The Vermont Statutes Online

Title 16: Education

Chapter 133: STATE FUNDING OF PUBLIC EDUCATION

• Subchapter 001: GENERAL PROVISIONS

• § 4000. Statement of policy

  (a) The intent of this chapter is to make educational opportunity available to each student in each town on substantially equal terms, in accordance with the Vermont Constitution and the Vermont Supreme Court decision of February 5, 1997, Brigham v. State of Vermont.

  (b) [Repealed.] (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 2003, No. 68, § 25.)

• § 4001. Definitions

  As used in this chapter:

  (1) “Average daily membership” of a school district or, if needed in order to calculate the appropriate homestead tax rate, of the municipality as defined in 32 V.S.A. § 5401(9), in any year means:

  (A) The full-time equivalent enrollment of students, as defined by the State Board by rule, who are legal residents of the district or municipality attending a school owned and operated by the district, attending a public school outside the district under section 822a of this title, or for whom the district pays tuition to one or more approved independent schools or public schools outside the district during the annual census period. The census period consists of the 11th day through the 30th day of the school year in which school is actually in session.

  (B) The full-time equivalent enrollment in the year before the last census period, of any State-placed students as defined in subdivision 11(a)(28) of this title. A school district that provides for the education of its students by paying tuition to an approved independent school or public school outside the district shall not count a State-placed student for whom it is paying tuition for purposes of determining average daily membership. A school district that is receiving the full amount, as defined by the State Board by rule, of the student’s education costs under subsection 2950(a) of this title shall not count the student for purposes of determining average daily membership. A State-placed student who is counted in average daily membership shall be counted as a student for the purposes of determining weighted student count.

  (C) The full-time equivalent enrollment for each prekindergarten child as follows: If a child is enrolled in 10 or more hours of prekindergarten education per week or receives 10 or more hours of essential early education services per week, the child shall be counted as one full-time equivalent pupil. If a child is enrolled in six or more but fewer than 10 hours of prekindergarten education per week or if a child receives fewer than 10 hours of essential early education services per week, the child shall be counted as a percentage of one full-time equivalent pupil, calculated as one multiplied by the number of hours per week divided by ten. A child enrolled in prekindergarten education for fewer than six hours per week shall not be included in the district’s average daily membership. There is no limit on the total number of children who may be enrolled in prekindergarten education or who receive essential early education services.

  (2) “Equalized grand list” has the same meaning that equalized education property tax grand list has in 32 V.S.A. chapter 135.

  (3), (4), (5) [Repealed.]

  (6) “Education spending” means the amount of the school district budget, any assessment for a joint contract school, career technical center payments made on behalf of the district under subsection 1561(b) of this title, and any amount added to pay a deficit pursuant to 24 V.S.A. § 1523(b) that is paid for by the school district, but excluding any portion of the school budget paid for from any other sources such as endowments, parental fundraising, federal funds, nongovernmental grants, or other State funds such as special education funds paid under chapter 101 of this title.

  (A) [Repealed.]

  (B) For all bonds approved by voters prior to July 1, 2024, voter- approved bond payments toward principal and interest shall not be included in “education spending” for purposes of calculating excess spending pursuant to 32 V.S.A. § 5401(12).

  (7) “Long-term membership” of a school district in any school year means the:

  (A) average of the district’s average daily membership, excluding full-time equivalent enrollment of State-placed students, over two school years, the latter of which is the current school year, plus

  (B) full-time equivalent enrollment of State-placed students for the most recent of the two years.

  (8) [Repealed.]

  (9) “Public school” means an elementary school or secondary school for which the governing board is publicly elected. A public school may maintain evening or summer school for its students and it shall be considered a public school.

  (10) “School district” means a town school district, city school district, incorporated school district, the member school districts of an interstate school district, a union school district, a unified union district, or an unorganized town or gore.

  (11) “School year” means a year beginning on July 1 and ending on the following June 30.

  (12) “Weighted long-term membership” of a school district in any school year means the long-term membership adjusted pursuant to section 4010 of this title.

  (13) “Base education amount” means a number used to calculate categorical grants awarded under this title that is equal to $6,800.00 per equalized pupil, adjusted as required under section 4011 of this title.

  (14) “Per pupil education spending” of a school district in any school year means the per pupil education spending of that school district as determined under subsection 4010(f) of this title.

  (15) “Prekindergarten child” means a three- or four-year-old child who is enrolled in a prekindergarten program offered by or through a school district pursuant to rules adopted under section 829 of this title or who is receiving essential early education services offered pursuant to section 2956 of this title. Prekindergarten child also means a five-year-old child who otherwise meets the terms of this definition if that child is not yet eligible for or enrolled in kindergarten. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 117, eff. March 11, 1998; 1999, No. 152 (Adj. Sess.), § 166b; 2001, No. 8, § 15; 2003, No. 68, § 15, eff. June 18, 2003; 2003, No. 68, § 25; 2003, No. 130 (Adj. Sess.), § 10; 2005, No. 182 (Adj. Sess.), § 8; 2007, No. 62, §§ 4, 6; 2007, No. 66, § 16; 2007, No. 66, § 17, eff. July 1, 2009; 2007, No. 132 (Adj. Sess.), §§ 4, 5; 2009, No. 44, §§ 16, 20, 30, eff. May 21, 2009; 2009, No. 156 (Adj. Sess.), § E.500.1, eff. June 3, 2010; 2011, No. 38, § 1, eff. May 19, 2011; 2011, No. 45, § 13d, eff. May 24, 2011; 2011, No. 58, § 17, eff. May 31, 2011; 2011, No. 129 (Adj. Sess.), § 35; 2011, No. 156 (Adj. Sess.), § 23; 2013, No. 179 (Adj. Sess.), § E.514.5; 2015, No. 46, §§ 26, 34; 2015, No. 132 (Adj. Sess.), § 3, eff. July 1, 2017; 2017, No. 173 (Adj. Sess.), § 15, eff. July 1, 2019; 2019, No. 66, § 2, eff. June 17, 2019; 2021, No. 73, § 18; 2021, No. 127 (Adj. Sess.), § 24, eff. July 1, 2024; 2023, No. 183 (Adj. Sess.), § 20, eff. July 1, 2024.)

