Vermont Legislature SmartTranscripts:

[Speaker 0]: Good afternoon, everybody. This is a joint hearing between the House Education Committee and the Senate Education Committee. We're continuing our work on Act 73. Yesterday, we heard the report of the task force, and that was some task force members, co chairs and member. And today, we're continuing we're still in our first week of the session, getting our feedback under us on this issue, and today we want to hear from, we're going to hear from Jan. From the the NEA, the Royal School Boards Association, and the Royal Principals Association. A combination of reaction to the report of the task force, and maybe more importantly, your thoughts about how the two committees, or how you'd like to see this process end up. So,

[Rep. Peter Conlon (Chair, House Education Committee)]: kind

[Speaker 0]: of shows those two things, and then that goes from 01:30 to three and then 03:00 we're going to have the secretary end, and it's sort of the same question. So we should have time for a break before we start the 03:00 session, just to give people a sense of where we are. And probably even though I think all of us in this room pretty much know each other, we should probably do the usual and go around and introduce ourselves because people are watching far. And why don't we start with what I know is the newest member on this committee?

[Rep. Leland Morgan]: Name is Leland Morgan. I represent Grand Isle County in the western portion of the town of Milton.

[Sen. Nader Hashim]: My name is Leanne Harpel and I represent Orleans 4 which is Albany, Craftsbury, Greensboro, Clever.

[Sen. Steven Heffernan]: Steven Heffernan, Madison County District. Live in Bristol.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: Joshua Dobrevich, I represent Williamstown and Chelsea.

[Sen. Terry Williams (Clerk)]: Terry Williams, Rutland District Senator.

[Sen. Nader Hashim]: Nader Hashim, Senator from Windham County.

[Speaker 0]: Seth Bongartz, represent the Bennington Senate District, Chair of the Senate Education Committee.

[Rep. Peter Conlon (Chair, House Education Committee)]: Peter Coleman, I represent five small towns in Addison County and Chair of the House Education Committee.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: Good afternoon, Senator David Weeks, representing Rutland County.

[Sen. Nader Hashim]: Chris Taylor, representing Milton in a small part of Georgia. Jenna Brown, I represent the town of Richmond. Ram Hunter, banked at four.

[Rep. Emily Long]: Emily Long, Windham Pike.

[Jeff Fannon (Executive Director, Vermont-NEA)]: And I am Jeff Bongartz. Yeah.

[Speaker 0]: I'm sorry. That was a bit yeah.

[Rep. Peter Conlon (Chair, House Education Committee)]: Sorry. Oh, that was a lot here.

[Sen. Nader Hashim]: So is

[Speaker 0]: this oh, I'm sorry. We we left off one person on the screen. Oh, yeah. Senator Ron Hinsdale, who will

[Rep. Emily Long]: introduce herself.

[Sen. Kesha Ram Hinsdale]: Yes. So happy to be forgotten today, but here to listen. Senator Ram Hinsdale from Chittenden County.

[Jeff Fannon (Executive Director, Vermont-NEA)]: Good afternoon. Jeff Bannon, executive director of Vermont NEA. I prepared my comments to I was invited by Stephanie, thank you. I thought it was just the Senate education, so I apologize to my house friends and the committee there. But your written comments are with that, I think, on the website, I assume. If you have any questions, let me know. I'll go through those and happy to stop me or wait till the end for any questions. As you said, first off, Jeff Fannington, Executive Director for Montague, represents some 13,000 school employees. And actually, those are members. Then some 16,000 educators statewide represent them in matters of health care and other issues that come before them. So thank you for reminding me to share with you some thoughts about Act 73 and the redistricting task force, as well as discuss NEA's 2026 legislative agenda. I want to acknowledge and appreciate this committee, the Senate Education Committee, again apologies to the House, for traveling around the state in November and December and meeting with schools and members and students and community members in those places. And you get to see the hard and amazing work that's happening in our local public schools. Spending a full day in a school helps to give you a sense of the realities on the ground. And we hope that as you embark on your work this session, you hold on tightly to the voices of the students and educators with whom you heard and met. It is their good work and their successes and challenges every day in every school in our community that grounds our work the building. And I hope that it will guide you as you go forward. Vermontony believes the school district and task force outlined a reasonable approach to forming new local public school districts that rightfully calls for seeking strategic and incentivized through voluntary configured, though not voluntarily configured, mergers that make sense in those communities over a reasonable timeline. The task force took a measured approach to its work and used facts and evidence to support its recommendations. That work included recommending five CESAs, the Cooperative Education Service regions, that are similar to BOCES that you passed a couple of years ago, that 40 other states already have in place and what Vermont now allows pursuant to Acts 168 from 2024. These five regional CESAs would allow school districts to streamline services, purchases of goods and services, and other cost saving measures. Finally, the task force recommended larger, comprehensive regional high schools that would be voluntary, visioned, and incentivized through construction aid support to better offer student to offer better student academics, access to CTE locally, and improve physical plants. Of course, there would need to be school construction aid, but with the second oldest nation the second oldest in the nation's school infrastructure already, this was an existing priority, and the task force again thoughtfully combined the consolidation goals of Act 73 with the reality on the ground. The task force's recommendations are not perfect. But we do applaud their work and efforts to achieve the goals of Act 73 in a very time constrained period without necessary data and supports necessary for such an undertaking. We agree that change is essential and Vermont and Nieh policy priorities recognize that reality. They're also included. Romanian Yates legislative priorities are attached, but I want to lift up one of those issues in particular. The issue of property tax relief is a strategic goal for Romanian Yates shares with what I imagine is every member of the general assembly. We think it's long past due to abolish the property tax, the residential property tax, and instead move to an income tax with which to fund education. The details of that proposal are also attached. In short, the goal is to fix the income sensitivity cliffs, rebalance the Ed fund to remove expenses that previously were general fund obligations that were shifted to the property tax, eliminate the residential property tax. The time is now to make these changes, and it can and should be done while we follow the recommendations of the task force. I would be remiss if I did not thank you for your successful work in establishing reference based pricing to rein in hospital costs. That goes for the House and Senate. It was a law that was passed last year, Act 68. That law, when implemented fully in 2027, will save tens of millions of dollars for school districts and school employees. That is a win win that will make a difference going forward. And it is the type of collaborative legislating that will reduce taxes. Additionally, your work to cap the cost of hospital administered medication under Act 55, combined with the October 25 budget orders by the Green Mountain Care Board and the work of the VHI, the Vermont Education Health Initiative, which is the jointly administered trust between school boards and school employees, their board of directors, that will result in an additional savings of $40,000,000 starting 07/01/2026. And that's a reduction of property taxpayers and the 35,000 Vermonters on those VHI plans. The road ahead is hard, but we know the direction we must go to realize health care affordability for all Vermonters. I will end by noting that our members, teachers, bus drivers, paraeducators, school counselors, food service workers, get up every day to give Vermont students their all. Thank you. As governor Scott noted, they are working under trying and challenging circumstances with more and more students and families struggling. And those struggles show up every day in our schools across the state. Last year, because of local school budget cuts, we know that over 400 educators lost their jobs. And we are anticipating this year it will be similar, a similar number. Collectively, this was the single largest job loss in Vermont made by an employer, private or public. These cuts affect kids, the opportunities they have to access to, and middle class jobs in our communities. The work ahead is hard, but please do not lose sight of the kids, communities and Vermonters who will be impacted by your decisions for decades to come. Thank you for giving me some time today, and happy to answer any questions.

