H 955 — An act relating to next steps in transforming Vermont’s education system

§ 794, and the Individuals with Disabilities Education Act, 2020  U.S.C.

The board shall annually VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 14 of 140 evaluate the executive director’s performance and effectiveness in implementing the programs, policies, and goals of the BOCES CESA.

The BILL AS PASSED BY THE HOUSE H.955 Page 15 of 149 executive director shall not serve as a board member, officer, or employee of any related for-profit or nonprofit organization.

All monies VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 15 of 140 contributed by the member school districts and all grants or gifts from the BILL AS PASSED BY THE HOUSE H.955 Page 16 of 149 federal government, State government, charitable foundations, private corporations, or any other source shall be deposited into the fund.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 16 of 140 (c) Financial accounting system.

BILL AS PASSED BY THE HOUSE H.955 Page 17 of 149 (d) Audit.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 17 of 140 The total principal, interest, and fees to be paid on such loan shall not exceed the total amount of the authorized budget for the same length of time.

BILL AS PASSED BY THE HOUSE H.955 Page 18 of 149 § 606.

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 1819 of 140149 § 607.

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 1920 of 140149 Sec.

APPROPRIATION (a) There is established the Boards of Cooperative Education Services Educational Service Area Start-up Grant Program, to be administered by the Agency of Education, from funds appropriated for this purpose, to award grants to enable the formation of boards of cooperative education services (BOCES) formed pursuant to 1616 V.S.A. V.S.A.

§§ 603(a) 603(a) to assist with start-up costs.

§§ 603(a). 603(a).

§§ 4025 4025 to the contrary, the sum of $70,000.00 is appropriated from the Education Fund to the Agency of Education in fiscal year 2025 to fund the Boards of Cooperative Education VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 2021 of 140149 Services Educational Service Area Start-up Grant Program created in subsection (a) of this section.

(c) The sum of $30,000.00 is appropriated from the General Fund to the Agency of Education in fiscal year 2027 to provide additional funding for the Cooperative Educational Service Area Start-up Grant Program created in subsection (a) of this section.

§§ 261a 261a is amended to read:

In order to maximize the impact of available funding and resources, and to reduce duplication of educational programs, personnel, and services, whenever legally permissible, supervisory unions are encouraged to reach agreements with other supervisory unions jointly to provide any service or perform any duty under this section pursuant to section 267 of this title, or to form boards of cooperative education services educational service BILL AS PASSED BY THE HOUSE H.955 Page 22 of 149 areas pursuant to chapter 10 of this title.

Agreements shall include a cost-benefit analysis outlining the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 21 of 140 projected financial savings or enhanced outcomes, or both, that the parties expect to realize through shared services or programs.

§§ 1691a 1691a is amended to read:

* * * (10) “Teacher” means an individual licensed under this chapter the majority of whose employed time in a public school district, supervisory union, or board of cooperative education services educational service area is assigned to furnish to students direct instructional or other educational BILL AS PASSED BY THE HOUSE H.955 Page 23 of 149 services, as defined by rule of the Standards Board, or who is otherwise subject to licensing as determined by the Standards Board.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 22 of 140 Sec.

§§ 1931(20) 1931(20) is amended to read:

§§ 5051(10) 5051(10) is amended to read:

(10) “Employee” means the following persons employed on a regular basis by a school district, by a supervisory union, or by a board of cooperative education services educational service area for not fewer than 1,040 hours in a year and for not fewer than 30 hours a week for the school year, as defined in BILL AS PASSED BY THE HOUSE H.955 Page 24 of 149 16 V.S.A.

provided, however, that if a person who was VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 23 of 140 employed on a regular basis by a school district as either a special education or transportation employee and who was transferred to and is working in a supervisory union or a board of cooperative education services educational service area in the same capacity pursuant to 16 V.S.A.

§§ 1981 1981 is amended to read:

* * * (8) “School board negotiations council” means, for a supervisory district, its school board, and, for school districts within a supervisory union or BILL AS PASSED BY THE HOUSE H.955 Page 25 of 149 board of a cooperative education services educational service area, the body comprising representatives designated by each school board within the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 24 of 140 supervisory union or board of cooperative education services supervisory union board within each cooperative educational service area and by the supervisory union board or board of a cooperative education services educational service area to engage in professional negotiations with a teachers’ or administrators’ organization.

§§ 1722 1722 is amended to read:

* * * (18) “School board negotiations council” means, for a supervisory district, its school board, and, for school districts within a supervisory union or board of a cooperative education services educational service area, the body comprising representatives designated by each school board within the BILL AS PASSED BY THE HOUSE H.955 Page 26 of 149 supervisory union or board of cooperative education services supervisory union board within a cooperative educational service area and by the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 25 of 140 supervisory union board or board of cooperative education services educational service area to engage in collective bargaining with their school employees’ negotiations council.

§§ 2101 2101 is amended to read:

* * * BILL AS PASSED BY THE HOUSE H.955 Page 27 of 149 (3) “School employer” means a supervisory union or school district as those terms are defined in section 11 of this title, or a board of cooperative VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 26 of 140 education services educational service area formed pursuant to chapter 10 of this title.

§§ 603(a) 603(a) shall appoint a person to serve on the board of directors of the applicable CESA pursuant to 16 V.S.A.

§§ 603(c). 603(c).

§§ 603(a) 603(a) shall call a meeting of the directors of the CESA at which each CESA board shall elect a chair and other necessary officers.

BILL AS PASSED BY THE HOUSE H.955 Page 28 of 149 * * * Union School District Exploration and Formation * * * Sec.

chapter 10, shall employ or contract for the services of seven union school district formation VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 27 of 140 facilitators (facilitators) who shall be responsible for organizing and facilitating study committees to study the advisability of forming a unified union school district.

§§ 603(a)(1)–(7). 603(a)(1)–(7).

Using the suggested school district BILL AS PASSED BY THE HOUSE H.955 Page 29 of 149 groupings contained in Sec.

and VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 28 of 140 (iii) school districts on the same study committee may be members of different supervisory unions.

§§ 708(b)(1) 708(b)(1) and (2), that are not members of the study committee or are not members of the CESA, or both, and shall work with the applicable facilitator or facilitators to adjust study committee membership as necessary.

BILL AS PASSED BY THE HOUSE H.955 Page 30 of 149 (B) Notwithstanding 16 V.S.A.

§§ 706(b) 706(b) as it applies to study committee budgets and 16 V.S.A.

§§ 707(a) 707(a) and (b), a study committee formed pursuant to this section shall be funded through appropriations made by the General Assembly for this purpose;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 29 of 140 (C) In addition to the requirements of 16 V.S.A.

§§ 708(c), 708(c), the final report of the study committee shall include an analysis of the following:

BILL AS PASSED BY THE HOUSE H.955 Page 31 of 149 (iii) the likely operational and financial viability and sustainability of the proposed new unified union school district;

(E)(i) If a study committee formed pursuant to this section determines that it is inadvisable to propose formation of a new unified union VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 30 of 140 school district, before the study committee members vote to dissolve the study committee pursuant to 16 V.S.A.

§§ 708(d), 708(d), the study committee shall prepare a report with the following details:

and (IV) if the decision of the study committee was not unanimous, an analysis of the minority view of the committee outlining the ways in which BILL AS PASSED BY THE HOUSE H.955 Page 32 of 149 a unified union school district promotes the State policy set forth in section 701 of this chapter.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 31 of 140 (iii) Members of a study committee that determines it is inadvisable to propose formation of a new unified union school district may form a new study committee or committees and may pursue any union school district formation option available under 16 V.S.A.

BILL AS PASSED BY THE HOUSE H.955 Page 33 of 149 (5) On or before February 1, 2028, a school board shall complete its review and provide comments to the study committee pursuant to 16 V.S.A.

§§ 709(a) 709(a) regarding the study committee’s report and proposed articles of agreement.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 32 of 140 (c) Secretary review.

§§ 709(b). 709(b).

§§ 709(c) 709(c) regardless of whether the Secretary submits a recommendation regarding the proposed unified union school district.

