MONTPELIER — The average education tax rate won’t hold steady and is instead set to rise a penny after school spending came in higher than expected.
Before they adjourned, lawmakers have hashed out a deal on the so-called “yield” bill, upon which local property tax rates are set. The average residential rate will be $1.51 next year (it was $1.50 this year) and the average non-residential rate, which is applied to second homes, camps and businesses, will be $1.59 (it was $1.58 this year). About two-thirds of Vermonters actually pay property taxes based on income — that rate will actually fall, from an average of 2.48% this year to 2.47% next year.
Vermont Tax Commissioner Kaj Samsom had projected in December that spending would grow by 3.2 percent and that, thanks to underlying growth in incomes and the grand list, tax rates would remain flat.
But the budgets approved by voters on Town Meeting Day went up more than projected. All told, education spending went up by $56 million, and special education costs rose $14.5 million, for an overall increase of more than 4%.
“There’s some concern that schools spent more than they were told they should in order to achieve no tax increase. And so we’re delivering a slight increase,” said Senate Finance Chairwoman Ann Cummings, D-Washington.
The $1.7 billion fund that pays for the state’s preK-12 schools receives the bulk of its revenues from property taxes. But other taxes also feed the fund, including sales and use taxes, whose revenues are set to grow by $28 million, in large part because of expanded online sales taxes.