Educating Mary Barrosse

In February 1997 a 38-year-old mother of three from East Dorset, Vt., called her state representative with a question. She had heard on the news that Vermont’s Supreme Court had declared the local school funding system unconstitutional. Mary Barrosse had two daughters in Dorset Elementary school and another child entering nursery school. Part of the reason she and her husband, a doctor with a family practice, had made their home in East Dorset was because the district invested heavily in its schools. What exactly did the change mean?

Mary Barrosse’s representative did not give her good news. Vermont’s courts had overturned the state’s long-standing system of school finance. Under the old system, town property taxes paid directly for something like three-fourths of the cost of local schools. Now, at least for a while, the towns would still collect the money. But they would have to send it to the state government, which would set property tax rates for everyone and then return a flat block grant of $5,000 or so per child to each town for education.

The court had said it would no longer be all right for one school district to spend more money on its children than another. That wasn’t giving Vermont children an equal opportunity to learn. The court acknowledged that the system of local property taxes paying for local schools was old, but said that it must be ended. It said today’s children "cannot be limited by eighteenth century standards." It referred to Brown v. Board of Education, the landmark federal case that had taken on school segregation. The court likened the school spending disparities to racial discrimination. Its message was serious: social justice on a grand scale was involved here. The money had to go to the state capital, so that it could be given out fairly.

Schools and how we pay for them are two things Americans feel strongly about. Over the course of the past three decades, state courts and governments like Vermont’s have moved repeatedly in the name of equity to change how schools are financed. For equity’s sake, they have fiddled with the local connection parents have with their schools. And every time they have done so, they have met with incomprehension and even fury from parents. Like Mary Barrosse, they begin to wonder: Why is this happening? Where is the money going? Why didn’t someone ask me?

Over the months that followed her first telephone call, Vermont’s legislature moved to implement the court’s ruling, and Mary Barrosse tried to figure out where she stood. She learned that there were many in Vermont’s state legislature who agreed with the court as a matter of principle and had pushed the case along. Many of the lawmakers were teachers, or members of teachers’ families, or school administrators, who thought Montpelier could do a better job of controlling the money. Others had even campaigned on the theme, arguing the new regime would cut property taxes. Many Democrats generally backed the change, and many Republicans opposed it, but it wasn’t entirely a partisan debate: There were Republican supporters of the switch, and Democratic opponents. The state’s governor, Howard Dean, was proud of the change, and would later call the new era of statewide funding "a joyous time."

It became clear to Barrosse that, now that the Supreme Court had ruled, party line and individual decisions didn’t matter much. Even those lawmakers who opposed the change had little choice now but to join in undertaking a sort of Robin Hood action to help poorer Vermont towns. It soon became clear that some of the school money from wealthier towns would go to subsidize schools in towns with lower tax bases. The budgets of the schools in the wealthier towns would probably have to be cut.

At home, Barrosse found herself contemplating what might be cut at Dorset Elementary. Her area spent several thousand dollars per child over the $5,100 cap the state was imposing. She put down the phone and worried. She had never thought much about school finance or property taxes, and she wished the problem would go away. She remembers thinking: "They can keep their taxes. Just let us have our schools."

Indeed, under the state legislature’s plan, known as Act 60, the new statewide property tax rate would be $1,100 for every $100,000 in assessed value of a home. For low income owners, this rate was eased. But for those with lots of property — the 500-acre farmer — there was no escape from a giant tax hike. If towns wanted to spend more than their block grant, they could raise that extra money on their own. But they had to give a share of every additional dollar they raised to poorer towns.

Act 60 would split Vermont’s 251 towns into two groups: "receiving towns," which would benefit from subsidy, and "sending towns," which were deemed prosperous enough to share their money. In Montpelier, lawmakers spoke with a touch of Schadenfreude about the wealthy towns sharing their prosperity; "gold towns," thriving ski resorts for the most part, were to be among some of the biggest "senders."

Dorset was clearly going to be a "sender," a sender that had to undertake serious cuts. Yet later in 1997, when lawmakers took final action to pass Act 60, the scope of the cuts shocked Barrosse. A health teacher and two classroom teachers would be laid off, raising the student teacher ratio at Dorset Elementary to about 20-1 from 15-1. Technical education and shop classes would end. Other cuts were coming in music, art, and computers. In all, Dorset Elementary School’s budget was to be cut 30 percent. But the cuts would feel even deeper. State and federal law said the school could not cut its special education programs for handicapped children. The superintendent’s budget — administrative jobs — also were not to be touched. So that 30 percent had to come out of the regular classroom. Teacher salaries would have to come down.