• § 4002. Payment; allocation

  (a) State and federal funds appropriated for services delivered by the supervisory union and payable through the Agency shall be paid to the order of the supervisory union and administered in accordance with the plan adopted under subdivision 261a(4) of this title. Funding for special education services under section 2969 of this title shall be paid to the supervisory unions in accordance with that section.

  (b) The Secretary shall notify the superintendent or chief executive officer of each supervisory union in writing of federal or State funds disbursed to member school districts. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 2013, No. 92 (Adj. Sess.), § 234, eff. Feb. 14, 2014; 2015, No. 148 (Adj. Sess.), § 2, eff. July 1, 2017; 2017, No. 173 (Adj. Sess.), § 8, eff. May 25, 2018.)

• § 4003. Conditions

  (a) No school district shall receive any aid under this chapter unless that school district complies with the provisions of law relative to teachers’ salaries, appointment of superintendents, detailed financial reports to the Agency, and any other requirements of law.

  (b) Aid to any district shall not be denied unless the district unreasonably refuses to comply with the requirements of law. Any school district denied aid by reason of the provisions of this section shall have the right within 60 days from the date of such denial to appeal to the Superior Court in the county where the district is situated. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 2013, No. 92 (Adj. Sess.), § 235, eff. Feb. 14, 2014.)

• Subchapter 002: GENERAL STATE FUNDING OF PUBLIC EDUCATION

• § 4010. Determination of weighted long-term membership and per pupil education spending

  (a) Definitions. As used in this section:

  (1) “EL pupils” means pupils described under section 4013 of this title.

  (2) “FPL” means the Federal Poverty Level.

  (3) “Weighting categories” means the categories listed under subsection (b) of this section.

  (b) Determination of average daily membership and weighting categories. On or before the first day of December during each school year, the Secretary shall determine the average daily membership, as defined in subdivision 4001(1) of this title, of each school district for the current school year and shall perform the following tasks.

  (1) Using average daily membership, list for each school district the number of:

  (A) pupils in prekindergarten;

  (B) pupils in kindergarten through grade five;

  (C) pupils in grades six through eight;

  (D) pupils in grades nine through 12;

  (E) pupils whose families are at or below 185 percent of FPL, using the highest number of pupils in the district:

  (i) that meet this definition under the universal income declaration form; or

  (ii) who are directly certified for free and reduced-priced meals; and

  (F) EL pupils.

  (2)(A) Identify all school districts that have low population density, measured by the number of persons per square mile residing within the land area of the geographic boundaries of the district as of July 1 of the year of determination, equaling:

  (i) fewer than 36 persons per square mile;

  (ii) 36 or more persons per square mile but fewer than 55 persons per square mile; or

  (iii) 55 or more persons per square mile but fewer than 100 persons per square mile.

  (B) Population density data shall be based on the best available U.S. Census data as provided to the Agency of Education by the Vermont Center for Geographic Information.

  (C) Using average daily membership, list for each school district that has low population density the number of pupils in each of subdivisions (A)(i)–(iii) of this subdivision (2).

  (3)(A) Identify all school districts that have one or more small schools, which are schools that have an average two-year enrollment of:

  (i) fewer than 100 pupils; or

  (ii) 100 or more pupils but fewer than 250 pupils.

  (B) As used in subdivision (A) of this subdivision (3), “average two- year enrollment” means the average enrollment of the two most recently completed school years, and “enrollment” means the number of pupils who are enrolled in a school operated by the district on October 1. A pupil shall be counted as one whether the pupil is enrolled as a full-time or part-time student.

  (C) Using average two-year enrollment, list for each school district that has a small school the number of pupils in each of subdivisions (A)(i)–(ii) of this subdivision (3).

  (c) Reporting on weighting categories to the Agency of Education. Each school district shall annually report to the Agency of Education by a date established by the Agency the information needed in order for the Agency to compute the weighting categories under subsection (b) of this section for that district. In order to fulfill this obligation, a school district that pays public tuition on behalf of a resident student (sending district) to a public school in another school district, an approved independent school, or an out-of-state school (each a receiving school) may request the receiving school to collect this information on the sending district’s resident student, and if requested, the receiving school shall provide this information to the sending district in a timely manner.

  (d) Determination of weighted long-term membership. For each weighting category except the small schools weighting category under subdivision (b)(3) of this section, the Secretary shall compute the weighting count by using the long-term membership, as defined in subdivision 4001(7) of this title, in that category.

  [Subdivision (d)(1) effective until contingency met; see also subdivision (d)(1) contingently effective July 1, 2026 set out below.]

  (1) The Secretary shall first apply grade level weights. Each pupil included in long-term membership shall count as one, multiplied by the following amounts:

  (A) prekindergarten—negative 0.54;

  (B) grades six through eight—0.36; and

  (C) grades nine through 12—0.39.

  [Subdivision (d)(1) effective July 1, 2026 if contingency is met; see also subdivision (d)(1) effective until July 1, 2026 if contingency is met, set out above.]

  (1) The Secretary shall first apply grade level weights. Each pupil included in long-term membership shall count as one, multiplied by the following amounts:

  (A) [Repealed.]

  (B) grades six through eight—0.36; and

  (C) grades nine through 12—0.39.

  (2) The Secretary shall next apply a weight for pupils whose family is at or below 185 percent of FPL. Each pupil included in long-term membership whose family is at or below 185 percent of FPL shall receive an additional weighting amount of 1.03.

  (3) The Secretary shall next apply a weight for EL pupils. Each EL pupil included in long-term membership shall receive an additional weighting amount of 2.49.

  (4) The Secretary shall then apply a weight for pupils living in low population density school districts. Each pupil included in long-term membership residing in a low population density school district, measured by the number of persons per square mile residing within the land area of the geographic boundaries of the district as of July 1 of the year of determination, shall receive an additional weighting amount of:

  (A) 0.15, where the number of persons per square mile is fewer than 36 persons;

  (B) 0.12, where the number of persons per square mile is 36 or more but fewer than 55 persons; or

  (C) 0.07, where the number of persons per square mile is 55 or more but fewer than 100.

