KILLINGTON- The Tax Reform Committee has recommended four
courses of action for the Town of Killington, which it presented at
the Aug. 28 selectboard meeting. The committee was formed in
response to the strategic operating plan adopted by the Killington
selectboard unanimously on April 10, 2012. That plan outlines four
goals: maintain fiscal strength and low municipal taxes; provide
efficient municipal services; increase tourism and year-round
employment; and maintain strong educational and cultural
The Tax Reform Committee was asked to research options to most
efficiently meet these goals and to make specific recommendations
to the selectboard based on their findings. The committee members
include Jim Haff, Mike Solimano, Bob Montgomery, Patty McGrath and
Seth Webb. Ed Fowler and Vito Rasenas also contributed.
The committee recommended the following four actions:
1) Create case studies to help educate lawmakers and citizens
about the effects of Act 60/68.
2) Seek to retain 100 percent of the local option tax to use
for capital reinvestment/economic development (as it effectively
helps counter-act the negative effects of Act 60/68.) Currently,
state law keeps 30 percent of the tax and the town keeps the other
3) Consider dedicating the personal property tax to support
the beautification of Killington Road. (Since this is a business
tax, it should support an important issue for businesses. This tax
currently generates about $100,000/year.)
4) Consider/analyze making a payment from the Town to
the School (to effectively lower the per pupil rate and thereby the
corresponding tax burden.)
The committee has begun to tackle the first of these
recommendations. It has completed three case studies to demonstrate
how significantly the state property tax burden has increased since
Act 60/68 was passed in 1997. The committee analyzed the effect on
Ed Fowler, a private resident; The Inn at the Long Trail, a small
business; and Killington Resort.
The committee reported that Fowler's property taxes increased
491 percent from 1997 to 2012. Patty McGrath, the owner of the Inn
at the Long Trail, reported a rise of 394 percent from
1994 to 2012 for her small business and Killington Resort saw a 345
percent property tax increase from 1996 to 2012. For the Resort,
that difference amounted to $554,000 in additional property
taxes-$780,000 in 2012 compared with $226,000 in 1996. (Inflation,
of course, would have increased taxes at the rate of school
spending in any case; no matter how the taxes were raised. If
school spending during that time went up 10 percent, for example,
over 15 years, that's 150 percent. So Act 60-68 increased it by
that much more.)
The effects of such high increases, the committee noted, were
• Limiting retirees' ability to live comfortably
in Killington (if on a fixed income or for those who may not
qualify for income sensitivity- that limit is currently $90,000 for
• Limiting funds to reinvest infrastructure to
• Creating major barriers to selling.
• Limiting funds for marketing.
• Hindering the resorts ability to maintain
competitive edge as Killington's competition is not limited to
Vermont, but also includes resorts in Maine, New Hampshire,
Colorado, Utah and California.
"One of three pillars of Vermont's economy is tourism. Resorts
like Killington are the drivers of tourism," the committee
emphasized in the report, also noting that during the same time
period, Vermont reduced its commitment to funding tourism while New
York, New Hampshire and Maine all significantly outspent
"Property tax reform could support tourism," said Town Manager
Seth Webb. "The state should look at this."
To address the tax burden of Acts 60 and 68, the committee is also
reviewing the initial purpose of the law. Here's a brief
• Act 60 also known as The Equal Educational
Opportunity Act was passed in June 1997 by the Vermont legislature.
It was drafted in response to a Vermont Supreme Court decision,
Brigham vs. State of Vermont case, which stated that Vermont's
existing educational funding system was unconstitutional because it
did not provide an equal opportunity for all Vermont youth to
educated, favoring towns with higher real estate values over those
that were property poor. At the time, property rich towns paid very
little in property taxes to support their town's educational system
compared to other towns in Vermont that paid several times more
than Killington, Manchester, Stowe, Woodstock, South Burlington,
Essex Junction and several other property rich towns.
• A summary paragraph in that ruling
"The current system for funding public education in Vermont, with
its substantial dependence on local property taxes and resultant
wide disparities in revenues available to local school districts,
deprives children of an equal educational opportunity in
violation of the Vermont Constitution."
• As a result of Act 60 students were more
assured of an equal opportunity to get an education by essentially
leveling the playing field - in terms of taxation - for all towns.
The Legislature did that by providing a mechanism to pool all state
funding and redistribute the money based on residents' ability to
pay, including rebates for those whose real estate value exceeded
their ability to pay the taxes. Prior to this court decision
Vermont used a foundation formula to provide state aid to augment
local school district property taxes, but it was regularly
underfunded by the Legislature that created large disparities in
• In 2003, Act 68 was passed amending Act 60, to
correct some shortcomings in the original law.