§ 5402 — Education property tax liability

[Subsection (a) effective until contingency met; see also subsection (a) effective July 1, 2028 if contingency met, set out below.]
(a) A statewide education tax is imposed on all nonhomestead and homestead property at the following rates:
(1) The tax rate for nonhomestead property shall be $1.59 per $100.00 divided by the statewide adjustment.
(2) The tax rate for homestead property shall be $1.00 multiplied by the education property tax spending adjustment for the municipality per $100.00 of equalized education property value as most recently determined under section 5405 of this title. The homestead property tax rate for each municipality that is a member of a union or unified union school district shall be calculated as required under subsection (e) of this section.
[Subsection (a) effective July 1, 2028 if contingency met; see also subsection (a) effective until contingency met, set out above.]
(a) A statewide education tax is imposed on all nonhomestead and homestead property at a rate sufficient to cover expenditures from the Education Fund other than supplemental district spending, after accounting for forecasted non-property tax revenues and any funds unreserved in the Education Fund following the process under 16 V.S.A. § 4032(c). It is the intention of the General Assembly that the statewide education tax rate under this section shall be adopted for each fiscal year by act of the General Assembly. If the General Assembly fails to adopt a statewide education tax rate for a fiscal year, the statewide education tax rate for the fiscal year shall equal the product of 110 percent and the statewide education tax rate for the preceding fiscal year. The statewide education tax rate shall be adjusted for homestead property and each general class of nonhomestead property provided under section 4152a of this title as follows:
[Subsection (b) effective until contingency met; see also subsection (b) effective July 1, 2028 if contingency met, set out below.]
(b) The statewide education tax shall be calculated as follows:
(1) The Commissioner of Taxes shall determine for each municipality the education tax rates under subsection (a) of this section divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment. The legislative body in each municipality shall then bill each property taxpayer at the homestead or nonhomestead rate determined by the Commissioner under this subdivision, multiplied by the education property tax grand list value of the property, properly classified as homestead or nonhomestead property and without regard to any other tax classification of the property. Statewide education property tax bills shall show the tax due and the calculation of the rate determined under subsection (a) of this section, divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment, multiplied by the current grand list value of the property to be taxed. Statewide education property tax bills shall also include language provided by the Commissioner pursuant to subsection 5405(g) of this title.
(2) Taxes assessed under this section shall be assessed and collected in the same manner as taxes assessed under chapter 133 of this title with no tax classification other than as homestead or nonhomestead property; provided, however, that the tax levied under this chapter shall be billed to each taxpayer by the municipality in a manner that clearly indicates the tax is separate from any other tax assessed and collected under chapter 133, including an itemization of the separate taxes due. The bill may be on a single sheet of paper with the statewide education tax and other taxes presented separately and side by side.
(3) If a district has not voted a budget by June 30, an interim homestead education tax shall be imposed at the base rate determined under subdivision (a)(2) of this section, divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment, but without regard to any spending adjustment under subdivision 5401(13) of this title. Within 30 days after a budget is adopted and the deadline for reconsideration has passed, the Commissioner shall determine the municipality’s homestead tax rate as required under subdivision (1) of this subsection.
[Subsection (b) effective July 1, 2028 if contingency met; see also subsection (b) effective until contingency met, set out above.]
(b) The statewide education tax shall be calculated as follows:
(1) The Commissioner of Taxes shall determine for each municipality the education tax rates under subsection (a) of this section divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment. The legislative body in each municipality shall then bill each property taxpayer at the applicable rate determined by the Commissioner under this subdivision, multiplied by the education property tax grand list value of the property, properly classified as homestead or nonhomestead property and without regard to any other tax classification of the property not authorized under this chapter. Statewide education property tax bills shall show the tax due and the calculation of the rate determined under subsection (a) of this section, divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment, multiplied by the current grand list value of the property to be taxed. Statewide education property tax bills shall also include language provided by the Commissioner pursuant to subsection 5405(g) of this title.
(2) Taxes assessed under this section shall be assessed and collected in the same manner as taxes assessed under chapter 133 of this title with no tax classification other than those required by this section; provided, however, that the tax levied under this chapter shall be billed to each taxpayer by the municipality in a manner that clearly indicates the tax is separate from any other tax assessed and collected under chapter 133, including an itemization of the separate taxes due. The bill may be on a single sheet of paper with the statewide education tax and other taxes presented separately and side by side.
(3) [Repealed.]
[Subsection (c) effective until contingency met; see also subsection (c) effective July 1, 2028 if contingency met, set out below.]
(c)(1) The treasurer of each municipality shall by December 1 of the year in which the tax is levied and on June 1 of the following year pay to the State Treasurer for deposit in the Education Fund one-half of the municipality’s statewide nonhomestead tax and one-half of the municipality’s homestead education tax, as determined under subdivision (b)(1) of this section.
(2) The Secretary of Education shall determine each municipality’s net nonhomestead education tax payment and its net homestead education tax payment to the State based on grand list information received by the Secretary not later than the March 15 prior to the June 1 net payment. Payment shall be accompanied by a return prescribed by the Secretary of Education. Each municipality may retain 0.225 of one percent of the total education tax collected, only upon timely remittance of net payment to the State Treasurer or to the applicable school district or districts.
[Subsection (c) effective July 1, 2028 if contingency met; see also subsection (c) effective until contingency met, set out above.]
(c)(1) The treasurer of each municipality shall by December 1 of the year in which the tax is levied and on June 1 of the following year pay to the State Treasurer for deposit in the Education Fund one-half of the municipality’s statewide education tax, as determined under subdivision (b)(1) of this section.