[Speaker 0]: Questions? We're on this table.

[Rep. Peter Conlon (Chair, House Education Committee)]: I'll kick things off if that's okay. Thank you. And thanks for, I think, elevating the 400 educators who lost their jobs. That's the system we have today. I think Act 73 was really trying to come up with a system where that didn't become, frankly, the norm. I think it has become the norm. Could you talk a little bit about anything within Act 73 that the NEA does support? And the things that it very much supposes?

[Jeff Fannon (Executive Director, Vermont-NEA)]: I'm going stick to the report. The report called for voluntary incentivized mergers.

[Rep. Peter Conlon (Chair, House Education Committee)]: I'm talking about the debt.

[Jeff Fannon (Executive Director, Vermont-NEA)]: You've got the three things that went into immediate effect: school calendar, student teacher ratios, if you will, class size. And then the I'm not blank onethree. Calendar, school class size, help me out. Graduation requirements. Graduation requirements, right. So the graduation requirements are being developed, or at least they're rolling out. And that seems to make sense. We've met with Aaron Davis from the AOE about those. Those seem good and productive. Class size, it's I think it's hard for Montpelier to dictate what a class size should be in Cornwall or any other small town in Vermont. So I think that's a problem for us. I do think a lengthy bill, and I haven't looked at it. You're asking me the bill, I've been focused on the report. That's my problem. So I would say that there are things in there that we did agree with. We acknowledge that it's essential to make change as we have a declining student enrollment. And we just think it should be done locally, and with a much more presence of the local voice. That's the challenge there. So I don't recall the exact provisions of the law. Like I said, I prepped working at the report, I thought that's what we were talking about today. But I'm happy to come back and give you a fuller, richer discussion about that.

[Speaker 0]: Thank you. So maybe picking up a little bit on the questions from chair Conway. For the last several years, we have brought down the property tax rate by dumping money into the funnel, if you will, and we've done that to the tune of a couple $100,000,000 annually and not quite that much, but that's what the gap appears to be this year if we were to do the same thing again. Each year we do that, as you know, it actually makes it worse the next year because this year for instance we had 5% increases, well it looks like 5% increases across the board, but it's going to cost 12% to make it up partially because we keep doing what we've been doing. And so one of the questions I have or at least ask you to think about is whether you agree that we need to do like immediately to really bring down the need to keep doing that because I think by any measure, I don't know anybody would disagree that that's not sustainable, what we're doing, and it would just take a whole deeper each year. And so I'm wondering if there's anything, if you've thought about anything that we could do, if you agree that there's a need to do something very quickly to bring down that rate of increase so that we can actually justify buying down the rate. I agree with that premise, but that's okay. Whatever you I just want to get on this.

[Jeff Fannon (Executive Director, Vermont-NEA)]: I think I do you know, we do talk about that in our property tax reform measure, which is take a look at what's coming out of the Ed Fund now that wasn't previously. So it might get to that point. We used have a general fund transfer. Now we're borrowing or whatever you want to call it against the general fund. And so that is a problem. But taking a look at what's coming out of the Ed Fund that previously was not. So for example, pensions in 2018 are now the normal costs are coming out of the Ed Fund. They were not previously. There's been a growth, a significant growth in mental health student services that previously was in the general fund. I recall the number from the superintendent here in Montpelier, would be Bongesteel. I think she said $10,000,000 I forget how many people that was, but a cost that was previously not borne by the school, but by the mental health service agencies in the community, in the county or whatever. And they're now being born by the school. That's an enormous tax shift from the general fund to the property tax. So to your point, I guess you could say, yes, we think that something immediately should be done. And looking at what's coming out of the Ed Fund and putting it back to the General Fund where it was previously, it might be the best thing to do. That would be sort of a different way to get at it, but that's the question. Yes, immediate

[Speaker 0]: funding issue, but it would be different, which is a fair response.

[Jeff Fannon (Executive Director, Vermont-NEA)]: Yeah, but I mean, yeah, schools are burdened by health care, if you will. The growth in health care, which is significant. That's something everybody in the state and everybody in the country is grappling with. To say that schools have to manage better as it relates to health care when nobody else is or expected to. We have the highest insurance rates in the country and therefore the highest insurance rates in the world. Vermont has the highest insurance rates in the world. And expecting schools, school boards, buying members to try to figure out and solve for that is just not practical. So yes, we think something immediately should be done about health care. There are some things that are being done, but they're going to take a little bit to reference based pricing starts 01/01/2027. But there are some things that are happening, and more can happen, we think, with health care reform. And we're supportive of that. And have been for many, many years.

[Rep. Peter Conlon (Chair, House Education Committee)]: Any other questions? Oh,

[Speaker 0]: yeah.

[Sen. Nader Hashim]: I just I've been following very closely the conversation about whether it's better to go to the property tax or whether to go to the income tax. And one of the questions that keeps coming up that seems like a challenging part of the situation is if we switched from a property tax to an income tax to fund education, how would we deal with nonresidential contributions or those people who have wealth but are not earning it through an income?

[Jeff Fannon (Executive Director, Vermont-NEA)]: Fair enough. Great question. So we're proposing to eliminate the residential property tax. So nonresidential properties

[Sen. Nader Hashim]: Would still exist.

[Jeff Fannon (Executive Director, Vermont-NEA)]: Would still exist. So second homeowners businesses. We are starting to, in Act 73, Representative Conlon did talk about getting to the second home and bifurcating that and making changes there going forward. We support that. Some states have upwards of eight different property categories in their property tax systems. I'm not suggesting that, but there are ways to is a fifth home the same as a second home? I don't know. Is it the same as the business? No. Don't we need and want businesses to thrive in this state, we shouldn't overburden them. But somebody who's got five or six homes, should we treat them differently? I think we should. So it might get to some of your I think what you're talking about is an asset test. That currently exists, though. There are people who, under our current income tax, which funds a significantly larger sum of money, which is about $9,000,000,000 from the general fund, there are people there who avoid taxation there. That's a current problem. I don't know that we should not move the income tax with which to fund education, because we haven't solved that problem for the larger $9,000,000,000 general fund. So I would say we should move there and also solve for that. You know, this in this building, that building across the way, for many years we should have an asset test for many things. And I support that. You How get there, I don't know. It's never been discussed thoroughly and really researched, I think. But it's a good point. People are using the laws to their advantage when we might not want them to. It rewards them for doing certain things that we may not want to

[Speaker 0]: Better to advise. Better represent.

[Sen. Steven Heffernan]: So you represent the teachers, the bus drivers, and your main goal is to do what is best for who you represent. Correct?