  (5) The Secretary shall lastly apply a weight for pupils who attend a small school. If the number of persons per square mile residing within the land area of the geographic boundaries of a school district as of July 1 of the year of determination is 55 or fewer, then, for each pupil listed under subdivision (b)(3)(C) of this section (pupils who attend small schools):

  (A) where the school has fewer than 100 pupils in average two-year enrollment, the school district shall receive an additional weighting amount of 0.21 for each pupil included in the small school’s average two-year enrollment; or

  (B) where the small school has 100 or more but fewer than 250 pupils, the school district shall receive an additional weighting amount of 0.07 for each pupil included in the small school’s average two-year enrollment.

  (6) A school district’s weighted long-term membership shall equal long-term membership plus the cumulation of the weights assigned by the Secretary under this subsection.

  [Subsection (e) not in effect July 1, 2025-June 30, 2029.]

  (e) Hold harmless. A district’s weighted long-term membership shall in no case be less than 96 and one-half percent of its actual weighted long-term membership the previous year prior to making any adjustment under this subsection.

  (f) Determination of per pupil education spending. As soon as reasonably possible after a school district budget is approved by voters, the Secretary shall determine the per pupil education spending for the next fiscal year for the school district. Per pupil education spending shall equal a school district’s education spending divided by its weighted long-term membership.

  (g) Guidelines. The Secretary shall develop guidelines to enable clear and consistent identification of pupils to be counted under this section.

  (h) Updates to weights. On or before January 1, 2027 and on or before January 1 of every fifth year thereafter, the Agency of Education and the Joint Fiscal Office shall calculate, based on their consensus view, updates to the weights to account for cost changes underlying those weights and shall issue a written report on their work to the House and Senate Committees on Education, the House Committee on Ways and Means, and the Senate Committee on Finance. The General Assembly shall update the weights under this section and transportation reimbursement under section 4016 of this title not less than every five years and the implementation date for the updated weights and transportation reimbursement shall be delayed by a year in order to provide school districts with time to prepare their budgets. Updates to the weights may include recalibration, recalculation, adding or eliminating weights, or any combination of these actions. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1999, No. 49, § 2, eff. June 2, 1999; 2003, No. 68, § 39, eff. June 18, 2003; 2003, No. 130 (Adj. Sess.), § 11; 2007, No. 62, § 7; 2007, No. 66, § 19; No. 82, §§ 7, 8; 2013, No. 92 (Adj. Sess.), § 236, eff. Feb. 14, 2014; 2013, No. 142 (Adj. Sess.), § 32; 2013, No. 174 (Adj. Sess.), § 53; 2015, No. 46, § 22, eff. July 1, 2016; 2015, No. 46, § 24, eff. July 1, 2020; 2021, No. 73, § 19, eff. June 8, 2021; 2021, No. 127 (Adj. Sess.), § 4, eff. July 1, 2024; 2021, No. 185 (Adj. Sess.), § E.500.8, eff. July 1, 2024; 2023, No. 76, § 3, eff. July 1, 2026.)

• § 4011. Education payments

  (a) Annually, the General Assembly shall appropriate funds to pay for statewide education spending and a portion of a base education amount for each adult education and secondary credential program student.

  (b) For each fiscal year, the base education amount shall be $6,800.00, increased by the most recent New England Economic Project Cumulative Price Index, as of November 15, for state and local government purchases of goods and services from fiscal year 2005 through the fiscal year for which the amount is being determined, plus an additional one-tenth of one percent.

  (c) Annually, each school district shall receive an education spending payment for support of education costs. An unorganized town or gore shall receive an amount equal to its per pupil education spending for that year for each student. No district shall receive more than its education spending amount.

  (d) [Repealed.]

  (e) [Repealed.]

  (f) Annually, the Secretary shall pay to a local adult education and literacy provider, as defined in section 942 of this title, that provides an adult education and secondary credential program an amount equal to 26 percent of the base education amount for each student who completes the diagnostic portions of the program, based on an average of the previous two years; 40 percent of the payment required under this subsection shall be from State funds appropriated from the Education Fund and 60 percent of the payment required under this subsection shall be from State funds appropriated from the General Fund.

  (g) The Secretary shall pay to a school district a percentage of the base education amount for each resident student for whom the district is paying a technical tuition to a regional career technical center but who is not enrolled in the district and therefore not counted in the average daily membership of the district. The percentage of the base education amount to be paid shall be the percentage of the student’s full-time equivalent attendance at the career technical center multiplied by 87 percent.

  (h) The Secretary shall make all payments required by subchapter 5 of chapter 23 of this title.

  (i) Annually, on or before October 1, the Secretary shall send to school boards for inclusion in town reports and publish on the Agency website the following information:

  (1) the statewide average district per pupil education spending for the current fiscal year; and

  (2) a statewide comparison of student-teacher ratios among schools that are similar in number of students and number of grades. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), §§ 90, 117a, eff. March 11, 1998; 1999, No. 49, § 197; 1999, No. 108 (Adj. Sess.), § 3, eff. May 10, 2000; 2001, No. 8, § 16; 2001, No. 63, § 170b; 2003, No. 36, §§ 21, 22; 2003, No. 66, § 187b; 2003, No. 68, § 16, eff. June 18, 2003; 2003, No. 76 (Adj. Sess.), § 25, eff. Feb. 17, 2004; 2003, No. 122 (Adj. Sess.), § 174; 2003, No. 130 (Adj. Sess.), § 15; 2005, No. 54, § 16; 2005, No. 176 (Adj. Sess.), § 1; 2007, No. 66, § 9; 2009, No. 4, § 81, eff. April 24, 2009; 2009, No. 44, § 17, eff. May 21, 2009; 2013, No. 77, § 8; 2017, No. 49, § 29, eff. May 23, 2017; 2021, No. 127 (Adj. Sess.), § 25, eff. July 1, 2024; 2023, No. 113 (Adj. Sess.), § E.504.4, eff. July 1, 2024.)

• § 4011a. Repealed. 2017, No. 49, § 31, effective May 23, 2017.

