The budget up for consideration on June 4th is a 10.02% increase in spending over the FY24 Budget. Due to offsetting revenues, the increase in Education Spending is 4.1% greater than last year. The overall Education Spending is $792,183 less than the budget presented on Town Meeting Day.

Why is “Education Spending” a consideration?

“Education Spending” is what’s left after offsetting revenues (e.g. tuition, fund balance) are subtracted from the overall spending. Education Spending is the amount that Fairfax requests from the State to operate the school. Tuition money comes directly from the sending schools (like Fletcher).

Education Spending is the basis for all tax calculations.

How much has this changed since the Town Meeting Day vote?

Since Town Meeting Day, spending has been reduced by $542,183. Offsetting revenues have been increased by $250,000 by using fund balance. This combines to result in a $792,183 reduction in Education Spending since the Town Meeting Day vote.

The governor and the media say there is a 13% tax increase coming. Is that in addition to this?

Education tax rates are determined at the local level. The proposed tax rate increase for Fairfax is 8.16%. The 13% you are hearing represents an average increase statewide. Initially, this was reported as a 20%+ increase but has been reduced based on revised budgets across the state.

On the ballot, what is Article 2? Why does the school district need to borrow money?

“Shall the voters of said school district authorize the School Directors to borrow money for school expenses in anticipation of revenue for the ensuing year? BY AUSTRALIAN BALLOT”

Article 2 gives the school board the authority to borrow money for expenses in anticipation of revenue. This is standard practice to operate the school district during the summer months. Beginning on July 1, the school incurs expenses (e.g. insurance, annual service contracts, salaries, supplies…) that need to be paid. We do not receive funding from the town or state until mid to late September. Essentially, we borrow 3 months' worth of expenses and pay it back as soon as we receive funds from the State. We earn a small amount of interest that essentially covers the interest charged by the bank.

If the budget is going up by 10.02%, why is my tax increase different?

The school board determines the overall education spending amount through the budget process. The tax rate is calculated from that number using the Long Term Weighted Average Daily Membership (LTWADM), the Property Yield, and the Common Level of Appraisal (CLA). These measures are determined by the state and impact the bottom line of your tax burden in different ways…

Offsetting Revenue

This amount includes tuition and fund balances that are received locally to reduce the spending amount. The fund balance represents budget surplus that is returned to the town. We had a substantial surplus during the COVID years which the board has used strategically to reduce tax impact and manage cost fluctuations year over year. Education spending is what’s left when offsetting revenue is subtracted from the overall expenses. It is the value used in all tax rate calculations.

LTWADM
This figure is determined using student weights established by Act 127. Each student receives a certain weight based on their grade, socioeconomic status, school size, and other factors. Education spending divided by LTWADM equals cost per equalized pupil.
Property Yield
This number is set by the legislature each year based on statewide education spending. It ensures that a sufficient amount of money is raised statewide to fully fund education. The equalized tax rate is determined by dividing per pupil cost by the yield.
Discount

The legislature approved H850 in January which provides a tax rate discount to towns that were impacted by the change in weighting. Fairfax received a 14-cent discount. The equalized tax rate (after the discount) decreased from $1.1448 to $1.1245 ( a 1.8% decrease).

CLA
This is an adjustment factor determined by the state to equalize property values across the state. It is determined by comparing actual house values to appraised house values. Since house prices are rapidly increasing, the Fairfax CLA is 95.86% (down from 105.56% last year), which increases the tax rate. The tax rate you will see on your tax bill is the equalized tax rate divided by the CLA.

The estimated tax rate is $1.1730. This is an 8.16% increase over last year’s tax rate.

What reductions were made from the budget that didn’t pass on Town Meeting Day to this new proposed budget?

April	Bond Interest Payment	($198,105)
April	Mower (Buildings and Grounds)	($30,000)
April	FWSU Assessment	($23,709)
April	Teacher Retirement	($9,822)
April	Board Member Stipends	($2,691)
June	School Resource Officer	($85,000)
June	Co-curricular supplies/fees	($10,000)
June	Teacher Retirement savings	($25,000)
June	Georgia Special Ed Para savings	($45,000)
June	Dean of Students savings	($25,000)
June	Vacant Custodial Position	($72,856)
June	Reduction in ELL budget	($15,000)
June	Fund balance reduction (Seen in offsetting revenue)	($250,000)
TOTAL		$792,183

The board reduced the Education Spending by $792,183.

How does this budget impact my taxes?

Actual Homestead Tax Rate →	1.0845	1.1730	0.0885
Home Value	FY24	FY25 - June Revote	Change
$250,000	$2,711	$2,933	$221
$300,000	$3,254	$3,519	$266
$350,000	$3,796	$4,106	$310
$400,000	$4,338	$4,692	$354
$450,000	$4,880	$5,279	$398
$500,000	$5,423	$5,865	$443

What is Act 127 and what does that have to do with the budget?