[Jeff Fannon (Executive Director, Vermont-NEA)]: The main goal. I mean, I I

[Speaker 0]: Well, that is board. I have

[Jeff Fannon (Executive Director, Vermont-NEA)]: a board. They direct me. And and and

[Sen. Steven Heffernan]: So they're My question is when it when new contracts come up here in the next three to four years or sooner, is the NEA willing to hold the line like we're asking our schools to hold the line, to not ask for, you know, six or 7% pay raises? Are they do you believe they're gonna be willing to not ask for as much knowing that you're coming to a school, a school board, a district that is already pushed to the max on being up with the Fordham, is the NEA gonna be willing to say, you know what? I know we all want raises. I know we want better for our employees, but we know the situation that our state is in, and we're willing to show that we're gonna hold back until we're in a better place. You believe the NEA is willing to do that?

[Jeff Fannon (Executive Director, Vermont-NEA)]: Well, I I so we don't dictate to our local associations. We don't bargain at the state level for salaries. It's done locally, so it's done in Rutland. You know, they had

[Sen. Steven Heffernan]: a I understand that, but you oversee most of that in

[Jeff Fannon (Executive Director, Vermont-NEA)]: your We don't you don't tell them

[Speaker 0]: what to bargain. But will

[Sen. Steven Heffernan]: you discuss that, hey. Vermont's in a tough situation. We should, as a union, set back some. That's what I'd like to hear. It's like, I I understand. You're you're here for to make more money for your employees. That's what you use to protect protection and to make more money, better benefits. But you're working with a state that is in dire straits of affording education. So I'm just asking, as a citizen and as a senator, will the NEA start looking and saying, you know, we want more, but we are gonna just we're gonna hold the line like we're asking the the schools to hold the line for a year or two. I that would show a great a great precedence that we're all in this together, and we'll get through it. But we gotta we gotta get a better

[Jeff Fannon (Executive Director, Vermont-NEA)]: financial strategy. Think we're we're very much there in as much as my members feel directly the cuts that are being made. That means that their workload is increasing. Their costs at the supermarket are going up like everybody else's. Cost of gas, whatever is going up, up, up. The average teacher is a female who holds a master's, for example, and makes about $66,000 a year. I don't think that's an excessive salary at all. They would qualify for income sensitivity. I just heard last night, it was a meeting, that many of the cafeteria workers, many of the paraeducators who are my members, were at a food bank, if you will, getting food over the holidays. So these are people who are not wealthy, and I think they deserve every penny they

[Sen. Steven Heffernan]: Oh, I'm not lying that. I'm just saying when it comes time for that, that it's more reasonable.

[Jeff Fannon (Executive Director, Vermont-NEA)]: I would I think likewise, we're trying to design think we ought to go to an income tax so that the wealthy and the wealthiest among us pay their fair share. And right now, the way the system is, they pay a smaller share of their income, if you will, to support education. And I think that needs to be addressed. So I think that's the solution. I think we do what our members locally work with their school boards, understand well what the community needs are, and they come to an agreement all the time that works for the community and works for them. Is it perfect for them? No. Is it perfect for the school board? No. It's called an agreement where they compromise a little bit here and a little bit there. I think that's how it's done. It's less salary for exchange for other working conditions that they feel are important. So it's a give and take at the bargaining table.

[Speaker 0]: Senator Windham?

[Sen. Terry Williams (Clerk)]: So I just want to say something to both committees that the issue about the cost drivers of education came out. One of the biggest things was healthcare. But I'd like us all to admit that we, as a committee, can't fix healthcare in the state. I mean, we have to be cognizant of that as an issue as we're proceeding with Act 73 and how we're going to get it implemented. But I'd like to stay on focus, just recommend that we just stay on focus about Act 73 and where we know we have to go with this.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: My question is kind of a follow-up to Senator Williams if I could. So, I'm I'm curious if the NEA has a position on whether our state teachers could potentially join the same health care pool as state employees to increase that pool

[Speaker 0]: to

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: potentially drive down costs. I'm wondering if, again, it's just, it's, one of dozens of levers we could potentially pull, but I'm wondering if you have a position.

[Jeff Fannon (Executive Director, Vermont-NEA)]: Yep. Been supportive of healthcare reform generally for years and decades, honestly. So would we be willing to look at that? You We understand that our pool, the largest pool in the state, could drive down costs in creative ways. And if we had a larger pool, that might give us more leverage with which to do that. So I think that's something we could explore and certainly would be open minded to that. I'm not saying we support it. I don't know. I know there's some discussions going on and I think that Lisa didn't reject it.

[Rep. Peter Conlon (Chair, House Education Committee)]: Another question more on the specifics of seventy three itself. One of the concepts within it, the task force took a different approach, I'd to sort of stick to one of the concepts within seventy three, is newer, larger districts, whether it's five or 50, probably mandated by the state. I think the NEA has basically been in opposition to that. And I would just like to have some understanding to the reason why.

[Jeff Fannon (Executive Director, Vermont-NEA)]: I have seen evidence from both sides. I just read an article this morning that there is mixed evidence, for example, on larger is better. Some places it works, some places it doesn't. Most places where they merge, it's lower income kids are bussed farther. Therefore, because they're bussed farther, they have less chance, less opportunities for after school.

[Sen. Nader Hashim]: So I would but I'm not

[Rep. Peter Conlon (Chair, House Education Committee)]: about governance, not about whether a school is opened or closed because 73 doesn't actually say anything about bus rides or schools open or closed.

[Jeff Fannon (Executive Director, Vermont-NEA)]: Right. But I mean, think that's you know, the logical extension has been and the understanding has been larger is going be that some schools may have to be closed.

[Rep. Peter Conlon (Chair, House Education Committee)]: I mean, that's a reality today.

[Jeff Fannon (Executive Director, Vermont-NEA)]: It is, absolutely, in my community right now. Many communities around the state are having conversations. And that's good. That's again, so I think, I don't think Montpelier should be telling Worcester that it should be closing its school. I do think Worcester and its surrounding communities are going to make that decision, I think, on February 10. And that's how it should be. There are other small schools. And there's one district in the state, I believe, that meets the numbers under Act 73. That means it's But it doesn't mean that every school that merges or districts, excuse me, that merges will be able to achieve that. That's the problem. So if you mandate it, I think it's frankly going to be really difficult. And you're going have tons of carve outs for geographic concerns and other concerns. And I think that having it done locally is a better approach. That was our concern with Act 73.

