Vermont Legislature SmartTranscripts:

[Emilie Kornheiser (Chair)]: Good afternoon. This is, I believe, the final meeting of the Ways and Means Committee for this biennium. It is May 29. I still have no idea what date it is until I look

[Rebecca Holcombe (Member)]: at this newspaper. I'm glad

[Julia Richter (Joint Fiscal Office)]: that I've been consistent for two years.

[Emilie Kornheiser (Chair)]: And it's 02/22, and we are doing a walk through of final conference committee report on H nine forty nine, the yield bill. We have spent time on this every week since January, and I'm glad that we get to gather again to do this

[Julia Richter (Joint Fiscal Office)]: despite the very large room.

[Emilie Kornheiser (Chair)]: Julia, hello. So nice to see you. Can you take us through the bill via fiscal note or outlook or whatever you prefer to start with?

[Julia Richter (Joint Fiscal Office)]: Sure, absolutely. Julia Rutgers office. Do you want me to share my screen? Yes, please. So there are a number of documents posted on the committee page under my name. I think it probably makes sense to start with the fiscal

[Rebecca Holcombe (Member)]: note. And we're getting paper copies of

[Emilie Kornheiser (Chair)]: the fiscal note, but there's a paper jam in the copy room, and so they'll be here soon.

[Rebecca Holcombe (Member)]: The meantime has one. I believe

[Julia Richter (Joint Fiscal Office)]: there's going be a first source to turn on staring. Oh, do you want me to just start walking through it? Look, there she is. Oh, perfect.

[Rebecca Holcombe (Member)]: You can pass me down.

[John Grady (Office of Legislative Counsel)]: Thank you.

[Julia Richter (Joint Fiscal Office)]: So walking through the fiscal note, there are four documents on the community page under my name. There's the fiscal note, there's the education fund outlook, Then there's the two spreadsheets that were discussed by Rutland on the floor this morning during the caucus of the whole. I'm just going to go deep into each section. So section one, this is setting the yields and the rates. The construct that the Committee of Conference landed on was to use the $100,900,000 of one time general fund money all in fiscal year twenty twenty seven to uniformly lower property tax bills. Pivoting to the education fund outlook, I put together here the column B. This is reflecting what was passed out of the House. You'll recall that the House contract was to apply half of the $104,900,000 of one time general fund to uniformly lower property taxes and reserving the other half for buying down property taxes in the following year. The Senate construct was to use the 100,900,000 in general fund to uniformly lower property taxes in a single year. The difference in that $104,900,000 versus the 100,900,000 of general fund has to do with the one time expansion of the renter credit. So the Senate proposal had the one time expansion of the renter credit, which was estimated to cost $4,000,000 in FY '27. And this was what was adopted by the Canadian conference. So January used to uniformly lower bills in FY 'twenty seven and $4,000,000 to the regular credit. What we can see here in column D is the Committee of Conference report. So you can see the corresponding yields and rate, which would result in an estimated average uniform bill change of 3.5%. So that's across homestead, non homestead, and income sensitized property taxpayers. The latest education spending information that we have is that education spending is estimated to grow by 3.8% FY '26 and FY '27. Moving down, we can see the underlying policy decisions that inform those yields, the $9.33 purchase and use in meals and rooms change, and then of course, the one time general fund transfer of 100.9. We see where you haven't gotten here yet, but the $9.49, the TIF payment that you voted out of waive means still is within this construct. You can see no money is put towards additional reserves. However, the stabilization reserve is fully funded. So that is the yield construct as reported by the webcast

[Rebecca Holcombe (Member)]: Yeah. Thank you so much. Very helpful to get this. So the final rate is lower than what people expected when they voted on budgets, because the final rate post buy down is 3.5 until its spending is up. I

[Julia Richter (Joint Fiscal Office)]: don't know what voters were told when they voted on their budgets. Each school district each school board decides to use a different field. It is lower than what was forecasted in the December '1 letter.

[Rebecca Holcombe (Member)]: Can you guesstimate and obviously, so many things change, so anything's a guesstimate. Can you guesstimate what the impact of using $100,000,000 this year is on budgeting process next year?

