A significant equity concern in Vermont’s current education funding system.

The day after Christmas I had a number of meetings scheduled in my district to catch up on issues prior to the session. After leaving one of those meetings, I sat in the parking lot and checked my emails finding one from a reporter asking me for my reaction to the Vermont education weighting study which had been released on Christmas Eve. After more than a decade of fighting for funding for small and rural schools in Vermont, I was immediately thrilled to learn that this long awaited assessment and recommendation on equity in our current state education funding mechanism had finally been released. The concept of evaluating student weights had been introduced in numerous legislative sessions, repealed, reintroduced and the subject of a threatened legal enforcement action by myself and Rep. John Gannon.

As I began to read the executive summary, the initial excitement faded away. I could feel the anger rising in my chest as I read the well researched confirmation of the injustice that has been done to rural and poor Vermont students – including my younger siblings and my children –  in the name of supposed “equity” 20 years ago. 

The Weighting Study

On December 24th 2019 the Pupil Weighting Factors Report was sent to the House and Senate Committees on Education, the House Committee on Ways and Means, and the Senate Committee on Finance. This report was prepared by Tammy Kolbe, Ed.D., University of Vermont, Bruce Baker, Ph.D., Rutgers University, Drew Atchison, Ph.D., American Institutes for Research and Jesse Levin, Ph.D., American Institutes for Research Constitutional.

The Vermont Agency of Education (AOE) was directed, under Section 11 of No. 173 of the 2018 Acts and Resolves of the Vermont General Assembly (Act 173) to undertake a study that examines and evaluates whether: 1) the current weights for economically-disadvantaged students, English language learners (ELL), and secondary-level students should be modified; 2) new cost factors and weights should be incorporated into the equalized pupil calculation; and 3) the special education census grant should be adjusted for differences in the incidence of and costs associated with SWD across school districts.

From the Executive Summary Pupil Weighting Factors Report

The Legislature’s rationale for the study is accurately captured in the Executive Summary:

“In part, the [General] Assembly’s direction [to conduct the weighting study] stems from concerns about the extent to which the existing funding formula is effective in equalizing educational costs, and by extension, opportunities to learn for students across the state. The manner in which the State currently calculates the number of equalized pupils in a school district has been criticized for being out of step with contemporary educational conditions. For the most part, the student need cost factors and weights used in the calculation have not been modified in more than 20 years, despite the significant changes in statewide demographics and student need that have transpired during that time.”

From the Executive Summary Pupil Weighting Factors Report

The report recommends dramatic increases in the weights for students in poverty and ELL and new weights for middle school students, students in small schools and on the basis of population density (rurality).

Historical perspective:

The basis for the existing funding formula, Act 60, also known as the Equal Educational Opportunity Act, was signed into law in June of 1997. The Legislature drafted the law in response to a Vermont Supreme Court decision that said Vermont’s existing educational funding system was unconstitutional. The court, in Brigham v. State of Vermont, concluded that the state must provide “substantially equal access” to education for all Vermont students, regardless of where they reside.

Under Act 60, tax rates were directly tied to per pupil spending. Act 60 assured that when districts spent the same amount per pupil, residents would have identical tax rates regardless of the town’s property wealth. In other words, a key measure of student equity was and is determined by per pupil spending. The two factors to measure per pupil spending are the total amount of spending divided by the total number of students.

In 2003, Act 60 was revised by Act 68 which created a disincentive for rich school districts to spend excessively. Act 68 penalized districts with education spending per equalized pupil that exceed the threshold, and subjected those districts residential taxpayers to an additional tax rate. For each dollar spent above that threshold, the district must send an extra dollar to the state.

Since the passage of Act 60, policymakers and multiple administrations have behaved as if small rural schools cost more per pupil to educate. The presumption has been that there was an economy of scale feature in our “equitable” financing mechanism, that it was more cost effective to provide an equitable education in larger districts. Despite exactly zero evidence to validate that presumption, as Vermonters have justifiably clamored for property tax relief, financial penalties and cost containment measures have almost exclusively focused on penalizing rural and poor districts – harming the most vulnerable students in our state. 

