Home News and Features Montpelier Could See a 19.4% School Tax Increase

Montpelier Could See a 19.4% School Tax Increase

US Dollar sign written on a blackboard
US Dollar sign written on a blackboard. Image from Vecteezy.
At the Dec. 13 meeting of the Montpelier Roxbury School Board, business manager Christina Kimball presented the first draft of the Fiscal Year 2025 budget with newly updated numbers, which at latest count amounts to a 19.4% school tax increase in Montpelier, and a 5% increase in Roxbury.

The district has been working for weeks through the impacts of Act 127, which changes student weights in the state school funding formula.

The presentation included estimated residential tax rate increases based on a $300,000 home, anticipating a $652 school tax increase in Montpelier and a $196 increase in Roxbury. These estimates could change in the following weeks.

“New numbers are coming in every single day. It is different from last Wednesday already, in a good way,” said superintendent Libby Bonesteel.

Under Act 127, a school district can get a cap on the increase of the residential tax rate at 5%, with the state education fund providing the remaining money instead of taxpayers. This cap is only available if the district has an annual increase in “per weighted pupil spending” of less than 10%. This cap is also only available through FY30, after which local taxpayers will bear the full brunt of school spending.

“We’re currently hovering around 9% right now, which gives us a little wiggle room if some of these estimates come in not in our favor,” said Bonesteel. While this week’s estimate of spending per weighted pupil was $14,600, Kimball said they had received new numbers only an hour before and would update it again next week.

From last Wednesday’s presentation, $800,000 in cuts were needed to be under the 10% mark. Kimball said they learned last Thursday of an $80,000 jump in the special education extraordinary reimbursement, and the special education (SPED) census block grant went up $187,000. “That helped offset what we thought we needed to do on the expenditure side,” she said, and cuts required to stay within the state-imposed 10% cap are now down to $525,000. 

The special education revenue isn’t guaranteed for FY26 and beyond. If students “age out of the program, if they don’t need the services any longer, that could change our revenue drastically in those areas,” said Kimball.

Further Cuts Don’t Impact Budget

“It’s an extremely weird year,” said Jake Feldman, board member. “Even if we cut like a million bucks, our tax rate is still going to be $1.34 because of the cap.”

An uncapped increase “would give us an equalized residential tax rate of $1.54,” said Kimball. “We’re at 21% equalized residential tax rate (increase) without the cap,” said Kimball, with the education fund making up the 16% difference.

Another pressure on taxpayers this year is that “our tax rates are going up about 22 cents, which is a lot,” said Feldman, “but we’re so far above the 5% cap that it’s like, you couldn’t even get it down to something smaller,” so the school district isn’t able to and wouldn’t want to make more cuts. 

“It’s almost like a Goldilocks of below 10% per pupil, from last year, and above the 5% in order to be capped,” said Bonesteel.

graphic image of spreadsheet showing tax rates.
Excerpt from the slides presented by MRPS business manager Christina Kimball during the Dec. 13, 2023 school board meeting.
“Montpelier has 1,895 homesteads, and about 66% of those homesteads pay property taxes based on income sensitivity. Roxbury has 222 homesteads, and about 63% qualify for income sensitivity,” said Kimball.

Budget Pressures from Enrollment, Health Insurance

The proposed general education budget is increasing 9% for FY25. “It’s a lot to do with the health insurance increases and contract negotiations,” said Kimball. Health insurance is increasing about 16% statewide, and 80% of the district’s total budget is salaries and benefits.

“Sixteen percent is unfortunately kind of in the ballpark of the type of cost increases we’ve been seeing, pretty much on a regular basis,” said Murphy.

“That’s a statewide bargaining number, so we have no influence over this,” said Bonesteel. She said this is a $400,000 increase to the budget.

Not Backing Down in Academic Goals

“In any of our budgets, we want to support our theory of growth,” said Bonesteel, “while still being sensitive to the tax implications for our community.” She said the budget is driven by a goal of academic achievement for all students, as well as “safety, inclusion, and belonging for every member of our community.”

Painful Cuts to Full-Time-Equivalent Employees

Because of necessary cuts, “we’re not adding any staff this year,” said Bonesteel.

There is a downward trend in student enrollment, said Bonesteel. “Costs are starting to really skyrocket at Union Elementary School, and this is largely because of the very small class sizes,” she said.

Among others, 1.5 full-time-equivalent (FTE) positions currently unfilled will remain vacant, and there will be two 0.2 FTE reductions in currently held part-time positions, said Bonesteel. She said these two positions do not directly work towards their focus areas of academic achievement and safety, inclusion, and belonging.

“It’s easy to concur with RIFs (reductions in force) that don’t actually impact someone or it’s a vacant position or there’s low enrollment, but that one really sticks out because that would be cutting an individual’s salary for someone that we already have, and that feels crummy,” said Jill Remick, board parliamentarian.

Cutting currently filled positions “is very hard to do. Believe me, I know that, because I am the person sitting across from them telling them this,” said Bonesteel.

Bonesteel said reductions in force are typically solved by a person deciding to go to a different employer, or by retirement.

“And these are not bad teachers, these are wonderful teachers,” said Bonesteel. “We’re going to have to make hard decisions. That’s unavoidable right now,” she said.

Murphy said they tried to minimize impacting positions that people currently occupy “to the extent practical,” but they could not avoid it.

“Teachers are not just givers of information, they’re also, you know, lifelines for students,” said Miriam Serota-Winston, student representative on the board.

“This is not a one year challenge with Act 127, it’s a five year challenge with Act 127. So this is a place where the board will probably be looking in the next few years,” said Bonesteel.

For the RVS after-school program, “we are losing an after-school grant that is currently paying for most of that program,” said Bonesteel. “We need to ask parents to pay for that service next year.”

There will be a second budget draft presentation on Dec. 20 and a third budget draft presentation on Jan. 3. The board will need to approve a budget on Jan. 17, and then the budget will be up for a vote on Town Meeting Day, March 5.

For more, read past Bridge coverage of MRPS board meetings, and for context on Vermont budget pressures, see Phil Dodd’s recent article in The Bridge. More information about Act 127 can be found at mrpsvt.org/budget