[Speaker 0]: Questions? If not, we can move on to Thank you.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Good afternoon. I'm Sue Seglowski, the executive director for the Vermont School Boards Association, and appreciate the chance to share VSTA's current position on Act 73 and our legislative priorities for the 2026 session. I testified before house education yesterday on these same topics. So today I'm going to really focus on my main points and provide some information relevant to some of the questions that were asked yesterday. So I'll start with VSBA's current position on Act 73. We appreciate the goals of Act 73, improving student outcomes, creating a more cost effective education system, and ensuring responsible use of public dollars. Our members strongly support the need for viable, sustainable solutions to the challenges facing public education in Vermont. School boards have raised grave concerns about the process and the timeline set out in Act 73, and particularly the central strategy of mandating school districts of 4,000 to 8,000 students. As written, Act 73 would require a sweeping system overhaul in a very short time without sufficient consideration of the impact on students, families, educators and communities. That level of disruption without clear evidence of benefit raises some serious red flags for school boards across the state. Moving on to the redistricting task force report, we are grateful for the work of the task force and we commend its measured evidence based and community centered approach. In connection with the task forces work, the VSPA sent a survey to all 132 individuals who serve as board chairs of school districts, supervisory districts, and supervisory unions in the state of Vermont on 09/17/2025. And the school district redistricting task force members provided input on those survey questions prior to the issuance of the survey. The survey closed on 10/06/2025, and we received a total of 67 responses to the survey. 97% of responding board chairs responded that their boards have discussed redistricting. They provided insights and details about those conversations, and most responses reflect significant engagement and serious concern about the implications of Act 73. Even when no formal position was marked, boards expressed intent to discuss soon or to collaborate regionally. Several respondents emphasized that past force mergers created distrust making boards cautious about committing too early. 77% of responding boards indicated that they have taken a formal position on redistricting, and the survey summary provided many more details on that. The board chair survey has not been updated since October. It is definitely a snapshot in time, and it may not portray current circumstances, but I wanted to provide you with that information and make you aware of it. It is posted on the Redistricting Task Force website and there is a pretty comprehensive summary. It's over 300 page the summary is not 300 pages long, but the entire report is over 300 pages long. And there's a summary at the beginning, and then you can look at more details in the back part of the report. So moving on to the task force report itself, it highlights something school boards know well, and that is the urgency of addressing major cost drivers in public education. Importantly, the task force found no evidence that large scale mandatory mergers would lower costs, improve student outcomes, or increase equity. The VSBA supports in concept explore strategic voluntary mergers guided by feasibility studies and aimed at relieving fiscal pressures. At the same time, we believe the state must play an active role in ensuring that voluntary approaches do not deepen inequities among districts or students. As this work continues, VSBA strongly urges the legislature to ensure meaningful participation by school board members throughout all remaining phases of this process, require clear data and evidence demonstrating that any redistricting proposal will actually lower costs, improve schools, and benefit students, and develop a comprehensive action plan and a realistic timeline that accounts for the complexity of implementation. PSBA will continue to advocate for the principles outlined in our position paper, responsible implementation of act 73, and that was submitted with my testimony today. Before the VSBA issued sorry. Before the task force issued its report, the VSBA developed criteria based on statewide input from school board members to evaluate any Act 73 proposals. I want to be clear, because I'm not sure if I was clear about this yesterday, that we applied those criteria to the task force report. And based on that evaluation, the VSBA supports the task force's proposal. In brief, school boards believe that any successful statewide plan must meet the following criteria. Be grounded in a clear vision for Vermont's Pre K through 12 system, demonstrate improved student outcomes supported by evidence, ensure equitable access to programs, services and opportunities, share responsibility for students statewide, recognizing that some populations require additional resources, expand access to career and technical education and flexible pathways, invest invest in safe and modern facilities, address major cost drivers, especially health care, in transparent and cost effective ways, ensure meaningful school board engagement throughout the process, and finally, detailed data analysis, cost modeling, and transition planning before any structural changes are adopted. Redistricting, if pursued, must be grounded in research, reflect regional differences, preserve community connections, and respect local democratic participation. We see the task force report as creating the conditions to meet most of these criteria. And we believe that the legislature's next step should be to build carefully on that work by refining the proposal and filling in the details. I'll turn next to VSBA's 2026 legislative priorities. But before getting into the priorities, I wanted to underscore something that is very important, and that is that school board members across Vermont are working extraordinarily hard right now to develop budgets that that deliver high quality education while remaining affordable to taxpayers. They are deeply concerned about property tax impacts and rising costs. Sustainable education transformation must address structural cost drivers. Without that, reforms risk higher costs, disruption, and even disappointing results. Our first legislative priority is reforming statewide bargaining for public school employees' health benefits. We are focusing on this first because it is one area where the legislative action can have a real near near term impact on education costs and property taxes. This is fundamentally an affordability and sustainability issue. Health care benefits for public school employees are now approaching $400,000,000 annually. They are one of the fastest growing drivers of education spending, and that growth far exceeds inflation and state revenue growth. In the last three budget cycles alone, health benefits costs have increased 16% in FY '25, 12% in FY twenty six, and 7.3% is projected for FY twenty seven. Before 2018, when statewide bargaining was passed into law, these costs were under 10 of school budgets. Today, they make up about 15%. And if nothing changes, they will approach 20%, meaning that $1 out of every five spent by school districts will go to health care and not education. Premium growth illustrates why this matters. The most common plan, the Vijai Family Gold CDHP, has increased 125% in eight years, while inflation rose about 32%. At the same time, health reimbursement arrangements or HRAs magnified the total costs. HRAs are fully taxpayer funded, provide first dollar coverage and require no employee contribution. In 2023, districts paid over 33,000,000 statewide in HRAs alone. Hundreds of employees paid nothing out of pocket, even for very high claims. The key issue is balance. The current system offers the most expensive benefits in the state without adequate mechanisms to ensure affordability, moderation or shared responsibility. This growth is closely tied to the statewide bargaining structure created in 2018. Since then, both arbitration awards have increased benefit levels and the winner take all arbitration model discourages compromise or cost containment. VSBA is asking for guardrails, tools that allow costs to grow sustainably while protecting educational programs and taxpayers. Specifically, we urge you to cap the total value of health benefits phased in over time, establish a single statewide HRA administrator to reduce unnecessary cost and variation, add neutral and independent members to the Commission on Public School Employees' Health Benefits, expand arbitration criteria to include comparability to the Vermont Health Connect plans and the impact on education spending and economic growth. And finally, blended arbitration awards rather than winner take all outcomes. There is a House bill that will be introduced soon that will provide detailed language on our proposed changes. And I provided a handout with my testimony today, providing more information about why this matters. And there's paper copies here if anyone would like, paper copies of that. The takeaway for your committee is simple. Healthcare benefits are now a primary driver of education costs and property taxes. If we do not address this structure, other education reforms, no matter how well informed, will continue to be undermined by rising costs. Additional priorities for this legislative session are laid out in my written testimony in more detail, and I'll cover them very briefly here. You can see my written testimony for more detail. The VSBA urges the legislature to stabilize education costs and taxes through targeted reforms and rigorous modeling, ensure fair, transparent education funding, grounded and reliable data, fully fund student mental health supports, maintain and modernize school facilities, promote accountability and transparency for all use of public education dollars, and preserve community based education, recognizing that local elementary schools are anchors in Vermont's communities. In conclusion, Vermont the SBA stands ready to work collaboratively with the legislature to advance thoughtful, evidence based reforms that support students, respect communities, and protect taxpayers. We ask that school boards remain meaningful partners in shaping the future of public education in Vermont. And thank you for your time and your leadership and your continued commitment to Vermont students. Thank you.

[Speaker 0]: Questions?