(2) The Secretary of Education shall determine each municipality’s net education tax payment to the State based on grand list information received by the Secretary not later than the March 15 prior to the June 1 net payment. Payment shall be accompanied by a return prescribed by the Secretary of Education. Each municipality may retain 0.225 of one percent of the total education tax collected, only upon timely remittance of net payment to the State Treasurer or to the applicable school district or districts.
(d) [Repealed.]
[Subsection (e) repealed July 1, 2028 if contingency met.]
(e) The Commissioner of Taxes shall determine a homestead education tax rate for each municipality that is a member of a union or unified union school district as follows:
(1) For a municipality that is a member of a unified union school district, use the base rate determined under subdivision (a)(2) of this section and a spending adjustment under subdivision 5401(13) of this title based upon the per pupil education spending of the unified union.
(2) For a municipality that is a member of a union school district:
(A) Determine the municipal district homestead tax rate using the base rate determined under subdivision (a)(2) of this section and a spending adjustment under subdivision 5401(13) of this title based on the per pupil education spending in the municipality who attends a school other than the union school.
(B) Determine the union district homestead tax rate using the base rate determined under subdivision (a)(2) of this section and a spending adjustment under subdivision 5401(13) of this title based on the per pupil education spending of the union school district.
(C) Determine a combined homestead tax rate by calculating the weighted average of the rates determined under subdivisions (A) and (B) of this subdivision (2), with weighting based upon the ratio of union school long-term membership, as defined in 16 V.S.A. § 4001(7), from the member municipality to total long-term membership of the member municipality; and the ratio of long-term membership attending a school other than the union school to total long-term membership of the member municipality. Total long-term membership of the member municipality is based on the number of pupils who are legal residents of the municipality and attending school at public expense. If necessary, the Commissioner may adopt a rule to clarify and facilitate implementation of this subsection (e).
[Subsection (f) effective July 1, 2028 if contingency met.]
(f)(1) A supplemental district spending tax is imposed on all homestead and nonhomestead property in each member municipality of a school district that approves spending pursuant to a budget presented to the voters of a school district under 16 V.S.A. § 563. The Commissioner of Taxes shall determine the supplemental district spending tax rate for each school district by dividing the school district’s per pupil supplemental district spending as certified by the Secretary of Education by the supplemental district spending yield. The legislative body in each member municipality shall then bill each property taxpayer at the rate determined by the Commissioner under this subsection, divided by the number resulting from dividing the municipality’s most recent common level of appraisal by the statewide adjustment and multiplied by the current grand list value of the property to be taxed. The bill shall show the tax due and the calculation of the rate.
(2) The supplemental district spending tax assessed under this subsection shall be assessed and collected in the same manner as taxes assessed under chapter 133 of this title with no tax classification other than as homestead or nonhomestead property; provided, however, that the tax levied under this chapter shall be billed to each taxpayer by the municipality in a manner that clearly indicates the tax is separate from any other tax assessed and collected under chapter 133 of this title and the statewide education property tax under this section, including an itemization of the separate taxes due. The bill may be on a single sheet of paper with the supplemental district spending tax, the statewide education tax, and other taxes presented separately and side by side.
(3) The treasurer of each municipality shall on or before December 1 of the year in which the tax is levied and on or before June 1 of the following year pay to the State Treasurer for deposit in the Education Fund one-half of the municipality’s supplemental district spending tax as determined under subdivision (1) of this subsection.
(4) The Secretary of Education shall determine each municipality’s net supplemental district spending tax payment to the State based on grand list information received by the Secretary not later than the March 15 prior to the June 1 net payment. Payment shall be accompanied by a return prescribed by the Secretary of Education. Each municipality may retain 0.225 of one percent of the total supplemental district spending tax collected, only upon timely remittance of net payment to the State Treasurer or to the applicable school district. (Added 1997, No. 60, § 45, eff. Jan. 1, 1998; amended 1997, No. 71 (Adj. Sess.), § 8, eff. Jan. 1, 1998; 1997, No. 71 (Adj. Sess.), § 53; 1997, No. 71 (Adj. Sess.), § 73, eff. January 1, 1999; 1999, No. 1, § 60e, eff. March 31, 1999; 1999, No. 49, § 30, eff. June 2, 1999; 2001, No. 63, § 276, eff. June 16, 2001; 2001, No. 144 (Adj. Sess.), § 21, eff. June 21, 2002; 2003, No. 68, § 76, eff. June 18, 2003; 2003, No. 68, § 4, eff. for fiscal years 2005 and after; 2003, No. 76 (Adj. Sess.), § 6; 2003, No. 80 (Adj. Sess.), §§ 49a, 49c, eff. March 8, 2004; 2003, No. 130 (Adj. Sess.), § 13; 2005, No. 182 (Adj. Sess.), §§ 11, 12; 2007, No. 33, § 11, eff. May 18, 2007; 2007, No. 65, § 289; 2007, No. 82, § 12; 2007, No. 190 (Adj. Sess.), §§ 10, 11; 2009, No. 1 (Sp. Sess.), § H.23, eff. June 2, 2009; 2013, No. 92 (Adj. Sess.), § 284, eff. Feb. 14, 2014; 2013, No. 174 (Adj. Sess.), § 61, eff. June 4, 2014; 2015, No. 46, § 28; 2018, No. 11 (Sp. Sess.), § H.14, eff. July 1, 2019; 2019, No. 51, § 25; 2021, No. 20, § 267; 2021, No. 127 (Adj. Sess.), § 29, eff. July 1, 2024; 2021, No. 163 (Adj. Sess.), § 1, eff. June 1, 2022; 2023, No. 183 (Adj. Sess.), § 14, eff. July 1, 2025; 2025, No. 73, § 68, eff. July 1, 2025; 2025, No. 73, § 47, contingently eff. July 1, 2028.)