Vermont Legislature SmartTranscripts:

[Peter Conlon (Chair)]: Okay, this is House Education, Wednesday, January 2. This afternoon, we're gonna be doing a recap of Act 73, all the various points in it with our legislative counsel, who we very much welcome back to the committee room and we'll turn the table over to you.

[Beth St. James (Office of Legislative Counsel)]: Hello, friends. Hi, Beth St. James, Office of Legislative Counsel. I'm starting the year off with a cold, I will eventually end up coughing. I apologize. This will be the third time I've done this presentation in the last two days, and it's taken me anywhere from forty five minutes to an hour, depending on questions. That's not including John's section. I mean, it's whatever you want to make of your hour, but I am also conscious of the fact that you have limited time. On your website, you should have links to Act 73, various different summary documents that we've prepared over the last few months, the timeline and a reports document with links to all the reports that are due to you that have come out or that I have had access to. Some of those reports are linked directly in the PowerPoint presentation. Do you want me to share my screen or Yeah. Okay. So I've prepared a PowerPoint presentation that is really a high level overview of sections one through 33, which are the sections that I drafted and that are generally speaking, the education policy sections of the bill. This is a summary. Not every detail of every section are in these slides. I have given you page number references to the actual bill. And the first slide is a hot link. Anything you see underlined is the hot link. So if there is a detail or a concept that you're not seeing covered on a slide, it's likely that it's just not the level of detail that I provided for you today, and we can dive into the act itself.

[Peter Conlon (Chair)]: There are probably areas that we could skip over. We already had a report from the Commission on the Future of Public Education.

[Beth St. James (Office of Legislative Counsel)]: You wanna do anything with the intent section?

[Peter Conlon (Chair)]: Sure.

[Unidentified member of House Education Committee]: It's up to you. Yes.

[Beth St. James (Office of Legislative Counsel)]: Okay. So I didn't really put anything on the slides because the intent section speaks for itself. I'm going to skip over all of the Brigham stuff. We're going go right to subsection B in section one, which essentially is your plan for this year. And this is all intent language. You could not bind yourselves last year. You cannot bind yourselves this year. So it is further the intent of the General Assembly to in the 2026 session enact new larger school district boundaries that would be effective at the end of the session. Enact updates to CTE, both governance and funding and kind of a statewide strategy for coordination. Begin the process of creating voting wards within each school district to ensure board membership is constitutionally proportional. Establish an appropriate weight for pre K students, as well as enact changes to publicly funded pre K to ensure that costs are borne by the appropriate funding source, depending on the age of the student and the pre K provider. And then also basically to provide the support to the field, the agency, the town clerks, and any other integral parties in order to stand up those new school districts and any of the other changes you make, either in Act 73 or pursuant to Act 73. That was or is your plan for this year. There's also, I don't think in the interest of time we need to go through it. Subdivision three is basically a list of things that this bill proposes to do to mitigate property taxes. Section two is the Commission on the Future of Public Education, which sounds like we can skip over because you already know what they did. There is a link to their report there. Section three, the School District Redistricting Task Force. There is a link to their final report. Do you want to go into any level of detail about that? Section four of the school district voting word working group. This working group exists today. I believe they've met at least twice prior to today. And my understanding is they stand ready to start working if and when it is appropriate for them to do so. One big thing I will point out to you is that part of their charge, in addition to making recommendations for awards, voting awards within new school districts, is to recommend school board size. There is no date deliverable, like no state certain that they are supposed to make that recommendation to you. Part of that is we don't know when you're going to have school district boundaries, etcetera. But if and when you all hit a point in time where you wish you had that recommendation, someone's going to have to proactively reach out to facilitate that. Section six, class size minimums. These are effective 07/01/2026, so they are not effective yet. I'll let the minimums speak for themselves. Multi age classrooms are limited to two grade levels per classroom in grades K through eight. And then there are several types of courses or classes that are exempt from class size minimums, including pre K and kindergarten, CTE, flexible pathways, terminal courses, advanced placement courses, courses that require specialized equipment, driver's ed, and then classes related to special education English learner academic intervention.

