Vermont Legislature SmartTranscripts:

[Ann Cummings (Chair)]: We are live. We are back. We are minus well, I've got one member head. He got children. And here comes the rest of the committee with

[Ruth Hardy (Member)]: ice

[Ann Cummings (Chair)]: cream.

[Ruth Hardy (Member)]: It's the ice cream crew. Oh, we're live.

[Ann Cummings (Chair)]: Okay. We are back. And we are going to 02/20. This is, yes, the education funding spending in fiscal year twenty eight and twenty nine. This is the bill that proposes to cap the increase, not cap, Cap, increase based on present school spending. So, you're a high spender, you can't spend more than 3% per student more. If you're a low spender, you can go up to 9%. So it's not brief, but it's a limit on the increase. Thought being that we are working towards the foundation formula and some restructuring, but next year we are not, according to all projections, going to have a $100,000,000 by now the tax rate as we have. This will be our third year. Plus, if we agree, the governor's budget proposes to remove the $50,000,000 in $10,000,000 annual increments from the education fund and move it to the transportation fund. This was money that was added. It was increased in order to help pay for a 60. This is not money that has that wasn't stolen from transportation. If that happens, by next year, there will be a $20,000,000 and probably no money to backfill that. The year after it will be thirst, so we have yet to approve that. I don't know if we will, but that is the proposal that's on the table. So we're trying to get a handle and to bridge this once and if we get to a foundation formula, schools will be given a set amount per student with weights and all kinds of other fellows and linguistics, but there will be a set amount. You won't be able to go spend $25,000 a student and then have that go over the Ed Fund and everybody else in the state help pay that cost. That's where we are. And we've got we sent we went through the bill last Friday, I think, and there was concerns that, especially in small schools, because this involves weighted pupils, that if you lost one or two pupils that came with several weights, they were poor, they had a disability, and they spoke English as a second language, they lose that one student as they move. Could have a significant impact if you're a small school. So we were looking for that cost per student or I thought it was your overall capping your overall budget or or spending in that, but two things. And then because we recognize that we can't predict all things, like your furnace might die and require you to make a substantial investment kind of thing, We asked to have an appeal put in there to the Secretary of Education or designee or something, but to have there be an appeal process. So, John, are we is that you or Julia? I don't know.

[John Brady (Office of Legislative Counsel)]: I think we're gonna both come up. That's okay. I wasn't gonna start with language because I think I'm still completely clear.

[Ann Cummings (Chair)]: Have this year to make sure I stay legal at follow education law, law. Let's see where we go. Okay.

[John Brady (Office of Legislative Counsel)]: Hello. John Brady, I'm the senior citizen counsel.

[Julia Richter (Joint Fiscal Office analyst)]: Julia, third day, I'm fine.

[John Brady (Office of Legislative Counsel)]: So I'm just gonna say things, but I think we had a question from the last discussion, which was about addressing this declining student enrollment, and there's been a proposal related to giving the greater ed spending versus the per pupil spends that you would get, and this was meant to account for the fact that if you had declining enrollment, that you wouldn't be entitled to have the same overall education spending, just intuitive, just pick up the people bigger that you would get when people increase as a result of the decline in student count. Understood So, this in, I think, slightly different ways as to what you might be requesting.

[Ann Cummings (Chair)]: We were totally clear at 04:00 on Friday afternoon.

[John Brady (Office of Legislative Counsel)]: That's right. So one question is just to get clarity on what the desired goal is here. I've read something that tries to get at the technical difficulty is that you can't just outright compare education spending against per pupil spending because ed spending will always be a greater nominal number than your per pupil spend. So we need an apples to apples comparison, means you need to either compare ed spending versus ed spending, or per pupil spending versus per pupil spending. So I have a draft that focuses on per pupil spending and artificially creates a way of comparing last year against this year that protects against student pupil count decline, basically. But there's another understanding which might be simpler, and I don't know if you want to offer that.

[Julia Richter (Joint Fiscal Office analyst)]: Sure, so to John's point, we have since since we were in here on Friday, John and I have been meeting to try to figure out the different ways to go about this. The other idea of how it could be interpreted is to look at the greater of looking at the education spending that would be permitted under the allowable growth calculation, or the prior year's education spending increased by inflation. Whichever is greater is what you're capped at, so looking at the aggregate education spending figure.

[John Brady (Office of Legislative Counsel)]: So totally different you know, they produce different effects. One is I think this is a much simpler one to describe, it's just last year's inflated versus the standard allowable percentage determination that you've already seen in the draft, or kind of a targeted approach at student enrollment decline. And I will just offer that if we get to the point of showing language, because this may just be a discussion about what you guys are trying to do, and then I can go back and put something together. But if we get to the point of looking at language, I can also talk about an alternative way to draft what I've done that changes it from being about per pupil spending to getting education spend. There's different ways to do it, but I think the first question is this difference between just high level approach.

[Julia Richter (Joint Fiscal Office analyst)]: The inflation rate, I think sometimes we use the education inflation rate or side camera, what is it called? NIBA? Typically in Title 16, it's NIBA, so the National Income Products Account inflator for state and local government expenditures and gross investment. Okay. Like, the total. Usually, just refer to it as HIPAA. Do you know what it has do you have do you know what it was this year or is this year? So I can hold I I can send the full the state economist forecast set forward. Mhmm. And it is produced by BLS. And NIFA from '26 to '27 is 2.8%. So that's what I've implied here absent the different decision. 02/06 to '26 to '27. Correct. FY twenty six to FY twenty seven. The reason that I've included that is because I was trying to calculate the difference in savings under the different constructs. As you'll recall, when we spoke about F220, one of these times, and we talked about the estimated savings of 67,500,000.0, that was referring to, if this were to happen in FY27, what do we estimate it would save? Because we don't know FY twenty eight budgets. Okay. So if we the the 2.8 would be applied to the total education spending, not to the per pupil spending. It it would be and that would be the greater of the two of those, the the per pupil long term weighted average or the amount that you generate by SpartanNebub?

[John Brady (Office of Legislative Counsel)]: The way we were talking about it is I think the inflator would only be applied to a whole ad spending. So that's the simple comparison. It's prior year ad spending inflated or allowable credit. Whichever is greater on a total dollar basis.

[Julia Richter (Joint Fiscal Office analyst)]: Aggregate basis. So, it's, ad spending increased by attention. That is silent to long term weighted pupil counts and how they may or may not change. That doesn't matter. Where the per pupil spend or the change in the long term weighted average daily membership does matter is for calculating that allowable growth amount. Is there a way to do the aggregate one in a sort of sliding scale like the per pupil one is, the three to 9%. So so so that so it is that. So the way that and this is all part like, this is how I interpreted the conversation to be Yeah. Yeah. And it doesn't need to be super helpful, Julia. Thank That's why I'm trying to understand too what you're think how you're thinking about it. Thank you. So the way that I'm thinking about it is we're gonna talk first about allowable growth, how that's calculated. So that maintains the original calculation that exists in S220, where it's got the floor of 3%, and then it slopes up to 9% inversely related to the per pupil spend. So that's calculated. And then that's multiplied by the prior year's per pupil spend to get the current year's allowable per pupil spend. Then we take that allowable per pupil spend and multiply it by the long term weighted membership of that year to get the aggregate, how much allowable education spending is there. The slope and the floor and all of that still exists within the allowable education spending. And then we take that and we say, okay, we just calculated this for everybody. Now we're going to look at everybody's prior year ed spend and increase it by inflation. And then if your ad spend increased by inflation is greater than your allowable growth, you can have your ad spend increased by inflation.

