2023 Report From the School Directors

January, 2024

As I reflect on the past year, my thoughts return to a couple items that will impact our future.

In previous years I’ve discussed the complexity of the statewide school funding mechanism (https://youtu.be/cVYTmuxUOdQ), with focus on spending per Equalized Pupil, the Base Tax Rate, the Yield, and the
Common Level of Appraisal. Following a 2019 study on school funding, the Vermont Legislature determined this
mechanism was not always getting resources to the most disadvantaged districts. Accordingly, the Legislature passed
Act 127 in 2022 to help redirect those resources. Details regarding the changes brought about by this law can be found
on the LNSU website (http://tinyurl.com/2p9n4xad), vtdigger (http://tinyurl.com/yc5erp2x) and other news outlets.

In a nutshell, the law further complicates the funding formula by changing the weighting of student counts to include
additional criteria, affecting resources available to the district. Equalized Pupils is replaced by Long-Term Average
Daily Membership. In CES’ case, the result was an increase of 99 “students”, or a nearly 24% increase in LT ADM
over comparable FY 24 calculations. This decreases spending per LT ADM by 6.02%, to $13,286. The net effect is
beneficial to CES, increasing resources available to support the diverse needs of our school community.

Another aspect of the law that’s attracted recent attention is the 5% cap on the tax rate increase. Districts that increase
spending per LT ADM less than 10% over each of the next 5 years qualify for a 5% capped tax rate increase each year.
It is intended to lessen the burden of the funding formula change, providing a softer transition for the hardest-hit districts
to work toward more responsible budgets over the next few years. Without the benefit of the cap, the natural tax rate
increase for Cambridge would have been 8.74%, to 1.3537. However, we are capped at 5%, or a 1.3071 tax rate.

Unfortunately, to some the 5% cap has also given the illusion of free money. Districts can push the 10% spending limit
with additional expenditures, and it won’t increase their tax rate beyond 5%. While education budgets are developed
locally, they are effectively a single expenditure at the State level. For example, say District A has very high
expenditures from exploiting what they see as free money, and Districts B and C put forth relatively modest budgets.
What the State will see is a single expense, including all the “free money”, to be paid for by the education fund. To
generate sufficient revenue, all districts will see relatively higher tax liabilities to cover the cost, so Districts A, B and C
will all bear the cost of District A’s overspending. With that in mind, the budget we’ve brought forth for CES, as well as
the budget presented by the LNMUUSD Board, are both conservatively crafted. We’ve focused on the most vital
services and maintenance needs, understanding that nothing is free. Treating our spending headroom as free money
will irresponsibly put an additional tax burden on all districts, including our own.

We also have two interesting facility projects at CES: A new wood pellet boiler system and EV recharging stations. We
explored upgrading our older oil boiler to wood pellets this time last year, and by moving quickly on the project last
spring, we were able to take advantage of available equipment at a lower cost than expected. The timeline also worked
out that we could get the system running a year ahead of schedule. With the volatility of oil markets in recent years,
and the projected costs of regionally sourced wood pellets, getting a head start on reducing our heating cost was
appealing. The EV charging station was an idea to use available ARPA funds in a way that would not only benefit the
school, but the surrounding community. Additional funding was recently secured from the state EV Infrastructure Grant
Program to completely cover a pair of charging stations, with installation projected for later this year. By leveraging
significant grant funds from Efficiency Vermont, ARPA and the EVSE Program, these projects invest in the
diversification of the school’s energy footprint at a reduced cost to taxpayers. In the long run this will be good for both
our environmental stewardship and our future tax burden. Many thanks to Rachael and Nathan Mascolino, the
Cambridge ARPA Committee, Efficiency Vermont and Green Mountain Power for their hard work and collaboration in
these efforts. Education, by definition, is investing in our future through our students. We are excited that we can also
invest in our community through these new technologies.

Respectfully Submitted on Behalf of the Cambridge School Board
Mark Stebbins
Chair, CES Board of Directors