[Peter Conlon (Chair)]: Probably worth noting for the community that while they dealt it effect till July 1, they actually are having effect as the school boards develop their budget for next

[Beth St. James (Office of Legislative Counsel)]: year. And so the next thing I'm gonna go through is what happens if someone is not meeting class size minimums. And I think that was a great point that your chair made in that I get to live in the black and white world of the law. I don't live in the field. So what I'm about to walk through of the consequences of not following class size minimums is going to seem like a very long and protracted timeline, because that's what the law says. What that means for folks planning ahead is totally different in the field. So I'm going to say that the first time you're going to see any action taken by the state for failure to comply with class size minimums, it's probably going to be the earliest 2031. But that doesn't mean that folks aren't planning and taking their own actions in the field. So class size minimums go into effect 07/01/2026. If a school is not meeting class size minimums over three consecutive years, so that puts us in 2029, The secretary may take actions allowed when a school is not meeting education quality standards, which requires two years of technical assistance first. So section seven, put some caveats on this. So under current law, law before Act 73 and law after Act 73, a school is not meeting education quality standards or their students are making insufficient progress in student performance. The secretary is required to provide notice to them in writing of what they're doing wrong and how they need to come into compliance and then two years of technical assistance. So if the education quality standard that a school is not meeting is class size minimums, they have to have three consecutive years of not following. So if we start in 07/01/2026, the first date someone could be deemed not to be following class size minimums where there is any consequences is 07/01/2029. That triggers the secretary's option to may provide notice and then the actions that they take. Have to provide two, secretary has to provide two years of technical assistance. So that puts us to 2031.

[Unidentified member of House Education Committee]: Then, you want me to keep going?

[Beth St. James (Office of Legislative Counsel)]: Are we taking questions? Go ahead.

[Peter Conlon (Chair)]: Stop. Please jump in if you have a question.

[Beth St. James (Office of Legislative Counsel)]: My question is, you said that the Secretary of Education has to provide them with a written notice. If for some reason that doesn't happen at the time that it should, like they have a backlog or they didn't notice, then the two years is delayed until they receive that notice. The statute is not that specific. So I hesitate to make an assumption there because I'm not the one executing the law. I think you would need to ask the secretary how she would execute that, but that's a very reasonable interpretation from a legal standpoint. Okay. So we've got two years of technical assistance. If they've done everything great, they're in compliance, we move on. If they're still not in compliance, then the secretary is required to make a recommendation to the State Board of Education on next steps. And there is a menu of next steps in section 165. I believe we spent quite a bit of time looking at them last year. The secretary could say, we're going to keep working on a performance plan essentially, right? Keep providing technical assistance. The secretary of the state could maintain control of the school. It could be consolidation required. Supervisory union boundaries could be adjusted. All of that remains on the table for failure to comply with class size minimums, except section seven of Act 73 says, if you do everything you need to do, you give them three years, then the two years of technical assistance and they're still not in compliance and the secretary is gonna make a recommendation on the state board to take action. The state board cannot require any sort of consolidation to cure the class size minimums. If that consolidation is going to result in school construction costs, that could not be already borne by the district because of a capital reserve account or something like that, until you establish new school district boundaries and take further actions on consequences for failure to meet EQS. So basically, if you fail to comply with class size minimums, the state board can't then generate require you to generate a bunch of capital debt to comply. That option's off the table.

[Unidentified member of House Education Committee]: And just to clarify that going all the way back to the beginning, it's still it's a may no shall. So there can be a school that's not meeting class size minimums. And based on circumstances, the Secretary of Education may say, yeah, it's fine because whatever. They don't have to,

[Beth St. James (Office of Legislative Counsel)]: they may. Yes. And the state board may grant a waiver if the school is geographically isolated or they're working on a compliance thing. Thank you.

[Peter Conlon (Chair)]: I'm reading, so everybody please just jump in.

[Unidentified member of House Education Committee]: Mostly, I guess this is an out loud note for myself of wanting to go back and look at the different versions we've passed in the schedule. But immediately having not been looking right at the bill for a few months now is jumping out to me as somewhat backwards to essentially be pushing out something that is both about efficiency and fairness about education quality at least five years. It's something that's quite cheap, actually improves efficiency to implement versus the district piece. There's, I think, a much more question around district size and education quality. We've heard for years on this committee from educational experts about class size minimums being a really important policy tool. And these are extremely low by most standards and by what happens in most states. The timeline piece all of a sudden is sort of red flashing lights to me of like, wow, we're gonna turbocharge districts and we're gonna slow walk more efficient and educationally sound sized classrooms. I would respond to

[Peter Conlon (Chair)]: that by saying, I think that most districts look at the 07/01/2026 as the law and they may choose to slow lock it,

[Unidentified member of House Education Committee]: know, I guess I that's what they're worry not supposed about Given the schedule that has now been put in, its effectiveness, even if they are planning for it, it's still very long, gradual.