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: Oh, yes. So to speak. So thank you, Sue. I appreciate your testimony. I'm wondering I'm wondering if it's fair, because in your testimony, you made several comments about health care, statewide health care, futures health care, etcetera. May be fair for the NEA to respond to some of those comments because it's a little, you know, you're you're working at slightly cross purposes. You're NEA represents the teachers and the, you know, union, etcetera. The school board employs those teachers and their responsibility to the community has a slightly different perspective. I'm just wondering if Jeff agrees that he could comment on some of Sue's healthcare specific commentary. Is that appropriate? I

[Speaker 0]: want to make sure we have time for questions from the committee, but if you can do it quickly, Jeff, if you have a quick

[Jeff Fannon (Executive Director, Vermont-NEA)]: Sure, thank you. Certainly a richer conversation needs to take place, but I'll just say this, my members, educators, they pay 20% of the portion of the healthcare. So they're already paying 20% of the ever escalating price hike that Sue mentions. We agree that's a lot. I hear from my members it's too much, and we we we would agree that we need to reform the system in some reasonable way.

[Rep. Peter Conlon (Chair, House Education Committee)]: Thank you.

[Speaker 0]: Okay. Do you have a question?

[Rep. Peter Conlon (Chair, House Education Committee)]: Sure. Switching back to Act 73. In its original form, was age four fifty four. As it left the House and went to the Senate, it had the backing of the SVA. When it left the conference committee, it did not. Could you talk about the specific changes that took place that made that switch from support to opposition?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes. I think the major changes that led to the opposition of the major one was the size of districts changed the district size requirement.

[Rep. Peter Conlon (Chair, House Education Committee)]: It did?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes. I think it was 2,000 to 4,000 in the house version, and then it went to 4,000 to 8,000, I believe.

[Rep. Peter Conlon (Chair, House Education Committee)]: I may disagree with that.

[Speaker 0]: Let me try the question I asked Jeff earlier. The legislature is in this real dilemma of constantly going to battle for money, we have enough to fund all kinds of things that we need to fund, and we keep buying down the rate every year, and the difficulty of it is that every time we do that, it actually makes it worse. And so I think there's a sense that we need to get out of this cycle and we need to figure out how to get out of this cycle pretty quickly. And I'm just wondering if you've got any thoughts that would help us do that. And I realize, I hear the discussion about systemic changes and taking time and all that, and I understand that and I respect the testimony, but but one of the issues we have is that we're looking at putting more money in again this year, making it worse for next year, and we've got to break this cycle pretty fast because we're digging a deep hole for ourselves. Just wanted to have your thoughts that you might help us get out of that.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: The SBA has typically been opposed to the legislature taking that step because, as you say, it just comes back the next year and causes an issue, a hole in the end fund. So we definitely don't support the legislature doing that on an annual basis. But I think you have done it for so many years now that it's going to be hard to cut it off cold turkey. There's probably gonna need to be some level of support. But I think the bigger issue, it was pointed out by Mr. Fannon, which is what is coming out of the Ed Fund? What is the Ed Fund funding? And if you take a look at it, there are many different things that the Education Fund funds that it didn't used to fund and also the mental health supports that he mentioned. So I think that's the place to start looking.

[Speaker 0]: Any yes.

[Rep. Peter Conlon (Chair, House Education Committee)]: So just to correct the record here, when the bill left that house, it was a minimum average daily membership to the extent practical of 4,000 students.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Okay, okay. Thank you. Thank you for correcting that. So we, I think, had earlier in the session supported a proposal that was 2,000 to 4,000. And so that's what was thinking about. So we did support what came out of the House. I don't know that that's a level that we that would currently have the BSBA support, but we did not support raising that number to 8,000.

[Rep. Peter Conlon (Chair, House Education Committee)]: Because it was a cap. Yes.

[Rep. Emily Long]: The other

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: piece that we we didn't support were the changes that were made regarding the change from 50% down to 25% on the independent schools? I'm looking at some of

[Rep. Peter Conlon (Chair, House Education Committee)]: the positions here, I'm sure where I go, who doesn't agree with all of this, but it's a lot to ask. At this point, would you say, could the VSBA support new districts mandated by the state as a concept?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: I think that's a difficult question to answer because you haven't provided enough details.

[Rep. Peter Conlon (Chair, House Education Committee)]: Okay. I could understand that. Mr. Chair?

[Speaker 0]: We're in the middle of questioning from one member of the around the table here. Maybe let let chair Conlon finish his questions, and then if you wanna ask one, that would be great.

[Sen. Kesha Ram Hinsdale]: Sure. I I kind of wanted to ask his question differently.

[Rep. Peter Conlon (Chair, House Education Committee)]: Sure. Take a shot at it. Okay.

[Sen. Kesha Ram Hinsdale]: Which is just to say, I I was appreciated, Sue, that your members we we know from our our hearings and our visits, they have been talking about consolidation. They know what it would take. And it strikes me it's very expensive. And so I just feel like there's a different question in there about asking the school boards to support redistricting without any resources. That just seems like a false question. I think the question would have to be how much would it cost for school districts to consolidate, and where is that figure, and why is AOE asking for 3 to $4,000,000 for themselves, but not coming up with that figure or being helpful in that number?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: You are very correct to point out that it would it would cost a lot to do redistricting. I know that in Act 46, there was money that was provided to the agency for grants to school districts in order to do that. So I don't have the specifics off the top of my head of how much those grants were, but it's certainly something that I could investigate.

[Rep. Peter Conlon (Chair, House Education Committee)]: I do, a different sort of topic. I think about my seventeen years on a school board, much of it dealing with the issue of consolidation and having gone through consolidation. And I basically remember wishing, and in fact speaking to, people at the state level saying, We can't do this on our own. We're a bunch of volunteers. We need the state to step in and mandate this. I think we're probably going to see a very good test of this coming up in February in Washington Central, to see whether a community can be sold on the concept consolidating when it has the power to not have that happen. Forgot where I'm going with that. I just is to say, my experience as a school board member was that I felt like we needed the state as a partner to make some of the hard decisions that are really, I felt, unfair to put on volunteer board members. So that's just a statement. But my question would be then, looking more at your positions, you described the timeline laid out in Act 73 as rushed and fast causing upheaval, could you recommend a different timeline?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: I don't have specifics about a different timeline, but I'd certainly be happy to come back with some more information about that. I think that the timeline in I I think the timeline, that was another change between the house version, senate version. No? Okay, I was thinking the House version had a different timeline, a year different timeline.

[Sen. Nader Hashim]: It may have been.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yeah, a one year difference timeline. I mean even a year can make

[Speaker 0]: a

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: difference. And I think that the situation that you pointed out with, you were talking about consolidation, but I think you're sort of mixing it up with also with I apologize. Yes.

[Rep. Peter Conlon (Chair, House Education Committee)]: Yeah. Thank you.

[Sen. Nader Hashim]: I I didn't I didn't mean

[Rep. Peter Conlon (Chair, House Education Committee)]: to conflate the two. In that case, I was talking about actually yes. The state stepping in in that case of of helping out with the number of buildings available. Yeah. In one of the other in the criteria for a successful plan, I really appreciate there are all questions to ask, recommend parameters for district size by enrollment that are large enough to allow efficiency at scale, but small enough to maintain a strong sense of community and personalized attention to each and every student. Would be happy to welcome recommendations as to how one threads that needle. Yes. And I think my overall request here is specifics. Think if we are going to move forward with anything, and I think that Jeff Fannon from the NEA really highlighted the crisis when we are cutting 400 people per year in our education system, and we're all trying to find a solution to that not being the new normal. We specific help. And think that that's, I guess my question is more of a plea for that as well.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: The SBA did support the VSA framework and timeline that they provided last year, which was 2,000 to 4,000 students. We do recognize that there are certain areas of the state where that would be very difficult to do because of the rural nature of those areas, and that you wouldn't want to have the district cover such a large area geographically that then the school district and the school board are out of touch with the people that live there.