[Julia Richter (Joint Fiscal Office)]: I can't speak to how it will impact school board budgeting processes. What we do know is that using one time money in one year means that the overall property tax burden is artificially lowered or lowered one time, meaning that in the following year, we not only will need to make up the difference from that buy down, but then however much has grown on top of that. So we'll see

[Rebecca Holcombe (Member)]: a larger increase year over year without additional one time money. Is that something we can get modeling of based on prior what impact that's likely to have on tax rates next year? What I'm mindful of is every year, we started this year talking about digit increases in tax rates, and school spending only went up 3.9%, and now it's going to be 3.5%. No one's going to remember that, they're just going to remember how fast that spending is growing. We're going to start next year with the same narrative. And I'm just wondering, is there some way to educate people about that in the public so we With can have that respect to

[Julia Richter (Joint Fiscal Office)]: how the school board will respond, I don't know. I did present the modeling in this committee about a month ago that showed the different impacts of different buy down amounts using a whole host of assumptions. I believe I also wrote a memo to the speaker that's posted on the speaker's website. Beyond that, I don't know what else we could do.

[Emilie Kornheiser (Chair)]: Thanks, Julia. Anyone else have any questions?

[Rebecca Holcombe (Member)]: Yeah. Are you asking just for questions on the EdFund outlook? Or are you asking Sure. So if do that,

[Emilie Kornheiser (Chair)]: and then we can Julia can take us for other documents.

[Rebecca Holcombe (Member)]: Questions on other Okay.

[Emilie Kornheiser (Chair)]: But Okay. More questions on the. Okay. Is do you have a preference on which document we go to next? Or do you have a preference,

[Rebecca Holcombe (Member)]: Julia, on which document we go to

[Julia Richter (Joint Fiscal Office)]: I defer to the committee and what is most helpful. Okay. I thought we could briefly walk through what is in nine forty nine is passed by the committee of conference to understand all of the pieces and then move to the spreadsheets. But if everyone That sounds great. Let's do that. Okay. So that's the yields and rates. Going back to the fiscal notes. Section two, this amends the exemption within the current law excess spending. So recall, the excess spending adjustment means that education spending above the excess spending threshold is subject to double tax. Under current law, there's one exemption that's for voter approved principal and interest payments on bonds that were approved prior to 07/01/2024. The Committee of Conference report amends that temporal condition to push it out. So it's all bond payments bonds approved prior to 07/01/2026, would be exempt from the excess spending threshold. According to data from the Bond Bank, you'll recall we spoke about this in committee, there are 11 districts that would be eligible for this exclusion, estimated to be approximately $11,600,000 in the annual debt service. That said, at least in FY27, all but one of those school districts sit below the excess spending threshold. So that doesn't mean necessarily 11.6 more in exclusions that will impact the amount raised from the excess spending.

[Rebecca Holcombe (Member)]: Just for credit, so this would increase spending on other folks if this is also now counted. Can someone just remind me, CHIP, we're starting to withhold revenues from the Ed Fund? When are we going to start to feel that on property taxes?

[Julia Richter (Joint Fiscal Office)]: I am not the CHIP expert. I would ask John. And if John doesn't know, I would need

[Bridget Burkhardt (Clerk)]: to call my colleague, Ted.

[John Grady (Office of Legislative Counsel)]: John Grady, Office of Legislative Counsel. I don't think we know yet. I mean, I think the program is currently being stood up and applications would need to go through, but then we wouldn't see any effects on

[Bridget Burkhardt (Clerk)]: the fund until retention started.

[John Grady (Office of Legislative Counsel)]: So I don't know how quickly, but it takes a look. It's not immediate.

[Emilie Kornheiser (Chair)]: Thanks, John.