§§ 709(c)(2) 709(c)(2) on or before June 1, 2028.

BILL AS PASSED BY THE HOUSE H.955 Page 34 of 149 (e) Vote to form a unified union school district.

§§ 710, 710, on or before November 7, 2028.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 33 of 140 (f) Study committee status report.

provided, however, that a facilitator shall transmit the facilitator’s rationale for such choices to the lead facilitator for inclusion in the report required pursuant to Sec.Sec. 15 of this act.

15BILL AS PASSED BY THE HOUSE H.955 Page 35 of this149 act.(1) Group one:

(1) Group one:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 34 of 140 (3) Group three:

Athens Grafton School District, Bellows Falls Union High School District, Marlboro School District, River Valleys Unified School District, Rockingham School District, Stratton School District, West River BILL AS PASSED BY THE HOUSE H.955 Page 36 of 149 Modified Union Education District, Westminster School District, and Windham School District.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 35 of 140 (9) Group nine:

BILL AS PASSED BY THE HOUSE H.955 Page 37 of 149 (12) Group 12:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 36 of 140 (14) Group 14:

BILL AS PASSED BY THE HOUSE H.955 Page 38 of 149 (19) Group 19:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 37 of 140 Sec.

BILL AS PASSED BY THE HOUSE H.955 Page 39 of 149 (2) differences in operating structures;

AGENCY OF EDUCATION REPORT VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 38 of 140 On or before January 1, 2029, the Agency of Education, in consultation with the study committees formed pursuant to this act and the State Board of Education, shall submit a written report to the House and Senate Committees on Education with recommendations for supervisory union boundary adjustments and CESA boundary adjustments that take into account the new union school districts formed or proposed to be formed pursuant to this act.

APPROPRIATIONS (a) Study committee reimbursement grant;

appropriation.

(1) The Agency of Education shall pay up to $10,000.00 to a study committee formed pursuant to Sec.

13 of this act to reimburse participating school districts for legal and other services necessary for the analysis and report required pursuant to 16 V.S.A.

§ 708(c) and Sec.

13(b)(3)(D) or (E) of BILL AS PASSED BY THE HOUSE H.955 Page 40 of 149 this act, as applicable.

The study committee shall forward invoices to the Agency on a quarterly basis.

The Agency shall reimburse one-half of the total amount reflected in each set of invoices upon receipt and the remaining one- half upon completion of the final report required pursuant to Sec.

13(b)(3)(D) or (E) of this act, as applicable;

provided, however, that no payment shall cause the total amount of funds paid to a study committee to exceed the $10,000.00 limit.

(2) The sum of $210,000.00 is appropriated from the General Fund to the Agency of Education in fiscal year 2027 for the purpose of awarding study committee reimbursement grants to the study committees formed pursuant to Sec.

13 of this act in accordance with subdivision (1) of this subsection.

(b) Facilitator appropriation;

reports.

(1) The sum of $442,000.00 is appropriated from the General Fund to the Vermont Learning Collaborative in fiscal year 2027 for the purpose of hiring or contracting for seven facilitators and one lead facilitator pursuant to Sec.

13(a) of this act as well as for administrative costs associated with contracting for the facilitators.

VTLC may use up to $32,000.00 of the funds appropriated pursuant to this subsection for administrative costs.

(2) Beginning on October 1, 2026, and every three months thereafter for the next year, the Vermont Learning Collaborative shall submit written quarterly reports to the House Committees on Appropriations, on Education, BILL AS PASSED BY THE HOUSE H.955 Page 41 of 149 and on Ways and Means and the Senate Committees on Appropriations, on Education, and on Finance with a detailed accounting of the funds expended pursuant to this subsection.

(c) CESA executive director grant;

appropriation.

(1) From funds appropriated to the Agency of Education for this purpose, the Agency shall award a grant in the amount of $50,000.00 to each CESA created in 16 V.S.A.

§ 603(a) to be used by the CESA to hire an executive director;

provided, however, that the Vermont Learning Collaborative shall not be eligible for a grant under this subsection.

(2) The sum of $300,000.00 is appropriated from the General Fund to the Agency of Education in fiscal year 2027 for the purpose of awarding CESA executive director grants in accordance with subdivision (1) of this subsection.

Sec.

17.

STUDY COMMITTEE REIMBURSEMENT GRANTS;

CESA EXECUTIVE DIRECTOR GRANTS;

REPORTS;

§§ 708(c) 708(c) and Sec.

The study committee shall forward invoices to the BILL AS PASSED BY THE HOUSE H.955 Page 42 of 149 Agency on a quarterly basis.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 39 of 140 (2) Of the funds appropriated to the Agency of Education in 2025 Acts and Resolves No.

C.103 of legislation enacting the budget in fiscal year 2027, $442,000.00 shall be granted to the Vermont Learning Collaborative (VTLC) within 4545 days days following the passage of this act for the purpose of hiring or contracting for seven facilitators and one lead facilitator pursuant to Sec.

BILL AS PASSED BY THE HOUSE H.955 Page 43 of 149 (c) CESA executive director grant;

§§ 603(a) 603(a) to be used by the CESA to hire an executive director;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 40 of 140 (2) Of the funds appropriated to the Agency of Education in 2025 Acts and Resolves No.

EFFECTIVE DATES * * * (e) Sec.

61a shall take effect on January 1, 2027, provided that the General Assembly has enacted new school district boundaries between the enactment of this act and January 1, 2027.

(f)(1) The following sections enumerated in subdivision (2) of this subsection shall take effect on July 1, 2028 2030, provided that the new school districts contemplated by this act have assumed responsibility for the education BILL AS PASSED BY THE HOUSE H.955 Page 44 of 149 of all resident students and that the expert tasked with developing a cost-factor foundation formula has provided to the General Assembly the report pursuant to Sec.

45a to provide the General Assembly an opportunity to enact legislation in consideration of the report following conditions have been met:

(A) the clerk of each school district voting on the proposal to form a unified union school district on or before November 7, 2028, pursuant to legislation enacted by the General Assembly in 2026 that requires each school board to participate on a study committee to study the advisability of forming a unified union school district, has certified the results of that vote to the Secretary of Education pursuant to 16 V.S.A.

§ 713(a);

(B) the expert tasked with developing a cost-factor foundation formula has provided to the General Assembly the report required pursuant to Sec.

45a;

(C) the Joint Fiscal Office has provided the legislature with an analysis that shows the combined approved fiscal 2027 education spending for the school districts consolidated into each new school district compared with the estimated educational opportunity payment under the revised proposed foundation formula for each district;

and (D) legislation has been enacted that addresses:

(i) suitable geographic measures for determining sparsity within the foundation formula;

BILL AS PASSED BY THE HOUSE H.955 Page 45 of 149 (ii) whether it costs more to educate a secondary student than an elementary student in Vermont and, if so, an appropriate weight to capture the cost differential of educating secondary students;

(iii) how to account for the provision of career and technical education within Vermont’s foundation formula;

(iv) how to account for regional differences in operating costs, including those driven by regional differences in cost of living and legacy collective bargaining agreements within the foundation formula;

(v) how to fund special education services;

school construction, renovation, and repayment of school district debt;

transportation;

and universal pre-kindergarten;

and (vi) any other aspect of the foundation formula the General Assembly deems prudent to address.

(1)(2)(A) In Sec.

27, 16 V.S.A.

§ 823(a) and (d);

(2)(B) Sec.

28 (tuition repeals);

(3)(C) Secs.

34–43 (transition to cost-factor foundation formula);

(4)(D) Sec.

45b (educational opportunity payment transition);

(5)(E) Secs.

46, 47, 49, and 50 (statewide education tax;

supplemental district spending tax);

(6)(F) Sec.

46a (supplemental district spending tax;

cap;

transition);

(7)(G) Sec.

48a (tax rate transition);

BILL AS PASSED BY THE HOUSE H.955 Page 46 of 149 (8)(H) Secs.

51, 52, and 54–56 (property tax credit repeal;

creation of homestead exemption);

(9)(I) Sec.

57 (Education Fund Advisory Committee;

review of foundation formula);

and (10)(J) Secs.