Effects of existing weights

Weighting of students is done to adjust for the differences in the cost of educating different types of students. From the report:

“Students come to school with dissimilar learning needs and socioeconomic backgrounds that may require different types and levels of educational supports for them to achieve common standards or outcomes. Similarly, schools in different contexts may also require different levels of resources due to scale of operations or the price they must pay for key resources.”

Prior to Act 60, Vermont had an increased “weight” for high school, poverty and english language learning students. That means there was acknowledgement that those types of students cost more to educate. Vermont’s funding formula provides additional taxing capacity to educate those students. However, the study found little empirical evidence for the existing weights. Vermont had no understanding of the differences in cost to educate different types of students, or if it was equitably weighting students 

If educational equity in Vermont had been defined as student opportunity and measured by student outcomes, then it would have cost more to educate students in smaller rural settings. But because equity has been defined as per pupil spending and measured in taxing capacity (with an added decades worth of non student focus on achieving progressivity in residential taxation) the effect has been virtually no difference in the average per pupil education spending – regardless of district size.

What does it mean? Since Act 60 we have denied rural and poor students access to equitable financial resources. The same policies have also incentivized larger wealthier districts to spend more on purchasing student opportunity – without tax penalty.

Deerfield Valley News January 30th Legislators urge letters, testimony or legal action

Our current funding mechanism has incentivized more spending for students who it costs less to educate and incentivized less spending for students who it costs more to educate.

This mechanism has cost all Vermont taxpayers in addition to rural and poor students – for twenty years. That is an entire generation of students and taxpayers. The cost in lost opportunity and increased spending has almost certainly had compounding negative effects for students and taxpayers in rural and poor districts.

The Vermont Legislature’s dedication to progressivity in our state residential education taxing construct has completely ignored what those taxes were able to buy or what students education should cost across the state. 

Historical actions taken to address/examine the inequity in the funding mechanism

  • 2012 Dover and Wilmington taxpayers commissioned a study with Art Woolf and Dick Heaps
  • 2014 Dover taxpayers hired a lobbyist specifically to try and prevent the loss of the small schools grants, perennially threatened by economy of scale thinking. 
  • 2015 Vermont Educational Reform call for ideas. Daniella Hall and Ian Burfoot-­‐Rochford Penn State University Center on Rural Education & Communities researchers produced: A Balanced Approach to Equity and Funding and submitted it for consideration as part of a legislative call for ideas in the lead up to Act 46. The study recommended that the legislature: “lower the excess spending threshold, while also implementing size-­‐based exemptions to ensure equity regardless of school size”. As the researchers arrived in Vermont to testify in the House Education Committee, a 25-page rebuttal was released by the Agency of Education. 
  • A weighting study was included in S.130 of 2017 and I amended the bill to ensure that a study of population density was included – but S.130 never passed.
  • A weighting study did pass in the Miscellaneous Education Bill on May 23rd, 2017. But no funding was appropriated for the study.
  • Rep. Gannon and I threatened to sue for completion of the study in 2017
  • The law authorizing the study was repealed in 2018 and replaced with a new weighting study in Act 173 of 2018 as well as an appropriation to contract for completion of the work. That report was due on November 1st 2019 and delivered on Christmas Eve.
2015 Vermont Educational Reform “call for ideas”. Daniella Hall and Ian Burfoot-­‐Rochford Penn State University Center on Rural Education & Communities researchers produced: A Balanced Approach to Equity and Funding and submitted it for consideration as part of a legislative call for ideas in the lead up to Act 46. The study recommended that the legislature: “lower the excess spending threshold, while also implementing size-­‐based exemptions to ensure equity regardless of school size”. As the researchers arrived in Vermont to testify in the House Education Committee, a 25-page rebuttal was released by the Agency of Education. 

What’s next

On January 8th, 2020 the House Ways & Means and Education Committees heard testimony from the study’s authors. The authors called the existing student weights “historical artifacts” and indicated they could find no empirical evidence to support them.

Rep. Janet Ancel, the long time Chair of the House Ways & Means was quoted in VTDigger

 “(The report has) given us a lot of information to use to challenge the way we’ve been doing business. But that doesn’t mean that we are necessarily going to act on it immediately or even in the next couple of years.”

Senator Baruth, Chair of the Senate Education was quoted in that same article:

“I think it’s an extremely important thing. And I was sent here to do extremely important things that make the system work in a better, fairer way,” he said.