[Ann Cummings (Chair)]: That's your cap.

[Julia Richter (Joint Fiscal Office analyst)]: Your allowable growth is greater than your prior year ad spend increased by inflation, then you get your allowable growth. So it results in less savings because it creates more capacity for school districts. Do you agree with all of that?

[John Brady (Office of Legislative Counsel)]: Yep. How much?

[Scott Beck (Member)]: Can you quantify that, Chittenden?

[Julia Richter (Joint Fiscal Office analyst)]: So preliminary estimates, this is if it were to be applied in FY '27, the preliminary estimate for the S220 as originally drafted was 67,500,000.0, which I testified to. Then a preliminary savings of this construct that I just spoke to using the NIPA twenty six to twenty seven is an estimated savings of 57,000,000. So a little bit of $10,000,000 of savings.

[Ann Cummings (Chair)]: John, would you I add think that's what we were talking about.

[John Brady (Office of Legislative Counsel)]: Okay. I've drafted several things, and that is not one of the best. We were having

[Scott Beck (Member)]: we were talking about at least allowing them to spend have the same education spending they've been had the years prior. Yep. Right. We didn't have the idea of the nipple on top of that is new.

[John Brady (Office of Legislative Counsel)]: So I have something that is like that. That that is but we can do any of these things. What I have is kind of that description. It would grant you, if you're, if it would result in a better, a higher budget for you higher ed spending to use last year's ed spending because you had a student enrollment decline, you could use that. It doesn't involve any inflating of last year's figures. It's just, the simple way to describe it is it's an alternative way to have a holy harmless provision, basically. It basically says you can use the friendliest student count, either this year's or last year's, to determine the perfume spend, and we, just in terms of determining the impacts, I think you would also look at this piece.

[Julia Richter (Joint Fiscal Office analyst)]: Yeah, so the way

[John Brady (Office of Legislative Counsel)]: I don't know if you felt comfortable, yeah.

[Julia Richter (Joint Fiscal Office analyst)]: The the same the saving the the change in savings seems to be negligible when looking at the Those two. The parameters or the calculation that John just laid out compared to s two twenty. K. Yeah. So the the way that Julia described it was more to in in sort of keeping with what I was trying to describe last week. Was it private? Yeah. Describe it. Because I think that if we just allow them last year's amount, that doesn't account for the increase in sort of inflation costs, like contracts and oil and all the things that go up in price. But if we just do it on a per pupil basis, the long term weighted average basis, it doesn't take into account changes in enrollment or changes because of data problems. Like we talked about the poverty data from the federal government probably being really, really messed up. So districts could be punished for bad data that's not their fault when they do it on a long term weighted average basis or the loss of students who are heavily weighted students as we've talked about. So I think the the option that Julia mentions is gets more at what I was getting at. Granted, that's not what I suggested, but she's thought about a lot more than I have. So I I think it gets at it. It is yeah. And I I mean, I just also wanna reiterate that the the new data that we got last week shows overall budgets going up by 3.5% this year. So they are fairly close to that right now. You know? They are not they are not going out and, you know, buying gold mugs.

[Ann Cummings (Chair)]: Senator Chittenden.

[Thomas Chittenden (Vice Chair)]: Yeah. I agree with what senator Hardy was just saying. And I'm just I like what you're saying. I'm wondering if you'd agree with this way of framing the Julia,

[Julia Richter (Joint Fiscal Office analyst)]: notice. I don't want it all out to be clear.

[Ann Cummings (Chair)]: Fair enough. This is our this is ours.

[Thomas Chittenden (Vice Chair)]: Yeah. But jumped

[Ann Cummings (Chair)]: out of here.

[Julia Richter (Joint Fiscal Office analyst)]: We But I appreciate

[Thomas Chittenden (Vice Chair)]: Alright. So I think what I heard you say is that if this were to go in effect, some of you agree or disagree with this, all school districts would just okay. By default, all school districts would not be able to spend higher if they're do not be able to have their aggregate spending higher than their NIPA adjusted amount, unless their pupil count increases allowing the higher allowable growth amount to proportionally allow for a higher aggregate budget. We're cap we would be effectively capping in growth for everybody at that NIFA rate unless the pupil count allows them a higher growth percentage that.

[John Brady (Office of Legislative Counsel)]: Is that incorrect? I think it's slightly different than that, which is that the comparison of the NIFA inflated factor against what you would get under allowable growth isn't allowable growth captures more than just pupil count, right? It's a determined percentage based on last year's spend of the relative difference of your district against the highest spending district, so we can't just say outright that it will be the case that you only get allowable growth if your pupil count increases. It could be that allowable growth is determined, like if you are a relatively low spending district and you get a 9% allowable growth percentage, then that could result in greater flexibility for you. It's slightly more complicated, but you're on the right line of spending.

[Ann Cummings (Chair)]: I see. And

[Julia Richter (Joint Fiscal Office analyst)]: if I may, I think the the other absolutely everything John said and the other piece that I would add, and I think you said this, but I wanna be clear that we're talking about education spending, not school district budgets Right. Or school district spending on education, which are different, The education spending is the total budget minus offsetting revenues and that's how

[Ann Cummings (Chair)]: we get for education spending.

[Scott Beck (Member)]: I'm just trying to think of it simply. In S220 as introduced, there is a ceiling for every district. Okay. And all we're talking about here is having a second ceiling and the district can spend up to the higher ceiling if they want to.

[John Brady (Office of Legislative Counsel)]: They want That's right.

[Scott Beck (Member)]: Yeah. That's all we're doing.

[Ann Cummings (Chair)]: The higher ceiling is the NIFA inflation rate.

[Julia Richter (Joint Fiscal Office analyst)]: Well, could be. Could be. It depends on the district.

[Scott Beck (Member)]: Could be education spending plus. It could be something else.

[Ann Cummings (Chair)]: But coming in pretty 2.8%. Yeah. It's coming in fairly well. Okay.

[Thomas Chittenden (Vice Chair)]: If they want to, it's important. This is not saying they're gonna get this much money to spend. This is it. They can go up to that amount or less if they so desire in the current state. Great.

[Julia Richter (Joint Fiscal Office analyst)]: Can I can I just ask I mean, John, if I can put you on the spot? So, when you first introduced this bill, you did express some concerns. Yes. With the potential constitutionality of it and I'm wondering if you could reiterate those in the context of this The

[John Brady (Office of Legislative Counsel)]: way that I express the constitutional concerns will not vary much based on the way that we design the cap. I would say it's largely just a function of there being an outright cap. I think the basic point I was trying to make is that under the education clause, state is obligated to provide an education to its students, there's a constitutional obligation there. If the cap was such, and I'm not saying that it is, but if a cap was set such that school districts could not adequately fund education for their students, then you could have a claim that you violate the education clause. It's really that simple. We don't know empirically what that number is. In this case you can say things like we're determining the cap on the basis of prior spin in, which is presumably reflective of the amounts that school districts deemed appropriate. So that's one concern is under the education clause. There's additionally a concern under BRIDGAM, just about substantial quality of educational opportunities. I think a simple way to think about the concept here is just that you're literally setting differential caps, varying caps for different districts based on their prior spending. A low spending district can spend up to X amount at their allowable growth cap. And a higher spending district can spend up to a different cap. Now there was an equity factor that went into the determination of those caps. They're inversely related to prior year people spending, but it is literally the case that some districts by law would be allowed to spend more than others. The thing I would say to try to complicate this even more, to give unhelpful loitering speak, is that you could imagine, I'm just going give a hypothetical, you could imagine a law that says your lowest spending districts can spend no more than $1,000,000 per pupil, and then you didn't apply that same limitation to the highest spending district. So by law, you have in place a cap only on low spending districts and not on high spending districts, but I'm guessing, and we don't know, but I would guess that no one would particularly care that you impose this $1,000,000 cap on the lowest spending and not on the highest because no one spends $1,000,000 on their pupils. So the point is just, I'm trying to draw, it's an empirical question, but I think there are potential concerns under both. It's not to say that either is resolving the situation, but just so you guys are aware. Is

[Ann Cummings (Chair)]: the fact that this is two years at all mitigating, and the fact that we're putting an appeals process into this so that if you in fact can't hire a math teacher, you have an appeals process to go through. Would that mitigate that concern at all?