60 and 61 (property tax classifications).

(g) In Sec.

27, 16 V.S.A.

§ 823(b) and (c) shall take effect on July 1, 2028 July 1, 2030, provided that the new school districts contemplated by this act have assumed responsibility for the education of all resident students clerk of each school district voting on the proposal to form a unified union school district on or before November 7, 2028, pursuant to legislation enacted by the General Assembly in 2026 that requires each school board to participate on a study committee to study the advisability of forming a unified union school district, has certified the results of that vote to the Secretary of Education pursuant to 16 V.S.A.

§ 713(a) and that the cost-factor foundation formula report required pursuant to Sec.

45a contains evidence that it costs more to educate students in grades nine through 12 but the General Assembly has failed to enact legislation to add a secondary student weight.

(h) Sec.

62 (regional assessment districts) shall take effect on January 1, 2029.

BILL AS PASSED BY THE HOUSE H.955 Page 47 of 149 Sec.

18.

2025 Acts and Resolves No.

73, Sec.

70 is amended to read:

Sec.

70.

(A) school districts have had an opportunity to study the advisability of forming a new unified union school district and the clerk of each school district voting on a proposal to form a unified union school district on or before VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 41 of 140 November 7, 2028, pursuant to legislation enacted by the General Assembly in 2026 that requires each school board to participate on a study committee to study the advisability of forming a unified union school district, has certified the results of any such vote, to the extent that any such votes occurred, to the Secretary of Education pursuant to 16 V.S.A.

§§ 713(a); 713(a);

BILL AS PASSED BY THE HOUSE H.955 Page 48 of 149 (B) the expert tasked with developing a cost-factor foundation formula has provided to the General Assembly the report required pursuant to Sec.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 42 of 140 (iii) how to account for the provision of career and technical education within Vermont’s foundation formula;

and BILL AS PASSED BY THE HOUSE H.955 Page 49 of 149 (v) how to fund special education services;

§§ 823(a) 823(a) and (d);

and [Deleted.] VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 43 of 140 (10)(J) Secs.

§§ 823(b) 823(b) and (c) shall take effect on July 1, 2028 July 1, 2030, provided that the new school districts contemplated by this act have assumed responsibility for the education of all resident students school BILL AS PASSED BY THE HOUSE H.955 Page 50 of 149 districts have had an opportunity to study the advisability of forming a new unified union school district and the clerk of each school district voting on a proposal to form a unified union school district on or before November 7, 2028, pursuant to legislation enacted by the General Assembly in 2026 that requires each school board to participate on a study committee to study the advisability of forming a unified union school district, has certified the results of any such vote, to the extent that any such votes occurred, to the Secretary of Education pursuant to 16 V.S.A.

§§ 713(a) 713(a) and that the cost-factor foundation formula report required pursuant to Sec.

DEPARTMENT OF TAXES On or before October 1, 2027, the Department of Taxes shall publish on its website an interactive education funding calculator (interactive calculator) that VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 44 of 140 enables a school district or a union school district study committee to calculate an estimate of the total education funding from the State it received under Vermont’s current education finance system in fiscal year 2027 and the estimated total education funding it would have received from the State under BILL AS PASSED BY THE HOUSE H.955 Page 51 of 149 the new financing formula had it been in effect in fiscal year 2027.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 45 of 140 (1) despite being colloquially known as the “universal prekindergarten program,” not all children three and four years of age in the State have equal access to a prequalified prekindergarten provider;

(2) Vermont ranks second in the country with regard to access to prekindergarten education by children who are four years of age, with 7676 percent percent of eligible four-year-old children receiving prekindergarten BILL AS PASSED BY THE HOUSE H.955 Page 52 of 149 education, and that Vermont is one of two states in which more than 70 percent of children who are four years of age receive prekindergarten services;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 46 of 140 Sec.

BILL AS PASSED BY THE HOUSE H.955 Page 53 of 149 (3) provide access to licensed teachers in the classroom of both prequalified public and private providers, including access to support and provisional status;

JOINT FISCAL OFFICE;

PREKINDERGARTEN;

REPORT;

APPROPRIATION (a)(1) The Joint Fiscal Office shall contract with a contractor with expertise in Vermont’s education funding system to make recommendations regarding how to account for the provision of prekindergarten education within Vermont’s education finance system, including the consideration of use of categorical aid or the inclusion of prekindergarten education within a foundation formula through the use of a prekindergarten weight.

The contractor’s recommendations shall be designed to provide funding for prekindergarten education that:

(A) supports achieving access for every prekindergarten child, as that term is defined in 16 V.S.A.

§ 829, with equal payments and equal educational standards for public and private providers;

(B) ensures the cost of prekindergarten education is included in the full cost of education;

BILL AS PASSED BY THE HOUSE H.955 Page 54 of 149 (C) increases access and participation in areas of the State where access or participation is limited;

and (D) continues to support a mixed delivery system.

(2) The recommendations shall, to the extent possible, align with the recommendations of the report required pursuant to 2025 Acts and Resolves No.

73, Sec.

45a.

The contractor shall submit a written report with the contractor’s recommendations to the House Committees on Education, on Human Services, and on Ways and Means and the Senate Committees on Education, on Finance, and on Health and Welfare on or before January 15, 2027.

(b) The sum of $50,000.00 is appropriated to the Joint Fiscal Office from the General Fund in fiscal year 2027 to hire a contractor to make recommendations in accordance with subsection (a) of this section.

Sec.

21.

It is the intent of the General Assembly to, in the 2027 legislative session, establish a funding structure for prekindergarten education that:

§§ 829, 829, with equitable payments and equitable educational standards for public and private providers;

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 4755 of 140149 (2) ensures the cost of prekindergarten education is included in the full cost of education;

(1) The Agency of Education, Department for Children and Families, and Building Bright Futures (BBF) shall establish a system to jointly monitor and evaluate prekindergarten education programs to promote optimal results for children that support the relevant population-level outcomes set forth in 33 V.S.A. V.S.A.

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 4856 of 140149 (ii) initial or updated data findings including prekindergarten student demographics and number of hours by prekindergarten program by district;

This study shall provide estimates for the current full cost ofBILL VT LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 4957 of 140149 of providing prekindergarten education for children three, four, and five years of age, not yet eligible to enroll in kindergarten.

§§ 829 829 is amended to read:

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 5058 of 140149 (e) Rules.

§§ 2311 2311 and to collect data that will inform future decisions.

* * * * * * DataEffective CollectionDate * * * Sec.

EFFECTIVE DATE This act shall take effect on July 1, 2026.

* * * Data Collection * * * Sec.

22.

§§ 4010(c) 4010(c) is amended to read:

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 BILL AS PASSED BY THE HOUSE H.955 Page 59 of 149 compute the weighting categories under subsection (b) of this section for that district, for all resident students in prekindergarten through grade 12.

In order to fulfill this obligation, a school district that pays public tuition on behalf of a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 51 of 140 resident student (sending district) to a public school in another school district, an approved independent school, or an out-of-state school, or a prequalified private prekindergarten education provider (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 shall require each resident student in prekindergarten through grade 12 on whose behalf the district pays tuition to complete a form or forms developed by the Agency of Education in order to obtain the information needed in order for the Agency to compute the weighting categories under subsection (b) of this section for all students residing in that district, including students that are educated by a receiving school.

BILL AS PASSED BY THE HOUSE H.955 Page 60 of 149 * * * Special Education Funding * * * Sec.

73 (Act 73), nor the implementation of Act 73, shall be construed to permit a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 52 of 140 reduction in State or local funding for special education and related services in a manner that would violate the maintenance of effort requirements of the Individuals with Disabilities Education Act, 20 U.S.C.

§§§§ 1400–1485. 1400–1485.

It is the intent of the General Assembly that implementation of Act 73 or any future education funding BILL AS PASSED BY THE HOUSE H.955 Page 61 of 149 reform shall not limit the right of students with disabilities to a Free Appropriate Public Education (FAPE), including access to individualized services in the least restrictive environment as required by federal and State law.