Barrosse, whose third child, Bernie, was due to enter kindergarten after all these cuts were in place, pondered the situation over and over. She thought about private school, but it was costly, and there wasn’t really a good school near her that seemed right for her kids. She had heard the news that towns could spend above the flat rate if they levied extra property taxes for that purpose. But when she asked, she found out that Dorset would have to double her property tax to something like $6,200 just to sustain the school the way it was. Some towns would have to raise taxes seven times as high to keep the schools they had.

Barrosse couldn’t believe what she was hearing. Now she began to read about the problem in earnest. She learned that it was sometimes called "equalization," and that it had happened all over New England. Maine had its equalization story in the 1970s; New Hampshire was expecting its Supreme Court to change everything some time later in 1997. Equalization had happened on the West Coast, too, and in Texas. All over the country, citizens of states were fighting treacherous little battles over the changes.

Barrosse started phoning around, and she found that many of her friends felt the way she did. There were things they didn’t like about the state’s schools. They weren’t happy, for example, that the state had no strong regime for testing kids, so there was no barometer to tell how Vermont was doing. But there was also a lot to like about Vermont’s public schools. The state and towns already spent an average of more than $6,800 per child on education, $1,000 above the national average. Were Vermont’s schools really so bad that the whole system needed to be ripped up?

Many of the unhappy parents were people in "gold towns," towns for which the state was planning little property tax bombs. One of them was John Irving, the author of The World According to Garp. Irving’s five-year-old was just starting school, and he was furious at the change. "Like a lot of families in this area, this choice came for us because of the schools. Now we are seeing those schools decimated," he told a reporter. As a Democrat, he was angry at the Democrats who supported the change. "I’m to the left of most of these people. This is my party that’s wreaking havoc." He saw the whole thing as ill-conceived class warfare against the gold towns, class warfare that wasn’t even going to work. "It is easy to discriminate against a minority if that minority is allegedly well to do." He said he was thinking of pulling his son out of the public schools.

Barrosse also found people in the "receiving towns" who were angry. Jeffrey Wennberg, the mayor of Rutland, which was a receiving town, was furious. "These are a bunch of pathological redistributionists," he said. Vermont to him was like a house, a dear house that he had moved to and loved and made his home. But the legislature didn’t see that. "They wanted to change things but they didn’t change them incrementally. They just blew up the whole house."

Many people concluded that equalization’s advocates in Montpelier and in the courts had a hidden agenda: They were using an equity argument to get control of the property tax kitty. Gaining control of the property taxes meant that Montpelier was gaining control of $680 million, a figure that was higher than its revenues from all other state taxes combined. Legislators were already bragging about their new clout. "Money follows power," commented Wennberg bitterly.

At summer’s end, while picking apples for her son’s nursery school, Barrosse talked with other mothers. They had heard that Gov. Howard Dean was hosting a meeting of Democratic governors at the Equinox, a historic inn in Manchester. It was well known that Gov. Dean supported the shift, and that he supported Act 60. Barrosse and the other mothers decided they would do something.

Standing on the back of a red pickup truck that belonged to Barrosse’s husband, protestors talked about why they were unhappy with the change. Even though the night was cold — "we held candles and shivered," Barrosse recalls — more than 500 people showed up, many more than anyone had anticipated. The number sounded small, but it was one of the biggest political rallies in years. The state had called out volunteer firemen, with hoses, in case the event got out of hand. The protestors carried signs that made pointed jokes, like "Soured on Howard." One speaker played on the fact that the governor was a medical doctor. She asked him "if one leg was broken, would you break the other to equalize the pain?" They talked about how the "equalized yield pool," the technical language for the change, was really a "shark pool."

The Equinox event resonated in Vermont, in part because of location. Vermonters knew that the hotel stood on the site of an old tavern that had been there since Colonial days, when the Green Mountain Boys met to plot their battle against the British in the American Revolution. The governor’s inadvertent choice of the location was a bitter reminder of what Montpelier’s work was doing to Vermont’s old tradition of home rule.