[John Brady (Office of Legislative Counsel)]: So to answer both questions, on the two year piece, the constitutional obligation persists regardless of the temporal duration. It may be the case that it's more difficult to frame a successful challenge within a two year period, but the constitutional obligation exists nonetheless. So to your point about the appeals process, I think it would likely depend a lot on how the appeals process goes, but I certainly, the advising on this front, feel much more comfortable when you have an appeals process built in because that's basically granting an avenue to say, someone can say, and I can show you the language if we end up getting to that point, I don't wanna, I know this is a complicated discussion, but basically the language is saying something like, you would submit your budget to the Secretary of Education if the budget necessary for your schools needed to exceed the allowable growth that was set for your district. So it's literally an appeal on the basis that to adequately fund your education, you need a higher allowable growth. So if the appeal's processed worse, it's reflective of actual costs. That makes me feel better, as the lawyer, but, so I think it is something that boosts the ability to withstand constitutional challenges, if that's the question.

[Ann Cummings (Chair)]: Okay. And we haven't gotten, to the we just said it's an appeals process, but I get it. I I have.

[John Brady (Office of Legislative Counsel)]: And it it really is yeah.

[Ann Cummings (Chair)]: Sandra Beck, do you have a question? No. No. Have. Okay. Sandra Hardy.

[Julia Richter (Joint Fiscal Office analyst)]: I have a question. One, so we already have a excess spending threshold that above which districts get doubly passed if they go above it. But that, the constitutional concerns on that are less because it's It's still threshold.

[John Brady (Office of Legislative Counsel)]: Right. It's a rather than so the same concerns of yeah, I would say a threshold is different than a cap in terms of, if you just think about the education flaws concern, right, someone's incapable of It's a test threshold, a lot of attention.

[Julia Richter (Joint Fiscal Office analyst)]: Okay. And so, I one of the conversations we had last week was could we do the same thing with using the spending threshold, just lower that a little bit, and it would still and I don't know if you looked at those numbers. At all. Had a chance to look at those numbers yet. I can follow-up with that. Yeah. I mean, I don't know how interested others are in that, but we already have a mechanism. So this is introducing some other complex mechanism.

[Scott Beck (Member)]: And means change the number. Pardon me? Stakes the spending threshold. Just change the number

[Julia Richter (Joint Fiscal Office analyst)]: and you've

[Scott Beck (Member)]: done it.

[Julia Richter (Joint Fiscal Office analyst)]: Yeah. Really, you're good graft. So, yeah, so I guess that if you were interested in looking at a change, the excess spending threshold, the question then is to what? From one eight right now, right, the excess spending threshold is that twenty twenty five average per pupil spend, excuse me, increased by inflation and then multiplied by the statutory factor of a 118%. Mhmm. If we were gonna model how it would look different, the question the first question would be, instead of what 118%, what percentage would you be? Right. And what would how would this impact tuition rates? Is there there's This

[John Brady (Office of Legislative Counsel)]: doesn't affect anything about tuition rates. This is just a

[Julia Richter (Joint Fiscal Office analyst)]: a caps lump of $8.29. That's good.

[Ann Cummings (Chair)]: We do have some amendments that are coming. The

[Julia Richter (Joint Fiscal Office analyst)]: if if I may, the the the further consideration that I would raise with respect to the excess spending threshold and the cap, and I think this is obvious, the cap literally is limiting how much education spending is committed.

[Scott Beck (Member)]: Yeah. The hard cap. Mhmm.

[Julia Richter (Joint Fiscal Office analyst)]: And so we will know the maximum amount of education spending in the state. Adjusting the excess spending threshold, I don't I won't be able to model how school district budget decisions will be impacted by by a different excess spending threshold. Really, what I would be able to model is how the tax distribution would change across the state. Right? Because by lowering the excess spending threshold, if we assume there's no budget changes, is what I would need to assume, that just means that certain districts are gonna be paying more in taxes, which means other districts are gonna be paying less in taxes. The districts that are at or above? The districts that are above the excess spending threshold will then be double taxed in the amount they're above. So they'll be paying making up a larger part of that property tax pie, meaning the other districts below the threshold will be making up a lower piece of the pie.

[Ann Cummings (Chair)]: So I already know that it's easier for some districts to pay the double taxation than other districts, which is one of the reason we have low spending districts who I've heard it argued aren't able to pass a budget that adequately educates their kids. So we're kind of in a rock in a hard place there.

[Scott Beck (Member)]: But if you do, you know, bring that walk ins and spending threshold down, that does push the yield up. It makes it easier for those low spending districts to spend additional months.

[Julia Richter (Joint Fiscal Office analyst)]: That's another way of saying what Julia just said and actually go.

[Ann Cummings (Chair)]: Okay. Let's have John walk us through the appeals process, which is drafted, and then we can go back. I just wanna start.

[John Brady (Office of Legislative Counsel)]: Yeah. Do we have two So I will follow your direction. I think it is probably simpler if I just describe the appeals process because the amendment I have contains the per pupil concept as against the HIPAA deflated one, so it really is quite simple. It is just that EPA school board determines that the budget that is necessary for the upcoming school year does not fit within the allowable growth, it submits its budget for a spending review to the Secretary of Education. And then using a similar concept to what was used in the Act 127, for the tax rate review, the Secretary of Education, with the assistance of three superintendents and three business managers, would then review each budget that's submitted for spending review and just ask the question, was this outside of the district's control, or was there other good cause for increase in the ad spending of that district? They determined that there was good cause for the increase, then they would amend the district's allowable growth to permit them that could cause increase. It really is that simple, there's no factors built in. You may recall the different factors from the 1.7 review process. They aren't applicable here, because that's more about tax rate mitigation. So it really is just a simple secondary of education with the assistance of these six professionals who've reviewed each submitted budget. It would be a discretionary call by the school board to submit those budgets, but they would review each submitted budget and then determine whether there was good cause for the increase in the ad spending and potentially amend that, allow the growth for the district to permit the increase. The way the timing is currently set up in the draft, the limitation is now that a school, you may recall that the initial S-two 20 draft just said if you can't have education spending in excess of fuel and the whole process, right? So it was just a prohibition on having excess spending at a sufficiently high level. Now the draft is targeted at proposed budgets, so the restriction is school board cannot propose a budget that exceeds this, and so the idea contemplated was that the school board determines that their budget would exceed the allowable growth, they then submit it to the Secretary of Education for review so that the budget they end up submitting to the voters can be reflective of what is necessary needed to correct me.

[Ann Cummings (Chair)]: Yes. Okay, does that work for people? Okay. So have the per people spent, the allowable growth cap as it was presented to us, with whichever is greater, which would have less savings, your total budget with an increase according to the NIM of inflation rate, which this year was 2.8. Alright. So more, you know, trying to prevent it. Sean's Yeah.

[John Brady (Office of Legislative Counsel)]: Mine is like it's the concept is like the hold harmless.