• § 4012. State-placed students

  (a) A district that provides for the education of its students by paying tuition to an approved independent school or a public school outside the district shall receive from the Secretary an amount equal to the calculated net cost per pupil in the receiving school, as defined in section 825 of this title, prorated for the percentage of annual tuition billed for a State-placed student. If the calculated net cost per pupil in a receiving independent school or school located outside Vermont is not available, the Secretary shall pay the tuition charged. A district shall not receive funds under this section if all the student’s education costs are fully paid under subsection 2950(a) of this title.

  (b) A school district shall request reimbursement under this section by submitting tuition bills and documentation of payment to the Secretary. The Secretary shall make reimbursement twice a year, once for requests submitted prior to January 1 and once for requests submitted prior to May 1. Requests submitted on or following May 1 shall be reimbursed in the next payment. The Secretary shall reconcile tuition overcharges in the year following payment to the school district pursuant to section 836 of this title. For the purpose of recovering any tuition overcharge, the Secretary shall be considered a receiving district. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 91, eff. March 11, 1998; 2013, No. 92 (Adj. Sess.), § 238, eff. Feb. 14, 2014.)

• § 4013. [Reserved for future use.]

• § 4013. English learners services; State aid

  (a) Definitions. As used in this section:

  (1) “Applicable federal laws” mean the Equal Education Opportunities Act (20 U.S.C. § 1703), Title VI of the Civil Rights Act of 1964 (42 U.S.C. §§ 2000d et seq.), and Titles I and III of the Elementary and Secondary Education Act of 1965 (20 U.S.C. §§ 6301 et seq. and 20 U.S.C. §§ 6801 et seq.), each as amended.

  (2) “EL services” mean instructional and support personnel and services that are required under applicable federal laws for EL students and their families.

  (3) “EL students” or “EL pupils” mean students who have been identified as English learners through the screening protocols required under 20 U.S.C. § 6823(b)(2).

  (b) Required EL services. Each school district shall:

  (1) screen students to determine which students are EL students and therefore qualify for EL services;

  (2) assess and monitor the progress of EL students;

  (3) provide EL services;

  (4) budget sufficient resources through a combination of State and federal categorical aid and local education spending to provide EL services;

  (5) report expenditures on EL services annually to the Agency of Education through the financial reporting system as required by the Agency; and

  (6) evaluate the effectiveness of their EL programs and report educational outcomes of EL students as required by the Agency and applicable federal laws.

  (c) Agency of Education support and quality assurance. The Agency of Education shall:

  (1) provide guidance and program support to all school districts with EL students as required under applicable federal law, including:

  (A) professional development resources for EL teachers and support personnel; and

  (B) information on best practices and nationally recognized language development standards; and

  (2) prescribe, collect, and analyze financial and student outcome data from school districts to ensure that districts are providing high-quality EL services and expending sufficient resources to provide these services.

  (d) Categorical aid. In addition to the EL weight under section 4010 of this title, a school district that has, as determined annually on October 1 of the year:

  (1) one to five EL students enrolled shall receive State aid of $25,000.00 for that school year; or

  (2) six to 25 EL students enrolled shall receive State aid of $50,000.00 for that school year.

  (e) Annual appropriation. Annually, the General Assembly shall include in its appropriation for statewide education spending under subsection 4011(a) of this title an appropriation to provide aid to school districts for EL services under this section.

  (f) Payment. On or before November 1 of each year, the State Treasurer shall withdraw from the Education Fund, based on warrant of the Commissioner of Finance and Management, and shall forward to each school district the aid amount it is owed under this section. (Added 2021, No. 127 (Adj. Sess.), § 10, eff. July 1, 2024.)

• § 4014. Early education

  (a) The Secretary may grant funds for voluntary early education programs. The funds may be used for personnel costs, training of parents and staff, materials and educational equipment, and other costs related to early education programs.

  (b) The Secretary shall solicit proposals for early education programs from community organizations serving young children. Community organizations include school districts; other public agencies, including Head Start programs; and private agencies, including child care programs and parent-child centers.

  (c) The Secretary also shall investigate to determine those areas that are not served by early education programs and whose children are in greatest need of such services. In those areas, the Secretary shall provide assistance in preparing proposals for grants. In conducting the investigation, the Secretary shall collect and analyze demographic factors that are likely to predict unusual community needs for early education services. The Secretary shall distribute the results of the analysis to all interested persons.

  (d) The Secretary shall evaluate proposals based on the following criteria:

  (1) The program will serve additional children with special needs, such as those who are economically disadvantaged, those who have limited English language skills, those who have a disability, or those who have experienced or are at risk of abuse or neglect.

  (2) The program will rely on early screening of children’s development to determine need.

  (3) The program will provide experiential learning activities that are developmentally appropriate for three- and four-year old children. Such activities may be provided in home or group settings or a combination of the two.

  (4) The program will include active parental involvement in program design and in making decisions about services.

  (5) The program has been cooperatively developed by community and school organizations that serve young children in a town or group of towns.

  (6) There is a demonstrated need for the program.

  (7) The program considers the transportation needs of children and parents.

  (8) The program enables children with disabilities to be served in settings with peers who do not have a disability.

  (9) The program includes voluntary training for parents.

  (e) The Secretary shall give preference to programs to be offered in parts of the State that do not have early education services at the time of the application.

  (f) Grant proposals shall be submitted to the Secretary. Grants shall be for one year but may be renewed. No grant may exceed $30,000.00. The Secretary may, in his or her discretion, set other terms of the grant. (Added 1987, No. 68, § 3; amended 2011, No. 58, § 6, eff. May 31, 2011; 2013, No. 92 (Adj. Sess.), § 239, eff. Feb. 14, 2014; 2013, No. 96 (Adj. Sess.), § 81; 2021, No. 20, § 70.)

• § 4015. Merger support for merged districts

  (a) A school district that was voluntarily formed under 2010 Acts and Resolves No. 153, 2012 Acts and Resolves No. 156, or 2015 Acts and Resolves No. 46, each as amended, and received a merger support grant shall continue to receive that merger support grant, subject to the provisions in subsection (c) of this section.

  (b) A school district that was involuntarily formed under the Final Report of Decisions and Order on Statewide School District Merger Decisions Pursuant to Act 46, Secs. 8(b) and 10 dated November 28, 2018 and that received a small schools grant in fiscal year 2020 shall receive an annual merger support grant in that amount, subject to the provisions in subsection (c) of this section.

