Sadie Boyd, Madeline Klein & Town of Whitingham v. State , 2022 VT 12 ( 2022 )

NOTICE: This opinion is subject to motions for reargument under V.R.A.P. 40 as well as formal
revision before publication in the Vermont Reports. Readers are requested to notify the Reporter
of Decisions by email at: JUD.Reporter@vermont.gov or by mail at: Vermont Supreme Court, 109
State Street, Montpelier, Vermont 05609-0801, of any errors in order that corrections may be made
before this opinion goes to press.
2022 VT 12No. 2021-177
Sadie Boyd, Madeline Klein & Town of Whitingham Supreme Court
On Appeal from
v. Superior Court, Windham Unit,
Civil Division
State of Vermont January Term, 2022
Katherine A. Hayes, J.
James A. Valente and Adam W. Waite of Costello, Valente & Gentry, P.C., Brattleboro, for
Plaintiffs-Appellants.
Thomas J. Donovan, Jr., Attorney General, and David Boyd, Assistant Attorney General,
Montpelier, for Defendant-Appellee.
PRESENT: Reiber, C.J., Eaton and Carroll, JJ., and Johnson, J. (Ret.), and Bent, Supr. J. (Ret.),
Specially Assigned
¶ 1. CARROLL, J. Plaintiffs are Sadie Boyd, a student at Twin Valley Middle High
School in Whitingham, Vermont; Madeleine Klein, a resident and property owner in Whitingham;
and the Town of Whitingham. In October 2017, plaintiffs filed a complaint for declaratory and
injunctive relief against defendant State of Vermont, arguing that the education funding and
property taxation system set forth in 16 V.S.A. ch. 133 and 32 V.S.A. ch. 135 violated the
Education Clause, the Proportional Contribution Clause, and the Common Benefits Clause of the
Vermont Constitution. They claimed that the system was unconstitutional because it deprived
plaintiff Boyd of an equal educational opportunity, required plaintiff Klein to contribute
disproportionately to education funding, and compelled the Town to collect an unconstitutional
tax. The civil division granted the State’s motion for summary judgment, concluding that plaintiffs
had failed to demonstrate that the alleged inequities were caused by the statutes in question or that
the education property taxation system lacked a rational basis. We affirm.
I. Relevant Law
¶ 2. Vermont’s education funding and property taxation statutes are intended “to make
educational opportunity available to each student in each town on substantially equal terms, in
accordance with the Vermont Constitution and the Vermont Supreme Court decision of February
5, 1997, Brigham v. State of Vermont.” 16 V.S.A. § 4000(a). Chapter II, § 68 of the Vermont
Constitution, known as the Education Clause, makes education “a fundamental obligation of the
state.” Brigham v. State (Brigham I), 166 Vt. 246, 263, 692 A.2d 384, 394 (1997) (per curiam);
see Vt. Const. ch. II, § 68 (providing that “a competent number of schools ought to be maintained
in each town unless the general assembly permits other provisions for the convenient instruction
of youth”). In the landmark Brigham I decision, we recognized that the Education Clause and the
Common Benefits Clause together guarantee Vermont students a right to equal educational
opportunities, and concluded that the then-existing statewide education funding scheme violated
this right. 166 Vt. at 268, 692 A.2d at 397.
¶ 3. At the time Brigham I was decided, Vermont public schools were financed by a
combination of funds raised by towns and cities through local property taxes funds distributed by
the State under its so-called foundation plan. The foundation plan provided money to school
districts to allow them to spend an amount per pupil that would provide a minimally adequate
education. Despite this assistance, wide disparities in per-pupil spending existed between rich and
poor school districts. Towns with greater property wealth spent more per pupil and had lower
effective tax rates than poorer towns. The State conceded in Brigham I that as a result, children
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living in property-poor school districts lacked the same educational opportunities as those living
in wealthier districts.