[Peter Conlon (Chair)]: And if I can just add to what you just said. I actually am familiar with the school district who's considering closing their school because they can't meet. Literally closing their school and becoming non operating because they can't meet the minimum class size minimum section. And it's not just the numbers in a class, but it's also the multi age classroom. Yeah.

[Beth St. James (Office of Legislative Counsel)]: Yeah, I think that needs to be made clear to schools. We just cut seven employees for next year because of this, and it seems really preemptive and alarmist.

[Peter Conlon (Chair)]: I think you're kind of saying the opposite.

[Beth St. James (Office of Legislative Counsel)]: Maybe I would say the opposite. Well, that's my opinion though. Okay. All right, in the interest of time, I'm gonna kind of fly through things that require reports to you all. So section eight is requiring the State Board of Education to update rules that reflect class size minimums and statewide graduation requirements. Statewide graduation requirements don't come into play until 2027. And then also update the independent school approval rules for class size minimums. And they are also required to give you a report with proposed standards for schools to be deemed small by necessity or sparse by necessity. When I prepared these slides, I did not have access to the report. But thanks to Ezra, I do now have access to the report, and it's on the report. There's a hot link to it on the report handout.

[Unidentified member of House Education Committee]: That was just a clarifying question. Does the statewide graduation standards piece that we need? Anything that comes back to us or is it out of our hands?

[Beth St. James (Office of Legislative Counsel)]: Section nine requires AOE to recommend to the state board on or before January 1 statewide graduation standards because the state board is the one that would be implementing them. So you have a report not linked here, but linked in the reports document with those recommendations.

[Unidentified member of House Education Committee]: But they don't come back to us for any sort of voting or political change?

[Beth St. James (Office of Legislative Counsel)]: No, but you could look at them and decide to take legislative action this year. But yes, you are correct. Section nine requires AOE to develop a statewide calendar on or before 01/15/2027 for the twenty eight-twenty nine school year. And then Section nine also required reports back on all of these items. And you have those reports linked to you in the reports section or the reports document that has posted for you. I will say it's not one report. It's a bunch of different reports. Section 10 is the sunset review of the state board rules. They have to look at all their rules, figure out what could be sunset, what needs updating, come back to you all the plan and any associated costs or staffing needs. Sections 12 through 20 are the stated to school construction program.

[Peter Conlon (Chair)]: Quick questions for anybody who's been paying attention. Do we have that State Board of Education report?

[Beth St. James (Office of Legislative Counsel)]: It won't be due to you until twenty twenty six, December.

[Peter Conlon (Chair)]: Sorry, I have my December which just happened and we are in 2026. Confused as a whole.

[Beth St. James (Office of Legislative Counsel)]: I mean, you want to skip right through this session,

[Unidentified member of House Education Committee]: we can go. Wednesday? Yeah.

[Beth St. James (Office of Legislative Counsel)]: No, I meant the whole legislative session. But state aid school construction sections 12 through 20 does not take effect until 07/01/2026, with the exception of section fourteen and fifteen, which is the state aid for school construction advisory board. They were stood up until July 1 this year I'm sorry, last year. And they do have a report for you related to legacy debt and consolidation and how to deal with that. Section 21, tuition. So section 21 is who can get tuition. And then section 27 later on is how much do they get. So this is who and then we have how much later. So section 21 amended section eight twenty eight in title 16, which was basically the list of educational programs or types of schools that a school district was allowed to pay tuition to. So after, and this is effective 07/01/2025. So this is current law, no conditions. So currently, after Act 73, a school district can pay tuition to a public school in Vermont, an independent school that meets EQS, a tutorial program, an approved education program, a public school located in another state, a and therapeutic approved independent school in Vermont, another state or another country, and approved independent schools that meet certain criteria. That criteria is all listed here. So located in Vermont, already an approved independent school when the law went into effect, located geographically in a SD that does not operate a public school for summer all grades, or an SU of one or more member districts that do not operate a public school for summer all grades, Had at least 25% of its student enrollment composed of tuition students during the twenty three-twenty four school year and complies with class size minimums. Section 21 also adds a definition for therapeutic schools, which did not exist in title 16 before. Conception 22 is a transition section that allows students who are enrolled last year or currently enrolled by an approved independent school that does not meet the requirements we just walked through. So the pre Act 73, they were eligible. That student could continue through graduation there, even if the school doesn't meet these good requirements.