For more than 200 years, Vermont’s tiny towns had conducted their business on an annual town meeting day. In many towns every citizen, even those who are not elected officials, is allowed to vote on the budget. All Vermont watched as the lawmakers wrote Act 60, the implementing law. In late June 1997, or soon after Act 60, the state’s education department asked a polling company called Macro to survey voters on their opinions; at that time 42 percent of those surveyed said that they thought Act 60 was "unlikely" to bring "substantially equal educational opportunity" to Vermont, while 46 percent said it was "likely." By October, the tide was turning. Fifty percent said the change was "unlikely" to achieve its goals, compared with 40 percent who still thought it could work. One in four thought that the program was "unlikely" to benefit even the children in poorer towns. Soon Vermont’s towns, which had never felt particularly divided before, did indeed find themselves pitted against one another into two opposing armies, an army of Haves and an army of Have Nots. The New York Times, which sent a reporter to cover Act 60 and its reception, quoted Louis Costanza, a retiree from Long Island, who expected the property tax on his three-bedroom home in Winhall to go to $6,000 from $800. "They see a lot of the Mercedes and Landrovers and Wagoneers and say: ‘those yuppies have a lot of money. How am I going to get it?’ They’ve been dreaming about this for a long time." Cameron Page, a Stowe mother and school board member, met a woman from a receiving town at a hockey match. Page told the Times that the neighbor "actually leaned over to me and said ‘Nyeh, nyeh.’"

There were those, though, who expressed their anger in an even coarser fashion. Vermont, the self-advertised "picture postcard" state, began to see outright hostility. Cheryl Rivers, a state senator who led the writing of Act 60 from the legislature’s finance committee, was one of the targets. She sold her old Dodge Colt, only to learn that opponents of property tax change were the buyers. They parked the car in front of the state house and offered bypassers a chance to hit it with a baseball bat. The price was $5 a whack. Vermont, Mary Barrosse’s "safe, clean, place, where everyone could be friends with everyone" was moving toward civil war.

The Vermonters’ tax protest was, in its way, a classically American event. Property taxes have been a touchy subject for Americans off and on since the days of the colonies. In 1768, citizens from North Carolina’s Orange and Rowan counties warned that "a few shillings in taxes might seem trifling to gentlemen roiling in affluence, but to Poor People who must have their Bed and Bed-clothes, yea their Wives Petticoats taken and sold to Defray [taxes] how Tremenjouse judge must be the consequences." Fries’s rebellion, one of several early tax rebellions that shook the young nation, was a property tax rebellion; 30 traitors were convicted, and two sentenced to death, but President Adams pardoned them all.

After this bumpy start, though, things grew more peaceful. One reason was that those property taxes soon came to be spent on something people cherished — their town schools. A hundred years ago, property taxes and schools were a very local affair in most states. What we imagine of the arrangement — four farmers meeting on a village green to pay for a schoolmistress, who also lodged at their houses — is not inaccurate. Vermont’s first constitution, from 1777, reflected this vision by making local funding the explicit rule: "a school or schools shall be established in each town, by the legislature, for the convenient instruction of youth, with such salaries to the masters to be paid by the town; making proper use of school lands in each town, thereby to enable them to instruct youth at low prices."

Most constitutions were something like this early one: They used phrases like "thorough and efficient" to describe the sort of education they wanted their citizens’ children to receive. The implication was that towns would provide that education. A wealthier town might chose to spend more; a poorer town less. That was their business and their lot. In short, a local matter.

Economists and education scholars say a local property tax, spent locally, is a "good tax." People who pay property taxes for schools they control see what they are getting; if they like it, they push to "buy more," and pass or tolerate tax increases. If they don’t like it, they will try to "buy" less from government by pushing for a tax cut. "Local property taxes, spent locally, are a fee for service arrangement disguised as a tax" says William Fischel, a professor at Dartmouth who studied the effects of equalization.

In their explanations, the economists often refer to something called the "Tiebout hypothesis," after Charles Tiebout, a scholar of public finance. In the 1950s Tiebout tried to work out what was happening in suburban towns. He found and articulated what most Americans already know instinctively: Towns compete for families, through their schools, their parks, their safety records. People, in simple language, will "vote with their feet." They will give up more space for better schools. They will choose Dorset over Danby.

