In 2014, the Agency of Education and the Burlington School District (BSD) reached an Agreement acknowledging BSD would no longer receive any payment in-lieu of taxes (PILOT) funding from the City of Burlington. In the agreement, the State asserted the PILOT payments were in violation of State law intended to ensure equitable education funding for all Vermont children. State law is built on Vermont’s constitutional principle that Vermont children are entitled to equality in education funding. To ensure that per pupil funding does not vary dramatically as a result of disparities in local wealth, city or town funds cannot be used “directly or indirectly” for education expenses. Per the law, the City’s PILOT revenues cannot be used for educational expenses by the BSD because this revenue stream is not available to, or shared with, other school districts.
Following the BSD’s agreement with the Agency, the City worked with the BSD and Agency to find legal ways to spend as much of the municipal PILOT funding as possible in a manner that would address goals related to the children of Burlington without improperly using municipal funding for education expenses. The City, Agency, and BSD were able to find ways to appropriately allocate about $400,000 of the $1.4 million in PILOT revenues in such a manner, and the City continues to make these payments every year. At the time of this work, then BSD-interim Superintendent Howard Smith was complimentary and appreciative of the efforts of the City in reducing the impact of the Agency ruling on the school budget.
In the years that followed, the City has continued to find ways to support the District with PILOT money in ways that reflect the constitutional principle of equality in education funding. When a new bus route was offered in 2017, for example, the City picked up half the cost for the District (and will cover the full cost in the FY19 budget). The following links document the City's continued attempts - at times rejected by the Agency of Education - to find creative ways to increase appropriate support to the BSD.