[Unidentified member of House Education Committee]: You want me to keep

[Beth St. James (Office of Legislative Counsel)]: going? Sections 24 through 26 for the State Board of Education appointing authority change. So State Board of Education was and is 10 members. Act 73 changed the appointing authority for two members. So the governor prior to Act 73 appointed all 10 members. Now after Act 73, this is current law. This is already in effect. No contingencies. The governor appoints eight members, including two student members. And the speaker appoints one member and the Senate Committee on Committees appoints another member. The appointing authority that made the initial appointment will continue to fill that seat anytime there's a vacancy. The transition appointments, the speaker appoints the first vacancy in the Senate Committee on Committees, then the governor, and then it would be all the governor unless it was a vacancy in the seat that the speaker appointed, would be the speaker again, you get it. The governor retains removal authority over all 10 board members, no matter who appointed them. However, the original appointing authority gets to fill that vacancy. So if the governor removes the speaker appointment, the speaker gets to then fill the vacancy created by that removal. Again, that's all in effect right now. Section 27. This is the tuition section on how much they get. So section 27 is really part of the foundation formula, but because I'm the tuition person, it ended up in the chunk of Act 73 that I worked on. But section twenty seven and twenty eight is contingently effective. On 07/01/2028, if you look at the bottom of the slide, if new school districts are operational and the cost factor formula report is received by you all and you have an opportunity to enact legislation and consideration. So, basically, changes to how tuition is calculated don't take effect unless those contingencies are met. And those contingencies are the same for the foundation formula. So, this would be tuition under the foundation formula. And it's relatively simple, base and weights follow the student. So if you'll remember, the foundation formula has the legislature determining a base amount to assign each student. I believe it was 15,003.

[John (Office of Legislative Counsel)]: 33.

[Beth St. James (Office of Legislative Counsel)]: 33. So every student would be when you're looking at how much money a school district is gonna get, we start with every student gets $15,033. And then weights are applied on top of that depending on the characteristics of the student or the school district or school. So for tuition, the base and weights for that particular student are going to follow the student to wherever they're tuitioning to, whether that's a public school, an independent school, etcetera. That means every student has the potential to bring different money with them, depending on the weights that are applied to them. In addition to the tuition amount, a receiving school, so that's public or an independent school, may charge an additional fee up to 5% of the base amount. So 5% of that 15,033 for each student attending the receiving school in high school, so grades nine through 12, only if the receiving school has received approval from the state board to charge that fee and the electorate of the school district with at least one student attending the receiving school, Each school district with at least one student attending the receiving school has approved supplemental district spending for the purpose of the additional fee and an amount sufficient to cover the additional fee. So lots of hoops to jump through to even be able to apply that fee.

[Unidentified member of House Education Committee]: But that only applies to commissioning? Like it wouldn't apply to a public high school?

[Beth St. James (Office of Legislative Counsel)]: It applies to a public high school that is receiving tuition students.

[Unidentified member of House Education Committee]: And it wasn't in an operating this time. Like, also, sorry,

[Beth St. James (Office of Legislative Counsel)]: wouldn't be No, because they're not charging their resident students fees. That's where the concept of supplemental district spending comes into play. And John can get into that. Let's see. An improved independent school in Vermont functioning as an area CTE center cannot charge the additional fee, and we'll get into why in a second. And receiving schools that elect and are eligible to charge the additional fee are required to charge the same fee for everyone. So every student in every school district gets the same fee. And then section 28, also contingently effective on 07/01/2028 are all of the repeals of current law that would need to go away in order to make these changes make sense. Section 28A requires the State Board of Education to adopt rules to govern the approval process for the receiving school to charge that fee. And that approval process has to include requirement for the receiving school to demonstrate the fee is necessary to educate the students the fee is being applied to, and that the fees will not be used to shift costs elsewhere within the school's budget.

