Agency of Education seeks $4 million one-time boost for transformation as federal pandemic funds expire

The Agency of Education on Feb. 14 briefed a joint hearing of the House Education Committee and the House Ways and Means Committee on its FY26 budget request and plans to support a statewide education transformation.

Interim Deputy Secretary of Education Jill Briggs Campbell and Interim Chief Financial Officer Sean Cousineau presented figures showing a total AOE spending request of roughly $2.6 billion across appropriations for FY26, a decrease of about $47.5 million from the prior year driven primarily by the end of pandemic-era federal funding such as ESSER and GEER grants. "We are really trying to squeeze every penny out of this," Briggs Campbell said, describing the agency's use of liquidation-extension authority from the U.S. Department of Education to stretch remaining federal dollars into 2025.

Why it matters: The drop in federal pandemic funding shifts pressure onto state resources and into local district budgets at the same time the agency plans major governance and funding changes under the governor's education-transformation proposal. The AOE says it needs surge capacity to support districts and new district governance arrangements during the transition.

Key budget numbers and drivers Cousineau described the overall AOE request as roughly $2.6 billion across appropriations with a net decrease of $47.5 million compared with the prior year, driven largely by the expiration of pandemic grants and associated spending. The agency reported an increase in the base education grant (the Education Fund grant) of about $104.7 million in draft numbers shared with legislators, while federal grant-funded spending and grant-related personnel declined as federal ESSER/GEER awards wound down.

The agency highlighted operating and personnel cost drivers including higher health-care costs, increases in back-office services (single audit, liability insurance, human-resources systems), and reductions in contract spending previously supported with pandemic funds.

One-time $4 million request for education transformation Briggs Campbell and Cousineau asked for a $4 million one-time appropriation to support the agency's planned education transformation. The agency described three primary uses for those dollars for FY26: (1) financial-transformation and budgeting support to model impacts of changes to the foundation formula and to provide on-the-ground budgeting assistance to districts; (2) education-quality and accountability work tied to the agency strategic plan and district quality standards; and (3) training and support for new school-board governance under the proposed consolidation or reorganization of district structures.

On whether that money would be spent on consultants or staff, Briggs Campbell said the agency envisions "consulting contracts" for many of the surge activities, including contractors to provide on-the-ground budgeting support and to help with school-board transition work. "We would anticipate this would be an ongoing support, so it would start as a one-time, but ... this would be an ongoing role for the State Board of Education," Briggs Campbell said, adding that the one-time funds are intended as a surge to support the transition while the agency completes its strategic planning.

Capacity, vacancies and contracting The committee raised concerns about the agency's ability to manage consultant contracts and the transformation while operating with a high vacancy rate. A staff member who provided vacancy data said, "Currently, the agency has 23 vacant positions out of a 81 overall. 14 of those vacancies are currently in the recruitment pipeline." The agency representative also provided a vacancy trend line: about 6% in 2020, 9% in 2023, and 8% in 2024, compared with a state average of roughly 6–7%.

Briggs Campbell acknowledged recruiting challenges for specialized roles and said the agency has used restructuring and reclassification to attract candidates and has employed available HR tools to retain staff. She said some functions proposed for consultants—such as school-board training—are not typically agency staff functions and thus are appropriate for contracted expertise.

Smaller notable requests and program details Cousineau and Briggs Campbell also identified smaller items in the FY26 request: $50,000 for an emergency meal-sites grant appropriation to allow the agency to help schools stand up meal service in statewide emergencies; $45,000 transferred from the Department for Children and Families for Hunger Vermont outreach to align with child-nutrition work; and $30,000 as AOE's portion of Act 264 collaboration between AHS and AOE to coordinate services for youth with disabilities.

The agency described how federal liquidation-extension options allow districts to continue using certain federal program dollars (for example, for Read Vermont) into late 2025 and that the agency has requested extensions where permissible.

Education quality and accountability work Briggs Campbell said the agency is developing a strategic plan and intends to strengthen alignment between local benchmark assessments, statewide assessments, the ESSA state plan and district quality standards. She said the agency's work must "hook up the plumbing"—aligning measures, assessments and accountability—to support consistent education quality across districts. That work, she said, is central to the agency's readiness to support governance and funding changes.

Federal funding uncertainty Committee members asked about the risk of losing federal funding or changes at the U.S. Department of Education. Briggs Campbell noted that while federal funds comprise a modest share of total state spending, they are concentrated on supports for disadvantaged students (for example, homeless liaisons, English-language instruction and literacy coaches) and therefore any large federal shift would raise substantial policy and budget questions.

Questions, next steps and transparency Legislators pressed for more detail about how one-time funds would be contracted and how many dollars would go to out-of-state consultants versus Vermont firms; the agency said it would follow standard RFP and contracting rules and did not commit to a geographic split. The agency also offered to provide more detail on vacancy-management and recruitment strategies.

No formal votes were taken at the hearing. The presentation and questions provide the committee with the agency's requested amounts and rationale for the one-time transformation funds and several smaller appropriations; legislators may use that information in upcoming budget deliberations.

Ending The AOE emphasized that the education-transformation proposal and the strategic plan are ongoing processes that will continue to evolve through the legislative session and that additional staffing or base funding requests could follow as the agency finalizes priorities.