On Saturday January 25th, Rep. Laura Sibilia, Rep. John Gannon, Rep. Carolyn Partridge and Rep. Kelly Pajala hosted a public discussion on the study, Vermont’s Education financing system and how it relates to student opportunity and property taxes. 

On Tuesday January 28th four bills H.909, H.910, H.911 and H.912 were introduced by Rep Gannon, Rep. Partridge, Rep Pajala and I. All four bills were sent to the House Education Committee.

Freezing changes to the education tax financing formula until the Legislature has acted on the recommendations in the Pupil Weighting Factors Report.

Adding a poverty weight, population density student weight, and a geographic necessity weight to the formula used to calculate equalized pupils, factors recommended in the report.

To require the Agency of Education to perform a “look back” at data from 2000 to 2018 and “identify the costs in student outcomes related to inadequate funding through inequitable and inadequate equalized pupil weights.”

• To require the AOE or Joint Fiscal Office to calculate the “cumulative under- and overtaxing” that resulted from student equalized pupil weighting from 2000 to 2018.

February 2, 2020 letter demanding action this year sent to The Speaker of The House and The Senate President Pro Tempore on behalf of Vermont’s students demanding action by the General Assembly this year.

On Wednesday January 29th, several Deerfield Valley students and educators sat in on Vermont Secretary of Education Dan French’s testimony to the House Ways & Means Committee

AOE Policy Recommendation: 

The cost factors recommended by the Pupil Weighting Factors Report (Poverty, % ELL, Enrollment, Population Density, Middle Grades, and Secondary Grades) were based on regional and national comparisons and confirmed by an empirical modelling of Vermont data. These factors should be adopted to replace the current factors, the origins of which could not be confirmed by the Report. 

The Report found the current pupil weights to be outdated. They do not represent current educational circumstances or costs. In particular, the variation between the current poverty weight (0.25) as compared to the poverty weight determined through the analysis from the Report (3.14) suggests immediate action by the General Assembly is necessary to address a significant equity concern in the current education funding system.

The Report identified broad dissatisfaction with the current Smalls Schools Grant. Its parameters are rather subjective and not consistent with the goals of other policies such as Act 46.The new cost factors identified in the Report of school size and population density should be implemented in lieu of the Small Schools Grant.

Making Matters Worse:

What we are hearing:

Informally, the best case scenario I am hearing legislators say is that it will take a number of years for the legislature to implement these changes.

The districts in the study with the largest positive change in tax capacity if the weights had been accurate in 2018. Virtually every Vermont School District is impacted. *AOE has not checked the calculations for accuracy and legislative analysts are working on the 2020 projections.

A number have downplayed the report findings, noting that the corrected weight tax rates it projects for 2018 simply change the list of winners and losers. 

“It’s a zero sum game.”

If we put these weights in place we will have a full scale rebellion. See 1997 equivalent

And perhaps the most disturbing commentary I am hearing from too many legislators and analysts is that there is no way of knowing if districts would use the projected savings to purchase more opportunity for their students or simply pocket the tax savings. 

This is an accurate observation. It is also the exact construct that was put in place 20 years ago when the legislature put in place a statewide education property tax and left decision making to the locals. We equalized taxing and spending and left the actual achievement of equality of educational opportunity for all Vermont students in the hands of 200 districts.

I can assure all of my colleagues in the legislature – all of Vermont’s school boards have done the very best they could with inequitable access to the resources we have provided them.

Those who had access to more resources spent them and those who had access to less resources cut programs and lived on the edge of the excess spending penalty. 

It seems to me that puts us right back where we were 20 years ago: in violation of our student’s constitutional rights.

What can you do?

  • Read the report
  • If you are a parent or student or educator or board member who has a story to tell about how your students have been impacted – write to the House and Senate Education Committees and the Agency of Education tell them how your students and taxpayers are being impacted, ask to testify on the bills in the House, write a letter to the editor of your local paper
  • Contact your state Senators and your state Representatives
  • Stay tuned – there are a number of legislators looking for productive ways our districts can learn more.
  • Talk to your school board and selectboard about what it says. Consider how you can legally fight for your students and taxpayers if the legislature does not act.

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