[Julia Richter (Joint Fiscal Office)]: Section three, same as what you passed out of your committee. This is that technical correction and street wide adjustment. Section four, same as what you passed out of the house. This is the transfer to the Department of Taxes. This is for the tip overpayment to the city of Barrie for $150,576 This is included in the estimates of the yields and the rate. Section five, also this was included in September as passed out of the House. This is that inflation adjustment to the special education census grant. Section six and seven, these are new as were passed out of the House. Sections six and seven, these are the sections that would amend the excess spending adjustment. I know there's a lot of words on the page, but essentially, the way that this would work is so that in FY28, taking a step back, we know that the excess spending threshold is calculated by taking the FY25 average per pupil spending, increasing it by inflation, and then multiplying it by 118%. That's current law. That's how the threshold is calculated. And then all of the spending above that threshold is what is subject to double taxation absent those excluded block payments. So that's current law. Sections six and seven amend that calculation so that in FY '28, the threshold is calculated by still taking the average FY '25 per people spend increased by inflation. And rather than multiplying it by 118%, it will now be multiplied by 115.5%. FY '29, that goes down by one percentage point, so then it's multiplied by one hundred and fourteen fourteen point five percent. Dependent on what happens with H95 and the foundation formula, I don't want to get ahead of anything, that is the year that the foundation formula is estimated to take effect. So if the foundation formula takes effect, then there no longer is an excess spending penalty or an excess spending threshold because the financing system is completely changed. So what we see here is if the foundation formula does not take effect as is contemplated in H95, then what happens? And per the September construct, what would happen would be the excess spending threshold would continue, and

[Bridget Burkhardt (Clerk)]: it

[Julia Richter (Joint Fiscal Office)]: would continue to decrease over a couple of years until it flattens out. So in FY30, it would decrease another percentage point down to 113.5, in 'thirty one down to 113, and then in 'thirty two, FY 'thirty two, would decrease to 112.5%, and then would continue in perpetuity unless at some point the foundation formula comes into effect and all of the financing changes you've all talked about come into effect,

[Emilie Kornheiser (Chair)]: and then none of this no longer applies. And right now in September, as the conference committee report has the foundation formula if we meet the contingencies being effective for fiscal year 2030. Correct. So that we would be essentially wrapped this Yield bill construct at 114.5.

[Julia Richter (Joint Fiscal Office)]: Correct.

[Emilie Kornheiser (Chair)]: Thank you.

[Julia Richter (Joint Fiscal Office)]: And we know that the base amount in, excuse me, in Act 73 increased by inflation would equal the 114.2%.

[Rebecca Holcombe (Member)]: In 2030?

[Julia Richter (Joint Fiscal Office)]: In every year. If we take a step back and we think about how much So the 73 base amount is the $15,033 increased We by can get to that $15,033 by taking the FY 'twenty five average per pupil spend, increasing it by inflation, and multiplying it by 114.2%. And that, too, would bring us to the base.

[Rebecca Holcombe (Member)]: I have a series of questions. I don't know how you want to handle it. So, one of my questions is, it seems to me that there's a bit of an inflation mismatch. So the base number that we're using before we add any of the percentages to get to the threshold is going to be increased by NIFA, which is right now running at three point something. We know that school district budget inflation pressure

[Julia Richter (Joint Fiscal Office)]: on school districts anyway is much higher

[Rebecca Holcombe (Member)]: than that because a big percentage is salary increases and benefits increases that are growing faster than general inflation. So, is it true that we're putting additional pressure on school districts, not just by lowering that percentage to calculate the threshold, but that the base as well that we're calculating that threshold on is growing slower than the pressure on school district budgets?

[Julia Richter (Joint Fiscal Office)]: I don't think I can answer that. I think that that is really a question for how you identify what are the pressures that are within a school district's control and outside of a school district's control. And that's not my place to say. So let

[Bridget Burkhardt (Clerk)]: me reframe it, and you don't have

[Julia Richter (Joint Fiscal Office)]: to answer it. I just

[Rebecca Holcombe (Member)]: want to share my thinking with the committee.

[Julia Richter (Joint Fiscal Office)]: All things being equal, we like to

[Rebecca Holcombe (Member)]: say that, right? If all things were equal, if we didn't hire any more staff, we didn't change any programming, we didn't do anything differently, We're going to have healthcare costs that are still, even though we've done a lot of hard work to bring the increases down, those increases are still seven plus percentage points a year. And our legacy contracts and all of that with our staff and our teachers and our administrators, and most districts are going up a lot faster. So, that's my concern, is that we've got pressure to grow school budgets. And the only way to do that without to keep within inflation. For example, in one of the two districts that I represent, this year, decided to cap ed spending growth at 3.5%, which was the inflation number that we had looked at a couple months before the budget had to be finalized. And that required making cuts.

