Overview of Vermont's Public Education Funding

How much to Spend

Public education funding in Vermont is a balance between local and State control. Each of Vermont's over-100 school districts has a budget that is voted upon by local voters. The sum total of all those budgets determines the size of the education fund. After all the votes, the State knows it needs to have about $2.4 billion to divvy out to each of those school districts throughout the year. Each district will get back from the education fund the amount their voters approved.

Where the money comes from

There are many sources contributing to the education fund. The following is a list of those that are not related to property taxes. The percent of the fund that they provided for the 2023-2024 school year is also shown..

• Sales & Use Tax  28%

• One-third of Purchase & Use Tax  2.3%

• One-quarter of Meals & Rooms Tax - 3%

• Lottery Transfer 1.7%

• Medicaid Transfer .5%

• Other Sources (Wind & Solar, Fund Interest) .5%

That's a little over a third of the total needed. The rest of the required funds must come from property taxes.

• Homestead Education Property Tax 32.47 %

• Non-Homestead Education Property Tax 38.49%

Almost a quarter of those Homestead Education Property tax revenue goes back to tax payers as credit if they qualify and apply for it. 

What all that means

What is not provided to the Ed Fund by that first list of sources must be provided by the second. So the amount of money required to be raised by taxes depends on things like how much sales tax was collected or how many people played the lottery. Those numbers change every year and throughout the year.

The tax rate is set in each Vermont town such that the Ed Fund is completely filled and able to send back to each town the amount the voters approved.