  (c)(1) Payment of a merger support grant under this section shall not be made in any year that the school district receives a small school weight under section 4010 of this title.

  (2) Payment of a merger support grant under this section shall continue annually unless explicitly repealed by the General Assembly; provided, however, that the Secretary shall discontinue payment of the grant in the fiscal year following the cessation of operations of the school that made the district originally eligible for the grant, and further provided that if the building that houses the school that made the district originally eligible for the grant is consolidated with another school into a renovated or new school building, then the Secretary shall continue to pay the grant during the repayment term of any bonded indebtedness incurred in connection with the consolidation-related renovation or construction. (Added 1997, No. 71 (Adj. Sess.), § 92, eff. March 11, 1998; amended 1999, No. 49, § 3, eff. June 2, 1999; 1999, No. 66 (Adj. Sess.), § 39, eff. Feb. 8, 2000; 2003, No. 68, § 23, eff. July 1, 2004; 2003, No. 76 (Adj. Sess.), § 27, eff. Feb. 17, 2004; 2007, No. 82, § 28; 2009, No. 44, § 19, eff. May 21, 2009; 2011, No. 129 (Adj. Sess.), § 7, eff. May 11, 2012; 2013, No. 92 (Adj. Sess.), § 240, eff. Feb. 14, 2014; 2015, No. 48, § 6; 2015, No. 46, § 20, eff. July 1, 2019; 2021, No. 73, § 20, eff. June 8, 2021; 2021, No. 127 (Adj. Sess.), § 26, eff. July 1, 2024.)

• § 4016. Reimbursement for transportation expenditures

  (a) A school district or supervisory union that incurs allowable transportation expenditures shall receive a transportation reimbursement grant each year. The grant shall be equal to 50 percent of allowable transportation expenditures; provided, however, that in any year the total amount of grants under this subsection shall not exceed the total amount of adjusted base year transportation grant expenditures. The total amount of base year transportation grant expenditures shall be $10,000,000.00 for fiscal year 1997, increased each year thereafter by the annual price index for state and local government purchases of goods and services. If in any year the total amount of the grants under this subsection exceed the adjusted base year transportation grant expenditures, the amount of each grant awarded shall be reduced proportionately. Transportation grants paid under this section shall be paid from the Education Fund and shall be added to education spending payment receipts paid under section 4011 of this title.

  (b) In this section, “allowable transportation expenditures” means the costs of transporting students to and from school for regular classroom services and shall not include expenditures for transporting students participating in curricular activities that take place off the school grounds or for transporting students participating in cocurricular activities. The State Board shall further define allowable transportation expenditures by rule.

  (c) A district or supervisory union may apply and the Secretary may pay for extraordinary transportation expenditures incurred due to geographic or other conditions such as the need to transport students out of the school district to attend another school because the district does not maintain a public school. The State Board shall define extraordinary transportation expenditures by rule. The total amount of base year extraordinary transportation grant expenditures shall be $250,000.00 for fiscal year 1997, increased each year thereafter by the annual price index for state and local government purchases of goods and services. Extraordinary transportation expenditures shall not be paid out of the funds appropriated under subsection (b) of this section for other transportation expenditures. Grants paid under this section shall be paid from the Education Fund and shall be added to education spending payment receipts paid under section 4011 of this title. (Added 2003, No. 107 (Adj. Sess.), § 12; amended 2013, No. 92 (Adj. Sess.), § 241, eff. Feb. 14, 2014; 2023, No. 183 (Adj. Sess.), § 22, eff. July 1, 2024.)

• § 4017. Universal meals supplement

  (a) Definition. For the purpose of this section, “universal meals supplement” has the same meaning as that term has in subdivision 1261a(5) of this title.

  (b) Public schools. From State funds appropriated to the Agency from the Education Fund for the universal meals supplement, the Agency shall provide a universal meals supplement for the cost of each meal actually provided to each student in the district during the previous quarter when meals are offered to all students at no charge pursuant to subdivision 1264(a)(1)(B) of this title.

  (1) Reimbursement from State funds shall be available only to districts that maximize access to federal funds for the cost of the school breakfast and lunch program by participating in the Community Eligibility Provision, under 7 C.F.R. § 245.9(f), or Provision 2, under 7 C.F.R. § 245.9(b), of these programs, or any other federal provision that in the opinion of the Agency draws down the most possible federal funding for meals served in that program. At the start of each school year, the Agency of Education may require that a school food authority requesting the universal meals supplement begin a new cycle of the relevant federal provision and group sites in a manner the Agency determines will maximize the drawdown of federal funds.

  (2) Second breakfasts, as allowed under 7 C.F.R. § 220.9(a), do not qualify for reimbursement under this subsection.

  (3) A nonprofit prequalified private prekindergarten provider that is qualified pursuant to subsection 829(c) of this title and is not also an approved or recognized independent school is eligible for the universal meals supplement under this subsection if it operates a food program under a public school school food authority.

  (c) Approved independent schools.

  (1) From State funds appropriated to the Agency from the Education Fund for the universal meals supplement, the Agency shall provide a universal meals supplement for the cost of each meal actually provided to each qualifying student on public tuition when meals are offered to all students at no charge pursuant to subdivision 1264(a)(1)(B) of this title, provided that:

  (A) If the approved independent school participates in the food programs as a site under a public school school food authority, the public school school food authority shall be reimbursed only for students attending the approved independent school on public tuition.

  (B) If the approved independent school participates in the Community Eligibility Provision under 7 C.F.R. § 245.9(f), or is in a year other than the base year of Provision 2 under 7 C.F.R. § 245.9(b), the school shall provide the Agency with the number of students attending the school on public tuition and the total number of students enrolled in the school. The Agency shall calculate the percentage of students attending the school on public tuition and multiply that number by the paid student percentage, the results of which shall be the number of meals the school shall be reimbursed for.

  (2) Second breakfasts, as allowed under 7 C.F.R. § 220.9(a), do not qualify for reimbursement under this subsection.