[Julia Richter (Joint Fiscal Office)]: It required cutting teachers and it required cutting programs and consolidating things.

[Rebecca Holcombe (Member)]: And I think that's true in most places, not every place, but most places, flat funding or only growing by inflation is really challenging for districts. And so, I'm just concerned that there's a bit of a development here. I have a question from a colleague that I got asked on the floor, and I just wanted to make sure that my lines were precise when

[Julia Richter (Joint Fiscal Office)]: I was answering that question, which is what happens with districts that have reserves already? Do those reserves help them stay below the excess spending threshold? They could, depending on how the district decided to use those reserves. So you think about the way that the excess spending threshold works is it's comparing a district's per weighted pupil spending to the threshold. And the way that that per weighted pupil spending is calculated is by taking a district's total education spending and dividing it by its weighted pupil count. Going deeper into that formula, the education spending is calculated by taking the district's total budget and subtracting its offsetting revenues, which of course is categorical aid from federal and state government, but could also include a district pulling monies from reserve. So a district could choose if they had significant reserves to pull money from the reserve to use as offsetting revenues, assuming that the reserve value were permitted to be used in such way to decrease their overall education spend, which could help them to sit either below or closer to the threshold than if those reserve dollars have been used. And just to make sure I'm clear, none of

[Rebecca Holcombe (Member)]: the reserves were taken into account when we were looking at this. Just trying to think through how the spreadsheet would have been created.

[Julia Richter (Joint Fiscal Office)]: Sure. So happy to talk about the spreadsheet. Rev Kimbell did a perfect job walking through it this morning. I'm happy follow-up again if that would be helpful.

[Emilie Kornheiser (Chair)]: And before we say, I just want to jump in with a few things. One, as a reminder that we did put reserve guidance in, I think we've got all of that should be coming soon to address some of what your questions are about. Representative Burkhardt also just want to flag, we need to wrap up at three for some other All the other things. And so just wanted to make sure that everyone That we're getting through all the documents that folks want to look at, and then folks are getting their questions answered. So, Representative Holcombe, then if anyone else who has not asked a question, to

[Rebecca Holcombe (Member)]: ask think the research question is really important because we have districts that, because they thought we were getting double digit increases this year, used their own reserves to cushion themselves. And now we've added one time on top of that. They are in so much trouble next year. And that's arbitrary who's in that position. So I do think this stuff matters. The other thing I'm not sure, did the committee of conference discuss the continued issues in 01/2027 and how that's going to interact with this? No, but we discussed that in committee at some point. Not as it relates to excess spending, though. We didn't talk about that in committee, and we also didn't talk about the weights and some of the issues of the weights and how that arbitrarily affects subject to the access. I think we definitely discussed that topic in committee. We did not model to do that. I'm sorry. We did not.

[Emilie Kornheiser (Chair)]: So, anyone make questions for Julia?

[Rebecca Holcombe (Member)]: I'm going to seed my next question to Bridget, because have the same question she has on the

[Julia Richter (Joint Fiscal Office)]: Do you want me to answer the reserves question? I'm happy to. I think it's quite quick. I would say the reserves have been accounted for in the sense that reserves that were used to buy down budgets to education spending sit within this column C, the calculation of excess spending, the calculation of education spending. But my point is that in the out years,

[Rebecca Holcombe (Member)]: there's been no calculation that says, Okay, this is what FY 'twenty seven spending is. So yes, that contains some decisions that were made about where they were going to set spending based on those reserves. But there was no calculation that went deeper into district budgets to say, Here are these reserves that might be used to keep people. This just basically takes straight FY27 spending and compares it in all future years as if it doesn't change.

[Julia Richter (Joint Fiscal Office)]: Yes, that is correct. I did not go into each district's budget and look at what they have to serve.

[Emilie Kornheiser (Chair)]: And folks, we're not here to put Julie Richie on top.

[Rebecca Holcombe (Member)]: I'm just trying to

[Julia Richter (Joint Fiscal Office)]: make sure that I can answer questions that colleagues are asking our committee clearly before we have to vote on this. And I'm sorry if it comes to process. I'm not, Julie.

