating local process relating to the creation of a North Country Career Center and also defining membership on a new planning group - the North Country Workforce Development Board - in such a way that school leaders have minimal participation in the process. The legislation also defines how the Board must operate. Though the legislature certainly has legitimate questions about the contentiousness of the planning process for this project, the previous planning group and local school boards had recently reached agreement and were ready to submit recommendations to the voters - the ultimate decision makers. This language derails that process and sets in place a new planning group and process different from that required under current law. Local school leaders might well question the willingness of representatives in Montpelier to insert themselves into local decision making.
Section 44 makes the Twinfield Early Care and Education Center eligible for 30% state aid for construction. This is the second time a preschool project has been eligible for such funds.
In an effort to aid the Southwest Vermont Career Development Center - on the New York border - to fill empty seats in their classrooms, Section 45 allows the Center to charge New York students an amount that is $100 greater than the bill back amount charged to Vermont local high schools in the regional technical center area.
Action for School Districts: Only for those specifically mentioned.
Act 36 (H. 477): Education Technical Corrections Bill -
This bill contains a number of provisions that correct inadvertent mistakes made in legislative drafting and/or to create consistency in education law. This year's bill contains the following:
Act 46 (S. 23): Continuation of Technical Center Alternative Governance Pilots -
This bill allows governing boards of pilot technical center projects to continue operating under waivers until June 30, 2005 after written notification to the Commissioner of Education.
Action for School Districts:This law applies to only a few districts which will recognize its applicability.
Act 28 (S. 25): Motor Vehicle Passenger Safety -
This bill requires every occupant under the age of 16 in a motor vehicle other than a type 1 school bus operating on a public highway to be properly restrained in an approved restraining system (seat belt or other device). The new law specifies by weight and age what type of restraint system is required. For example: a child over twenty pounds and up to age 8 must be restrained in a child passenger restraining system; over 8 and through 15 years old, a child must be restrained in a safety belt system or a child passenger restraining system.
Failure of a passenger age 16 or older to wear an available seat belt may incur a fine as a secondary violation - that is if a car is stopped for some other violation and an officer notices lack of seat belt use.
Action for School Districts:School districts that may employee vehicles other than school buses or other vehicles regularly used to transport students for hire should be aware of these new requirements which may create a new area of liability.
Act 59 (H. 460) Implementation of the Help America Vote Act -
This comprehensive voting law provides that when a budget voted on by Australian ballot is rejected, and a vote on a revised budget is scheduled, a public informational meeting shall also be warned to take place at least five days following the public notice.
Action for Schools: Awareness of this requirement.
Act 17 (H. 320) Permitting Service Dogs in Public Accommodations -
This bill allows service dogs to accompany their masters in all places of public accommodation including schools. This means a dog used by a police, fire or other public service unit or dogs used by individuals with disabilities or dogs in training for such service.
Action for Schools: Awareness of this requirement.
Act 54 (H.206): Selling and Dispensing Illegal Drugs -
This is a comprehensive piece of legislation that attempts to combat drug crimes and substance abuse through education and prevention strategies, strong criminal enforcement of drug laws as well as the provision of treatment and recovery options and resource.
Relating specifically to schools, section 8 of the bill modifies 18 V.S.A. §4237 relating to selling or dispensing drugs on school grounds. It addresses violations of law when such activities happen not only ON school property but also on property ABUTTING school property when it occurs within 500 feet of school property.
The bill also creates pilot projects in Chittenden, Rutland and Bennington counties with provision for extension to three other counties to develop an approach to provide accountability, assessment and suitable services for persons with drug abuse problems who have been charged with a criminal or delinquent act. The focus of these pilots is on youth under the age of 21. The committees charged with carrying out these pilots consist of court officers, representatives of AHS departments, substance abuse provider organizations, and members of the communities.
Action for School Districts: Schools should be aware that the law expands the zone of school property when dealing with drug selling and dispensing. It may be worthwhile to be aware of the progress of the pilot projects in the affected counties in order to assist students with drug abuse problems.
Act 60 (H. 449): Professional Regulation -
As part of a large piece of legislation that modifies the regulation of a number of professions, Section 23 has provisions that apply to athletic trainers. The new legislation speaks of "licensure" rather than "certification" of athletic trainers and appears to bring the law in compliance with best practice and the requirements of most post secondary programs that qualify individuals for licensure.
I am told by the Vermont Principals' Association that it, as an organization, and athletic trainers supported this legislation.
Action for School Districts: This legislation imposes no new requirements of school districts. If school districts hire licensed athletic trainers, they may want to be aware of the requirements of their licensure.