  (3) Students attending an approved independent school on public tuition shall include a prekindergarten child if the approved independent school also qualifies as a prequalified private provider and the child’s school district of residence pays tuition to the school pursuant to section 829 of this title.

  (4) An approved independent school is eligible for the universal meals supplement only if it operates a food program that makes available a school lunch, as provided in the National School Lunch Act as amended, and a school breakfast, as provided in the Child Nutrition Act as amended, to each attending student who qualifies for those meals under these acts every school day.

  (5) Reimbursement from State funds shall be available only to approved independent schools that maximize access to federal funds for the cost of the school breakfast and lunch program by participating in the Community Eligibility Provision under 7 C.F.R. § 245.9(f), or Provision 2 under 7 C.F.R. § 245.9(b), of these programs, or any other federal provision that in the opinion of the Agency draws down the most possible federal funding for meals served in that program. At the start of each school year, the Agency of Education may require that a school food authority requesting the universal meals supplement begin a new cycle of the relevant federal provision and group sites in a manner the Agency determines will maximize the drawdown of federal funds.

  (d) Universal meals supplement. The universal meals supplement amount for breakfast shall be a sum equal to the federal reimbursement rate for a free school breakfast less the federal reimbursement rate for a paid school breakfast, using rates identified annually by the Agency of Education from payment levels established annually by the U.S. Department of Agriculture. The universal meals supplement amount for lunch shall be a sum equal to the federal reimbursement rate for a free school lunch less the federal reimbursement rate for a paid school lunch, using rates identified annually by the Agency of Education from payment levels established annually by the U.S. Department of Agriculture. (Added 2023, No. 64, § 3, eff. July 1, 2023.)

• § 4018. Repealed. 2023, No. 87 (Adj. Sess.), § 99, eff. March 13, 2024.

  (Added 2023, No. 78, § E.500.1, eff. July 1, 2023.)

• § 4025. Education Fund

  (a) The Education Fund is established to comprise the following:

  (1) all revenue paid to the State from the statewide education tax on nonhomestead and homestead property under 32 V.S.A. chapter 135;

  (2) [Repealed.]

  (3) revenues from State lotteries under 31 V.S.A. chapter 14 and from any multijurisdictional lottery game authorized under that chapter;

  (4) 25 percent of the revenues from the meals and rooms taxes imposed under 32 V.S.A. chapter 225;

  (5) one-third of the revenues raised from the purchase and use tax imposed by 32 V.S.A. chapter 219, notwithstanding 19 V.S.A. § 11(1);

  (6) revenues raised from the sales and use tax imposed by 32 V.S.A. chapter 233;

  (7) Medicaid reimbursement funds pursuant to subsection 2959a(f) of this title.

  (8) land use change tax revenue deposited pursuant to 32 V.S.A. § 3757(d);

  (9) uniform capacity tax revenue deposited pursuant to 32 V.S.A. § 8701(b)(3);

  (10) wind-powered electric generating facilities tax deposited pursuant to 32 V.S.A. § 5402c; and

  (11) revenues from the short-term rental surcharge under 32 V.S.A. § 9301.

  (b) Monies in the Education Fund shall be used for the following:

  (1) To make payments to school districts and supervisory unions for the support of education in accordance with the provisions of section 4028 of this title, other provisions of this chapter, the provisions of 32 V.S.A. chapter 135, and the Flexible Pathways Initiative established by section 941 of this title, but excluding adult education and literacy programs under section 945 of this title.

  (2) To cover the cost of fund auditing, accounting, revenue collection, and of short-term borrowing to meet fund cash flow requirements.

  (3) To make payments required under 32 V.S.A. § 6066(a)(1) and only that portion attributable to education taxes, as determined by the Commissioner of Taxes, of payments required under 32 V.S.A. § 6066(a)(3). The State Treasurer shall withdraw funds from the Education Fund upon warrants issued by the Commissioner of Finance and Management based on information supplied by the Commissioner of Taxes. The Commissioner of Finance and Management may draw warrants for disbursements from the Fund in anticipation of receipts. All balances in the Fund at the end of any fiscal year shall be carried forward and remain a part of the Fund. Interest accruing from the Fund shall remain in the Fund.

  (4) To make payments to the Vermont Teachers’ Retirement Fund and the Retired Teachers’ Health and Medical Benefits Fund for the normal contributions in accordance with subsections 1944(c) and 1994b(h) of this title.

  (5) To make payments for contracted services to support statewide administrative education systems, including the costs of the statewide school finance and financial management data system to complete the reporting required by subdivision 242(4) of this title and pursuant to 2018 (Sp. Sess.) Acts and Resolves No. 11, Sec. E.500.1.

  (c) [Repealed.]

  (d) Upon withdrawal of funds from the Education Fund for any purpose other than those authorized by this section, 32 V.S.A. chapter 135 (education property tax) is repealed. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 4, eff. March 11, 1998, § 68; 1997, No. 147 (Adj. Sess.), § 159(a); 1999, No. 1, § 102, eff. March 31, 1999; 1999, No. 62, § 127; 1999, No. 66 (Adj. Sess.), § 52, eff. Feb. 8, 2000; 1999, No. 152 (Adj. Sess.), § 166b; 2001, No. 63, § 277; 2001, No. 102 (Adj. Sess.), § 35a, eff. May 15, 2002; 2003, No. 19, § 50, eff. May 6, 2003; 2003, No. 68, § 36, eff. July 1, 2004; 2005, No. 38, § 4a, eff. June 2, 2005; 2005, No. 215 (Adj. Sess.), § 285; 2007, No. 65, § 184; 2009, No. 1 (Sp. Sess.), § E.513.1, eff. June 2, 2009; 2009, No. 67 (Adj. Sess.), § 63, eff. Feb. 25, 2010; 2009, No. 156 (Adj. Sess.), § E.139; 2011, No. 63, § E.513.1, eff. July 1, 2012; 2011, No. 63, § E.513.2; 2011, No. 143 (Adj. Sess.), § 56, eff. July 1, 2013; 2013, No. 179 (Adj. Sess.), § E.513.1; 2015, No. 48, § 7; 2015, No. 172 (Adj. Sess.), § E.513; 2017, No. 85, § E.500.2; 2017, No. 85, § H.3, eff. July 1, 2018; 2018, No. 11 (Sp. Sess.), § H.8; 2019, No. 72, § E.500.1; 2019, No. 88 (Adj. Sess.), § 66, eff. March 4, 2020; 2021, No. 114 (Adj. Sess.), § 25, eff. July 1, 2022; 2023, No. 87 (Adj. Sess.), § 74, eff. July 1, 2023; 2023, No. 183 (Adj. Sess.), § 6, eff. July 1, 2024.)