[Rep. Peter Conlon (Chair, House Education Committee)]: I thoroughly agree that's why the language in law says as practical. Yes. So

[Rep. Emily Long]: that prompted me, I've got a couple of questions sort of unrelated, but they're all related. If Act 73 was fully implemented in the end and we so called right sized our district, do you not see, and I could have asked Mr. Fannon this as well, 80% of our budgets are made up of staffing. And if we're going to right size, we're probably going to see those same reductions or maybe bigger reductions by right sizing. I don't know. That would be decided later. But if we've been reducing the number of staff over

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: the

[Rep. Emily Long]: last few years, Does that not say that school boards are taking the challenges that we've been facing very seriously and trying to readdress how they're operating? That's my first question. I'm just curious about that. Yeah. Especially from hearing.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: I believe that they are taking it very seriously. And an example is in Senator Bongartz area. The Taconic and Green School District, is closing two of its schools. And that is in direct response to the demographic changes in the state.

[Rep. Emily Long]: Okay. I just wanted that for clarity. What I wanted to speak about is when you came to testify to the House Ed Committee, I think it was yesterday. Yes. Feels like I'm taking some point. You clarified for me that a couple of your very strong priorities were making sure that we were very clear on the cost drivers of the increases in education spending. And furthermore, you were urging us to use timely and accurate data to make decisions on the next steps. And so I think I'm right about that.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes. So

[Rep. Emily Long]: I'm going to go back. My agenda says that you're here to talk about the redistricting task force report. Don't I mean, I have a couple of questions about that. And I would love to hear your feedback on two elements that we've been hearing seem to have some real potential for support for increasing educational opportunities and outcomes, as well as reducing our overall costs. And that is the seesaw model that we heard yesterday in testimony, from the redistricting task force group and, the regional high school model. And could you just give us a sense of how the SBA feels about those two pieces of the redistricting task force report?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes, we do support those two pieces of the report. We applied the criteria that I talked about to each of the three proposals in the report, and we and we do support those.

[Rep. Peter Conlon (Chair, House Education Committee)]: Okay.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: Yes. Last question. Can I follow on from representative Wong's comment? So, you started your presentation with a comment that you didn't see indications of benefit from Act 73 but in fact, Act 73 led to the redistricting task force led to three recommendations that you're endorsing. Do you see a benefit to the the Boces or seesaw model of five districts as having a cost benefit implication if enacted?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes, I think that the areas have to do with professional development, providing in some cases, special education services, and also help with mass purchasing. Think those are So the three big

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: you see a benefit having five BOCES or seesaws across the state for a business rationale that's a cost saver. I think fundamentally, we'll agree with that because that's why we enacted the BOCES legislation a year or two ago. I'm wondering why the same corollary can't be transitioned to the leadership of districts. If it's good for a business model, why is it not good for a leadership that we could have fewer leaders in the state as we would have fewer districts, fewer business models. Why isn't that same translation applicable to the leadership, which is core to school boards and superintendents?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: It is very much out of scale with how Vermont has traditionally operated. And if we were to adopt that type of a model, we would have less school board members in the state than senators. And it it would become a very political position. And right now, it really is not a political position in in the pure sense.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: I can just a follow-up. So the governance model has not been decided. So we don't need to scare the public that there'll be fewer school board members than senators because we don't know what that construct will look like because we don't even know how many districts there'll be. We don't know how many board members there would be to a district. So I'm not sure that that's a fair challenge.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Thought you were asking I I thought you were asking me about five districts.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: I'm asking you why the same corollary can't be applied to the leadership portion of School of Vermont State boards and superintendents with the same benefit that we see with the business cost reduction of those reduced number of districts. In this case, five.

[Rep. Peter Conlon (Chair, House Education Committee)]: Just to be fair, you asked it in the context of the five BOCES, which I think is where the confusion is.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: So if five districts from a business perspective is beneficial to the state, why can't a reduced number of districts from a leadership perspective also be conducive to cost savings and education quality improvement?

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: It's possible it could be conducive to cost savings. I don't think that it would be conducive to Vermonters staying connected to their schools.

[Rep. Peter Conlon (Chair, House Education Committee)]: Thank you. I just want to clarify. The VSBA is not opposed to governance consolidation that might result in fewer superintendents and fewer school boards.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Yes, we are. Are. Are opposed to that.

[Rep. Peter Conlon (Chair, House Education Committee)]: Steven, if it's done on your own.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: No. It should be done voluntarily. We are opposed to the I was answering in the context of the five districts or five BOCES. I wasn't answering generally.

[Rep. Peter Conlon (Chair, House Education Committee)]: That's why I appreciate that. I just wanted some clarification because I think Senator Weeks was moving into general concepts

[Rep. Emily Long]: opposed to specifically five. Okay,

[Speaker 0]: so to stay on schedule, thank you.

[Sue Ceglowski (Executive Director, Vermont School Boards Association)]: Thank you.

[Speaker 0]: Have Jay Nichols, the Blood Principles Association.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: Good afternoon, everybody. The record, Jay Nichols, I represent the Vermont Principles Association. Jay,

[Speaker 0]: a little hard to hear you, if you could maybe get closer. It's our volume. Oh, it is.

[Sen. David Weeks (Vice Chair, Senate Education Committee)]: Oh, okay.

[Speaker 0]: Go ahead. Go ahead. Forget it. Just go.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: How are you now?

[Rep. Peter Conlon (Chair, House Education Committee)]: Now we're fine.

