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by Dave Soula, for FYIVT.com
For years now, Montpelier has been struggling to contain the explosion in statewide education property taxes. Public debate has focused almost entirely on education funding — how schools are paid for, how much they cost, and whether the system itself has become unsustainable.
But treating education funding as the problem misunderstands what is actually happening. Rising school taxes are not the root cause of Vermont’s fiscal crisis. They are the most visible symptom of a much deeper, statewide failure finally showing up on the balance sheet.
What Vermonters are experiencing now is the predictable result of multiple systems breaking down at the same time: education finance, demographic decline, housing scarcity, regulatory overreach, healthcare inflation, workforce deterioration, and a tax base that continues to shrink while public obligations grow.
Education funding is where these failures collide — not where they begin.
Below is the full picture, and the choices Vermont must make if it wants any kind of viable future.
I. Education Costs Are Skyrocketing — But Not Because of Brigham
Vermont spends over $26,000 per student, placing it among the highest per-pupil spenders in the United States. Despite this, academic outcomes have drifted toward the national average rather than improving. The cost alone is alarming, but it becomes more troubling when viewed alongside the underlying trends driving it.
Student enrollment has been declining for decades. Staffing levels have not declined accordingly. Benefit costs continue to rise. Administrative overhead has expanded. Small schools remain expensive outliers. And the return on investment remains flat or falling.
These are structural labor and governance costs, not educational necessities.
Much of the current system traces back to policy responses following the 1997 Brigham v. State decision, which required Vermont to provide substantially equal educational opportunity. But Brigham established a floor, not a spending mandate. It did not require Cadillac health plans, multi-layer administration, staffing ratios disconnected from enrollment, or the indefinite preservation of every local cost structure using statewide dollars.
What has spiraled out of control is everything built on top of that constitutional baseline — choices made by legislatures, school boards, and bargaining systems over decades.
This is why focusing narrowly on the funding formula misses the point. The formula did not inflate costs by itself. It simply exposes the consequences of the system Vermont chose to build.
II. The Role of Unions: Shared Responsibility in the Fiscal Crisis
While much of Vermont’s education cost crisis stems from regulatory and economic policy, it is impossible to ignore the role of public-sector unions. Over time, teachers’ unions and other education employee associations have negotiated compensation, benefits, and job security measures that significantly outpace the state’s economic growth.
Collective bargaining agreements have often locked in salary increases, step raises, and generous benefits—such as premium health insurance and pension commitments—that do not align with the state’s stagnant demographic and economic realities. These contracts create a rigid cost structure that makes it nearly impossible to adjust spending downward without legislative intervention.
This is not about vilifying teachers or public employees. It is about recognizing that the system has been built on agreements that assumed perpetual growth and unlimited resources. When the underlying economy does not grow, these agreements become unsustainable.
For Vermont to fix its education funding and public spending crisis, unions will need to be part of the solution. That means negotiating new tiers of compensation and benefits for future hires, aligning salary growth with actual economic conditions, and accepting that the current model is no longer viable.
In short, the unions have a responsibility to help reform the system if Vermont is to avoid a deeper fiscal crisis that threatens everyone — including educators and public employees themselves.
III. Small Schools Can Stay — But Only If Communities Accept the Cost
Contrary to popular belief, preserving small rural schools is entirely compatible with a Brigham-compliant funding system. The key is separating the state baseline obligation from local preference spending.
- The state funds a fair, equal per-pupil amount.
- If a small town wants to maintain a school that costs more than the baseline, the town covers the difference.
- No community is forced to close its school.
- No other towns are forced to subsidize that choice.
This is the honest path: local control paired with local responsibility.
IV. Workforce Readiness Is Collapsing
Employers report chronic difficulty finding workers who can:
- pass a drug test
- show up consistently
- handle basic math
- communicate effectively
- manage time
- meet workplace expectations
This is not a condemnation of young people. It is evidence of a school system that has deprioritized academic rigor, discipline, and skill mastery.
A state cannot rebuild its economy without a reliable workforce. And no workforce pipeline can exist if the K–12 system produces graduates unprepared for the jobs Vermont needs. When employers cannot find workers, they do not move here. When they do not move here, the tax base continues to shrink.
This is not an education policy issue alone. It is an economic survival issue.
V. Healthcare Costs Quietly Erode Everything
Even if Vermont perfectly reformed its education formula and solved the housing crisis, the healthcare system would continue quietly draining public and private budgets alike. Vermont has:
- among the highest insurance premiums in the nation
- limited insurer competition
- heavy coverage mandates
- a certificate-of-need system that protects hospital monopolies
- escalating administrative overhead in the healthcare sector
When school districts see health insurance premiums increase by 15–25 percent, budgets rise even when salaries stay flat. These cost pressures ripple through every town budget and every tax bill.