[Ann Cummings (Chair)]: It's okay. It's it's a greater spend either this year or last year. You can use either pupil count, which says if you lost your heavily weighted student or a whole family of heavily weighted students, you could use last year's per pupil spend.

[John Brady (Office of Legislative Counsel)]: There's another way to describe it that may be more intuitive to folks, because I guess that the per pupil spend is hard for, maybe hard to wrap the mind around. When you think in terms of declining student enrollments and per pupil spend, you're protecting against that decline, so you're just touching the per pupil spending piece. But another way to think about it is that you could say that a district will get its allowable growth calculated based on the ad spending that they had last year, or if they've had an increase in student count in this year, they would get an allowable growth that's determined based on last year's ad spend plus the per pupil spend in that year multiplied by the increase in student count. Right. So either way, the apples to apples creates unfortunately technical sounding language, But that's the concept if you do this that approach.

[Ann Cummings (Chair)]: And now we've had the allowable growth cap put on the table and lowering that to what? 3%?

[Julia Richter (Joint Fiscal Office analyst)]: What what do you you do you mean the excess spending? Excess spending. That's a 118%.

[Ann Cummings (Chair)]: Yeah. That's yeah. But the proposal we have that now. 20. Right. So I thought the proposal was to lower that.

[Scott Beck (Member)]: I don't see. Well, it's a conversation.

[Julia Richter (Joint Fiscal Office analyst)]: Yeah. Was a conversation about whether we could use a current mechanism.

[Scott Beck (Member)]: Let's do it that way.

[Ann Cummings (Chair)]: Okay.

[Scott Beck (Member)]: Yeah. I kinda you know, as far as whether we want a one test or two tests. I think if if we're gonna have an appeals, an appeal process, I would favor just going with a one test that's in the as introduced. And, we're do an appeal. There shouldn't be an appeal for a district. I just go with that one that one test. But if you're not they're not gonna have an appeal, so I think you do have to have multiple deaths, but that's just me.

[Thomas Chittenden (Vice Chair)]: So on that point, I'd love to hear from the agency of education if they have a preference because if they're worried that they're gonna get bombarded with appeals in an already busy time, then I guess I could be persuaded to that point. But if they that I'll say, you know, what it makes sense to the thing as we don't have the capacity to manage this budgetary two two tests. Two test. Yeah.

[Julia Richter (Joint Fiscal Office analyst)]: I mean Mhmm. I think also school districts know far better than the agency of education what their budgets should be and what their what is necessary to educate their students. So, while I support an appeals process, I frankly trust districts far more than I trust the agency to be making these decisions. And allowing the NIFA gets away from the problem we have discussed with the per pupil spending data, the funding enrollment issue.

[Ann Cummings (Chair)]: Okay, so if we have two, the likelihood of having a lot of appeals decreases. I see. Mean, now, you got voters. I don't think you would have to look too far to find school boards that don't feel they'll be given enough money to educate their students because their voters are not voting to spend that money. That's essentially how we get the big swing in per pupil spending. So I

[John Brady (Office of Legislative Counsel)]: just want to throw out that it it it may be the case that having two ceilings as described reduces the inclination to go to review, but it may not meaningfully decrease the you know? Like, it could be that school districts are still there's a lot of spending reviews. Right? Just depends what the needs are.

[Ann Cummings (Chair)]: We don't know. Okay. And we all live with, So I know we've got two amendments coming. You know, we live with two pronged test for the cap, the appeals process, and I think that's it. Right?

[John Brady (Office of Legislative Counsel)]: When you say two pronged, you mean the NIFA?

[Ann Cummings (Chair)]: Yeah. The The NIFA and is that something everybody can live with? Maybe not white.

[Scott Beck (Member)]: Yes general construct yes I'm not sure about NIFA I'm not sure about last year's spending plus NIFA I think that I mean for a district that is losing students and needs to make some decisions, that gives them a lot of upward per per pupil spending increase. And I don't think that's really what they ought to be doing.

[Julia Richter (Joint Fiscal Office analyst)]: Think they should be 2.8%. That's not that much.

[Scott Beck (Member)]: But if they're in a declining, they're I mean, most of us are in a declining a declining weighted situation. They're basically gonna get more than if not on a weighted student basis than I I just by giving a, I think it's it's delayed some hardships. It's that are declining in size.

[Thomas Chittenden (Vice Chair)]: Your earlier point, it's just the cap, so they could spend less. They could. I

[Scott Beck (Member)]: can go somewhere between last year and Nipa somewhere in between. Think giving them Nipa is too much.

[Ann Cummings (Chair)]: For every school, these are yeah. For every school that has declining, you're gonna have one that is increasing. You have

[Scott Beck (Member)]: They're going to be fine.

[Ann Cummings (Chair)]: I mean, it's, I don't know, we need to settle on something.

[Julia Richter (Joint Fiscal Office analyst)]: This is a bridge, remember? And in the short term, they're still gonna have their costs of the building, their teacher contracts, their their buck contract. You you can't turn around the ship that quickly. So this, you know, that's But then he But Nimba is the sort of, like, basket of goods inflator kind of thing. Because they still have the same basket of goods.

[Thomas Chittenden (Vice Chair)]: Two things. One, it gives me I'm more comfortable with NIFA because of Julia's estimates of it only affecting possibly 10,000,000 reduction of the overall possible anticipated 67,000,000, but I what I'll pick up on your concern with NIFA is with this continues, this gets extended afterwards, these districts are gonna keep defaulting to that NIFA amount continually to the point where I I don't think we'll ultimately accomplish putting some spending pressures on them. So I wonder if there's a way to allow for the NIFA cap and then having that somehow diminish in the following years if they continue to hit the cat. Would they get a

[Julia Richter (Joint Fiscal Office analyst)]: It's only two

[Ann Cummings (Chair)]: It's only two years. That's idea here that we will begin with foundation formula, which is a hard calf. You have a little wiggle room with a bulb at the top, but it is essentially 48, this, it is a limit on what you can spend.

[John Brady (Office of Legislative Counsel)]: So, on the cost, long term cost containment pieces, as currently drafted, the bill is kind of, while it can't be in thought, it is agnostic as to what is happening with the education system, but I would just point out that in FY '29, Act 73 is law, and the foundation formula will be rolled out, and these provisions will be meaningless in FY '29 because you would be under the foundation formula. But you can think of this as a bill that says whatever happens, thinking about a process for the VA costs.

[Ann Cummings (Chair)]: I think you tell that there's a lot, how Act 73 is playing out is being worked through this body, the two bodies, that every one of these bills has a long way to go, and that every one of them will probably be changed before we all get out of here. I think this is trying to give taxpayers some security that that we're going to put some limit. It's not going to stop going up, but we're going to stop the double digit going up for at least two years so that they can catch their breasts. I'm going to see if we can get more than one or two towns, but I've it's still a little early, but I really want to trace that tax delinquency thing before it is a real crisis because chance that some of those homes are gonna get brought up and turned into short term rentals is pretty good And I don't think any of us want to see that happen.

[Julia Richter (Joint Fiscal Office analyst)]: Thank you. I'm not expressive enough with my handwriting. No, just in my blind spot. I know, I have to be more expressive. I'm never the optimist, and I would like to think that in tandem with this particular effort, we are also potentially doing our seesaws, and we're potentially also doing some strategic mergers, and we're doing reference based pricing to bring down some health care costs. So the entire ecosystem will hopefully be responding in ways that will be beneficial over the next few years. That's my plea for optimism and hope. May I present my

[Ann Cummings (Chair)]: plan? I wanna get this settled

[Julia Richter (Joint Fiscal Office analyst)]: Got it.