[Jeff Fannon (Executive Director, Vermont-NEA)]: We're fine.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: Okay. Sorry about that. Yeah. For the record, Jay Nichols. I represent the Vermont Principals Association. Good afternoon, committee members and thank you for your service. I apologize for my throat. I've been asked to speak about the redistricting task force work on Act 73, as well as the VPA's legislative priorities. I've attached our legislative priorities, but I'm going to focus mostly on Act 73, which for us is our main priority as it is for everybody who's involved in education in the State of Vermont. So our executive board, which is made up of 15 members from around the state, school leaders, came up with four major areas related to the main priority with a little information behind each of those. So the first one is we respectfully ask that you take the time to do transformation effectively. We feel Act 73 has been rushed, and that the majority of Vermonters we have heard from agree with that. At the VPA, we work with a lot of organizations, not just schools around effective leadership and leadership training. We use a construct entitled DAC, which stands for Directional Alignment Commitment. And essentially, we are talking about begin with the end in mind and plan from there. What we have heard from the administration and many in the General Assembly is that we need to reduce education costs. Period. With improving schools often as an afterthought if discussed at all. And the level of detail on how schools would improve is lacking from the VPA's perspective. We're not saying that reducing costs is something we should not be worried about, but cutting costs to simply cut costs is narrow and short term thinking. There are a number of cost drivers that Act 73 doesn't appear to be addressing, but that local school boards and districts must contend with. And you've already heard the biggest example of that is healthcare. We also have increased needs of students and schools responding to those needs with providing mental health services and other services within the school. School districts are responding to the needs of their students and at the same time being beat up in the media, often by public officials who should know better for increased cost to schools or which they have very little control. I'd like to point out that we had a commission for the future of public education in Vermont that was supposed to take the lead in much of this work around education transformation and was supported by the General Assembly. That work was dismantled by the General Assembly after the governor presented his five Megadistrict Plan. The commission was focused on equity, quality, sustainability, and affordability. We at the VPA still think those are the correct considerations, but are worried that the concern for affordability is clouding judgment and are especially concerned that we don't really see OAC 73 as it is currently configured is going to reduce cost without forcing some schools to cut programming and forcing other schools to increase spending. We believe this is a realization that the majority of the redistricting task force concluded as well. And for the record, the VPA would like to state that we appreciate the work of that task force in a very compressed timeline. Our second point is that our Board believes that decisions need to be made based on what's best for students and the state overall in the long term. Politically expedient decisions should be treated as enemies of what you are hoping to accomplish. I know there is an election coming up, but I am asking people to think long term about what is best for the state, what is best for the students. There is a concept we also use in leadership circles that some of you may have heard of called upstream thinking. This is about planning ahead, not just responding to crisis situations. In Vermont, for perhaps decades, we have been in crisis response mode, which could perhaps be called downstream thinking. We let healthcare become a crisis. We let housing become a crisis. We let population decline become a crisis. And then we try to respond to these crisis situations. We are not blaming anyone for this downstream thinking, but we think it is time to engage in some upstream thinking. A couple examples. It might have been yesterday, a day before, Senator Ram Hinsdale mentioned that the General Assembly needs to dig into school construction. We completely agree. Let's start planning for what our school infrastructure should look like and design from there. We can't really effectively transform our educational system to a world class system with the terrible infrastructure we have now. We need to stop kicking the can on this and school construction funding needs to be part of any educational transformation. I heard testimony earlier this week from the Bond Bank that our $6,000,000,000 infrastructure deficit to bring school buildings to where we need them to safely be is growing by around a quarter of $1,000,000,000 a year. And with ever increasing construction costs, the longer we wait, the harder it's going to be construct modern, and highly effective and efficient school facilities. Another example is to streamline governance units in the state. I think it is time that we really took a hard look at this. In many places, we have an outdated governance structure that ties superintendent hands in terms of sharing staff and causes great redundancy for central office personnel, and in many cases takes away opportunities for some students. The governor is correct. 119 school districts is too many. However, getting to the correct number should be approached in a rational and surgical manner using a scalpel approach to cutting instead of a chainsaw approach. A final example here is that we should consider removing aspects of the education system that should be part of the general fund. The education fund is often used for political expedient decisions. What we need to acknowledge is every time we add costs to the education fund, we are increasing property taxes for Vermonters. There are some great things that we pay for in the Education Fund. But we should either move them to the General Fund or stop blaming schools for increases to educational spending. Some of those examples have already been mentioned. Teacher pension retirement, out of control healthcare costs, school resource officers, hasn't been mentioned, employees hired for student mental health needs, universal meals. Our members support all these things. We're not suggesting cutting them, but don't have schools be required to pay for them and then blame schools for the costs going up. Thirdly, moving towards governance systems that are streamlined, provide more opportunities for students, are cost effective, and are not redundant. We do think a voluntary and encouraged BOCES type of program, as described in the task force report, is something we should lean into. Voluntary mergers when and wherever school districts are willing to do so. Of course, the risk of this is adding more bureaucratic layers to an already highly bureaucratic governance system in many parts of the state. And it is unlikely that this is going to lead to immediate financial cost cutting, seems to be a major impetus as I've already stated. However, talking to other executive directors across the state, I mean across the country, many states that have these types of programs can point to significant financial savings over time. Another example is moving from supervisor unions to school districts. I know people don't want to hear this in many parts of the state, but that would provide more opportunities for students, it will be less redundant, and they are more cost effective in general. There would need to be a lot of work done to make this happen and we understand the Governor's desire to have less school districts and recognize that his idea has merit. However, the devil is in the detail and we don't think forcing systems that have never worked together into new larger districts will be well received by Vermonters. We don't believe that it will save substantial finances in the short term, and we worry that forced mergers will further disregulate a fragile educational delivery system. So, supervisor unions, and I want to underline this point, if forced to merge their current structures into school districts making up the same members, would at least have neighbors within their existing structure that have worked together in many areas, which would make merger much smoother. These supervisory unions that already have working relationships could become school districts, which are more efficient than supervisory unions. We are only suggesting this type of merger be considered as a construct if the general assembly continues to support forced mergers as are contemplated in Act 73. By doing this, you might also get bigger districts that are willing to create bigger governance structures voluntarily as a next step after that. Finally, remove the 4,800 language and substitute 1,000 to 4,000. I feel my friend, the chair of Health Ed who's really leaned into this, has done a great job, has said over and over again that the 4,000 to 8,000 is not a hard number. Still a lot of people are looking at it as a hard number and it doesn't have a research base for rural states like Vermont. Perhaps there should be no number language at all as some of my board members have suggested. It does seem to derive from out of state consultants looking at a perfect cookie cutter system which is not something that we have in our state. If the General Assembly decides to continue with the approach of forced consolidation and decides there needs to be a number of students targeted for a new district, I would strongly suggest moving to the 1,000 to 4,000 language. If you did that, the vast majority of school districts would at least be allowed to work with neighbors that they already have working relationships with. This will be critical as we look to align policy, contracts, compensation, etc. Schools that are already in a district of at least 1,000 students could be encouraged to join neighbors to create larger districts when and where it makes sense to do so in a geographical area. This would move us from 119 districts to 50 or so almost immediately. That would take a lot of work to accomplish this, but it would be much more manageable trying to form larger districts consisting of many smaller school districts that already have a working relationship than it would be with those who have never worked together, may have major discrepancies in pay scale compensation, other types of things. Finally, just a couple comments on the foundation formula. This is not from our board, it's from lots of conversations with different people in leadership roles across the state. I've not heard of any that support the idea of five or some similar number districts for the entire state. So, I want to be clear on that. I personally am not 100% opposed to a foundation formula. But I am worried about unintended consequences and don't believe all members of the General Assembly, much less Vermont citizens, have any understanding of potential concerns. My understanding of the administration's approach to the foundation formula is that the scale they proposed or something similar, I. E. 4,000 to 8,000 students, is necessary to make the math work in a foundation formula. Many of us fear that moving to systems of this size, and perhaps more importantly, trying to combine numerous government entities into new ones may completely dismantle the system. The combining of employee contracts, policy, governance procedures, and school board construction is an time consuming and very difficult work. Given federal concerns in education, our school employees are nervous about the future and feeling a little beat up. The more we can do to stabilize the system, the better. And however, there's been talk about just imposing a foundational formula. If we do that with no regional differences accounted for, without finding scale, is the math actually going to work? We really need to see the modeling on this. Will we have places that will have a lot more money to spend on education, but many other citizens will not be able to afford their taxes? And will it become worse than it is now in many parts of our state? I have been assured that this won't happen, but I am still worried about it. Conversely, will we have parts of the state in many cases that already have larger classrooms than average, in Chittenden County for example, that will be forced to make many cuts to programs to get to the foundation formula number, What we are calling the EOP. Many of these school districts have already made significant cuts to personnel and programming. For example, the CBU District has cut 80 something teachers in the last two years and they are already at scale. Do Do we make those places make more cuts? And if we do that, we need to realize we're cutting programming for kids. Wherever the General Assembly ends up with final decisions and the Governor passes something into law, the VPA will support the implementation process consistent with our overall mission and goals to uphold the public mission of schools to provide equitable learning opportunities for all Vermont students. And with that, take any questions or comments that you might have.