Act 62 (H. 453): Tort Claims Against Municipal Employees -
Unlike school employees who are covered against claims brought against them for accidental injury occurring during the discharge of their duties (16 V.S.A. §1756), town employees have not enjoyed such protection. Under the law, school districts are municipalities and this bill is general in nature - referring to all municipal employees. After it outlines the protections afforded municipal employees in an added section - 24 V.S.A. §901a - Act 62 contains subsection (f) which states that when two sections of law address the same issue (such as this new section and 16 V.S.A. §1756), a court shall apply the statute that grants the higher level of protection to the employee.
Action for School Districts:The new legislation changes nothing with regard to school districts and their employees and requires no action.
Act 21 (H. 29): Scholarships for Children of Vermont National Guard Members -
This bill modifies existing law (16 V.S.A. §2537) which provides post-secondary scholarships to the children of members of the Vermont Army National Guard and the Vermont Air National Guard to eliminate the residency requirement for recipients.
Action for School Districts: Assure that any eligible students are aware of the availability of these scholarships.
Act 65 (H. 141): State Income Tax Credit for Higher Education Investments -
This bill provides for contributions to an account held under the Vermont higher education investment plan (529 plan) to be eligible for a credit against Vermont income tax as provided in 32 V.S.A. §5825a. An individual is eligible for a 5% credit of the first $2,000 per beneficiary starting in 2004.
Action for School Districts: None
Act 39 (S. 149): Educational Assistance for National Guard Members - This legislation amends existing law which allows interest free loans up to $2,500 for active members of the Vermont National Guard to pay for tuition and fees at Vermont institutions of higher education. Act 39 removes the residency requirement and allows those loans to equal the instate tuition rate for a given year at the Vermont State Colleges.
Action for School Districts:None
Act 52 (S. 168) Possession of Alcoholic Beverages by Minors -
The stated purpose of this bill is to encourage more teens who drink alcohol to participate in the teen alcohol safety program. The law provides for referral to the county diversion board for the first alcohol offense for minors. The diversion board then enrolls that individual in the teen alcohol safety program and follows up with that individual outside of the customary juvenile court system.
Action for School Districts:None
In addition to new law detailed here, the General Assembly also approved five resolutions - statements of intent without the force of law - dealing with education related matters.
R-94 (H.C.R. 54): Honoring Vermont's School Bus Drivers -
This resolution acknowledges the important job carried out by Vermont's more than 2,000 licensed school bus drivers and honors them for "the vital role they play in assuring students arrive safely and promptly at their destination."
R-104 (J.R.S. 26): Bill of Rights Day -
This resolution recognizes the importance of the Bill of Rights in our history and to our future and designates December 15th of each year henceforth as Bill of Rights Day. It urges that Vermont agencies and departments be encouraged to commemorate that day appropriately. It also directs that a copy of the Bill of Rights be prominently displayed in the State House.
R-120 (H.C.R. 72): Include Veterans in Memorial Day Celebrations -
This resolution notes the importance of having Vermont school children understand and appreciate the sacrifices that veterans have made to protect and serve our country. It urges schools to invite veterans to participate with them in Memorial Day commemorations and to encourage other valuable experiences that might enrich students' understanding.
R-207 (J.R.H. 25) Expression of Concern about the No Child Left Behind Act -
This resolution expresses the General Assembly's concern about the possible negative impacts of the recent federal law on Vermont's education (including administration and curriculum) and the serious fiscal implications that are likely. The resolution notes that some provisions do not fit the Vermont situation and that the potential for interfering severely with state and local prerogatives while imposing new costs is significant. It further states the intention of the General Assembly to refuse to appropriate extra state funds to implement NCLBA and directs the Commissioner of Education to report to the General Assembly on the potential financial impact of any rules developed to implement NCLBA. It asks the Commissioner to report annually to the General Assembly on the expenditures made by the state and local districts in order to comply with NCLBA.
H.R. 19: Urging Schools to Purchase Vermont Milk -
This resolution notes the value of milk to good nutrition and the importance of the dairy industry to Vermont's well-being. It encourages school districts to take the lead of students from Mount Abraham Union High School who have initiated a campaign to encourage their school officials to purchase Vermont produced and processed milk. This concept was first introduced as a bill to require Vermont schools to purchase Vermont milk. VSBA encouraged the bill's chief sponsor to consider presenting this resolution instead and offered to disseminate information to school districts to make it easy and affordable for them do assure their students access to Vermont milk.
---- Edie Miller