[Ann Cummings (Chair)]: And see if we can all live with there may be some nose holding, but we can live with what we've got now, which is Julia's proposal.

[Julia Richter (Joint Fiscal Office analyst)]: The committee's proposal.

[Ann Cummings (Chair)]: The committee's proposal. Once we vote, it is ours, Julia's numbers, because we don't do this. The drafting we have for the appeals process, which we used before, and I think that's it. It's

[John Brady (Office of Legislative Counsel)]: a pretty

[Ann Cummings (Chair)]: simple little bill, which is a death knell. And now we have two amendments, and I have a feeling is that why that's in the report? Yeah. I thought so. You have to go. You'll catch it. Oh, that's it. Julie's got a hard stop at five, so we will let Julia go. I didn't take the next steps. Okay. We will listen to the two amendments that Beth has. Can I give this to you? And then we will decide what we wanna do with those, and, hopefully, we can get this sponsorship. I've got a tentatively scheduled for Thursday. Okay.

[Ruth Hardy (Member)]: Okay. Okay. So would you like me to open that by tomorrow.

[Ann Cummings (Chair)]: Oh, I had it tomorrow. I thought it was today. Okay. No.

[Ruth Hardy (Member)]: Because well, not that's when I

[Ann Cummings (Chair)]: you told

[Ruth Hardy (Member)]: me you

[Ann Cummings (Chair)]: had amended. So okay. So if we could do it tomorrow, we will. That all depends on drafters and stuff, getting things done.

[John Brady (Office of Legislative Counsel)]: Should be able to.

[Ruth Hardy (Member)]: Okay. Great. So I'll just share some concerns I had over the weekend as I was thinking about this that there is a potential with a cap to further degrade our public education system, although I hope that is not the case, There is that potential, and so I was worried that as we're potentially sort of bringing

[Ann Cummings (Chair)]: down quality

[Ruth Hardy (Member)]: in our public education system just because we're pulling funds out of the system, that there might be a reverse incentive for independent private schools to capitalize on that, and that was obviously a concern for me. Wanted to make sure that independent schools were also gonna have some kind of a cap on their tuition so that we didn't have that lopsided environment. I also wanted to make sure that the tax payer dollars that were going to pay for that tuition were not going for things other than education. Like, didn't want them going to scholarships, for example, to draw kids out of our public schools, because we know we have some small schools that if they close, there will be a public school desert in that geographic area, and I think we should do everything we can to avoid that. So those were a couple of my concerns, and those did get very eloquently placed into this amendment. Then my other concern just came from, again, personal experience with having to close our high school and having to now be building another one because of the PCV contamination. I was worried that debt service and money that we owe on loans that we got to a bond would be part of our education spending and that districts like mine would be punished for having that debt service. So I wanted to make sure that we address that as well. And I think John could probably stick to that.

[John Brady (Office of Legislative Counsel)]: John? Yeah. It's almost just, I'm gonna start because I have the first piece of this. It's gonna look a little funny because you haven't seen the underlying report of the Committee on Fightings, but this is just for presentation reasons against the concept that you guys have been discussing today. So, the first instance of amendment, this is using the same language that we use to exclude capital expenditures from the excess spending threshold. And so this is just adding to the allowable growth concept that when determining the Fed spending against which you compare your allowable growth cap, right, you're subjecting that the low growth cap, you would exclude from education spending voter approved bond payments for principal and interest. So this would treat the allowable growth cap in a similar way to how we approach the excess spending threshold and would exclude from education spending those bond payments.

[Ann Cummings (Chair)]: Those bond payments are included in this year's. Yeah. So I can see that if you had to start making a bond payment next year that it would inflate it. But if it is in this year's get spend, it's already accounted for. Right? I I think so.

[John Brady (Office of Legislative Counsel)]: I just wanna be careful if you're referencing the fact that post 07/01/2025, certain bond votes are included and others are not. Bond votes approved before a particular date, I think it's 07/01/2025, maybe 2024, those are excluded from education spending for the purpose of excess spending in the first case. That's based on when the bond was voted, not based on if they have it included in their budget this year. New So I just wanna be clear that that was happening. In general, the context of education spending includes your bond payments if that

[Ann Cummings (Chair)]: is the case. That is, so if

[John Brady (Office of Legislative Counsel)]: But we define, the way to think about it is we create technical concepts for particular pieces, so we say that for the purposes of the excess spending threshold, education spending excludes. Right. But the intuitive concept that people have is

[Ann Cummings (Chair)]: that education spending continues to If we're comparing both to last year's, Unless you voted a bond

[John Brady (Office of Legislative Counsel)]: Yes. Yes.

[Ann Cummings (Chair)]: Last year, and this is a new payment. Yes. It's in that case, I could see excluding it. Okay? But if what I'm being told is I can't spend x more this year than last year, and last year I paid a million dollars in a bond, you know, a bond payment, then that million dollars is already in my base. I can spend that again this year along with the three to 6% or the 2.8 NIPA.

[John Brady (Office of Legislative Counsel)]: You're saying that those payments are already captured in the ad spending that is accounted for in the allowable work.

[Ann Cummings (Chair)]: Right. Unless it was a bond voted last year, and I don't know if any were. But And

[John Brady (Office of Legislative Counsel)]: even if they were, they would be part of your in spending.

[Ann Cummings (Chair)]: In spending,

[John Brady (Office of Legislative Counsel)]: yes. So that part is

[Ann Cummings (Chair)]: the excess spending threshold piece is not applicable to how this works here. It's just using a similar method. I I mean, I if we exclude it and you were paying a million last year in your budget, this year, if that million is excluded, you could pay a million more in whatever and still stay under any cap.

[John Brady (Office of Legislative Counsel)]: Yeah, going along with the hypothetical, I think the way that I would state it is you would have a cap that is determined based on included bond payments within education spending, and then you would exclude from the education spending that you are subjected to a cap, those bond payments, which would then increase the amount that you could spend. I think that's what you're

[Ann Cummings (Chair)]: For some schools, but if I remember the treasurer in here, there wasn't much well, there were Chittenden there were three Chittenden County schools that had issued bonds, Like in the last twenty years, there wasn't much out there in the way of bond and indebtedness, and those bonds are already let. So unless some and to me, if your furnace blows up and you need to put x million into a new heating system, that's your appeals process. This is something beyond my control. We have another flood in Montpelier High School goes underwater. That's an extenuating circumstance. It's beyond my control. But just say we're not gonna count on proceeds that were in my per people or in my budget last year from this year's school spending gives any school that has that a whole lot of wiggle room that other schools aren't getting.

[Scott Beck (Member)]: I think what would make this work for me is if from a year over year if we're talking about an increase in their bond payment. Like I know that's kind of bourbon in that situation because you're building school and it goes up a

[Ann Cummings (Chair)]: little bit. It goes up, okay.

[Scott Beck (Member)]: Whatever that delta is, I think that's fair to mean to exclude.

[Ann Cummings (Chair)]: Okay. I'm not sure about the whole thing. Yeah. I mean, it's already.

[Scott Beck (Member)]: The whole thing's excluded from excess spending threshold.

[Ann Cummings (Chair)]: Yes. So,

[Ruth Hardy (Member)]: so a big chunk of our budget right now is paying off the building, right? Yep. And the voters in our town, we knew that we would be paying more because we voted for that bond because we needed a new high school. So the idea is we don't want to be punished because we are paying off the debt on the building. Like that's not going to education programming, that's not going to, you know, that's going to paying off the loan. Right, but that- It's part

[Ann Cummings (Chair)]: of your ed spending last this year Yeah. Figured in your ed spending. So this year, you've got that base. If we exclude what you paid last year, then you've got that, I don't know, 100,000 or a million dollars to spend on other programs, which schools don't know. Last year you paid a million and this year you owe a million 5. I think what Scott's saying is leave out 5.