A school district shall not implement programmatic reductions, staffing changes, or budgetary actions that VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 53 of 140 disproportionately affect students with disabilities or impair the district’s ability to meet its obligations to provide FAPE.

§§ 828 828 is amended to read:

APPEAL * * * BILL AS PASSED BY THE HOUSE H.955 Page 62 of 149 (e)(1) A school eligible to receive tuition pursuant to this section shall be prohibited from requiring tuition or fees of any kind from a student attending the school, according to the provisions of this chapter, above the amount of tuition paid by a sending school district pursuant to section 823 of this chapter.

(2) A public school located in Vermont that receives tuition pursuant to section 823 of this chapter shall be prohibited from charging any student attending the school a fee of any kind above the amount of tuition paid by a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 54 of 140 sending school district pursuant to section 823 of this chapter, regardless of whether the student is a resident student or a student attending the school on tuition.

24 of this act, which prohibits a receiving school from requiring tuition or fees of any kind from a student attending the school on public tuition, above the amount of tuition paid by a sending school district, shall take effect at the same time the foundation formula and other tax changes envisioned in this act shall take effect, provided that any applicable contingency has been met.

BILL AS PASSED BY THE HOUSE H.955 Page 63 of 149 * * * Union School District Study Committee Budgets * * * Sec.

§§ 707 707 is amended to read:

(1) If the proposed budget established in section 706 of this chapter exceeds $50,000.00 $500,000.00, then subject to the provisions of that section the board of each potentially participating school district shall warn the district’s voters to meet at an annual or special school district meeting to vote whether to appropriate funds necessary to support the district’s financial share VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 55 of 140 of a study committee’s costs.

_______________________________________, _______________________________________, and _______________________________________? It is estimated that the _______________________________________ school district’s share, if all BILL AS PASSED BY THE HOUSE H.955 Page 64 of 149 of the identified school districts vote to participate, will be $_______________________________________.

The VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 56 of 140 board of a school district appointing more than one person to the study committee may appoint residents of the school district who are not members of the board to any of the remaining seats.

At least one current board member BILL AS PASSED BY THE HOUSE H.955 Page 65 of 149 from each participating school district shall be appointed to the study committee.

(1) If the voters approve a budget that exceeds $50,000.00 $500,000.00 but the study committee later determines that its budget is likely to exceed the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 57 of 140 projected, voter-approved amount, then the boards of all participating school districts shall obtain voter approval for the amounts exceeding the previously approved budget in the manner set forth in subdivision (a)(1) of this section before the study committee obligates or expends sums in excess of the initial voter-approved amount.

(2) If a proposed budget does not exceed $50,000.00 $500,000.00 at the time the school boards appoint members to the study committee, but the study committee later determines that its total budget is likely to exceed $50,000.00 $500,000.00, then the boards of all participating school districts shall obtain voter approval for the amounts exceeding $50,000.00 $500,000.00 in the BILL AS PASSED BY THE HOUSE H.955 Page 66 of 149 manner set forth in subdivision (a)(1) of this section before the study committee obligates or expends funds in excess of $50,000.00 $500,000.00.

RULEMAKING VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 58 of 140 The State Board of Education shall, unless extended by the Legislative Committee on Administrative Rules, adopt updates to Agency of Education, State Board Rule 2000 Education Quality Standards (CVR 22-000-003) to establish criteria for identifying schools as small by necessity or sparse by necessity, or both, pursuant to 3 V.S.A.

§§ 843 843 on or before March 31, 2027.

BILL AS PASSED BY THE HOUSE H.955 Page 67 of 149 Sec.

RULEMAKING The Agency of Education shall, unless extended by the Legislative Committee on Administrative Rules, adopt updates to the district quality standards contained in Agency of Education, District Quality Standards (CVR 22-000-039) to establish criteria for intradistrict budgeting, pursuant to 33 V.S.A. V.S.A.

§§ 843 843 on or before March 31, 2027.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 59 of 140 Sec.

chapter 25 to update the District Quality Standards rules contained in Agency of Education, District Quality Standards (CVR 23-020), to include recommended BILL AS PASSED BY THE HOUSE H.955 Page 68 of 149 reserve fund account standards.

and VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 60 of 140 (5) identify conditions that may justify deviation from any broadly applicable standards adopted pursuant to this section.

BILL AS PASSED BY THE HOUSE H.955 Page 69 of 149 (1) The report shall include information on the following:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 61 of 140 (v) the method by which resident students arrive to and leave from each school a resident student attends, regardless of whether it is a school operated by the school district or a receiving school not operated by the school district, such as whether students rely on school district provided transportation, receiving school provided transportation, or transportation provided or arranged by a resident family, as well as whether there is any district reimbursement to resident families for privately incurred expenses related to student transportation;

and BILL AS PASSED BY THE HOUSE H.955 Page 70 of 149 (B) the aggregate cost of the current education transportation system, on a per-school-district basis, including:

§§ 11431–11435; 11431–11435;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 62 of 140 (2) The report shall also include recommendations regarding:

(C) how regionalized transportation services may work under a cooperative education service area (CESA) model, including with a CESA BILL AS PASSED BY THE HOUSE H.955 Page 71 of 149 serving as the fiscal agent for contracts, as well as information regarding the availability of transportation vendors in the CESA regions created in this act;

§§ 4016 4016 (reimbursement for transportation expenditures) and any related rules;

and (G) how to ensure a student who attends a career technical education (CTE) center other than the student’s assigned regional CTE center, due to VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 63 of 140 enrollment constraints, program availability, or some other barrier, has access to transportation to the same extent as students attending an assigned CTE center as provided pursuant to 16 V.S.A.

STUDENT PROFILE FORM On or before September 1, 2026, the Agency of Education, in consultation with school business officials, shall develop a student profile form to be used by school districts to collect the information necessary in order for the Agency BILL AS PASSED BY THE HOUSE H.955 Page 72 of 149 to compute the weighting categories under 16 V.S.A.

§§ 4010(b) 4010(b) for students in prekindergarten through grade 12 on whose behalf a school district pays tuition.

RULEMAKING The State Board of Education shall, unless extended by the Legislative Committee on Administrative Rules, adopt updates to Agency of Education, 2300 Length of School Day and Year—Specific Program Requirements for Public Schools (CVR 22-000-005) to update the criteria for the length of a school day for each grade, prekindergarten through grade 12, consistent with the definition of school day contained in 16 V.S.A.

§§ 11(41), 11(41), pursuant to 3 V.S.A.

§§ 843 843 on or before March 31, 2027.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 64 of 140 * * * Small and Sparse Schools * * * Sec.

REPEAL 2025 Acts and Resolves No.

§§ 4019) 4019) is repealed.

§§ 4019 4019 is added to read:

§§ 4019. 4019.

A student shall be BILL AS PASSED BY THE HOUSE H.955 Page 73 of 149 counted as one whether the student is enrolled as a full-time or part-time student.

and VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 65 of 140 (B) has been determined by the Agency of Education, on an annual basis, to be “sparse by necessity” under standards consistent with State Board of Education rule.

Annually, the Secretary shall pay a small schools support grant to each school district for each small school operated by BILL AS PASSED BY THE HOUSE H.955 Page 74 of 149 the school district in an amount determined by multiplying the two-year average enrollment in the small school by $3,157.00.

Department of Commerce, Bureau of Economic Analysis, from fiscal year VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 66 of 140 2025 through the fiscal year for which the amount is being determined, and rounding upward to the nearest whole dollar amount.

§§ 11 11 is amended to read:

* * * BILL AS PASSED BY THE HOUSE H.955 Page 75 of 149 (36) “Average class size” means the total number of students enrolled across all classes included in a grade band or content area, as applicable, divided by the total number of individual classes contained in a grade band or content area, as applicable, calculated separately for each school and each grade band or content area, as specified in subdivision 165(a)(9) of this title.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 67 of 140 (39) “Full-time equivalent class” means the proportion of instructional time relative to a full school year.

BILL AS PASSED BY THE HOUSE H.955 Page 76 of 149 (41) “School day” means the hours between the latest time at which a student may arrive at school and not be considered late and the time a student is dismissed from school, on a student attendance day.