Education spending cannot be contained when healthcare eats every available dollar.
VI. The Environmentalist Veto Is Choking Out Vermont’s Ability to Survive
Here is where honesty becomes unavoidable.
Vermont cannot fund its schools — or any of its public obligations — under an economic policy framework that treats nearly all development as a threat.
For decades, environmental policy in Vermont has operated on a single implicit assumption:
“Growth is dangerous, development is harmful, and the best way to protect the state is to prevent as much building and business expansion as possible.”
This worldview has created:
- Act 250 bottlenecks
- endless permitting delays
- unpredictable development reviews
- restrictive local zoning
- anti-housing appeals
- anti-business activism
- a political culture that treats economic growth as a moral hazard
The result is a state where:
- new housing is nearly impossible to build at scale
- industrial or commercial development is rare
- employers look elsewhere
- young families cannot afford to settle
- retirees become the dominant tax base
- small towns hollow out
- school enrollment drops
- per-pupil costs explode
You cannot claim to support Vermont’s scenic beauty while ignoring the economic devastation caused by regulatory absolutism. A state that refuses to allow growth cannot fund a modern public system. Period.
Vermont’s economy is not failing because businesses hate nature. It’s failing because Vermont treats economic activity as an intrusion rather than a necessity. Environmental protection and economic growth are not mutually exclusive, but Vermont policy treats them as incompatible.
Stay Tuned for Part 2
What is emerging is not a single failure, but a pattern. Vermont’s current strain reflects years of policy choices that constrained growth, increased costs, and expanded obligations, often without considering how those decisions would interact over time.
Education funding is one visible expression of that strain, but it is not the only one. Housing, healthcare, workforce readiness, regulation, and demographics all play a role in shaping the reality Vermonters now face.
In Part 2, we continue this examination by looking at the remaining policies and economic pressures bearing on the state — and what they mean for Vermont’s path forward.
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Categories: Commentary, State Government
Headline fixed:
The consequences of Democrat-progressivism – Part 1
Fix revised:
The consequences of one party rule – Part 1
Headline fixed (Part 2):
When Democrat-progressivism ignores reality – Part 1
It’s true, these are long term issues, that need long term solutions.
But, we know what works, and that is school choice for all, where the needed funding follow them. In most cases, at an amount much less than the local tax approved.
Require teacher contracts, to be binding arbitration, similar to police and fire. Strikes serve no purpose in gaining education for students, but law makers avoid the real issue, as many are former teachers responsive to local teacher unions.
This needs to stop.
No strike clauses, serve everyone with fair and balanced negotiations.
The problem with binding arbitration in a place like Vermont is that the arbitrators would be as Progressive/Leftist as the teacher’s union and likely to give them almost everything they want except one insignificant item so they could say they held the line.
Paul, that maybe true, I’m not sure?
But I’ve never seen the police or fire fighters, have that happen in the final results…
Thomas: You make some excellent points.
Re: ‘Long term solutions… school choice.
Yes. Absolutely. But the ‘long term’ compound adjective implies that the solution will take a ‘long time’ to develop too. We don’t have a long time.
Re: ‘require teacher contracts…’
Here, you cite an incongruence that may confuse folks. With school choice, parents can choose the school or education program they believe best meets the needs of their child – and voluntary agreement between educator and parent can be governed by any number of agreement details (e.g., ‘contracts’) – be they a hand shake or an immensely contrived union contract. Consider, for example, the contracts defining a homeschool program.
The problem we all tend to have is that we project our own personal attributes into education governance that may not be appropriate for others. The nature of school choice is that we can also choose the details of our voluntary relationships with our children’s educators.
“…if an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it. Most economic fallacies derive from the neglect of this simple insight, from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another.”
“When unions get higher wages for their members by restricting entry into an occupation, those higher wages are at the expense of other workers who find their opportunities reduced. When government pays its employees higher wages, those higher wages are at the expense of the taxpayer. But when workers get higher wages and better working conditions through the free market, when they get raises by competing with one another for the best workers, by workers competing with one another for the best jobs, those higher wages are at nobody’s expense. They can only come from higher productivity, greater capital investment, more widely diffused skills. The whole pie is bigger – there’s more for the worker, but there’s also more for the employer, the investor, the consumer, and even the tax collector.
That’s the way the free-market system distributes the fruits of economic progress among all people. That’s the secret of the enormous improvements in the conditions of the working person over the past two centuries.” – Milton Friedman
All about not having a computer and the promotion of envy, one school has an Apple Computer and one does not.
Our educational model could be replaced another, that we had many years ago with a new twist.
The two room school house…..and Star Link.
You can get private tutors on the internet for $3k per year to teach your child in person over the internet. You can have 4 students of different ages having different classes in the same room! You can also have home study programs. There are many vacant buildings/rooms/offices that could serve as a small classroom. In times past there were multiple one room schoolhouses across a town, all in walking distance. A bag lunch.