[Scott Beck (Member)]: Yeah. Because that's

[Ann Cummings (Chair)]: That's growth. Yeah. That's a contract that you have no control over. But to just say we're gonna leave out the million and give you that much, I think that would get us into some legal trouble. And if your school gets contaminated this year, you have to evacuate and stuff, that's when you do an appeal and get your rent for Macy's Yep. Or the Grange or whatever other tax cut.

[John Brady (Office of Legislative Counsel)]: So is there sorry.

[Ruth Hardy (Member)]: I'm I'm just trying to think about this because can you just repeat the date the the prior to '20 what?

[John Brady (Office of Legislative Counsel)]: July 1. 2024.

[Ruth Hardy (Member)]: Prior to twenty July one twenty twenty four, it is Voter approved bond payments for principal

[John Brady (Office of Legislative Counsel)]: and interest are those bonds that are approved prior to that, the bond payments on a yearly basis are excluded from the excess spending calculation.

[Ruth Hardy (Member)]: They're excluded from the excess spending calculation.

[John Brady (Office of Legislative Counsel)]: Meaning that those costs are distributed more widely across the state rather than being double taxed within the district that has those costs. Okay.

[Ruth Hardy (Member)]: And after that, they're not excluded?

[John Brady (Office of Legislative Counsel)]: After that, they're not for purposes of the excess spending threshold. Okay. There is an amendment in the there's a bill in the house that proposes to change this. I'm just

[Ruth Hardy (Member)]: thinking of how, you know, districts have all these building costs, and some of them are because they need to make adjustments and changes to a building in order to again, my one of my districts, they're literally closing an elementary school, and they need to make adjustments to the school they're moving all the kids to in order to accommodate all those kids. Plus, they need to make adjust they need to make changes to the security systems in all the buildings. They're not meeting, like, current security needs. So, these are not, like, frivolous building things. And, fact, one of them is in order to do what apparently we want them to do, which is to consolidate into fewer school buildings. So, I I'm just concerned that if we put too hard of a cap I mean, this is a concern of mine about the cap in general, is if we put too hard a cap on, they're not gonna be able to do these things which are necessary to do the long term things that we're that we're asking them to do in f seventy three. So that's why I'm trying to find this flexibility in the cap and this is one way of potentially doing that.

[Thomas Chittenden (Vice Chair)]: Yeah. So On that point, before Julia leaves, really quick, on her way out, do you know of any idea of the total ad spending in Vermont last year? What person what amount was would probably qualify as this type of voter approved bond payments? Is that a number that exists out there?

[Ruth Hardy (Member)]: I do not know, and I have not had I haven't seen this before right now, so I haven't had a chance to think about it real quick. We

[Ann Cummings (Chair)]: could, as we did with excess spending

[Thomas Chittenden (Vice Chair)]: Sorry to cut you.

[Ann Cummings (Chair)]: Exclude any bond payments or debt. Maybe you'll just go to your bank. Incurred for the next two years necessitated by building safety or efforts to consolidate, which would give you And then there's the appeals process.

[John Brady (Office of Legislative Counsel)]: So just to be clear, that case, you're talking about costs that otherwise would not be captured in the Ed spending that you were using to determine your capital, meaning they emerged in in FY twenty eight basically. Yeah.

[Ann Cummings (Chair)]: That this was this is an add on to what you spent last year, but it is necessitated either to enhance structural efficiency or safety.

[John Brady (Office of Legislative Counsel)]: Yeah, I mean, can do something Health and safety. You could do something like that, and there's different ways that you could do it. One is to exclude it from what constitutes education spending. Another is to add the dollar amount that corresponds to that to your allowable growth, and just say that your allowable growth is increased by the expenses you have that are related to merging and the like. Right? So there's there's different ways to

[Ruth Hardy (Member)]: Should we let them do the other parts if she has to go? Like, we could maybe go back to this. I don't know.

[Ann Cummings (Chair)]: Let's let's finish up that. K. And then so so we John, do you have enough to grab something that would allow

[John Brady (Office of Legislative Counsel)]: I have the first part of our conversation about manipulatives those things.

[Ann Cummings (Chair)]: Yes. I'm wondering, committee, about can we agree that we would allow not counting debt incurred in order to meet life safety or-

[Thomas Chittenden (Vice Chair)]: consolidation.

[Scott Beck (Member)]: I really hope we had to pay it for consolidation.

[Ruth Hardy (Member)]: Well, part of that is paying building costs. Is building I think that requires a little more conversation actually because I need to

[Ann Cummings (Chair)]: Let's get this one done. Put this on tomorrow for more discussion if possible, though. And if you can think of some ways to I will think of it. Yeah. Everyone will think better in the day. That's right.

[Beth St. James (Office of Legislative Counsel)]: Okay. That's Saint James Office of Legislative Council, section two in this document, introducing the tuition cap, fiscal years 02/1928 '29. Notwithstanding '16 BSA sections eight twenty three, subsection eight twenty four and section eight twenty five, and subsections eight twenty seven and those are all part of your town tuition program. They are the pieces of law that essentially say how much tuition, how tuition can be populated. So we're not withstanding all of that. And then any other provision of law to the contrary, just in case I have left something out. For fiscal years '28 and '29, only a school district that pays tuition for its resident students pursuant to chapter 21 and title 16, shall pay an amount not to exceed the average announced tuition of Vermont Union Elementary Schools and Union High Schools as applicable for fiscal year twenty seven? Thank you. The average announced tuition is determined can you remind me by whom? Is that state board or AOE. Average announced tuition is literally an average of the announced tuition. Announced tuition has the calculation for how you get to announced tuition. And announced tuition is determined by AOE. Oh, by AOE. There is well, I'm sorry. The net cost per pupil. They sorry. They AOE calculates it's called net cost per pupil. I think it's just allowable tuition is what AOE is calling it now. In statute, it's net cost per pupil. So the highest amount a public school district can charge for tuition. Mhmm. And then the school districts can decide to charge anything at that or under. Okay. And that would be their announced tuition.

[John Brady (Office of Legislative Counsel)]: Okay. But

[Beth St. James (Office of Legislative Counsel)]: that's what I remember doing as a school board member. Yep. Because I I thought school boards announced what their tuition was not. But they have then they report it to the agency and the agency averages it. Correct. Okay. So that average announced tuition is a concept for public school tuition rates. Yes. And that is under current law, tuition for elementary schools is capped at the average announced tuition of the union elementary schools and capped at the average announced tuition of union high schools. So, these are just the concepts in current law. There are other scenarios where you can go above that with voter approval, or if you are a independent school, meaning EQS, or you are a independent school serving as an area CTE center, you can charge more than the average amount of tuition. Mhmm. But generally speaking, that's where the cap is. Okay. So that was gonna be my question because there are lots of things that we call tuition. But so paying CTE schools. That's taking care of in a whole different way. Whole different. Okay. And then the pre K and the special ed school therapeutic schools, is that also a separate? Yes. Special education is under a separate chapter. Pre k does live in chapter 21, and so if you decide to move forward with this language, we can add some clarifying language. I think it's clear that pre k tuition is calculated differently, but it doesn't hurt to be more clear. This language as drafted, again, is a policy choice. Career and technical education tuition is governed under chapter 37 in title 16 with the exception of tuition to regional technical centers that are also approved independent schools that are serving as regional technical centers. That tuition is governed under chapter 21 and has been not withstood in this language that I've drafted. So, again, not the policy choice. Okay.