Regional Assessment Districts §§ 3415. 3415.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 68 of 140 (1) properties on grand lists are regularly reappraised;

§BILL 3416.AS PASSED BY THE HOUSE H.955 Page 77 of 149 § 3416.

§§ 3417. 3417.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 69 of 140 (1) guidelines for contracting with third parties to conduct or assist with reappraisals, including standard reappraisal contract terms;

and BILL AS PASSED BY THE HOUSE H.955 Page 78 of 149 (4) standardized practices for a full reappraisal, including cases in which physical inspections are unnecessary and how technology is to be utilized.

§§ 3418. 3418.

ESTABLISHMENT VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 70 of 140 (a) There are hereby established regional assessment district appeals boards for each regional assessment district established pursuant to section 3416 of this subchapter.

The Division of Property Valuation and Review BILL AS PASSED BY THE HOUSE H.955 Page 79 of 149 shall provide training and technical assistance to the board.

§§ 3419. 3419.

APPEALS TO REGIONAL ASSESSMENT DISTRICT APPEALS BOARD VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 71 of 140 (a) Within 30 days following the date of notice, a person aggrieved by the final valuation decision of an assessing official may appeal in writing to the district’s regional assessment district appeals board.

An appeal of a valuation decision conducted pursuant to section 3416 of this subchapter that is erroneously made to a municipality shall be considered timely if it would have BILL AS PASSED BY THE HOUSE H.955 Page 80 of 149 been timely if made to the regional assessment district.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 72 of 140 (A) The appellant shall be provided notice of the inspection and the appeal shall be deemed withdrawn if the appellant refuses to allow an inspection under this subdivision (2).

chapter 1, a board working within a municipality affected by an all-hazards event shall BILL AS PASSED BY THE HOUSE H.955 Page 81 of 149 not be required to physically inspect any property that is the subject of an appeal.

(4) Notwithstanding any provision of law to the contrary, if the board does not substantially comply with the requirements of this subsection, and if the appeal is not withdrawn by filing written notice of withdrawal with the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 73 of 140 board, or deemed withdrawn as provided in subdivision (2) of this subsection, the grand list value of the property subject to appeal shall be set at a value that will produce a tax liability equal to the tax liability for the preceding year.

BILL AS PASSED BY THE HOUSE H.955 Page 82 of 149 (b) Not more than two board members shall be panelists for a hearing involving a property located in the municipality for which the members are representatives.

The appeal to the Superior Court shall be VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 74 of 140 heard without a jury.

For an appeal from the board, the appeal shall be commenced by filing a notice of appeal pursuant to Rule 74 of the Vermont Rules of Civil Procedure within 30 days after entry of the decision of the BILL AS PASSED BY THE HOUSE H.955 Page 83 of 149 board.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 75 of 140 (b) On or before the last day on which appeals may be taken from the determination of the regional assessment district appeals board, an agent designated by the legislative body of the municipality, in the name of the BILL AS PASSED BY THE HOUSE H.955 Page 84 of 149 municipality, on written application of one or more taxpayers of the municipality whose combined grand list represents at least three percent of the grand list of the municipality for the preceding year, shall appeal to the Superior Court from any action of the regional assessment district board of appeal not involving appeals of the applying taxpayers.

(c) When a taxpayer, a legislative body of the municipality, or an agent designated by the legislative body of the municipality claims that an appeal to the Commissioner is in any manner defective or was not lawfully taken, on or VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 76 of 140 before 30 days after mailing of the notice of receipt of the appeal by the Director, the taxpayer, agent, or legislative body of the municipality shall file objections in writing with the Commissioner and furnish the appellant or BILL AS PASSED BY THE HOUSE H.955 Page 85 of 149 appellant’s attorney with a copy of the objections.

(e) When an appeal to the Commissioner is not withdrawn or forwarded by the Commissioner to the Superior Court pursuant to subsection (a) of this VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 77 of 140 section, the Commissioner shall conduct a hearing in accordance with 3 V.S.A.

(f) The Commissioner or court shall proceed de novo on all appeals and determine the correct valuation of the property as promptly as practicable and BILL AS PASSED BY THE HOUSE H.955 Page 86 of 149 determine a homestead and a housesite value if a homestead has been declared with respect to the property for the year in which the appeal is taken.

Within 10 days following the appeal being filed with the Commissioner, the Commissioner shall notify the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 78 of 140 property owner in writing of the Commissioner’s option to request an inspection under this section.

If the appellant requests in writing that the property BILL AS PASSED BY THE HOUSE H.955 Page 87 of 149 be inspected for purposes of the appeal, the Commissioner shall conduct the inspection through electronic means.

The appraisal so fixed by the Commissioner or court shall become the basis for the grand list of the taxpayer for the year in which the appeal is taken and, if the appraisal relates to real property, for the two next ensuing years, except that if the real property is enrolled in use value appraisal under chapter 124 of this title, the value of enrolled land, prior to its being equalized, shall be the per-acre value set annually by the Current Use VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 79 of 140 Advisory Board multiplied by the number of acres enrolled.

BILL AS PASSED BY THE HOUSE H.955 Page 88 of 149 Sec.

REAPPRAISAL * * * (b) If the Director of Property Valuation and Review determines that a municipality’s education grand list has a coefficient of dispersion greater than 20 or that a municipality has not timely reappraised pursuant to subsection (d) of this section, the municipality shall reappraise its education grand list properties.

[Repealed.] (c) If a municipality fails to submit an acceptable plan or fails to carry out the plan, pursuant to subsection (b) of this section, the State shall withhold the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 80 of 140 education, transportation, and other funds from the municipality until the Director certifies that the town has carried out that plan.

[Repealed.] (d) Each municipality shall commence a full reappraisal not later than six years after the commencement of the municipality’s most recent full BILL AS PASSED BY THE HOUSE H.955 Page 89 of 149 reappraisal unless a longer period of time is approved by the Director.

§§ 5405 5405 is amended to read:

provided, however, that for purposes of equalizing grand lists pursuant to this section, the equalized education property tax grand list of a municipality that establishes a tax increment financing district shall include the fair market value of the property in the district and not the original taxable value of the property, and further provided that the unified towns and gores of Essex County may be treated as one municipality for the purpose of determining an equalized education property grand list and a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 81 of 140 coefficient of dispersion, if the Director determines that all such entities have a uniform appraisal schedule and uniform appraisal practices.

(2) All municipalities within a regional assessment district shall be treated as a single entity for purposes of the equalization process under this BILL AS PASSED BY THE HOUSE H.955 Page 90 of 149 section, provided at least one simultaneous full reappraisal has been completed by the member municipalities of the regional assessment district as determined by the Director under subsection 3417(c) of this title.

§§ 3602c 3602c is added to read:

§§ 3602c. 3602c.

(d) The valuations furnished under this section shall be considered along with any other information as may reasonably be required by listers in VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 82 of 140 determining and fixing the valuations of property for the purposes of property taxation.

The valuations provided by the Division for property used for the transmission and distribution of electricity BILL AS PASSED BY THE HOUSE H.955 Page 91 of 149 shall be used by the listers as the valuations of that property for purposes of property taxation.

§§ 4041a 4041a is amended to read:

Within 30 days, the Commissioner shall estimate the cost of the municipality’s full reappraisal and transfer to the municipality the lesser of VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 83 of 140 two-thirds of the estimated cost or $66.00 per grand list parcel in the municipality.

[Deleted.] BILL AS PASSED BY THE HOUSE H.955 Page 92 of 149 * * * Conforming Changes;

§§ 3616(d) 3616(d) is amended to read:

chapter 131 §§ 3419. 3419.

No charge so established and no tax levied under the provisions of section 3615 of this title shall be considered to be a part of any tax authorized to be assessed by the legislative body of any municipality for general purposes but shall be in addition to any such tax so authorized to be assessed.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 84 of 140 Sec.

All such appeals shall be heard and determined no not later than December 31 BILL AS PASSED BY THE HOUSE H.955 Page 93 of 149 of that year.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 85 of 140 (c) The Board shall hear and decide appeals by three member hearing panels, the membership of such panels to be rotated on a periodic basis.

