NEWFANE — Judge Robert Gerety will decide whether attorneys present more evidence in a case against the state by the town of Whitingham, a student and a taxpayer. The plaintiffs allege the school funding system creates inequity regarding education quality and tax rates.
"You're saying one community gets more bang for its buck?" Gerety asked Wednesday in Windham Superior Court, Civil Division.
Gerety said he knows he has a lot of reading to do on the case, which he called "important." He is looking at whether to grant the state's motion for judgment on the pleadings, which would mean there are no material issues of fact to be resolved and the state is entitled to judgment as a matter of law.
But the plaintiffs' lawyers are arguing for more evidence to be considered than what was offered in the pleadings filed with the court. They hope to continue the pre-trial discovery process, which would allow the parties to obtain evidence from one another or others.
Attorney James Valente, who represents plaintiffs, has called the education property taxation and education funding system unconstitutional. Twin Valley student Sadie Boyd is "deprived of an equal educational opportunity" each day the system stays in place; taxpayer Madeline Klein is "required to make a disproportionate contribution to the state's education funding system," according to a proposed injunction filed with the court; "and every time the town of Whitingham is compelled to violate its resident taxpayers' and students' rights under the Vermont Constitution constitutes irreparable harm."
William E. Griffin, chief assistant attorney general, and David Boyd, assistant attorney general, wrote in July that the state has created "uniform tax formulas that apply statewide in all districts, so that every district with the same level of spending per pupil will have the same homestead property tax rate."
Homestead property taxes fund a portion of education spending payments the state makes each year to local school districts, the two attorneys wrote. By funding local budgets approved by voters and calculating tax rates uniformly throughout the state, they added, "the state corrects for differences among districts in property wealth, which had historically caused substantial inequality by allowing Vermont's wealthier districts to raise more money for education, at lower tax rates, than its poorest districts could at higher tax rates."
The state says the two formulas used to calculate homestead tax rates — one for spending per "equalized" pupil and another used to see whether districts exceed a statutory threshold that carries penalties — ensure substantial quality of education, preserve local control and control costs. But "a perfect fit between the formulas and their goals is not required," wrote Griffin and David Boyd.
What Whitingham really wants "is to pay a lower tax rate per-pupil than taxpayers who live in other districts," the two attorneys wrote, adding that the town is a subdivision of the state and therefore cannot sue the state to contest the constitutionality of tax formulas. "What plaintiffs are actually seeking is a per-pupil subsidy for taxpayers who reside in Whitingham from taxpayers in other districts."
Whitingham and Wilmington school districts consolidated 13 years ago, Griffin and David Boyd wrote, and the Whitingham tax rate has allegedly dropped by about 15 percent since then. The attorneys said only one above-average expense was cited by the plaintiffs: a special education assessment that accounted for about 4 percent of the expenditures allocated by the Twin Valley School District from the Whitingham School District.
The two towns' districts went from having a joint contract to forming a union on July 1. Whitingham hosts a high school and middle school in one building. Wilmington has an elementary school.
David Boyd told the court that the town does not have a claim to make with regards to education.
"Because it's a town; it's not a school district," he said. "It does not set tax rates."
The case is about taxes not education, David Boyd told the court, later adding that "there is no mid-size school subsidy requirement in the Vermont Constitution" but small-school grants — not available to schools Whitingham students attend because its student population has been slightly larger than state requirements, according to Valente — did take into account economies of scale.
Gerety asked, "What's wrong with the statute?"
"A lot," said Valente, who maintained that taxes and education quality are issues that are "inextricably linked." "Here, education in Whitingham comes at a cost based on the character of Whitingham that effectively creates a new class of taxpayers."
Because of its size and distance from other schools, Valente said, Whitingham needs to offer educational programs for elementary and high school students. To meet student-teacher ratios, he added, the schools are required by law to hire more teachers than they might actually need and are being penalized for exceeding spending thresholds.
Asked by the judge whether he thought the funding system had created an unintended consequence for medium-sized communities, Valente said, "There's a hole in the middle ... It's virtually impossible for them to provide students in Whitingham and Wilmington with [opportunities] remotely similar to what people nearer to the Brattleboro school district would get."
The judge gave Valente 10 days to file information he provided to the court about per-pupil spending in communities of similar size. David Boyd had requested it be submitted.
In an interview after the hearing, Valente said his team of lawyers believes the issues in the case are caused by the per-pupil spending foundation the whole system relies on. He said they hired an expert to perform an analysis but suspended the work until the state's motion is decided.
"We already engaged in some discovery," he said. "Our hope is to analyze how unequal the system is relating to all of the schools in the state, not just Whitingham. That requires somebody who's an expert in doing these kinds of economic evaluations and applying mathematical formulas to ferret out the cause for the disparity in what school one and school two offer; which is to say, if you have 10 towns who offer [Advanced Placement courses] and 10 that do not, why does that problem exist?"
Valente said his team does not agree with the state's argument that the case is only about the tax system.
"Our response to that is the tax system creates an educational problem," he said. "And as a result of the tax system, students don't receive substantially equal education."
Reach staff writer Chris Mays at email@example.com, at @CMaysBR on Twitter and 802-254-2311, ext. 273.