[Scott Beck (Member)]: So who does the supply to?

[Beth St. James (Office of Legislative Counsel)]: Every school district that pays tuition. So

[Scott Beck (Member)]: what happens to the allowable calculation?

[Ann Cummings (Chair)]: It's I

[Beth St. James (Office of Legislative Counsel)]: don't know what happens to the calculation. The cap at what a school district is allowed to pay would apply to both public and private schools.

[Scott Beck (Member)]: So every public school that's a received school, every approved independent school, Correct. They would receive the average amount tuition?

[Beth St. James (Office of Legislative Counsel)]: Not not to exceed the average amount tuition.

[Ann Cummings (Chair)]: That's Go ahead do the whole thing. Yeah? Okay.

[Beth St. James (Office of Legislative Counsel)]: Section three amends section eight twenty eight in title 16, which is the statute that controls which types of educational programs a school district can pay tuition to, and then amends the criteria for an approved independent school to be eligible to receive public tuition. So you'll see this is all current law, and we're adding that the approved independent school agrees that for the purposes of access to public records, the school is a public agency and shall comply with the Public Records Act and provides an annual assurance to the State Board of Education signed by the head of school that no public funds were used to subsidize the tuition of private payor students.

[Ann Cummings (Chair)]: Trying to feel a little bit beyond the scope.

[Thomas Chittenden (Vice Chair)]: There any precedent for existing restrictions on tuition dollars? Do we have any restrictions? 78.

[Ann Cummings (Chair)]: That's the act 79.

[Beth St. James (Office of Legislative Counsel)]: I mean, most of what is in 16 via the A28 Subdivision A2 is is brand new from last year in Act 73. All of it, actually.

[Scott Beck (Member)]: Sure.

[Ann Cummings (Chair)]: How do you define It's not defined here. If I'm a kid that just sits in my seat and learns and I'm being charged the same rate as the kid sitting next to me who has a hard time sitting in the seat and learning and needs special help in some way, I'm subsidizing his education because I'm taking less so that he can get more. Is that subsidizing, or is this looking it's I think It's all equals I hear you on the ambiguity of the term. Yeah.

[Ruth Hardy (Member)]: If you were to move forward with this language and you wanted to refine what you are prohibiting, I think we can come up with some language beyond subsidized or that modifies subsidized or defines subsidized,

[Ann Cummings (Chair)]: but as drafted, I hear you on the ambiguity of the term. Yeah. Committee. I'm looking at people who are staring at the screen. Do you wanna take this up, or do you wanna say this is more an education

[Scott Beck (Member)]: decision. I don't know. I think a lot of this feels like it's not germane to the underlying bill.

[Ruth Hardy (Member)]: That's kinda I wanna make sure all schools are subject to the same prohibitions. That's all. Okay.

[Ann Cummings (Chair)]: Senator Brock, do you have anything before I get to Senator Hardy?

[Scott Beck (Member)]: Just an overall impression that every time we discuss this, we add more complexity to it. I'm wondering how anybody's ever explained this to the public. That's an underlying concern of everything you've done here today.

[Ann Cummings (Chair)]: Starting out as pretty simple. I'd like to keep it being less than 20 pages. Very.

[Ruth Hardy (Member)]: Santa Hardy. Yeah, I think if if you could scroll previous, I think it's on page the no, the bottom of page one maybe is. Yeah. So, that one, that is just imposing a cap on tuition for all schools, public and private. Just like we're imposing a cap on all budgets for all public schools. So, it seems germane and entirely germane.

[Ann Cummings (Chair)]: I think that's consistent. And and fair.

[Ruth Hardy (Member)]: Yeah.

[Ann Cummings (Chair)]: Yeah. So And it's a cap on increase, not a cap. It's a

[Ruth Hardy (Member)]: cap on how much they can increase. Yeah. So, it does seem that that's entirely relevant and and also important because if school districts are going to have to, you know, main cap their spending part of their part of the increase in cost for many school districts is the variant type variant types of tuition whether it's CTE or independent school or whatever it is. So, being able to cap tuition, think, is an important way to help school districts be able to meet the other kinds of caps, the other kind of cap. Right. So, I'll just try to repeat, and I didn't say this clearly, but private and independent schools are not subject to the same amount of scrutiny and transparency in terms of their finances as public schools. That's why I'm concerned, I'll repeat, as we are potentially degrading our public school system, private schools might be able to not suffer the same kind of I don't wanna use the word degradation. What's another give me a synonym. Another strong move. Right? Constraint. Constraint. Because we don't know what they do with their endowments and their reserves, but potentially they could be used to kind of, I don't know, in ways that I personally can't even predict, but I'm worried that the gap is gonna become greater in this, potentially, in this scenario, and that was one of the things I was trying to do here, to say use your education dollar, your public education dollars for education. That's all.

[Ann Cummings (Chair)]: Okay. I think the first section is money. You can't increase your tuition any more than you can increase the rest of it. Then there everybody else can increase with probably the same exceptions. I don't wanna see somebody vote a new sports center next November or March and have those bond payments. For for a chert field? For a chert field or whatever. Or music theater. I mean, an art center. I I don't know, when it gets into making sure that private schools behave like that's getting beyond the jurisdiction of this committee. We're a money committee. How schools use their endowments is I'm not comfortable going there.

[Ruth Hardy (Member)]: But Can I make a suggestion for this language that maybe would it just an assurance that public instead of saying no public funds were used to subsidize tuition, private tuition, saying that public funds are only used to pay for the education of Public? Public schools. Schools or something like that.

[Ann Cummings (Chair)]: So making tuition fees. So it's

[Ruth Hardy (Member)]: a positive statement about that you're this is public money. You're gonna use it for publicly funded students only. Okay. That kind of thing.

[Scott Beck (Member)]: I mean, I still think it's not true, but oh, Can you go back up to section two, Jeff? I don't have any problem with having receiving schools, both public and independent, have to face similar constraints that our operating public schools are going to have to deal with, but this is not the way to deal with. I mean, public schools, have their announced tuitions are all over the map. Their allowable tuitions are all over the map. Some of them are extremely high. I know all the public schools in my area that receive students are, you know, they're receiving upwards of $27.28, $2,930,000 dollars. This would be to to force them to take the average amount would be enormous hit. The average amount is average. Not every public school, receiving school, has the same some of them have very high poverty rates and that's why they have a very high allowable tuition. This would really hurt, it would hurt the public schools in my area really badly that are receiving students. With that being said, I'm not opposed to having constraints on the growth of tuition for receiving schools, but this is not the way to do it.

[Ann Cummings (Chair)]: Why can't we just say you can't exceed

[Scott Beck (Member)]: 2.8%.

[Ann Cummings (Chair)]: You can't exceed Yeah. The cap set in the allowable growth caps.

[Scott Beck (Member)]: Yeah.

[Ann Cummings (Chair)]: Well,

[Ruth Hardy (Member)]: it doesn't work that way. It doesn't, yeah, it doesn't wouldn't work right. Okay.

[Thomas Chittenden (Vice Chair)]: Well, I was gonna say. I

[Ruth Hardy (Member)]: I I guess I would like to see some of that information about what because I because if they're public school, they themselves have a budget that they that would be restricted by the law of growth caps or 2.8%. So Yeah. But you're just saying

[Ann Cummings (Chair)]: as a public school. They are a private school that is functioning as the public school in its area. It won't be subject to the same growth restrictions.