(d) Either a taxpayer or the City Assessor aggrieved by the decision of the Board of Tax Appeals may file an appeal of a decision of the Board of Tax Appeals directly with the Director of the Division of Property Valuation and BILL AS PASSED BY THE HOUSE H.955 Page 94 of 149 Review Commissioner of the Vermont Department of Taxes or the Superior Court pursuant to 32 V.S.A.

The Board shall have the same duties and proceed in VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 86 of 140 the same manner to hear and determine tax appeals as a board of civil authority under 32 V.S.A.

§§ 3419 3419 except as otherwise provided in this charter.

The Board shall organize each year by the election of a Chair,BILL Vice-AS PASSED BY THE HOUSE H.955 Page 95 of 149 Chair, Vice-Chair, and Clerk.

chapter 131 §§ 3419. 3419.

Any property owner may file a grievance with the Board and appeal the decision of the Board as provided for under VT32 V.S.A. LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 87 of 140 32 V.S.A.

chapter 131 §§ 3419; 3419;

(d) In the case of any property used for both residential and nonresidential purposes within the District as of April 1, the Department of Assessment shall adjust the listed value for the purposes of determining the District tax under BILL AS PASSED BY THE HOUSE H.955 Page 96 of 149 this section to exclude the value of that portion of the property used for residential purposes.

chapter 131 §§ 3419. 3419.

chapter 131 §§ 3419; 3419;

APPEALS VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 88 of 140 A person aggrieved by the final decision of the Department of Assessment under the provisions of section 706 of this charter may appeal in writing under the provisions of 32 V.S.A.

chapter 131 §§ 3419. 3419.

BILL AS PASSED BY THE HOUSE H.955 Page 97 of 149 Sec.

§§ 3757(c) 3757(c) is amended to read:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 89 of 140 Sec.

§§ 3758(d) 3758(d) is amended to read:

An appeal of this decision of the Commissioner may be taken to the Superior Court in the same manner and BILL AS PASSED BY THE HOUSE H.955 Page 98 of 149 under the same procedures as an appeal from a decision of a Board of Civil Authority regional assessment district appeals board, as set forth in chapter 131, subchapter 2 section 3420 of this title.

§§ 3760(a)(2) 3760(a)(2) is amended to read:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 90 of 140 Sec.

§§ 3846(d) 3846(d) is amended to read:

BILL AS PASSED BY THE HOUSE H.955 Page 99 of 149 Sec.

§§ 4006 4006 is amended to read:

§§ 5136(b) 5136(b) is amended to read:

(b) Whenever a municipality votes to collect interest on overdue taxes pursuant to this section, interest in like amount shall be paid by the municipality to any person making any overpayment of taxes occurring as a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 91 of 140 result of a redetermination of the grand list of the taxpayer on appeal provided by chapter 131 121, subchapter 1A of this title.

§§ 5409(3)(B) 5409(3)(B) is amended to read:

BILL AS PASSED BY THE HOUSE H.955 Page 100 of 149 Sec.

§§ 5410(j) 5410(j) is amended to read:

The legislative body VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 92 of 140 may delegate this abatement authority to the board of civil authority or the board of abatement for the municipality.

BILL AS PASSED BY THE HOUSE H.955 Page 101 of 149 Sec.

§§ 5412 5412 is amended to read:

(A) The reduction in valuation is the result of an appeal under chapter 131 121, subchapter 1A of this title to the Director of Property Valuation and Review Commissioner or to a court, with no further appeal available with regard to that valuation, or any judicial decision with no further right of appeal, or a settlement of either an appeal or court action if the Director determines that the settlement value is the fair market value of the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 93 of 140 parcel.

BILL AS PASSED BY THE HOUSE H.955 Page 102 of 149 (B) The municipality submits the request on or before January 15 for a request involving an appeal or court action resolved within the previous calendar year.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 94 of 140 (3) Upon the Director’s request, a municipality submitting a request under subdivision (1) of this subsection shall include a copy of the agreement, determination, or final order, and any other documentation necessary to show the existence of these conditions.

BILL AS PASSED BY THE HOUSE H.955 Page 103 of 149 (b) To the extent that the municipality has paid that liability, the Director shall allow a credit for any reduction in education tax liability against the next ensuing year’s education tax liability.

(c) If a listed value is increased as the result of an appeal under chapter 131 121, subchapter 1A of this title or court action, whether adjudicated or settled, and the Director determines that the settlement value is the fair market value of the parcel with no further appeal available with regard to that valuation, the Director shall recalculate the municipality’s education property tax for each year at issue, in accord with the increased valuation, and shall assess the municipality for the additional tax at the same time the Director assesses the municipality’s education tax liability for the next ensuing year, unless the resulting assessment would be less than $300.00.

* * * VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 95 of 140 * * * Regional Assessment District Transition * * * Sec.

BILL AS PASSED BY THE HOUSE H.955 Page 104 of 149 (1) the Director of Property Valuation and Review shall not order any new municipal reappraisals of grand list properties that are not part of a regionalized reappraisal system on and after January 1, 2028;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 96 of 140 Sec.

BILL AS PASSED BY THE HOUSE H.955 Page 105 of 149 (b) Notwithstanding subsection (a) of this section, the Commissioner may, at the Commissioner’s discretion, identify a regional assessment district boundary that includes more than one school district or identify more than one regional assessment district boundary within one school district.

§§ 5402(c) 5402(c) is amended to read:

(2) The Secretary of Education shall determine each municipality’s net education tax payment to the State based on grand list information received by VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 97 of 140 the Secretary not later than the March 15 prior to the June 1 net payment.

BILL AS PASSED BY THE HOUSE H.955 Page 106 of 149 (3) For education taxes assessed in the current year only, a municipality may request reimbursement from the Commissioner of Taxes for education taxes abated under 24 V.S.A.

§§ 1535(a)(4) 1535(a)(4) in which there was a clear or obvious error or a mistake of the listers, provided the municipality abated municipal tax in the same proportion as it abated education tax and the abatement was for taxes assessed after the application of any homestead exemption allowed under chapter 154 of this title.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 98 of 140 * * * Valuation of Certain Property in a Limited Equity Cooperative * * * Sec.

§§ 3411 3411 is amended to read:

* * * BILL AS PASSED BY THE HOUSE H.955 Page 107 of 149 (10) assist municipalities in administration of property taxes, including the appraisal of classes of property difficult to appraise, such as industrial and utility properties;

§§ 1598. 1598.

§§ 4152 4152 is amended to read:

§§ 4152. 4152.

* * * VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 99 of 140 (10) A separate column listing the number of dwelling units, as defined pursuant to subdivision 4152a(c)(2) of this title.

§§ 4152a 4152a is added to read:

§§ 4152a. 4152a.

Each parcel of real estate shall be classified as one or more of the classifications listed under subsection (b) of this section and based BILL AS PASSED BY THE HOUSE H.955 Page 108 of 149 on information and guidance provided by the Commissioner of Taxes under this section and rules adopted pursuant section 5410 of this title.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 100 of 140 (A) is designed or intended to be used for occupancy by one or more persons in a household, including providing living facilities for sleeping, cooking, and sanitary needs;

(3) “Homestead” has the same meaning as in subdivision 5401(7) of this title and means a parcel, or portion of a parcel, declared as a homestead BILL AS PASSED BY THE HOUSE H.955 Page 109 of 149 on or before October 15 in accordance with section 5410 of this title for the current year.

As used in this section, “employee” means an individual who is reported by an employer for VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 101 of 140 purposes of complying with Vermont unemployment compensation law pursuant to 21 V.S.A.

§§ 4469a(a)(1), 4469a(a)(1), without regard for whether the farm employee is reported pursuant to 21 V.S.A.

BILL AS PASSED BY THE HOUSE H.955 Page 110 of 149 (6) “Nonhomestead residential” means a parcel, or portion of a parcel, with a dwelling unit that is not:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 102 of 140 (2) Underlying land, including improvements or fixtures that lack floor space, shall be classified proportionally based on the same percentage as the finished floor space of the buildings.