[Rebecca Holcombe (Member)]: You know I respect you and adore you. Think you've got amazing work. I'm just trying to make sure that I can represent your work clearly when people ask me questions about, which will happen. Another question I have is a question that I've probably asked the wrong people a couple of times, but I wanted to clarify it with you. In this whole construct that we're trying to ramp down to the base amount in the foundation form, that 15,033, my understanding is that when districts get a payment out of the foundation formula, they're going get that 15,033 with all the weights applied based on their pupils. And then there'll be categorical grants as well. And that will be part of this whole payment that districts are getting from the head fund. Is that correct?

[Julia Richter (Joint Fiscal Office)]: That depends on future policy decisions. So what we have right now established in Act 73 is the education opportunity payment, which is correct. That is the base amount multiplied by the weighted student count. Act 73 and H955 further amend the small and sparse by necessity, small school grants, which would fit next to the education opportunity payment. There's also language in about school protection aid. So there are pieces that are being worked on. To the extent that there will be additional categorical aid going to school districts in addition to the education opportunity payment still depends in part on outstanding policy choices of what those categorical aid programs would be, the amount of funds attributed to the categorical aid, how those funds are distributed. So what the future funding state looks like, we don't know until all of those choices have been made.

[Rebecca Holcombe (Member)]: Can you remind me which traces we've opened last year in addition to the 15? Was it just small and small? I thought it was more than that. I thought there were other things that we had not quite accounted for. For example, CTE funding and things like that, that we had not really factored into that 15,033?

[Julia Richter (Joint Fiscal Office)]: Oh, yeah. I would say there are a host of outstanding policy choices regarding the foundation formulas, certainly. So school construction, I know that's been worked on significantly in H95 CTE. The report that JFO is contracting, working on right now is looking at a special education weighting and geographic cost differences and differences. I'm totally talking about transportation. Transportation. And those are issues that haven't been decided how they'll be funded or if they will be funded or by how much.

[Rebecca Holcombe (Member)]: So that's my concern because we've been talking about how all your long been talking about how you can't compare current ed spending to future state spending because they're apples to pomegranates. And my worry is that in this idea that we're ramping from current spending down to the foundation formula, we're trying to ramp from apples to pomegranates. We're trying to ramp total ad spending right now for people down to a lower number that's ignoring some of these other policy choices that we need to make.

[Julia Richter (Joint Fiscal Office)]: That's not my place to say one way or the other. Those are false choices.

[Rebecca Holcombe (Member)]: Can we just confirm? Representative Holcombe, do you have a question? Yes, I do, please. Thank you. When Professor Colby came in and presented draft numbers last year, it wasn't based on recent data. It was based on projecting forward based on inflation from previous analysis. What was the base year of data that was used to generate those forward projections for the purpose of estimating I 15

[Julia Richter (Joint Fiscal Office)]: do not remember off the top of my head. I'm happy

[Rebecca Holcombe (Member)]: to share that memo back around with the committee. And it was the 01/2027 data that she was projecting forward?

[Julia Richter (Joint Fiscal Office)]: No, it was the By the 01/2027 data, do you mean the data that went into the people weights that were adopted in 01/2027?

[Rebecca Holcombe (Member)]: Is she projecting forward from that study?

[Julia Richter (Joint Fiscal Office)]: In part, the methodology was used, and she received new years of data on top of the data that was used in that 01/2027 study.

[Emilie Kornheiser (Chair)]: That would be great if you can send that to us.

[Rebecca Holcombe (Member)]: For the committee, why it matters is we have passed new legislation, which also creates new implications for school budgets. And if we're using data and just projecting forward, we're now ratcheting people down to a number that is based on pre policy decision data. Just the same.

[Emilie Kornheiser (Chair)]: We have a study coming back in December that's updating those numbers much more. Anyone else have any other questions about these documents?