This competition has a very healthy effect on almost everyone. It allows the Danbys to choose not to invest in public schools, if they like. But that choice brings its own punishment: So few people are attracted to the Danbys that there aren’t enough people around with valuable homes. Those who are there have to pay extra property taxes because there are fewer people to shoulder the burden. The result is the situation in many of Vermont’s poorer towns: high property tax rates.

But the Tiebout rule helps the Dorsets, setting off a virtuous cycle there. People like to move to places like Dorset, and do so in numbers. When enough of them move, there are more people around to share the burden of school costs. If a town like Dorset attracts enough homeowners, and values of homes go up enough, citizens can then have their cake and eat it too. They get high property values, low tax rates, and good schools.

This is good for everyone in Dorset. It is good for lower income people and renters, since they get the benefit of good schools. It is even good for empty nesters who pay lots of property taxes and have no children in school. In the end, they collect their benefit from the situation when they sell their house, at a higher price than they might in a town with bad schools. Caroline Hoxby, a Harvard economist who studied school finance, put it this way. "You don’t have to care about education. You just have to know that the people who might buy your house care about education." The Scarsdales, Oak Parks and Palo Altos of this world were evidence of the Tiebout hypothesis. Chester Finn, an education scholar and official in President Bush’s education department, spelled the phenomenon out in non-economic terms: "when they know what they are getting, there is no amount people won’t spend for their children’s education."

Gradually, though, in this century, the federal government and the states began to sever the connection between tax and school, thereby undermining Tiebout’s virtuous cycle. They started to foot some of the costs of education. In the 1950s and 1960s, the issue of funding came up in the nation’s civil rights discussion. Schools in poor urban neighborhoods often had less to offer their students than the plush schools in the suburbs. In Washington, the U.S. Supreme Court addressed this issue by handing down the opinions that gave the nation busing. And states and the federal government often paid for that busing. Very soon, though, it became clear that busing was not ending inequality in America. So civil rights advocates tried another way. They argued before the Supreme Court that every child across the nation was entitled to equal spending under the "equal protection" clause of the Constitution.

Our nation’s high court would not go that far. In a famous case, Rodriguez, the court refused to say that every locality must spend the same amount on every child, or that school finance must be rearranged to make that possible. Lewis Powell wrote that education "is not among the rights afforded explicit protection under our Federal constitution." So the civil rights forces in the states tried another route. They sued under their state’s constitutions. The first such case, Serrano v. Priest, challenged California’s education system. It said all parts of California must spend about the same amount per child on education. This meant, in the words of one economist who looked at the matter, "tax-financed differences in spending per pupil were, for all practical purposes, eradicated." After Serrano, California ended its old local property tax system. It planned to force richer neighborhoods to subsidize poorer neighborhoods. This meant that, at least in the short run, schools would be more equal.

But Serrano killed the virtuous cycle in California. It meant that families started to lose control of what they were getting for the money. Like Mary Barrosse, Californians felt rooked. When that arrangement broke down, people started to get angry. Californians were losing control of their local schools. They didn’t want to pay more. The consequence was a property tax revolt unlike any that had occurred in postwar America. School equalization so angered them that it moved Californians to pass Proposition 13, a draconian law capping and freezing property taxes.

Serrano soon began to replicate itself. Texas had its Serrano case. So did Maine, and New Mexico. Later came New Jersey, Kentucky, and Ohio. Usually, the American Civil Liberties Union helped out in making the case for equalization. Often they started with a set-piece example of inequality in their state. For example, Robert Gensburg, the lead plaintiff in the Vermont case, noted that Hardwick, a relatively poor town, found that it had to lay off a remedial reading teacher for the first grade. He contrasted Hardwick with Stowe, where the town was voting on whether to appropriate $84,000 to repair the high school’s tennis courts. In all these states, and soon they came to number over 20, the goal was the same: power to the state capital, so that it might regulate and enforce equal spending.

When there was the evidence that Montpelier was already moving to centralize. Act 60, the legislation, contained numerous new mandates that the states would impose on schools. It was going to introduce new statewide rules on local standards, set up a new barrage of requirements for the schools, and subject the schools to review every two years by a commissioner to "determine whether students in each Vermont public school are provided educational opportunities substantially equal to those provided in other public schools." The threat to schools that didn’t meet the criteria was clear: With its newfound control of the purse, the state could close those schools. What particularly irked citizens was that the state was spending quite a lot to pay for its new power center: $5 million to establish the oversight office, for starters.

