Treasurer’s office, Bond Bank push language to keep school construction debt off Vermont’s credit ledger

BURLINGTON, Vt. — On May 15, the Ways & Means Committee discussed a proposed technical amendment to the statewide school construction aid bill that would explicitly say debts incurred by school districts under the new aid program “do not constitute a pledge of the faith and credit or taxing power of the state,” and would name the Vermont Bond Bank as the fiscal agent for the program.

Ashley Dillon, director of policy in the State Treasurer’s Office, told the committee the change is twofold: it clarifies that district debt from the program is not state net tax-supported debt and it establishes the bond bank as fiscal agent. "The debt incurred by school districts as part of this new state school construction aid program is not to be considered to be net tax supportive debt of the state and not subject to the full faith and credit of the state of Vermont," Dillon said.

The amendment reflects a recommendation from the school construction task force that reported to the legislature in 2024 and is modeled on a Rhode Island approach, Dillon said. She and bond bank staff said consolidating district bonds in a bond bank pool should lower…