[Rebecca Holcombe (Member)]: Although I don't. I know she has one last. Yeah, absolutely. Carol, you don't have to it's Okay. I just want to be clear. And I'm making an assumption based on how the spreadsheet is laid out, that there were no assumptions made about changes to long term weighted out of standard membership into the out years. So we're assuming, just for purposes of the exercise, that

[Julia Richter (Joint Fiscal Office)]: LTW ABM states the same? I appreciate the questions. I think it would be helpful to sort of take a step back and say what these spreadsheets are and are not capturing. As Rebecca Holcombe mentioned on the floor today, JFO cannot estimate future school district decisions, and we are not able to forecast the weighted pupil count in the city going forward. Unless we were to undertake a significant amount of work, it would probably need more resources. So to that said, we were asked, we want to see what it would look like if the excess spending threshold were calculated differently in FY27 as a way to wrap our heads around the kind of changes that are being contemplated. And so what you're looking at here is not a forward projection. It is not an estimate of what the excess spending threshold will look like in fiscal year 'twenty eight, fiscal year 'twenty nine. It's simply saying, in fiscal year 2027, the excess spending threshold is calculated using 118. This is that threshold amount. There is eight districts that are over the threshold, and they're over the threshold at a sub amount of $4,300,000 If the threshold in FY 'twenty seven, using FY 'twenty seven education spending, FY 'twenty seven long term weighted AUM, to your point, were calculated using a different percentage, what would the impacts be? And that is all this is capturing.

[Rebecca Holcombe (Member)]: Thank you for clarifying that. I just wanted to be clear because school spending is often a step function. It can't be ratcheted down pupil by pupil by pupil. It's a chunk of pupils go away and then some spending can go away. And so my concern is that we're underestimating how many school districts are potentially going to hit the excess spending threshold that ratchets down because there are all those pressures on school budgets and also declining long term rate in ABM in a lot of these districts. And so I'm just worried that we're underestimating. And not saying that you did a bad job or you did anything that you weren't asked to do. I'm just saying that when you do analysis, you say sort of where the sensitivities are and where the potential challenges are. And to me, that's a potential challenge of looking at.

[Julia Richter (Joint Fiscal Office)]: Yeah. And I guess I just, I would follow-up and I would say, I don't see this as being an underestimate because this is not a future projection. This is saying if the thresholds were calculated in FY 'twenty seven using a different percentage, here is what it would look like. And so if the threshold were to have been changed for FY27, these are what those impacts are.

[Rebecca Holcombe (Member)]: I understand. Thanks, Juliet. Julia, can you help me?

[Bridget Burkhardt (Clerk)]: We don't have our handy dandy ways and means calendar chart in

[Emilie Kornheiser (Chair)]: this room. I never knew you appreciated that.

[Rebecca Holcombe (Member)]: I love the calendar,

[Bridget Burkhardt (Clerk)]: it's one of my favorite.

[Julia Richter (Joint Fiscal Office)]: Could you just remind me,

[Bridget Burkhardt (Clerk)]: per the we can't buy in the hands of any future lunches, folks can come back in January and decide to change pretty much everything that we can here. Could you walk me through,

[Julia Richter (Joint Fiscal Office)]: basically, is there anything that

[Bridget Burkhardt (Clerk)]: we do from here that would be too late to change when the legislature reconvenes in January? How much of this is said still in the first? Agree completely with the representative for correct that there's a lot of stuff about education transformation that we have not figured out yet that they have not finalized. And I think that we should be revisiting all of these mechanisms every year to tinker with things and have them move forward with transformation. So between the school budgets, the school board setting their budgets, warning them about all of that stuff, what are we locking in here?

[Julia Richter (Joint Fiscal Office)]: Yeah, that's a really interesting question. I'm gonna try to answer it and then I might call on John to see if he has other thoughts. The first thing that comes to mind is with respect to the excess spending threshold, we know that school districts start to build their budgets in late summer, early fall for the upcoming fiscal year. And the excess spending threshold is calculated and communicated to school districts in the fall. To the extent that school districts are building their budgets in accordance with what the excess spending threshold is going to be in the upcoming fiscal year, that amount will have been communicated to them prior to the legislature reconvening. School districts vote on their budgets, typically not always, on town meeting day. And the legislative session starts in early January. So that gives you a couple of months where if there were to be try to be a change for the same year, and you would want school districts to be able to account for that, the budgets they're putting to voters, if you, I don't know, I'm too tired to think of number of weeks right here. But before the budgets are voted on, need to be warned and they need to be printed, so you come back to that. John, do you have any other thoughts on this?

[John Grady (Office of Legislative Counsel)]: I think you gave a super helpful slide.