What upset the Vermonters most, though, was that there seemed no way of going back. In the winter of 1997 and 1998, some towns were still considering raising property taxes to improve schools. State lawmakers actually discouraged them from doing that — in other words, encouraged them to stay dependent so that they could keep their "receiving" status. Melissa Perkins, a citizen of Shaftsbury, a receiving town, studied the state government’s report on her town and discovered it would indeed be saving 11 percent on property taxes. But it also needed to spend an extra $107,388 in compliance costs to get ready for the new system. And it now found itself in an awkward situation. The town had been planning to increase its school spending significantly, by $287,559. But its planners discovered that if they did, they would lose "too much" of Act 60’s benefit. Perkins had discovered one of the many perversities in the new law: For towns with lower property tax bases, it actually discouraged education spending. Why should they choose to raise property taxes and pay more if it meant risking money and their status as a "receiving" town? The governor, wrote Perkins, "wants the people of Shaftsbury to spend $107,388 to support Act 60, but not $287,559 to support our children. What’s wrong with this picture?"

The saddest part of the story was that even after all its costs, equalization didn’t really work. Some extra money did indeed reach poor towns. But those results came at the Tiebout price. Like Californians, the taxpayers in other states were angry. In New Mexico, equal spending became the rule, but it was equal spending at a very low level. In other states, too, spending was equal, but the amount was not very high. Even in places where spending did go up, the schools still seemed to be in trouble. The federal government, the state of New Jersey and the city of Newark spend more per child on Newark children than on the children of many of New Jersey’s fanciest suburbs. But even in Newark, with all the spending, the results were not satisfactory. Newark children still failed, and Newark high schoolers still could not read when they graduated.

There were other problems. One was that spending just wasn’t making it to the students. Instead, it often ended up going to bureaucracy. Kansas City had been a famous landmark in the battle over segregation. So when a court ordered the state to pour money into Kansas City magnet schools in the hope of making them the envy of the state, the nation watched. The school district spent $30 million a year busing students to the new magnet schools. It raised student funding up to $11,700 a pupil, a figure that approached double the national average. It provided the new schools with television and animation studios, a robotics lab, a zoo, and a model United Nations with simultaneous translation capabilities. People in other parts of Missouri were outraged at the court’s decision, and even the judge who made the ruling was able to explain why. He told Paul Ciotti, an education writer who studied the matter for the Cato Institute, "I had to balance two constitutional issues. One was no taxation without representation and the other was kids’ right to an equal opportunity. I decided in favor of the schoolchildren."

But the result of the Kansas City experiment merely showed that trying to generate equality with money was a frustrating exercise. Computers stayed in crates on shelves until they were obsolete. The new inventory was so large that the school administrators lost track of it. Meanwhile, student scores didn’t improve. The prosperous families, most of them white, stayed away. Kansas City’s schools remained ghettoized.

The worst thing about the education battles was that they never seemed to end. This is because, while every state court said that equality is important, every legislature has a different definition of "equal." In some states, such as New Hampshire, the definition of equal meant fulfilling a minimum — the Supreme Court said "adequate." In other states, such as Vermont, it meant equal spending for everyone. The result was bitter quibbling, quibbling that never ended. In April 1998, the New York Times carried a feature story on the national scene. Its headline read: "Patchwork of School Financing Schemes Offers Few Answers and Much Conflict." It reported that in New Mexico, decades after the state’s original equalization change, districts and their lawyers were still fighting over cost-of-living adjustments, teacher salaries, and the education pie in general.

Nowhere was the price of the whole exercise clearer than in California. The California failure was such a grand one that observers of all backgrounds could not help but note it. Decades after Serrano Jonathan Kozol, an education writer who advocates rules enforcing equal spending, wrote a book about unequal school spending called Savage Inequalities. In it he noted that though "the plaintiffs won the victory they sought, it was to some extent a victory of losers. Though the state ranks eighth in per capita income in the nation, the share of its income that now goes to public education is a meager 3.8 percent — placing California forty-sixth among the 50 states. Its average class size is the largest in the nation." He added bitterly, "Beverly Hills still operates a high school that, in academic excellence, can rival those of Princeton and Winnetka. Baldwin Park still operates a poorly funded and inferior system." Nor did the rule of even distribution change student performance: Thomas Downes, a scholar, found that the standardized test scores showed that pupil performance didn’t much change after equalization shifts.

