Ten Years after Act 60, Who’s Paying For Vermont’s School?
Before Vermont considers more changes to the education funding system, theLegislature and public need a thorough analysis of how the current system isworking. In particular, they need to know how the cost of education is distributedacross all taxpayers. Much of this analysis could be done with information alreadycollected by the Tax Department. However, there is some additional informationthat could be collected on personal income tax returns that would fill out thepicture. Vermont resident homeowners now report a property code, the SPAN number,when they file their income tax returns so they can qualify for the residential taxrate instead of the non-residential rate. Using this code, it’s possible for the TaxDepartment to determine how much individuals or joint filers are paying inproperty taxes – school and municipal. This would be the first step in determininghow much people in various tax brackets are paying to support Vermont schools.There may be cases, however, where people are sharing a house or a non-familymember is paying nominal rent. Under Acts 60 and 68, some households qualify fora property tax reduction on the basis of their income, but that includes all incomeearned by the occupants of the home, not just the owners. To get a complete pictureof the relationship between income and school taxes, the Tax Department needs toget information from all household occupants in a way that links them to a specificproperty.Renters present another problem. Currently, there is not a way to connect themto the property taxes paid on the apartments or houses or condominiums they arerenting. There could ways to approximate each renter’s share of the school taxes ona property and compare that to his income. But right now the Tax Departmentdoesn’t collect the information that would allow that to be done. Renters make upabout a third of the households in Vermont, so they are making a significantcontribution to supporting Vermont’s schools.
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