[Emilie Kornheiser (Chair)]: Who are you?

[John Grady (Office of Legislative Counsel)]: I'm John Grant. I think you gave a super helpful like pragmatic practical only ground answer. If it's helpful, I'm happy to talk about in just a simple way the things that are locked in immediately. I would raise these in terms of effective dates just from yield bill, if that is helpful.

[Rebecca Holcombe (Member)]: Yeah, thank you.

[John Grady (Office of Legislative Counsel)]: So obviously the yields themselves are for FY27, so that's a lot. But a couple of things that stand out as not lock. I won't speak to the pieces that are effective 07/01/2026. It's obviously the yields for FY '27, the technical fixes related to refund in those pieces, But for the excess spending exemption extension, that's for that 07/01/2024 to 07/01/2026, that doesn't kick in until FY twenty eighth. But there's time to think more about that. And I think it's also paired with discussions around the legacy debt A piece, which of course is an effect of the foundation itself. So you might expect some continued discussion there. For the future excess spending thresholds that schedule of the 115.5 down to potentially 112.5, but that should just be 114.5. If you go to foundation formula that doesn't begin until FY 2018, but still time on those pieces. And obviously even once you've heard that schedule, there's still time for the following updates. The renter credit expansion would go ahead and have it, that's kind of locked in. The circuit breaker expansion isn't until about '28, although I don't expect people to have different feelings about that. And then the tuition fees related to FY twenty eight-thirty two, again, you would have time to think of the speed. I do want to follow-up

[Bridget Burkhardt (Clerk)]: before Betsy James. I assume this is your Betsy James. Can you remind me when the merger committee reports are due back to us?

[Julia Richter (Joint Fiscal Office)]: Yes, at St. James Office of Legislative Council, you're going to get a preliminary, your first report back in February of 'twenty seven with membership and any information that's available at that time. You're going to get another report in 12/01/2017. You're gonna get an interim report in '27 at the very end of the year after the merger committees have finished their work when a vote has not happened yet. And then you're going to get a final report in December 2018 with all the lay of the land after the dust has settled.

[Bridget Burkhardt (Clerk)]: Right, so because I imagine that when these merger committees are doing their work, they're going to be looking at things such as what their long term weighted ATM would be theoretically under a merged district, what that average per pupil spend would end up at in that merged district.

[Emilie Kornheiser (Chair)]: You don't even imagine they're required to, I believe.

[Bridget Burkhardt (Clerk)]: Sure. Either way, those are things that are going to be on the table and we will have time to adjust these numbers at least post FY20, not as we're receiving all of that information, but it's many, many years for education, parental nation. Point is we have time to check back on all of

[Emilie Kornheiser (Chair)]: these things and adjust them further if these numbers on this paper do not work two years from now. Thank you. I think we need to wrap now to get to our next-

[Rebecca Holcombe (Member)]: I just say one thing.

[Julia Richter (Joint Fiscal Office)]: Mean, really, I feel like

[Rebecca Holcombe (Member)]: I have to just respond to that. And it's very awkward when someone's always in the chair because you don't get a chance to talk as a committee. So this is not about you, Julia. If we all recall this year, there was a very substantial data error at the Agency of Education around the long term rate of ABM in the district. They had to put a budget together using that incorrect number, and they discovered it too late to correct. Districts are already talking now about what they're going to cut. This affects, it may not be, we may be able to come back and change the law, but we can't change the fact that they are going to start having impacts locally the minute we start passing this. I've been hearing already about districts that are losing teachers. Having said, I'm going to New Hampshire because the policy environment is more stable. They can't take their risk if they don't know what's coming, and people who can move far. So this is going to affect districts. I'm not saying yes or no. I'm just saying we should never assume that the decisions we make, particularly punitive decisions, are not having an impact on real people and other people's children. So this will have an impact, even if we go back and fix things after the fact.

[Emilie Kornheiser (Chair)]: Thank you. Thank you, Representative Holcombe. Thank you, everyone. I want to take this moment to thank you all for an incredible, vital, projective, somewhat wild biennium, and take another moment to really appreciate all of our staff with Extra Appreciation Consortium. We did not catch the last hit staff appreciations.