[Scott Beck (Member)]: I mean, I'll give you an example here, okay? Danville High School, the CCSU, which is Danville Cabinet in Twinfield, okay? Their announced tuition in FY last school year was, I'm

[John Brady (Office of Legislative Counsel)]: sorry,

[Scott Beck (Member)]: for this school year was $25,000 It's across, it's a SUI, okay?

[Ruth Hardy (Member)]: Is that for high school?

[Scott Beck (Member)]: That's for high school, Yep, that's right. They're allowable for last year, which is probably less than what they're allowed me to do for this year. They're allowable that their the charge is Cabot is $30,007.00 1. Danville is 27,773, and Greenfield is 26,007 and 96. That's what they're allowed to charge for last year, and they should charge for last year. The average announced tuition is, I mean, significantly lower than that. It's far lower than what their announced tuition is. So those schools, I mean, I'm guessing they probably have, my Danville has 15 receiving students. You know, we're talking probably pushing $100,000 of revenue yet for them by tying them to the average announced tuition. I think a percent growth, you know, your tuition can't be more than some percent. That's fine. That's, I think that's fine so that there's constraint on everybody, but I don't, this is, I don't think the way, way to do it.

[Ann Cummings (Chair)]: That sounds like this is gonna make a complicated system more complicated. This is supposed to be a two year reprieve for taxpayers. Right. If you can say somehow that you can't exceed the present year's tuition by any more than 3% because it sounds like they're high spenders. That's it.

[Scott Beck (Member)]: But they're not necessarily high spenders. I mean, these these

[Ann Cummings (Chair)]: are these are non weighted numbers. Yep.

[Scott Beck (Member)]: Right? They're non weighted.

[Ann Cummings (Chair)]: Okay. Because we're saying 20,000 a student if you're charging 27. Yeah.

[Scott Beck (Member)]: I mean, I I think the info works because what's gonna happen right? We're not talking about f y twenty seven. We're talking about FY twenty eight, right? They're gonna know next budgeting season what their allowable was, what they charged, what they charged the year before, and then they can build their tuition in FY twenty eight off of that number. They'd be under the same constraint as everybody else. I think that's how you do it. Not like this.

[John Brady (Office of Legislative Counsel)]: Can we

[Ann Cummings (Chair)]: live with that committee?

[Ruth Hardy (Member)]: I'm sorry. Go ahead. I I mean, I maybe I would like to see have Julia talk about what the since she's the numbers person, like, if she has any data that could show us what this would mean because Okay. I mean, I I just I appreciate your your trying to come up with something that you can live with.

[Ann Cummings (Chair)]: I I really do.

[Ruth Hardy (Member)]: And I do think it's fair to we're gonna cap one side of the system. We gotta cap the rest. So Yeah. I just am wondering I'd like to see more numbers to see how what the

[Ann Cummings (Chair)]: impact would be. What numbers should I

[Ruth Hardy (Member)]: well, I mean, I think Julia has information on the tuition rates and so I don't know if she has numbers on how many students districts are receiving. So, like, I just like, what is the financial impact? And is 2.8 the right number, is that unintentionally way too high or unintentionally way too low?

[Ann Cummings (Chair)]: Okay. So, Charlotte, can you just read do me an email when she gets in in the morning asking her if she can calculate the fiscal impact of limiting tuition increases to NIFA.

[Scott Beck (Member)]: What we just need to know is how much money did sending districts send to approved independent and public receiving schools, and I think A would notice that number.

[Ann Cummings (Chair)]: Okay. If you can give that I'll

[Scott Beck (Member)]: have Charlotte with that.

[Ann Cummings (Chair)]: To Charlotte and that one will Julia can know when we put this pre government agenda. Do you

[Thomas Chittenden (Vice Chair)]: None, sir. Yes. Do you have any time pressure to get this bill out? Is that looming on you at all? I know you said tomorrow or Thursday, but it

[Ann Cummings (Chair)]: I I am being asked when it's coming out.

[Scott Beck (Member)]: And I I could've told you.

[Ann Cummings (Chair)]: But I wanna make sure I would like to get this as workable as possible. Probably. So

[Ruth Hardy (Member)]: may I ask a question if you expect me to speak for tomorrow? Are you looking you wanna see language that caps what fiscal year's tuition rates to an increase of NEPA? Yeah. What fiscal year?

[Ann Cummings (Chair)]: What?

[Scott Beck (Member)]: Well, growth from FY '27.

[Ruth Hardy (Member)]: Yeah, we

[Ann Cummings (Chair)]: have dates in the bill. From '27 to '28 and '29.

[Scott Beck (Member)]: And I think the thing we really need to, I mean, for independent schools, it's really simple. They just charge, they just had an ounce tuition, it's okay. It's the public schools that are receiving, so we're actually a little more complicated because they are allowed to, well, AOE calculates their allowable. When you're talking about tuition for a public receiving school, are you talking about their announced tuition, which is just kind of like their sticker price, or are you talking about their allowable tuition, which is what they actually got paid?

[Ann Cummings (Chair)]: I think it's what they actually got paid.

[Scott Beck (Member)]: I think that's what you want too, yeah.

[Ann Cummings (Chair)]: No, that's the best thing.

[Ruth Hardy (Member)]: My understanding of the way this works is that allowable tuition is the highest amount they can charge under state law as calculated by AOE, but their announced tuition is what they are actually charging.

[Scott Beck (Member)]: I we didn't dig into that, and I have different

[Ruth Hardy (Member)]: That's what the law says, so if something else is happening in the field, that would be excellent. I'll sure I'll sure instead

[Ann Cummings (Chair)]: cannot go up higher than 2.8% for the years '28 and '29.

[Thomas Chittenden (Vice Chair)]: I sense agreement and consensus to mirror the cap on that allowable tuition rate to have a similar CHAP.

[Ruth Hardy (Member)]: Yeah, and we need a little more information on what's actually happening in the field versus what the law is. I think that's important.

[Scott Beck (Member)]: And that's the clarity I responded.

[Ruth Hardy (Member)]: I could absolutely be wrong. But we can't say, oh, it's too confusing and throw up our hands. No, we can't,

[Scott Beck (Member)]: but what we can do is we are trying to clarify.

[Ann Cummings (Chair)]: Yes. We don't wanna make it more confusing.

[Scott Beck (Member)]: The difference between allowable and announce is a huge deal for public schools that are receiving. It there's a huge delta between a lot of us. It makes a big difference in the I'm

[Ann Cummings (Chair)]: gonna send the maker of the motion, the amendment, proposal, see what you can find out. Okay. And see the goal, I think, on everybody's is to have an equal cap on tuition and public money being spent as tuition to private and independent schools, the same increased cap as is being put on the spending on public schools. So, you can't say, well, we're going up 10% this year, and oh, by the way, your kids can all have a suite, you know, a free indoor swimming pool and a ski pass if they come here. So, I think we're trying to find equity in this. Think, since it's 05:30, and I have been trying to build up your tolerance I'm trying to clear that board so we are not doing this until 10:00 at night and get those bills out of here. So I'd like to get this one. It was the first one we got. We were asked to get it out quickly. I'm being asked, what are you doing with it? Now I know where we're we're going. We're in an austerity environment. I just don't think there should

[Ruth Hardy (Member)]: be incentive for some that thrive No. When others are in austerity. Right.

[Ann Cummings (Chair)]: And I don't think anyone is disagreeing. I know. I think it's making sure that in trying to get equity, we don't end up inadvertently putting somebody on a diet. No. Agree. Because what we want is for kids to be educated. Okay. Thank you all.

[Scott Beck (Member)]: Thank you.

[Ann Cummings (Chair)]: Well, let's