[Speaker 0]: Well, I

[Rep. Peter Conlon (Chair, House Education Committee)]: guess it's more of a comment than a question. And, Terry, I you bringing up the idea that we are blaming schools for the escalating cost of education. It is not their fault. It is the fault of demographics, of increases in student mental health needs, runaway cost of health insurance. It doesn't change the fact that it is still expensive. Agreed. I just wanted to say that it's not about blaming schools, it is just about the fact that we are living in a really expensive reality right now that it's hard to pinpoint cost or blame. Anyway, I think you make a valid comment that Vermonters are skeptical of a state. I think you said that Vermonters would be reluctant to accept sort of a mandated larger governance system. At the same time, they're also reluctant to accept increases in their property taxes, and they're voting down school budgets, giving us the reality that Jeff Fanon laid out of positions being cut. And I think that how we can bring those two concerns together to address this is going to be vital, which is just to say, and I know you're always responsive to this, but as we try to figure out how to move something forward, your help is greatly appreciated. I'll just say that, and you can respond to this, my concern with building the CISA model, which I think is a strong model to look at, but in the meantime, we've got years of the normal that we're dealing with, and that's where my concern lies.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: Yeah, think that's a legitimate concern. I think my testimony kind of indicated I'm not all in on the CISA model. I've talked to friends who say they've had good experience with it in other states. And I do think it can help with some things. But again, as I said, I don't see it providing immediate relief. I'm not sure what would provide immediate relief without getting some control over the cost drivers that have already been articulated. I would say that we're trying to lean into this from a problem solving and trying to thread the needle to use words that you used the other day with me. And one of the ways to do that might be to consolidate people that are already working to, if you're going to do a forced merger, deal with people that already have maybe similar contracts and stuff because they're already working together in some capacity as opposed to putting completely disparate units together, which I think is going to be incredibly expensive, incredibly time consuming and dismantling to the system. I think we can get more towards where the governor wants to go if we put people together that already work together and have similar contracts and then encourage maybe voluntarily two years down the road for more of those people to even join together to become even bigger units. But if we got to units of 1,000 to 4,000 kids across the state and had 50 or something of those, you know, the research is pretty good that that's pretty powerful. And there are some potential savings by going that route. You'd have less central offices. You'd have, you know, you'd be able to consolidate some places. And then those new entities could decide do we have too many school buildings? Are there places where we've got seven or eight principals and maybe we only need three or four, and we only need three or four buildings? At least you've given some allowability for local control, is a real big thing that's going to be pushed back against legislature. You folks are in a tough spot and we're going to help you where we can and advocate for our members and kids at the same time.

[Speaker 0]: I can't help acting a little bit what Chair Conlon said. What I heard, I just want to be clear, I don't think there's any, but this is not about blame. Nobody's blaming anybody. I think Chair Conlon's comments are correct. As we went around to the five districts that we visited in December, I think it's fair to say that the entire committee was deeply moved by the heroic work being done by the principals and superintendents and especially the faculty with whom we engaged. You used the word stability during your testimony and I think that's what we are all trying to figure out is how we get to stability. What I worry about a lot is voters taking the UniNacks to the markets and that's not going to be good for anybody and so I, like everybody in this room, don't have all the answers but we're trying to figure out how to make this stable system work in a way that's stable within the confines of providers' ability to pay and that sort of mini tour, the theme was excellent educational opportunity for child and that's what we're all trying to figure out how to do and I just want to make clear to everybody that I think we're all on the same page in terms of the goals of what we're trying to accomplish. And I think that notion of stability is key, but I just can't help reiterating nobody's talking about blame.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: I'm glad to hear you say that because a lot of teachers and principals and superintendents and school boards feel like they're being blamed for the increased costs. So it would be good if the legislature got that message out there pretty strongly.

[Speaker 0]: It's a combination of not blaming, but also recognizing need to we need to make some changes because, well, this is gonna come when we've got problems. So You're right. I I see some of Ram Hinsdale's hand is up. We actually have to so last question.

[Sen. Kesha Ram Hinsdale]: Okay. I thought this was till three, but I can

[Speaker 0]: It is. It is. It is. I figured it'll take five minutes.

[Sen. Kesha Ram Hinsdale]: Oh, okay. Jay, you know I I don't know if I'm making friends or enemies with any of my questions, but I'm trying to be responsive to my constituents right now who are in that very, you know, Vermont place of cut my property taxes, but don't hurt my local school. But, you know, what I keep hearing that I that I really need a principal's perspective about is Vermonters feel like 50 something superintendents is a lot. Is there something you need as principals superintendents for that you feel would be lost if we say cut the number of superintendents in half, which would save probably a penny on the property tax?

[Jay Nichols (Executive Director, Vermont Principals' Association)]: Yeah, figure 14 million's a penny, right? Something like that. So that's a great question. I think that if we had 25 superintendents in governance structures with one board that were really well structured and all the contracts and stuff like that are negotiated and we had strong principles in every building, yeah that absolutely could work. But what can't work is having a superintendent with a whole bunch of multiple boards completely doing redundancy and not being able to focus on the mission of the organization. So certainly I don't even when I was a superintendent, I can remember in 2005 when I superintendent of Essex, the VSA made a proposal that would have cut like a whole bunch of our members just to go to single units that would have made more sense for kids and that never got anywhere. So, I think I think that you absolutely could run highly efficient systems with 25 superintendents or something along that lines as long as they had one board, one structure, one mission. We're all in it together, working together to build the best organization school system they could for the kids in this newer, slightly bigger community than a lot of our communities. But not something that's, you know, I would not want to go any higher than six seven thousand kids personally.

[Sen. Kesha Ram Hinsdale]: Right.

[Jay Nichols (Executive Director, Vermont Principals' Association)]: And that's why I suggest start with like one to four and work from there.

[Sen. Kesha Ram Hinsdale]: Thanks, Jay. Appreciate that. So,

[Speaker 0]: senator, you mentioned you implied you might have a second question, because you're right. We don't till three.

[Sen. Kesha Ram Hinsdale]: Oh, no. I think that just highlights that everybody has to give up a little something. That there's a lot of things about supervisory unions that seem like they add cost and don't find those efficiencies that I'm glad that was highlighted.

[Speaker 0]: Thank you. So why don't we take a five minute break and we'll try to keep it to that. Let's just stay back here at 03:05, someone can stay on