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How Vermont’s Major Education Transformation Will Unfold

Vermont Overhauls K-12 Education Funding and Governance with New Bill

Montpelier, VT — In a significant shift for Vermont’s education system, Governor Phil Scott is poised to sign H.454, a comprehensive 155-page bill aimed at transforming K-12 education funding and governance in the state. This landmark legislation responds to the governor’s call for sweeping reforms following the Republican party’s gains in the last election.

The bill fundamentally alters how schools are funded, centralizing control in the state’s hands and reducing local voters’ influence on spending decisions. It introduces a new foundation formula that allocates funds based on enrollment, with a proposed base of $15,033 per student, subject to future adjustments.

One of the most notable changes is the proposed minimum size for school districts, which will now require districts to encompass between 4,000 and 8,000 students. An appointed panel will draft recommendations for redistricting by December. Additionally, class size minimums are introduced, prompting potential closures for schools failing to meet enrollment standards for three years.

With regard to taxation, the bill creates a new "non-homestead residential" tax category aimed at taxing second homes to ease the financial burden on primary residences. The existing income-sensitive tax credits for homesteads will also be replaced with tax exemptions based on income.

Supporters argue this reform aims to streamline funding and improve educational quality, while critics express concerns over potential tax increases, particularly in lower-spending communities.

Implementation of these reforms will span several years, with immediate provisions like minimum class sizes set to take effect by July 1, 2026. However, the viability of many aspects hinges on upcoming decisions regarding school district maps.

As Vermont braces for the unfolding impacts of H.454, lawmakers are preparing for ongoing discussions and potential challenges in the upcoming legislative sessions.

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