[Unidentified member of House Education Committee]: You guys are great. No

[Beth St. James (Office of Legislative Counsel)]: questions. Section 29, special education delivery report. You have that. I've linked to it here. It's also in the reports document that Matt has posted. Section 30 is the special education strategic plan. You have that report. I've linked to it here. It's also in the reports document. Section 31 gave AoE one new permanent classified position to support the three year strategic plan. Section 32 got bumped up with Section 33, unfortunately, and it gave the agency of education an appropriation of 2,865,000 from the general fund in fiscal year twenty twenty six for the enumerated reasons. And then section 33 gave AOE five pool positions, limited positions for the positions listed. And I think you heard testimony yesterday from the secretary on where they are on that. And that is all I was responsible. Thank you.

[Peter Conlon (Chair)]: Sorry, everybody. Opportunity for questions. Yes? I have

[Beth St. James (Office of Legislative Counsel)]: a question about the student representatives on the state board of ed. Are those voting students?

[Unidentified member of House Education Committee]: I could look.

[Peter Conlon (Chair)]: Thank you for that, but also thank you for all of the hot links throughout the report, really helpful.

[Beth St. James (Office of Legislative Counsel)]: If something doesn't work, please just have Matt reach out to me. Most of them are available on your website, some of them are not, so let me know if you

[Unidentified member of House Education Committee]: have trouble with anything. Okay.

[Peter Conlon (Chair)]: I have

[Beth St. James (Office of Legislative Counsel)]: not read all of them,

[Unidentified member of House Education Committee]: so please don't ask for questions. I was going to.

[John (Office of Legislative Counsel)]: Hello? Hi. You're asking that?

