Advancing Equity With Policy

Vermont offers a useful case study for policymakers, as its school finance system is often cited as one of the clearest examples of how court intervention can fundamentally reshape how public education is funded. Today, Vermont spends nearly $27,000 per pupil on education, second only to New York. For context, Vermont spends more than twice as much as eleven lower-spending states. In 2025, the average per-student spending was $2,874 from the federal government, $23,895 from the state government, and $577 from local property taxes. This places Vermont first in per-student state spending among all states and territories (World Population Review, 2025). Understanding this system requires examining the historical structure of its funding, the court rulings that challenged it, and the legislative acts that followed to see how Vermont arrived at this model.

Historically, Vermont’s educational quality was a ‘zip code lottery’.Throughout most of the 19th and 20th centuries, Vermont’s school districts funded education mainly through compulsory local property taxes. As discussed by McGuire et al. (2015), reliance on local property wealth created vast disparities as property-rich towns could fund well-resourced schools at very low tax rates, while property-poor rural towns could barely provide basic services. From the 1960s through the 1980s, Vermont attempted to use a ‘Foundation Plan’ where the state set a standard tax rate and a target per-pupil cost, but this ultimately failed to provide equity because state aid fluctuated wildly based on general fund availability or political priorities (Vermont Joint Fiscal Office, 2021)

In 1997, the Brigham v. State of Vermont case brought major changes to Vermont’s school funding. The Vermont Supreme Court found the state’s system, which relied heavily on local property taxes, to be unconstitutional. The court declared that because the right to education is fundamental, it cannot be made a function of local wealth and that the state constitution requires substantially equal opportunity for all students (Brigham v. State, 1997). This ruling represented a philosophical departure from the traditional concept that the state’s primary obligation was educational adequacy, or that a minimum floor of resources is provided to every student. As this adequacy model made children’s educational quality a function of geography rather than need, the Vermont Supreme Court shifted the legal focus toward equity. 

After the Brigham decision, Vermont lawmakers passed Act 60 (1997) and Act 68 (2003), which together established the current equalized yield model. In this system, the state Education Fund served as a central reservoir, pooling property tax revenue from across the state to ensure the taxpayer effort equals revenue yield. This created a level playing field as two communities, one affluent and one struggling, choose to tax themselves at the same rate, the state guarantees they receive the exact same per-pupil funding. This effectively neutralized the advantage of high property values. 

However, ensuring property values did not influence funding inherently did not increase equity among students, as specific student populations, including English Language Learners, students from economically disadvantaged backgrounds, and those in rural schools, require greater resources to achieve equitable outcomes. Therefore, Vermont expanded its equitable funding framework through Act 127 (2022), which updated the state’s pupil weighting formula to increase funding for students in need by building on recommendations from the Vermont Joint Fiscal Office (2021). This sophisticated level of state coordination is why Vermont now leads the nation in state-sourced spending. It’s a system built on the belief that a truly public education shouldn’t be a luxury of the few, but a shared responsibility of the many.

References

Brigham v. State, 166 Vt. 246 (1997).

Downes, T. A., & Figlio, D. N. (2015). Tax expenditure limits, school finance, and school quality. In H. F. Ladd & M. E. Fuhrman (Eds.), Handbook of research in education finance and policy (2nd ed., pp. 436–450). Routledge.

Koski, W. S., & Hahnel, J. (2015). The past, present, and possible futures of educational finance reform litigation. In H. F. Ladd & M. E. Fuhrman (Eds.), Handbook of research in education finance and policy (2nd ed., pp. 42–60). Routledge.

McGuire, T. J., Papke, L. E., & Reschovsky, A. (2015). Local funding of schools: The property tax and its alternatives. In H. F. Ladd & M. E. Fuhrman (Eds.), Handbook of research in education finance and policy (2nd ed., pp. 415–435). Routledge.

Public Assets Institute. (2021). Vermont’s tools for education funding equity: Weighting and categorical aid. 

Vermont Joint Fiscal Office. (2021). Short history of education finance in Vermont. 

World Population Review. (2025). Per pupil spending by state 2025.