Estimates call for lower school taxes in most ANwSU towns
VERGENNES — Residential school tax rates are now expected to drop in four out of five Addison Northwest Supervisory Union communities, according to new estimates released this week by ANwSU officials.
They revised their estimates — which are lower than those published in ANwSU annual town reports — after the Legislature agreed late in January to make changes to school-funding provisions in Act 46, Vermont’s new education law that also promotes school consolidation.
Combined elementary and Vergennes Union High School rates in Addison, Ferrisburgh, Panton and Vergennes will drop by between a fraction of a cent in Vergennes to about 9 cents in Addison, according to the estimates.
Only Waltham will be looking at an increase, ANwSU officials said, and that is largely because its Common Level of Appraisal (CLA) is below 100 percent. Therefore, the town’s school rate must be adjusted upward. Other towns’ CLAs are higher than 100 percent and are lowering school rates.
CLA is a formula that adjusts the assessed value of property to bring it in line with fair market value; the goal is that property tax payers across Vermont pay taxes based on fairly assessed property.
Because state lawmakers acted to change Act 46 only after a lengthy debate on how and if to adjust the law’s per-pupil penalties, ANwSU Superintendent JoAn Canning said local town reports had to be printed and mailed out based on old information.
Officials had to publish rates under the assumption of no changes being made to Act 46, Canning said, and thus the reports contain higher — and inaccurate — tax rate estimates that now should be disregarded.
One reason the rates are lower is because of the uncertainty surrounding Act 46. ANwSU administrators and board members worked hard to minimize the law’s original penalties, which all three ANwSU elementary school spending plans avoided.
But the VUHS board found it impossible to avoid penalty territory. The school is still dealing with a major deficit from a failure in earlier years to properly account for special education spending, costing $254,000 in the proposed budget of roughly $10 million; a drop in the number of its equalized pupils, per state calculations; and a decrease of the school’s state contributions for special education costs, a factor that also drives per-pupil costs higher.
The impact of the VUHS budget was softened in ANwSU, however, when lawmakers finally agreed to reduce the dollar-for-dollar tax penalty for over-the-threshold per pupil spending to 40 cents, and raised the threshold by 0.9 percent.
Those changes, combined with frugal ANwSU elementary spending, brought better news for district residents, Canning said.
“I’m ecstatic to bring these numbers to the taxpayers,” Canning said.
Meanwhile, she said, even after administrators and board members were making tough decisions on budgets, they still preserved essential programs and positions.
“We went through an excruciating process. We still had to make some reductions. But I think our schools are very viable,” Canning said.
The estimates assume all four ANwSU budgets pass as proposed, including the roughly $10 million VUHS budget, an additional $100,000 capital fund article, and $734,000 for the Hannaford Career Center. The VUHS budget itself reduced spending by 2.23 percent, but not enough to avoid completely Act 46 penalties.
CLA numbers were provided by the ANwSU office.
ANwSU unification, if it also passes on March 1, will trigger a 10-cent tax break on residents’ tax bills, but not until the 2017-2018 school year. The following tax rates are for the 2016-2017 fiscal and school year.
Addison’s total residential school tax rate is now projected to be $1.5889 per $100 of assessed property value. That is 9.09 cents lower than the current rate of $1.6798.
Addison’s CLA of 109.6 percent (meaning that properties are assessed at 9.6 percent above fair market) is helping lower the rate.
The Addison Central School board on Jan. 21 adopted a $1,606,375 spending plan proposal that would make few changes to school programs and would raise spending by 4.12 percent, or about $63,000.
That increase is almost entirely driven by an expected hike of roughly 8 percent in health insurance benefits and contracted raises, officials said.
The board voted to use $100,000 of a projected fund balance from the end of the current school year to keep spending under the original dollar-for-dollar Act 46 penalty threshold.
Ferrisburgh’s total residential school tax rate is now projected to be $1.67, seven-tenths of a cent lower than the current rate of $1.677.
Ferrisburgh’s CLA of 104.72 percent is helping lower the rate.
The Ferrisburgh Central School board adopted a $3,432,273 budget that cuts almost $155,000 from the school’s current spending level. It would have been $28,000 over the original Act 46 per-pupil spending threshold; board members said they believed lawmakers were going to make at least the 0.9 percent hike in the threshold that would allow them to add in that $28,000.
Panton’s total residential school tax rate is now projected to be $1.5142, which is 7.41 cents lower than the current rate of $1.5883.
Panton’s CLA of 109.1 percent is helping lower the rate.
As well as VUHS, Panton sends students to Vergennes Union Elementary School. The VUES board adopted a $4.75 million budget that would increase VUES spending by 1.05 percent, or about $50,000.
The Vergennes residential tax rate is projected to be virtually identical to this year’s rate: ANwSU officials expect it to decrease by seven-hundredths of a cent to $1.5745.
The city’s CLA of 103.35 percent is helping keep the city’s school tax rate in check.
Vergennes sends its students to VUHS and VUES.
Only in Waltham, which also sends its students to VUHS and VUES, are taxes projected to increase.
ANwSU projects the residential rate to rise by 15.1 cents, from $1.5822 to $1.7323.
That increase would be by about 9.5 percent.
Waltham’s CLA stands at 94.06 percent. Without the upward pressure from the CLA, Waltham’s tax hike would be closer to 5 cents.
Even with the exception in Waltham, Canning believes the numbers show a solid future for ANwSU, especially if voters back unification, which she said will bring both financial and educational benefits. She noted also that the Legislature repealed Act 46 spending threshold penalties for the 2017-2018 fiscal year.
“I think that we’re going to be on the right track,” Canning said. “If we can get through unification and get through this year, they have repealed the caps for (fiscal year) ’18, so I think that we have the potential of building some long-range strategy around really continuing with high quality programs and keeping the cost down.”
Andy Kirkaldy may be reached at [email protected].