BILL AS PASSED BY THE HOUSE H.955 Page 111 of 149 (4) If a portion of floor space is used for more than one purpose, the use for which the floor space is most often used shall be considered the primary use and the floor space shall be dedicated to that use for purposes of tax classification, except as provided for a homestead under subdivision 5401(7) of this title.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 103 of 140 (1) Persons aggrieved by a decision of an assessing official relating to how a property is classified for taxation purposes under this section may appeal in the manner provided for property valuation appeals under this title.

BILL AS PASSED BY THE HOUSE H.955 Page 112 of 149 (3) A timely filed appeal made pursuant to this subsection that is erroneously made to the Commissioner instead of the municipality, or to a municipality instead of the Commissioner, shall be considered timely.

§§ 5410 5410 is amended to read:

DWELLING USE ATTESTATION * * * (g) If the property identified in a declaration under subsection (b) of this section is not the taxpayer’s homestead or if the owner of a homestead fails to declare a homestead as required under this section, the Commissioner shall VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 104 of 140 notify the municipality, and the municipality shall issue a corrected tax bill that may, as determined by the governing body of the municipality, include a penalty of up to three five percent of the education tax on the property.

If the Commissioner determines that BILL AS PASSED BY THE HOUSE H.955 Page 113 of 149 the declaration or failure to declare was with fraudulent intent, then the municipality Commissioner shall assess the taxpayer a penalty in an amount equal to 100 percent of the education tax on the property, plus any interest and late-payment fee or commission that may be due.

If the owner of a homestead fails to declare a homestead as required under this section, the Commissioner shall notify the municipality, and the municipality VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 105 of 140 shall issue a corrected tax bill.

* * * (i) An owner filing a new or corrected declaration or dwelling use attestation or rescinding an erroneous declaration or dwelling use attestation after October 15 shall not be entitled to a refund resulting from the correct BILL AS PASSED BY THE HOUSE H.955 Page 114 of 149 property classification, and any additional property tax and interest that would result from the correct classification shall not be assessed as tax and interest, but shall instead constitute an additional penalty to be assessed and collected in the same manner as penalties under subsection (g) of this section.

A taxpayer may appeal an assessment of any other penalty under this section to the listers within 14 days after the date of mailing of notice of the penalty, and from the listers to the board of civil authority, and thereafter to the courts, in the same manner as an appraisal appeal under chapter 131 of this VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 106 of 140 title.

Requests for abatement shall be made to the municipal treasurer or other person designated to collect current BILL AS PASSED BY THE HOUSE H.955 Page 115 of 149 taxes, and that person shall forward all requests, with that person’s recommendation, to the body authorized to grant or deny abatement.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 107 of 140 (m)(1) Annually, on or before the due date for filing the Vermont income tax return, without extension, each owner of a property with a dwelling unit, as defined under subdivision 4152a(c)(2) of this title, that is not declared as a homestead pursuant to this section, may file a dwelling use attestation describing how the dwelling unit will be used in the current year for purposes of assigning a tax classification under section 4152a of this title.

Properties with a dwelling unit for which no homestead declaration or dwelling use attestation have been filed shall be assigned the tax classification with the BILL AS PASSED BY THE HOUSE H.955 Page 116 of 149 highest statewide education tax rate multiplier under section 5402(a) of this title.

The municipality assessing and VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 108 of 140 collecting any fee, interest, or commission under this subdivision shall retain it to pay for municipal services.

BILL AS PASSED BY THE HOUSE H.955 Page 117 of 149 Any penalty imposed under this subdivision and any additional property tax interest and late-payment fee shall be assessed and collected by the Commissioner.

The Commissioner shall use the information to determine and assign a tax classification for every grand list VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 109 of 140 parcel, and on or before October 1, 2029, the Commissioner shall provide that information to the Joint Fiscal Office.

REPEALS 2025 Acts and Resolves No.

INTENT It is the intent of the General Assembly that the creation of a tax classification system, and the specific tax classifications to be used by that BILL AS PASSED BY THE HOUSE H.955 Page 118 of 149 system, will be reevaluated at the same time as any further amendment of the tax rate multipliers created under 32 V.S.A.

§§ 5401 5401 is amended to read:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 110 of 140 * * * (7) “Homestead”:

BILL AS PASSED BY THE HOUSE H.955 Page 119 of 149 (B) The parcel of land surrounding the dwelling shall be determined without regard to any road that intersects the land.

chapter 14 or owned by a nonprofit land conservation corporation or community land trust with exempt status under 2626 U.S.C U.S.C U.S.C.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 111 of 140 (D) A dwelling owned by a trust may qualify as a homestead if it meets the requirements of subsection 6062(e) of this title.

(E)(i) A homestead also includes a dwelling on the homestead parcel owned by a farmer as defined under section 3752 of this title and occupied as the permanent residence by a parent, sibling, child, or grandchild of the farmer or by a shareholder, partner, or member of the farmer-owner, provided that the shareholder, partner, or member owns more than 50 percent of the farmer-BILL owner,AS PASSED BY THE HOUSE H.955 Page 120 of 149 farmer-owner, including attribution of stock ownership of a parent, sibling, child, or grandchild.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 112 of 140 (G) For purposes of homestead declaration and application of the homestead property tax rate, “homestead” also means a residence that was the homestead of the decedent at the date of death and, from the date of death through the next April 1, is held by the estate of the decedent and not rented.

BILL AS PASSED BY THE HOUSE H.955 Page 121 of 149 (I) A homestead also includes any dwelling that is used as a homestead without regard for whether it is fit for year-round habitation.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 113 of 140 (2) Under Vermont’s current education finance system, school construction expenditures are paid from the Education Fund and apply pressure to property taxes.

(3) Although school construction decision-making is controlled at the local level, the costs of that decision-making are spread across all property BILL AS PASSED BY THE HOUSE H.955 Page 122 of 149 taxpayers in Vermont.

Unless additional revenue sources are utilized or an alternative financing model is identified, new school construction projects will continue to be VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 114 of 140 funded from the Education Fund and will continue to apply pressure to property taxpayers across Vermont.

BILL AS PASSED BY THE HOUSE H.955 Page 123 of 149 (2) address inequities in education funding across the State and remove disincentives to the construction of necessary and educationally appropriate school facilities by offering State aid in the form or forms best suited to a school district’s local context and needs;

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 115 of 140 (5) in the long term, provide State aid in the form of a debt service subsidy to school districts pursuing school construction projects that align with the goals of the State Aid for School Construction Program;

and BILL AS PASSED BY THE HOUSE H.955 Page 124 of 149 (7) leverage the capacities of the Vermont Bond Bank to simplify bond issuances for school districts, increase financing opportunities, and protect the State’s credit rating.

§§ 212(21) 212(21) for fiscal year 2028 a request to provide appropriate funding levels for the positions created by this section, and any other positions necessary, to staff the School Construction VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 116 of 140 Division of the Agency.

BILL AS PASSED BY THE HOUSE H.955 Page 125 of 149 Sec.

chapter 25 and 16 V.S.A.

§§ 3442(2), 3442(2), including rules to address:

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 117 of 140 (1) identifies opportunities for the construction or renovation of school facilities that support the consolidation of school governance structures and improve access to educational opportunities for public school students;

BILL AS PASSED BY THE HOUSE H.955 Page 126 of 149 (2) provides a full siting study for each identified school construction project that includes the cost, location, and any other factor the Board deems relevant to the General Assembly’s consideration of the project;

§§ 3440 3440 is amended to read:

§§ 3440. 3440.

Further, it is the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 118 of 140 intent of this chapter to encourage the use of existing infrastructure to meet the needs of Vermont students.

Joint construction projects between two or more BILL AS PASSED BY THE HOUSE H.955 Page 127 of 149 school districts and consolidation of buildings within a district where feasible and educationally appropriate are encouraged.