[Unidentified member of House Education Committee]: I'm

[John (Office of Legislative Counsel)]: Ray, obsolescent council. Share real quick. Okay. Where are we at? We're now at section 34. So that's starting on page 67 if you happen to be looking at the act, but I hope that you're not. So and then where are we at in title in law? We're at title 16, chapter 133, which is your state funding of public education. It's where all of your current ed spending concepts like that is the ed fund, all those pieces live. So I'm just gonna start out with an overview of the first set of sections I'm gonna go over. You If guys have appetite, I can walk through the education property tax changes as well. That does include it may be useful if you don't have full appetite to go through that to talk about supplemental district spending, which is situated within title 32. So we may just hit these and then the first title 32 pieces. But just as an overview, this is creating your foundation formula, your base amount, your pupil waiting, got some conforming changes, cleanup changes, the ed fund needs to pick up new supplemental district spending revenues, so some touches there, creation of reserve within the Ed Fund, a set of reports, and then some transition measures. Beth talked about these, but just to note, the foundation for the rollout is continually effective 07/01/2028. I'll show you that contingency language in just a second, but it's exactly as Beth described. For those sections that you see effective dates on passage, that's your reports, and then one technical cleanup piece. So here's that contingency language, two pieces, new school districts have assumed responsibility for education of resident students, and you've received that foundation form of the report under section 45a, which I'll talk about just briefly. You guys have had an opportunity to enact legislation in the inspiration of the report. So just for organizational purposes, because I've tried to group sections by topic rather than I'm trying to go sequentially, but I'd rather group by topic so it's a bit more intuitive. I'm gonna keep coming back to this table, and we'll fill out the table so you can see that we've handled all of the sections here. So first, we're starting out with the core creation of the foundation formula, your base and weights. That's sections thirty four and thirty five. So section 34 amends the definition section of chapter 133 to create that base amount of 15,033 per pupil that is inflation adjusted, so it will grow over time. And then we're switching from current ed spending payout for locally voted, locally funded budgets, sorry, statewide raise, but locally voted budgets to an educational opportunity payment that is determined in quite a different way. It's mathematical. You take your district's weighted long term membership and you just multiply it by that base amount of 15,033. It gives you your school district's educational opportunity payment, and that is the payment that is considered appropriate to educate those students. There are supplementary pieces as well, but that's your core foundation form of payout to the school districts. And then, of course, section 34 repeals and updates current education funding concepts to account for that new, foundation formula. Section 35, I don't have the figures here. If you're interested, I can jump to the text, but I thought high level, just probably more useful to talk about the general updates to the waiting section. I've listed them here, but just to talk about what you would have in FY twenty nine, the only grade level weight that exists after Act 73 is pre kindergarten, and that is, I think, meant to be updated at some point. So you've repealed grade level weights other than pre K. You've updated the economic disadvantage weight, it's just a slight tweak in that figure. We have an existing law, an English language learner weight, but it's not distinguished in any way, it's not broken out in any way. Act 73 breaks out that English language learner weight, and it distinguishes by proficiency level and formal education level. So for folks who had limited or interrupted formal education, they would get a separate weight as well, and you could get that on top of your proficiency level weights. It is worth noting that all of the weights are additive, so just keep that in mind. Stuck in one box, can pick up as a student, multiple weights. We currently have a census block grant approach for special education, and Act 73 adds special education rights, those census block grants are repealed. Special education rights distinguished by disability costs. There's three different categories there based on where a child's disability falls. And then lastly, small school and sparsity rights are repealed because those will be replaced, as you'll see shortly, with support grants. I'm gonna keep going unless Oops, I So let's jump to those support grants, and if you come back to the slide deck afterwards, I've given the page references at the top so you can see what corresponds to these topics. So section 37 adds your support grants. They are two separate grants, and you can receive both as a school. It is not something that, while it does go to the district because that's the entity to which payments are made, it is determined on the basis of schools rather than characteristics of the district, unlike existing sparsity, for instance, which is at the district level. So we've got a small school support grant and a sparse school support grant. The figures are there, but the eligibility conditions for small schools are fewer than 100 pupils in two year average enrollment, and then significantly, there's an annual determination by the state board to be small by necessity under standards established in section 8B. And then the sparse school support grant has a similar structure to it. A sparse school must be in a city, town, or incorporated village with less than 55 persons per square mile, and then annually determined by state board to be sparse by necessity, or I should say under standards consistent with those published by the state board of education to be sparse by necessity. I'll also note that this city, town, or incorporated village, you may recall discussions around zip code and other pieces. There's a report that's gonna be coming back. The big foundation formula report is gonna include as one of its considerations appropriate geographic metrics for sparsity, so that's something that may be influenced by future reports. As you might expect, a bunch of appeals need to happen to have these roll out, so just listing them here, a couple of note that I've already flagged. The census grant, special education twenty nine sixty one, that's repealed because you now have those special education weights. Similarly with the built out English language learners weight, you see the repeal of the categorical aid piece. This is not a full repeal, that full section, it's just a subsection that's being appealed. This will be super quick. There's just some technical and conforming changes throughout these sections, 36, 39, 40 and 45C. These are things just swapping out ed spending for EOP supplemental district spending, cleaning up some outdated language in the stabilization reserve section that references the enacting act from years ago, and then more substantively, section 45 c delayed the first meeting of the Ed Fund Advisory Committee by one year. It was initially scheduled to have its first meeting this past summer, and now that's been bumped to this summer, July 15. As you would expect, the changes that happen to title 32, which is gonna be the most complicated thing that I explained here, have some impacts within title 16 as well. Some of it is pretty substantial, so updates to the Ed Fund, change in the budget vote, which is probably the most important thing to hit here, and then the creation of a reserve. So section 38 is just giving a hold to the revenues for that supplemental district spending tax. Just we get to title 32, you can think about the funds that are raised for the foundation formula. It's just a uniform statewide education tax rate. It's unlike the current system of locally varying tax rates. It's a statewide education tax. The supplemental district spending tax is only imposed locally for districts that elect, that vote to pursue supplemental district spending, and those funds are raised entirely locally, much like the statewide education tax revenues, they will flow to the Ed Fund, but then they have a slightly different path, which if you look in the right column, there has created a reserve for supplemental district spending. This only picks up what is called recapture. I'll talk about that more in a second, But basically, any extra funds that are raised using the equalization measures of the supplemental district spending tax will go here, and they can be used to correct miscalculations with the supplemental district spending, or that could be used to decrease the following year's statewide education property tax rates, and we don't know what the extent of the recapture would be, but just know that the school district boundary configurations dramatically affect, potentially dramatically affect the amount of recapture that you could have, and any conversations around school district boundaries are likely to affect how you think about the equalization measures in Act 73. The last thing I wanted to hit here, which is quite large, is the difference in school budgets as envisioned under Act 73. So as we know, under the current system, school districts are formulating their budgets and then They're going out to voters to have support for their budgets, and so we don't know for some time what the actual impact on folks' property taxes are gonna be. In the new system, you're not gonna have a vote on that basic amount because it's covered by the foundation form. That's your base 15,033 multiplied by your weighted long term membership. The vote now, your school budget vote, is exclusively on your supplemental district spending. It's just what a school district might elect to spend above the educational opportunity payment, which means that some school districts may not have a vote. But if they do elect, you could vote on that supplemental district spending. And significantly too, the budget vote would show the resulting tax rate that is required to raise those funds, And the thinking is that it will be a good bit more certain than what is undertaken now, there would be a closer link between your voting behavior and the economic impact on it. And once I get to the supplemental district spending, it'll make some more sense as to how you could be more certain of those successes. We've got a few reports. So section 44 tests AOE with guidelines for minimum transportation to be provided and covered by transportation reimbursement grant. Section 45, JFOs reporting on inflationary measures, funding for pre k early care. Then significantly, section 45A, this is the report that's noted in the contingent effective date. Contracting with one or more contractors to recommend by end of this year updates to the cost factor foundation formula, that's considerations for moving from special education weights to a reliance on special education services, updates to any other weights as empirically necessary. So this could be quite a broad analysis of the foundation formula. Additionally, examining those sparsity measures, I noted the town, city, incorporated village for the sparsity support grants. This would include some consideration for what the best geographic measure is. Examining the cost of secondary students and whether a way would be appropriate for those, and accounting for CTE within the formula. That's the big report that you're receiving into this year, and it's part of that contingent effective date. Last thing I wanted to hit in these first ed finance sections are the transitionary measures for the first few years of the foundation formula rollout for fiscal years '29 through '32, and FY '29 is your first year of foundation formula rollout. This is a this is language that smooths the transition for school districts from their existing ed spending onto the educational opportunities payment. And the way that it works is hopefully pretty intuitive. You identify the gap, the transition gap between the district's f y twenty nine EOP, which is purely a function of that base, so weighted long term membership, and their f y twenty five ad spends. It is worth noting that is a fixed former ad spending year that we're referencing. That's already happened, and in part, I think the thinking around this was to avoid incentive effects. So you identify the gap between the district's FY twenty nine EOP their FY twenty five ad spending. It gives you a figure, and then you basically prorate that over five years. So those who have ad spending in FY '25 that is below their EOP, they'll gradually be moved upward to their FY '29 EOP, and then those that are above, the EOP will be moved downward over the next five years. So in FY '33, each school district would be fully transitioned onto the EOP they would receive as a function of foundation learning. So just high level for these sections.

