Vermont’s school spending for the past year is coming in far below expectations, meaning property owners will see a significant drop in expected taxes.

The tax department had predicted a 3.5 percent increase in school spending, which coupled with a $50 million deficit in the education fund left over from last year necessitated a tax increase of 9.4 cents on each $100 of assessed property value.

The tax department and Education Agency predicted a 3.5 percent increase in spending in fiscal year 2019, which coupled with a $47 million shortfall in the education fund led to the projection that the average property tax rate would increase by 9.4 cents per $100 of assessed property.

But the math has been changing as school districts submit their actual budgets.

Earlier this month, Brad James, finance manager for the Agency of Education, said budget reports from just over half the school districts showed spending was down to an increase of 2.14 percent. On Tuesday, he said that figure had dropped to 1.37 percent with nearly 80 percent of 176 school board submitting approved budgets.

That means an expected school property tax hike of 9.4 cents per $100 of assessed value will drop to less than 6 cents.

In the fall, Gov. Phil Scott and Education Secretary Rebecca Holcombe asked school boards to keep spending growth below 2.5 percent per pupil. The 136 school districts who have submitted board-approved budgets have an average per-pupil spending of $15,416, just a 0.71 percent increase.

Tax Commissioner Kaj Samsom said the school property tax was now projected to rise by 5.8 cents on $100 of assessed value.

Scott’s office recognized that school boards “rose to the fiscal challenge” but said any increase in taxes is still too much. “Vermonters cannot afford this. The administration will continue to advocate for system reforms this session that provide cost-containment to prevent this outcome,” said Rebecca Kelley, spokeswoman for Scott.

Speaker of the House Mitzi Johnson, D-Grand Isle, said lawmakers are “thrilled” with a per pupil growth rate of less than three-quarters of a percent. She said it proves local school boards are already able to control costs.

“The near-flat per pupil spending, as well as the education spending rate are both well under the growth rates of the governor’s own budget. When you look at growth over a couple of years, ed spending is within normal inflation,” she said.

Nicole Mace, head of the Vermont School Boards Association, said her staff members had criss-crossed the state making sure school boards understood the dire state of the education fund, a message also driven home by the Scott administration.

“School boards responded to the call from the state and then some,” she said.

Mace also credited Act 46, the school district consolidation law passed in 2015, which was meant to increase operational efficiency and flexibility by creating larger school districts.

“I also think Act 46 is working, in terms of larger districts realizing economies of scale and being better able to manage staffing,” she said.