Act 127, as passed in 2022, was designed to provide more resources to schools to support students with higher needs, in particular: multilingual students, those experiencing poverty, smaller schools, and rural schools.

It does this by giving more “weight” to students in these categories in the calculation that determines our education taxes.
Districts with comparably higher percentages of students in these categories are “tax-advantaged” by the new law, those with fewer, such as Georgia, are considered “tax-disadvantaged” by the law.
Due to H.850’s recent passage, Fairfax will receive a 14¢ “discount” this year pre-CLA because we’re tax-disadvantaged by the law. That discount will decrease by 20% yearly for the next four years.

What factors are impacting the budget this year?

Bond
Construction on the project has begun and the school will begin to make payments to repay the bond. In FY25, Fairfax will pay a full interest payment and a partial principal payment. This is the largest portion of the increase in the budget. It represents 29.8% of the overall increase.
Health Insurance
Health insurance rates increased by 16%. Health insurance is agreed to at the state level. The board does not control the rates, plans, or premium split. Health insurance increases represent 10.9% of the overall budget increase this year.
Professional Salaries
Teacher salaries are negotiated by a team that includes the board chairs of all three FWSU schools and central office staff. The team tries to agree on salaries that help to attract and retain high-quality educators while maintaining their fiscal responsibility to the town. FY25 will be the first year of a contract that is currently under negotiation.
Paraprofessional Salaries
Paraprofessionals settled a new master agreement last year that continues into FY25. The board agreed to a salary increase that brings our para salaries in line with surrounding schools and industries and provides a livable wage for the people who support our students every day.
Franklin West Assessment
The Franklin West assessment includes salary and health insurance increases for all those employed by Franklin West. This includes the central office staff and administration, IT personnel, paraprofessionals, and special educators. There are 45 FWSU employees who work in the BFA school building every day.

There is an upgrade to our financial accounting system in this budget. This system is used in all schools. It has not been upgraded since 2007 and is no longer supported (or updated) by its developer. This is a one-time expense.

What if this budget doesn’t pass?

If the budget vote is unsuccessful, the board will prepare a revised budget for the consideration of Fairfax voters. We will need to continue to vote until we have a passed budget. This budget reduced positions that are currently vacant. Future revisions will have to include professional and paraprofessional positions that will directly impact students.

What is the 87% loan I’ve heard about if the budget does not pass by July 1? Does this mean we would have to significantly cut our budget?

If Fairfax does not have an approved budget by June 30, the board would be able to borrow up to 87% of the FY24 budget in order to meet operating expenses. The board would continue to present revised budgets to the community until one is approved. Operating for a full year at 87% capacity would require approximately $4 million dollars in cuts.

Why don’t you make teachers and staff contribute more to health care costs?

Negotiating the contribution amount that teachers and staff make to health insurance costs and the level of insurance plan provided (e.g. platinum, gold, silver, or bronze) used to be handled by the local school boards as part of the contract negotiation process. Starting in 2019, that bargaining is conducted on a statewide basis by a commission of 10 people appointed by the Vermont School Board Association (5) and the Vermont Teachers Union (5). They negotiate benefits and then pass the costs onto all school districts. The board has no direct involvement in that process as a local school board.

How many students attend BFA?

There are currently 920 students enrolled at BFA. This includes 382 in preK-4, 278 in grades 5-8, and 260 in grades 9-12. We have 74 tuition students attending BFA from other towns.

Is the bus decision final?

Yes. The board has entered into an agreement with CCR/Mathieu Enterprises to provide bus service that meets the needs of our students. Further details regarding bussing can be found here.

Why is the revenue from the sale of the buses not included in the revenue for FY25?

We cannot sell the buses until after the end of the school year and did not want to make an inaccurate estimate of their worth as a defined line item in our budget. CCR has made offers on several of the buses which we will consider after comparing the book value of the buses. Revenue from the bus sale will be public information and will be used to offset expenses in the fiscal year.

How do I vote?

Residents will vote by Australian ballot on June 4, 2024, or you can request a ballot early. Voting instructions for the Fairfax Town Clerk’s office are available here.

What is happening on June 3rd, at 6:00 pm in the Elementary School Gym?

The board will be holding a budget informational meeting in the BFA Fairfax Elementary School Gym to share the budget revote information and answer your questions.

Are there other ways I can learn more about this?

The proposed budget, tax impact overview, reductions explanation, board newsletter, and more can all be found on the BFA website.

Can I lower my tax rate?

Fairfax homestead owners may pay a lower rate by receiving a property tax credit based on household income (below $128,000 for 2023) and home value. To apply for a tax reduction, contact the Vermont Department of Taxes at: www.tax.vermont.gov/property/tax-credit or call 802-828-2505