[Unidentified member of House Education Committee]: Does it speak out on that how you compare just like the so the districts in this construct, FY '25 districts are very different than the districts that exist when we're on a foundation formula in FY '29. If we get into that.

[John (Office of Legislative Counsel)]: I think the best way to explain it is to highlight the yearly adjustment language. So what you're actually receiving as a school district is your EOP, and then it's just making an adjustment on the basis of that gap, but it's not giving you a different result just because you happen to have the FY '25 spending. You're still receiving the figure that you're meant to receive, is that the

[Unidentified member of House Education Committee]: Yeah, guess I'm trying to figure out how you would calculate the gap if, say, have a Chittenden, or Northwest a district of 22,000 students right now is twenty, thirty different districts that have different FY '25 spending, the gap in some of them is going to be quite different.

[John (Office of Legislative Counsel)]: Yep. So I think there's one question about if school district configurations change, you would have to address. That's

[Unidentified member of House Education Committee]: That said unresolved.

[John (Office of Legislative Counsel)]: I think that specific piece is, but otherwise I would just say the gap is intended to be fixed. And it's when we get to the homes Well, we may not go over the homestead rate transition, but we're having to do transitions on the basis of known information. And so it's giving discounts based on what we know and not on future. And the way that it's done is you know the total revenues that are needed because you can calculate these figures, and then it's ensured that the tax rate produces sufficient revenues to fund those. But it's correct that if you had school district configuration changes, we'd have to revisit how to do this or have language to say treat these school districts together for purposes of you know, something like that.

[Peter Conlon (Chair)]: I I apologize, but we were under fairly strict orders to Yes. Adjourn and head to the floor. There's a lot more here. We'll discuss as a committee about having you back to kind of walk through the rest of it. But to both of you, is really excellent power Thank you. Everybody, let's play the comeback after the floor. It'll be brief. Yeah. So let's just do that.