Just think, ultimate green, no more transportation budget!
Sports/music and those extracurricular activities could be handled by the communities. This would foster intergenerational activities, good for everyone.
We could have a better educational system on $5k per student without question.
There are many ways to solve this problem. The fact that they can’t find ANY solution that involves a reduction in spending shows their true intent. They want it just the way it is at all costs, protect our bureaucracy! (aka our high paying gravy train jobs)
I like the way you think…
What this situation really exposes in Vermont?
The people are not in charge.
The politicians are not in control.
The unions, they NGO’s and the Lobbyists are who is truly running/ruining Vermont.
Everything by and for the Unions, the NGO’s, the lobbyist and the non-profits how could I forget the non-profits?
Who resists ANY change?
Who benefits from NO change?
Who is pulling the strings for NO change?
Who is making the money of NO change?
Everything points to the true people and organizations of Vermont Power, it’s not the people! Vermont is the most corrupt state in ethics, as outlined by independent reviewers, nobody knows what is going on under the golden dome.
Vermont is the largest purveyor of astro turf on the planet. We are not what we think we are, we the people are most certainly NOT in control.
With respect, Neil,
There IS change, but it’s in a very dark direction. Prop 22, H89, etc.
lol….yes I agree with you about the change we do get is getting us more in trouble than solving any issues…….I was suggesting change in the other direction. Yes, I agree we are still going in the wrong direction. Nobody is calling it out either.
Here is a standard line used in Montpelier, of we’ve done serious budget cuts! Serious budget cuts are this…we were going to increase by 21% and instead we decreased (the increase) by cutting it 9%!!!
and the press give them a pass when the increase is 12%!!!!!!
The ideological hole we are going down if very, very dark. Much more so than our financial predicament, I agree.
Tyler, are you saying the H.89 School Choice bill, on hold in the House and Senate Education Committees, is ‘a very dark direction’?
…or are your referring to Act No. 14 (H. 89). An act relating to civil and criminal procedures concerning legally protected health care activity – signed back on May 10, 2023.
Obama care was not written by Obama, it was already waiting at his desk prior to winning the election, written by lobbyists, NGO’s, non-profits by the uni-party.
Same is true for every Vermont session of legislature, there are 10 people who set the agenda ahead of time………and if you don’t vote as you are told, by the super majority you will no longer be in the party, you will be primaried and run out of office.
How does that fly in the face of representation of the people and defending the constitution?
Where do all the stupid regulations come from? Dig deeper, keep searching…….the truth will set you free.
Great article as usual…well done.
Was actually written by Rod Emanuel and a far left doctor friend to be implemented over a long term with final implementation in 2026, designed to break not improve the system ushering in Single Payer Canadian style ‘healthcare’ that includes government sanctioned euthanasia when gets too expensive
so true, all the expenses were not even starting to be paid for until he was out of office and everything else surely kicked down the road, all conveniently timed for 2030…….huh, why do so many things lead back to Agenda 2030? huh??? must just be a coincidence.
Very thoughtful analysis. And disturbing as an older Vermonter who would like to remain in Vermont to be close to children and grandchildren but facing the economic pressures outlined in this article. Perhaps Part 2 will address the impact of so called green policy that is disconnected from economic and scientific realities. The governor and legislature seem oblivious to the fact that chasing the fantasy of net zero (labeling an essential life giving plant food, CO2 , as a pollutant (which it definitely is NOT) and tying Vermont’s environmental policies to the failing state of California are quite literally, insane policies that are NOT even close to sustainable. Oh and threatening my use of our trusty Vermont Castings wood stove to burn a truly renewable resource (WOOD) that has kept us warm over the last 40 years even when the unreliable power grid fails as it often does. Our elected reps seem bent on ignoring real climate science and would rather virtue signal us into economic oblivion.
The elephant in the room being nearly as many staff members in each school as there are students.
“What is emerging is not a single failure, but a pattern.”, yes, a pattern set by 45 years of mostly Democrat control of the state.
Great summary of some of the problems we face. As others have pointed out, none of these were big issues 35 years ago. It seems clear that the State’s “progressive” policies have created more problems than they have solved.
Your observations, stated realities and causes are all true. All this has been repeated over and over. Year after year. Yet the implementation and retention of economically detrimental practices continues. Political promises that are not achievable are made to get votes and stay in power is the game. The education system, the press and the big government politicians work in conjunction to manipulate the voters. Sound fiscal practices are not taught or implemented. Politicians regulate away responsibility to non elected entities such as the Green Mountain Care Board. The Vermont Constitution is not changed through amendment it is just ignored. Article 66 on Vermont Citizenship is a case in point. If we abided by it freeloaders would stop coming into this state.