• § 4026. Education Fund budget stabilization reserve; creation and purpose

  (a) It is the purpose of this section to reduce the effects of annual variations in State revenues upon the Education Fund budget of the State by reserving certain surpluses in Education Fund revenues that may accrue for the purpose of offsetting deficits.

  (b) There is hereby created an Education Fund budget stabilization reserve determined on a budgetary basis and administered by the Commissioner of Finance and Management. Any budgetary basis undesignated Education Fund surplus occurring at the close of a fiscal year shall be reserved within the Education Fund budget stabilization reserve, provided that the balance reserved shall not exceed five percent of the prior fiscal year education fund appropriations, reduced by the amount distributed to school districts by municipalities for netting purposes under 32 V.S.A. § 5402(c), and any additional amounts as may be authorized by the General Assembly. Any undesignated Education Fund surplus and accrued interest remaining after the Education Fund budget stabilization reserve has been brought to the maximum authorized level shall remain in the Education Fund. When the General Assembly next meets, it may specifically appropriate the use of the undesignated Education Fund surplus for increased support for education.

  (c) In any fiscal year, if the Education Fund is found to have an undesignated fund deficit, the Education Fund budget stabilization reserve shall be used by the Commissioner of Finance and Management to the extent necessary to offset the undesignated fund deficit as determined by generally accepted accounting principles.

  (d) Determination of the amount of the undesignated Education Fund surplus or fund deficit in any fiscal year for the purposes of this section shall be made by the Commissioner of Finance and Management. Adjustments shall be made to the amounts authorized in subsections (b) and (c) of this section upon receipt of the final audited annual report of the Commissioner of Finance and Management.

  (e) The enactment of this chapter and other provisions of the Equal Educational Opportunity Act of which it is a part have been premised upon estimates of balances of revenues to be raised and expenditures to be made under the act for such purposes as education spending payments, categorical State support grants, provisions for property tax income sensitivity, payments in lieu of taxes, current use value appraisals, tax stabilization agreements, the stabilization reserve established by this section, and for other purposes. If the stabilization reserve established under this section should in any fiscal year be less than 5.0 percent of the prior fiscal year’s appropriations from the Education Fund, as defined in subsection (b) of this section, the Joint Fiscal Committee shall review the information provided pursuant to 32 V.S.A. § 5402b and provide the General Assembly its recommendations for change necessary to restore the stabilization reserve to the statutory level provided in subsection (b) of this section. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 94, eff. March 11, 1998; 2001, No. 63, § 265; 2001, No. 110 (Adj. Sess.), § 46, eff. May 23, 2002; 2003, No. 68, § 26, eff. June 18, 2003; 2019, No. 6, § 83, eff. April 22, 2019; 2023, No. 183 (Adj. Sess.), § 23, eff. July 1, 2024.)

• § 4027. Education Fund transfer amounts

  (a) [Repealed.]

  (b) Annually, on or before June 1, each superintendent shall report to the Agency, on a form prescribed by the Secretary, each education budget that was adopted by May 1 for the following fiscal year by the member districts of the supervisory union and for which no petition for reconsideration has been filed. A superintendent shall report a budget adopted following May 1, to the Agency, between 30 to 40 days following adoption or, if a petition for reconsideration has been filed, within 10 days of final adoption of the budget. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), §§ 5, 95, eff. March 11, 1998; 1999, No. 49, § 20, eff. June 2, 1999; 1999, No. 62, § 174a; 1999, No. 108 (Adj. Sess.), § 4, eff. May 10, 2000; 1999, No. 152 (Adj. Sess.), § 166a; 2001, No. 63, § 165a, eff. June 16, 2001; 2003, No. 68, § 19, eff. June 18, 2003; 2003, No. 107 (Adj. Sess.), § 21; 2003, No. 122 (Adj. Sess.), § 294w; 2013, No. 92 (Adj. Sess.), § 242, eff. Feb. 14, 2014.)

• § 4028. Fund payments to school districts

  (a) On or before September 10, December 10, and April 30 of each school year, one-third of the education spending payment under section 4011 of this title shall become due to school districts, except that districts that have not adopted a budget by 30 days before the date of payment under this subsection shall receive one-quarter of the base education amount and upon adoption of a budget shall receive additional amounts due under this subsection.

  (b) Payments made for special education under chapter 101 of this title, for career technical education under chapter 37 of this title, and for other aid and categorical grants paid for support of education shall also be from the Education Fund.

  (c)(1) Any district that has adopted a school budget that includes high spending, as defined in 32 V.S.A. § 5401(12), shall, upon timely notice, be authorized to use a portion of its high spending penalty to reduce future education spending:

  (A) by entering into a contract with an operational efficiency consultant or a financial systems consultant to examine issues such as transportation arrangements, administrative costs, staffing patterns, and the potential for collaboration with other districts;

  (B) by entering into a contract with an energy or facilities management consultant; or

  (C) by engaging in discussions with other school districts about reorganization or consolidation for better service delivery at a lower cost.

  (2) To the extent approved by the Secretary, the Agency shall pay the district from the property tax revenue to be generated by the high spending increase to the district’s spending adjustment as estimated by the Secretary, up to a maximum of $5,000.00. For the purposes of this subsection, “timely notice” means written notice from the district to the Secretary by September 30 of the budget year. If the district enters into a contract with a consultant pursuant to this subsection, the consultant shall not be an employee of the district or of the Agency. A copy of the consultant’s final recommendations or a copy of the district’s recommendations regarding reorganization, as appropriate, shall be submitted to the Secretary, and each affected town shall include in its next town report an executive summary of the consultant’s or district’s final recommendations and notice of where a complete copy is available. No district is authorized to obtain funds under this section more than one time in every five years.