The most compelling evidence of the Tiebout hypothesis, though, was not all the destruction it brought. It was that when towns and cities did try to reform their way out of the equalization method it was nearly always through an effort to recapture the financing of their old local school. Everywhere, the accent was on striving to regain local control. Across the country, wherever possible, people tried to find a way to reestablish the connection that centralization took away.

In California, parents developed their own method of getting around state control. They established local foundations — super PTAs — to serve their local schools through charity gifts from parents. By the mid-1990s, more than 500 such foundations had formed, raising, together, some $30 million a year.

In New York City, the only parent movement to make the papers in years was a parent uprising at a school in Greenwich Village. A teacher was being laid off; the parents banded together and decided they would pay for a replacement. The city’s schools chancellor resisted; but after enormous public pressure, the parents were allowed to spend their money.

Wealthy and middle-class parents were not the only ones who felt the urge to control finances at their local school. In Georgia, Democrats have taken the lead in restoring the local connection. They allowed the counties to raise additional funds for school construction by voting for a county-level increase in sales tax. Within two years after a state amendment made it possible for them to fund their schools this way, 129 counties, poor and rich, passed sales tax increases. They raised a total of $3.5 billion. Because the result was local — they could see the buildings going up — people were happy to spend.

In an article entitled "School Reforms to Nowhere," columnist William Raspberry dismissed the doctrine of centralization and laid out the case for a return to local control. Writing about Maryland’s Prince George’s County, he noted that,

These results underline an important truth — something Mary Barrosse, and indeed most every other parent, knows. It is that Chester Finn, the education scholar, was right. There is no limit to what people will spend on their children’s education. But this holds only as long as the money they spend really goes to their children. Taking away that connection costs something. Directly or indirectly, it costs everyone, even those children on whose behalf the change was made. The lesson was clear: You can’t fight for equity while ignoring taxation. If you do, you don’t even get the equity you seek.

Over the winter following Act 60, Vermonters mounted a dramatic, disparate effort to recapture financial control of their children’s education. The effort began in the state’s very smallest towns. The parents of Winhall, a ski town, voted 4-1 to shut down their only public grammar school. They knew they would have to continue to send property taxes to Montpelier. But at least, now, the state would have little say in how they educated their children. They could use their $5,100 block grants as tuition at a new school, a private school they established. The block grant money wasn’t enough for a new school — indeed, it was only one-seventh of the money the town was sending to Montpelier. But the parents decided they would raise the extra funds they needed by themselves and shut the state out.

Dover, a village with 719 voting souls, went another route. Voters there asked their selectmen to take citizens’ property tax money and put it in escrow until Act 60 could be reviewed again. Soon, several other towns followed. "Our civil rebellion," one official deemed the tax revolt. By spring, seven towns had planned or were seriously considering holding back their money. Dover officials were the feistiest. "They can’t build a jail big enough," Marylou Raymo, the clerk of Dover, told the Wall Street Journal.

Other towns were, at least for the moment, more hesitant. Montpelier had an entire armory of laws, rules, and lawyers with which to strike back. It too could withhold funds, funds the towns counted on to maintain roads in icy winters. So people looked for other avenues. In Dorset, locals met to ponder establishing a private charity to get around the high penalty they must pay if they wish to spend more through the public avenue. John Irving was so angry that he set about founding a private school, the Maple Street school, for his son and other disillusioned families. The school anticipated spending from $8,000 to $10,000 per child, or about the amount the town of Dorset was spending before equalization.

As for Mary Barrosse, she has come to the conclusion that "it has nothing to do with quality or equal education." People wouldn’t mind paying property taxes, she knew, if they controlled those taxes to educate their children. Government might turn its back on that local connection if it chose. It might choose to forget about individual parents and pursue statewide spending equity, school standards, national reading programs — whatever goal seemed important in the powerful, abstract world of politics. But, as the Vermont school wars were proving, denying people a say also has its price.