¶ 4. We held that this system deprived Vermont students of their constitutional right to
equal educational opportunities. Id. We noted that “[t]he Constitution does not, to be sure, require
exact equality of funding among school districts or prohibit minor disparities attributable to
unavoidable local differences.” Id. at 267, 692 A.2d at 397. However, we rejected the State’s
argument that the foundation plan sufficiently ameliorated the funding disparities between rich
and poor districts to eliminate a constitutional claim of discrimination, concluding that the system
fell “well short of achieving reasonable educational equality of opportunity.” Id. We went on to
explain:
In so holding we emphasize that absolute equality of funding is
neither a necessary nor a practical requirement to satisfy the
constitutional command of equal educational opportunity. As
plaintiffs readily concede, differences among school districts in
terms of size, special educational needs, transportation costs, and
other factors will invariably create unavoidable differences in per-
pupil expenditures. Equal opportunity does not necessarily require
precisely equal per-capita expenditures, nor does it necessarily
prohibit cities and towns from spending more on education if they
choose, but it does not allow a system in which educational
opportunity is necessarily a function of district wealth. Equal
educational opportunity cannot be achieved when property-rich
school districts may tax low and property-poor districts must tax
high to achieve even minimum standards. Children who live in
property-poor districts and children who live in property-rich
districts should be afforded a substantially equal opportunity to have
access to similar educational revenues. Thus, as other state courts
have done, we hold only that to fulfill its constitutional obligation
the state must ensure substantial equality of educational opportunity
throughout Vermont.
Id. at 268, 692 A.2d at 397.
¶ 5. After Brigham I was decided, the Legislature made major changes to the education
funding and property taxation scheme, and it has continued to make refinements in subsequent
years. See, e.g., 1997, No. 60; 2003, No. 68. Under the current system, voters within each school
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district decide the district’s budget for each fiscal year. See 16 V.S.A. § 428(a) (governing town
school districts); id. § 511(a) (governing incorporated school districts). The budgets are then
funded by the State, which collects property taxes at rates it sets to cover a portion of the cost. See
id. § 4025 (establishing Education Fund, which is funded by education property tax as well as
revenues from state lotteries and other taxes, and is to be used to pay school districts and
supervisory unions in accordance with 16 V.S.A. § 4028); id. § 4028(a) (providing for payment of
“adjusted education payment” to school districts); id. § 4001(14) (defining “adjusted education
payment” as “district’s education spending per equalized pupil”); 32 V.S.A. § 5402(a) (setting
uniform statewide education property tax rates). Property is divided into two categories for
purposes of the education tax: homestead property, meaning the principal dwelling and
surrounding land owned and occupied by a resident individual as the individual’s domicile; and
nonhomestead property, which includes most other types of property. 32 V.S.A. § 5401(7), (10)
(defining homestead and nonhomestead property); id. § 5402(a) (setting different rates for
homestead and nonhomestead property).
¶ 6. The State sets homestead property tax rates using universal statewide formulas to
address differences in property wealth between districts, so that voters in districts with the same
spending per equalized pupil pay approximately the same homestead property tax rate without
regard to whether property values in each district are relatively high or low. See id. §§ 5402, 5404-
5405; Brigham I, 166 Vt. at 255, 268, 692 A.2d at 389, 397 (invalidating previous funding scheme
under which per-pupil spending was highest in wealthy districts, which benefited further from low
school tax rates, while towns with limited resources spent less per student and paid more in taxes).
The legislative body of each municipality is required to bill property taxpayers as directed by the
Commissioner of Taxes in accordance with the education tax rates. 32 V.S.A. § 5402(b).
¶ 7. Under the current system, if a school district spends more than 121% of the
statewide average district education spending per equalized pupil in fiscal year 2015, increased by
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inflation through the fiscal year for which the amount is being determined, its homestead property
tax rate increases twice as fast on spending above that threshold. Id. § 5401(12) (defining “excess
spending”); id. § 5401(13) (explaining how education property and income tax spending
adjustments are calculated). The Legislature has exempted certain items from the excess spending
calculation, including approved capital construction spending and special education spending. 16
V.S.A. § 4001(6)(B).