  (d) The Joint Fiscal Office shall prepare a fiscal note for any legislation that requires a supervisory union or school district to perform any action with an associated cost, but does not provide money or a funding mechanism for fulfilling that obligation. Any fiscal note prepared under this subsection shall be completed not later than the date that the legislation is considered for a vote in the first committee to which it is referred. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 70, eff. July 1, 1999; 1997, No. 71 (Adj. Sess.),§ 118, eff. March 11, 1998; 1997, No. 147 (Adj. Sess.), § 159(b); 1999, No. 152 (Adj. Sess.), § 166b; 2003, No. 68, § 20, eff. June 18, 2003; 2005, No. 38, § 10, eff. June 2, 2005; 2007, No. 66, § 10; 2009, No. 44, § 19, eff. May 21, 2009; 2013, No. 92 (Adj. Sess.), § 243, eff. Feb. 14, 2014; 2013, No. 174 (Adj. Sess.), § 68, eff. June 4, 2014; 2015, No. 23, § 41; 2021, No. 20, § 71; 2023, No. 183 (Adj. Sess.), § 24, eff. July 1, 2024.)

• § 4029. Use of funds for education

  (a) Funds received by a school district may be used only for legitimate items of current education expense and shall not be used for municipal services.

  (b) Funds received by a municipality other than a school district may not be used directly or indirectly for education expenses.

  (c) If the Secretary determines that a school district has spent funds paid under section 4028 of this title for an item that is not a legitimate item of current education expense, the treasurer of the municipality shall, within 90 days, remit the amount of the expenditure to the Education Fund. The treasurer shall use funds raised pursuant to 17 V.S.A. § 2664, 20 V.S.A. § 2601, or 24 V.S.A. § 1309 for this purpose. If the Secretary determines that a municipality other than a school district has spent funds for an item that is a legitimate item of current education expense, the treasurer of the municipality shall transfer the amount of the expenditure from the local education fund to the municipal fund.

  (d) The legislative body of a school district or other municipality may appeal a decision of the Secretary under this section to the State Board, which shall hear the appeal de novo in the manner provided by 3 V.S.A. chapter 25 for the hearing of contested cases. A legislative body of a school district or other municipality may appeal a decision of the State Board to the Superior Court of the district in which the municipality is located. The Superior Court shall hear the matter de novo in the manner provided by Rule 74 of the Vermont Rules of Civil Procedure. An appeal from the decision of the Superior Court shall be to the Supreme Court under the Vermont Rules of Appellate Procedure.

  (e) For the purposes of this section, notwithstanding any provision of municipal law to the contrary, “legitimate items of current educational expense” may include reasonable payments to a municipality for services performed on behalf of a school district by its corresponding town or city clerk, the town or city treasurer, or the town or city auditors.

  (f) Annually, on a form prescribed by the Secretary, each school district shall report for the previous school year the amount it paid to or received from its corresponding municipality or municipal officials, including any payments made pursuant to subsection (e) of this section, and any property or in-kind services it donated to or received from its corresponding municipality.

  (g) Notwithstanding anything to the contrary in this section or otherwise in law, a school district and the town or city municipality or municipalities in which the school district operates may jointly fund the services of one or more cultural liaisons to support students and families who have limited English proficiency (LEP). A cultural liaison provides language translation and interpretation services to help facilitate educational and municipal services for LEP students and families; facilitates communication among school and municipal staff, LEP students and families, and community organizations; and assists in reconciling differing cultural perspectives and understandings. (Added 1997, No. 60, § 18, eff. July 1, 1998; amended 1999, No. 49, § 21, eff. June 2, 1999; 2003, No. 68, § 22, eff. June 18, 2003; 2013, No. 92 (Adj. Sess.), § 244, eff. Feb. 14, 2014; 2021, No. 66, § 8, eff. June 7, 2021.)

• § 4030. Data submission; corrections

  (a) Upon discovering an error or change in data submitted to the Secretary for the purpose of determining payments to or from the Education Fund, a school district shall report the error or change to the Secretary as soon as possible. Any budget deficit or surplus due to the error or change shall be carried forward to the following year.

  (b) The Secretary shall use data submitted on or before January 15 prior to the fiscal year that begins the following July 1 in order to calculate the amounts due each school district for any fiscal year for transportation aid due under section 4016 of this title.

  (c) The Secretary shall use data corrections regarding local education budget amounts submitted on or before June 15 prior to the fiscal year that begins the following July 1, in order to calculate the education payments due under section 4011 of this title. However, the Secretary may use data submitted after June 15 and prior to July 15 due to unusual or exceptional circumstances as determined by the Secretary.

  (d) The Secretary shall not use data corrected due to an error submitted following the deadlines to recalculate weighted long-term membership under section 4010 of this title. The Secretary shall not adjust average daily membership counts if an error or change is reported more than three fiscal years following the date that the original data was due.

  (e) The State Board may adopt rules as necessary to implement the provisions of this section. (Added 1999, No. 108 (Adj. Sess.), § 5, eff. May 10, 2000; amended 2003, No. 36, § 18; 2003, No. 68, § 27, eff. June 18, 2003; 2003, No. 107 (Adj. Sess.), § 13; 2011, No. 58, § 7; 2013, No. 92 (Adj. Sess.), § 245, eff. Feb. 14, 2014; 2021, No. 127 (Adj. Sess.), § 27, eff. July 1, 2024.)

• § 4031. Unorganized towns and gores

  (a) For a municipality that, as of January 1, 2004, is an unorganized town or gore, its education property tax spending adjustment under 32 V.S.A. § 5401(13) shall be one for purposes of determining the tax rate under 32 V.S.A. § 5402(a)(2).

  (b) For purposes of a claim for property tax credit under 32 V.S.A. chapter 154 by a taxpayer in a municipality affected under this section, the applicable percentage shall not be multiplied by a spending adjustment under 32 V.S.A. § 5401(13). (Added 2003, No. 36, § 23; 2003, No. 68, § 17, eff. July 1, 2004; amended 2003, No. 76 (Adj. Sess.), § 21, eff. Feb. 17, 2004; 2015, No. 46, § 31.)