§§ 3442 3442 is amended to read:

§§ 3442. 3442.

chapter 25 pertaining to school construction and capital outlay, including rules to specify a point prioritization VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 119 of 140 methodology and a bonus incentive structure aligned with the legislative intent expressed in section 3440 of this title;

BILL AS PASSED BY THE HOUSE H.955 Page 128 of 149 (3) including as part of its budget submitted to the Governor pursuant to subdivision 212(21) of this title its annual school construction funding request, including any projects contemplated under subsection 3440(b) of this chapter for funding through State bonding;

§§ 3443 3443 is amended to read:

§§ 3443. 3443.

[Repealed.] VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 120129 of 140149 Sec.

§§ 3445 3445 is amended to read:

§§ 3445. 3445.

VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 121130 of 140149 (B) The Secretary may approve a preliminary application if:

(iv) the applicant achieves the level of “proficiency” in the school district quality standards regarding facilities management adopted by rule by VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 122131 of 140149 the Agency or, if the applicant is a newly formed school district, the applicant will achieve the level of “proficiency” in the school district quality standards regarding facilities management adopted by rule by the Agency at its initial performance evaluation under the school district quality standards;

The Agency shall submit its annual school construction funding request to the Governor as part of its budget pursuant to subdivision 212(21) of this title and shall clearly identify VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 123132 of 140149 those projects contemplated under subsection 3440(b) of this chapter for funding through State bonding.

§§ 306 306 and submission of the Governor’s recommended capital budget to the General Assembly pursuant to 32 V.S.A.

§§ 309, 309, the House Committee Committees on Education and on Ways and Means and the Senate Committee Committees on Education and on Finance shall recommend a total school construction appropriation for the next fiscal year to the General Assembly for inclusion in the education payment under subsection 4011(a) of this title.

[Repealed.] VTBILL LEG #388817 v.1 AS PASSED BY THE HOUSE H.955 Page 124133 of 140149 (iii) the district has made arrangements for project construction supervision by persons competent in the building trades;

BILL AS PASSED BY THE HOUSE H.955 Page 134 of 149 (6) Award of construction aid.

VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 125 of 140 (A) The base amount of an award shall be fund 20 50 percent of the eligible debt service total approved cost of a project.

Projects are eligible for additional bonus incentives as specified in rule for to fund up to an additional 20 45 percent of the eligible debt service total approved cost.

(C) The Treasurer, in consultation with the Capital Debt Affordability Advisory Committee (CDAAC), shall recommend to the House Committees on Education,Education on Ways and Means, and on CorrectionsWays and InstitutionsMeans and the Senate Committees on Education,Education on Finance, and on InstitutionsFinance the annual total State bonding support available for the capital budget and this Program and the annual debt service subsidies to be awarded under this chapter.

TheBILL recommendationAS shallPASSED includeBY anTHE analysisHOUSE H.955 Page 135 of how149 (C) The Treasurer, in consultation with the VTCapital LEGDebt #388817Affordability v.1Advisory ASCommittee PASSED(CDAAC), BYshall HOUSErecommend H.955to Pagethe 126House ofCommittees 140on useEducation, ofon Ways and Means, and on Corrections and Institutions and the Senate Committees on Education, on Finance, and on Institutions the annual total State bonding support available for schoolthe constructioncapital underbudget and this Program affectsand overallthe capitalannual budgetdebt capacity.service subsidies to be awarded under this chapter.

The recommendation shall include an analysis of how the use of State bonding support for school construction under this Program affects overall capital budget capacity.

§§ 161(b); 161(b);

§§§§ 3141–3148, 3141–3148, and related federal acts and regulations.

BILL AS PASSED BY THE HOUSE H.955 Page 136 of 149 Sec.

REPEAL 16 V.S.A.

§§ 3454 3454 (deferred maintenance) is repealed.

§§ 4033 4033 is added to read:

§§ 4033. 4033.

Aid shall be awarded annually for annual debt service costs up to a maximum total annual amount of VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 127 of 140 $61,000,000.00 and is subject to an annual appropriation for the purposes of the legacy debt aid.

§§ 4011(a) 4011(a) is amended to read:

§§ 4011(a) 4011(a) is amended to read:

§§ 5401, 5401, the small schools and sparsity support grants under section 4019 of this BILL AS PASSED BY THE HOUSE H.955 Page 137 of 149 chapter, and a portion of a categorical base amount for each adult education and secondary credential program student, and any other amounts the State is obligated to provide under this chapter or chapter 123 of this title.

§§ 5401(22) 5401(22) is amended to read:

§ 4001(17), for the fiscal year, provided that the voters of a school district other than an interstate school VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 128 of 140 district shall not approve spending in excess of five percent of the product of the base amount, as defined in 16 V.S.A.

§§ 563 563 is amended to read:

§§ 563. 563.

BILL AS PASSED BY THE HOUSE H.955 Page 138 of 149 (B) [Repealed.] (C) At a school district’s annual or special meeting, the electorate may vote to provide notice of availability of the school budget required by this subdivision to the electorate in lieu of distributing the budget.

The proposed budget shall be prepared and distributed at least 10 days before a VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 129 of 140 sum of money is voted on by the electorate.

(iv) the definition of “supplemental district spending,” the long- term membership of the school district, and the district’s per pupil BILL AS PASSED BY THE HOUSE H.955 Page 139 of 149 supplemental district spending in the proposed budget and in each of the prior three years;

(D) The If the board determines that additional spending is necessary in excess of the school district’s educational opportunity payment, the board shall present the a supplemental district spending budget to the voters by VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 130 of 140 means of a ballot in the following form, provided that the board shall submit for authorization supplemental district spending to cover annual debt service costs for school construction only at the initial authorization of indebtedness and under subdivision (E) of this subdivision (11):

Shall the voters of the school district approve the school board to expend $ ______ for expenditures other than annual debt service costs on any outstanding capital indebtedness, which is the amount the school board has determined to be necessary in excess of the school district’s educational opportunity payment for the ensuing fiscal year? The ______ District estimates that this proposed budget, if approved, will result in per pupil supplemental district spending of $______, which is______% higher/lower than per pupil supplemental district spending BILL AS PASSED BY THE HOUSE H.955 Page 140 of 149 for the current year, and a supplemental district spending tax rate of ______ per $100.00 of equalized education property value.” (E) The board shall present concurrently with any vote to incur indebtedness for school construction a supplemental district spending budget to the voters by means of a ballot in the following form:

Shall the voters of the school district approve the school board to expend $ ______, which is the amount the school board has VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 131 of 140 determined to be necessary to cover the annual debt service cost on school construction and any other expenditure in excess of the school district’s educational opportunity payment for the ensuing fiscal year? The ______ District estimates that this proposed budget, if approved, will result in per pupil supplemental district spending of $______, which is______% higher/lower than per pupil supplemental district spending for the current year, and a supplemental district spending tax rate of ______ per $100.00 of equalized education property value.

BILL AS PASSED BY THE HOUSE H.955 Page 141 of 149 (2) Sec.

§§ 4001(17), 4001(17), in each of fiscal years 2031– 2034, the educational opportunity payment for a school district shall equal the VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 132 of 140 educational opportunity payment for the school district as calculated pursuant to 16 V.S.A.

§§ 4010(f) 4010(f) plus a yearly adjustment equal to:

§§ 823(a), 823(a), in each of fiscal years 2031–2034, a school district shall pay as tuition to a receiving school for each resident student attending the receiving school an amount equal to the adjusted base multiplied by the sum of one and any weights applicable to the resident student under section 16 V.S.A.

§§ 4010. 4010.

(1) “Adjusted base” means the quotient resulting from dividing the school district’s educational opportunity payment, as adjusted by the yearly BILL AS PASSED BY THE HOUSE H.955 Page 142 of 149 adjustment, by the school district’s weighted long-term membership as defined in 16 V.S.A.

§§ 4001. 4001.

Department of VT LEG #388817 v.1 AS PASSED BY HOUSE H.955 Page 133 of 140 Commerce, Bureau of Economic Analysis, from fiscal year 2025 through fiscal year 2031 and rounding upward to the nearest whole dollar amount.

§§ 4010(f) 4010(f) for fiscal year 2031 from the school district’s education spending in fiscal year 2025, as adjusted for inflation.