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by Matt Cota
Vermont is facing an estimated 12% increase in education property taxes next year unless lawmakers again step in with a General Fund subsidy. The Statehouse was buzzing last week as legislators absorbed another wave of sobering financial news ahead of the 2026 session. Fresh data confirms what many already feared: the state’s education finance system is under mounting strain, driven by rising personnel costs, inflation, and aging facilities. Over the past two decades, K–12 enrollment has fallen by 16%, yet overall education spending has grown by nearly $1 billion. Over the last five years, property taxes have risen more than 40%, even as student enrollment, academic outcomes, and program offerings have declined.
The state’s health care crisis is also coming into sharper focus. Lawmakers spent last week reviewing new data showing Vermonters now spend nearly 20% of their income on health care—compared with a national average of just 8%. Business leaders detailed how dramatically Vermont’s costs differ from neighboring states. For small employers, a silver-level plan for a company with five employees costs more than $8,500 per month in Vermont, while the same plan costs about $5,000 in New Hampshire.
Reading the Rules As the state develops the Tier 3 rules, rural landowners and municipalities may get more notice and further clarification on how Act 181 will impact them. Act 181 modernizes Act 250 by shifting to a location-based system that directs most development to designated growth areas while adding environmental protections in more sensitive rural regions.
Lawmakers are expected to ask for changes, such as requiring mailed notice to landowners in Tier 2, Tier 3, and parcels above 2,500 feet before Tier 3 rules are finalized. They may also ask for a delay to the “road-rule” to give municipalities additional time to prepare for changes to Act 250 jurisdiction. Under the road rule, Act 250 review can be triggered when new or upgraded private roads provide access to multiple lots, extending jurisdiction to both the road and the development it serves.
Energy Report The Vermont Public Utility Commission (PUC) has released its Act 142 report on energy cost stabilization, and the conclusion is clear: Vermont doesn’t need any new statewide energy programs. According to the authors, transportation accounts for 45% of the average household’s energy costs, followed by heating at 35%, and electricity at 20%. The report finds that many effective programs already exist — LIHEAP, Crisis Fuel, Weatherization, utility efficiency programs, and EV incentives — but all of them are underfunded. The PUC recommends the legislature increase Vermont’s existing 2-cent-per-gallon fuel tax on heating oil, propane, kerosene, and dyed diesel to expand the Home Weatherization Assistance Program. They also suggest adding general fund dollars to the fuel assistance program. On the transportation front, the PUC suggests funding incentives for new and used electric and plug-in hybrid vehicles, restoring the programs that ran out of money last year.
Buying Trends Use of GLP-1 drugs like Ozempic, Wegovy, and Mounjaro has surged to more than 12% of U.S. adults, reshaping how consumers eat, shop, and spend. Obesity rates have begun to fall, and companies are responding with healthier food offerings, revamped hotel gyms, and updated menus. GLP-1 users are buying more supplements but cutting overall grocery and restaurant spending by about 10%, shifting more meals back to the home. Alcohol purchases have dropped sharply, while nonalcoholic beverages and high-protein drinks are climbing.
NEWS OF NOTE
- Your tax dollars paid for them. Now you can buy them back, slightly used, at the Vermont State Surplus Property Auction. See what’s for sale here.
- Pull over and check out the Vermont Commercial Vehicle Enforcement Report.
- A new Cox Automotive study reveals that dealer confidence in the service and parts business is slipping, even as fixed operations remain a crucial revenue stream.
- The electric vehicle market continued to slump in November following the end of federal tax credits, a big draw for first-time buyers, at the end of September.
The Meadow Hill View is published by Matt Cota, principal of Meadow Hill Consulting, an advocacy firm providing management and advocacy assistance to trade associations, focusing on energy, transportation, and economic development.
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Categories: News Analysis, State Government
Dropping enrollment in a Vermont schools can only mean one thing, more staff, larger payroll.
How is dropping enrollment affecting costs? We are homeschoolers and we pay taxes for the crappy schools. We don’t receive anything from the state nor can we write off any expenses.
Mindy is correct in her question. Dropping enrollment doesn’t affect costs. Dropping enrollment increases per-student spending, but only because the administrators in the public school system mismanage and perpetuate its inability to adjust to the changing education market and continue to use its staff inefficiently.
But then again, why would the AOE or the State decrease its staff? That’s how the special interest groups who stalk their prey at the great education watering hole control the system and make money.
When it was up for passage I screamed at anyone listening that Act 181 was STATEWIDE ZONING and not needed. But the desire by Act 250 ideologues and “planning zealots” to punish rural towns who had purposefully voted against zoning was too strong. Their religion is power and control and they deny that Vermonters have any Property Rights… even some RINOs agreed.
Now watch as they lie and deceive us and call it “Act 250 Reform”….
I guess we need to go back to 30 kids in a classroom.
Or, we could let all parents have school choice, cut the education budget by 30% using Vermont’s ‘tuitioning’ governance and the latest in education pedagogy, e.g., homeschooling, micro-schools, learning pods, and various other hybrid education programs, with funding through Education Savings Accounts, as are now being used in places like Arizona.
But as long as we refuse to consider these alternatives and, instead, stick with the 19th century Horace Mann, public school, brick and mortar, child warehousing, we’ll get more of the same… no matter how many kids are in a classroom.
Think about it. If you mandate 30 kids per classroom, do you honestly think the public school system will limit one teacher per classroom? …only a reasonable alternative if you think you can sell ice to an Eskimo.