II. Facts
¶ 8. The following facts were undisputed for purposes of summary judgment.1 At the
time this case was filed, the Twin Valley Contract School District, a joint contract district created
by the Whitingham and Wilmington School Districts, operated the schools within its borders. In
2019, Twin Valley became a unified union school district and the Whitingham and Wilmington
school districts ceased to exist. At all relevant times, Twin Valley operated all schools within the
district and its school board proposed its budgets, which were approved or rejected by district
voters. The Town of Whitingham did not operate or fund any schools.
¶ 9. In fiscal years 2016-2019, the Twin Valley district had between 400 and 500
equalized pupils. During that period, Twin Valley’s education spending per equalized pupil
exceeded the Vermont statewide average by nineteen to thirty percent. The district spent, on
average, $3621 more per equalized pupil than the overall statewide average. During the same
period, other districts similar to Twin Valley—meaning districts with 350 to 550 pupils that
operated schools for all grades—spent less than the statewide average per pupil. Twin Valley
spent an average of $4047 more per pupil than these similarly sized districts.
1
Defendant filed a statement of undisputed facts. Plaintiffs responded with their own
statement of facts but did not directly respond to defendant’s statement of facts. Accordingly, for
purposes of summary judgment, defendant’s facts are deemed undisputed. See V.R.C.P. 56(e)
(stating that “[i]f a party fails to properly support an assertion of fact or fails to properly address
another party’s assertion of fact as required by Rule 56(c), the court may . . . consider the fact
undisputed for purposes of the motion”).
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¶ 10. While Twin Valley spends more per pupil than the average district in Vermont, its
socioeconomic makeup puts it generally in the lower portion of districts in the state, except for its
home values, which are near or slightly above average. However, according to plaintiffs’ expert,
Twin Valley’s spending is not driven by demographics; Twin Valley spends more per student than
other districts with similar demographics.
¶ 11. During the 2017-2018 school year, Twin Valley offered fewer than 100 high-
school-level courses.2 The previous year, Champlain Valley Union High School, which is the
largest high school in Vermont with a population of over 1200 students, offered more than 150
courses. Students at Twin Valley have access to many other courses online and in person through
dual enrollment and early college class options at participating colleges and the Windham Regional
Career Center.
¶ 12. Plaintiff Boyd was a student at Twin Valley Middle High School when this case
was filed. She testified that she would have preferred to have more options for courses while
attending that school, such as business, child development, and science classes. She preferred to
take classes in person rather than online. She also would have liked to play lacrosse and volleyball,
but Twin Valley did not offer these extracurricular sports.
¶ 13. Students at Twin Valley take college preparatory tests at lower rates than average
for high schools in Vermont and receive lower-than-average scores on those tests. The high-school
dropout rate at Twin Valley is somewhat higher than the statewide average.
¶ 14. As a whole, Vermont spends more of its total economic output, as measured by
gross domestic product, on public education than any other state. It has some of the highest overall
levels of per-pupil spending in the country. Education spending in Vermont is not highly
2
Plaintiffs’ statement of facts states that Twin Valley’s high school offered sixty-nine
courses. Defendant, pointing to the same exhibit, asserts that there are ninety-four courses offered.
The discrepancy appears to stem in part from whether separate sections of the same course are
treated as separate course offerings. The difference is not material to the outcome of the case.
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associated with student achievement. Plaintiffs’ expert opined that education spending in
Vermont, and at Twin Valley specifically, is above the threshold at which increases in spending
are associated with increases in student performance. He agreed that at the current level of
spending in Vermont, more spending did not create higher levels of educational opportunity.
¶ 15. Seth Boyd, a Twin Valley school board member and the Town’s designated
representative under Vermont Rule of Civil Procedure 30(b)(6), testified at deposition that the
district’s relatively high per-pupil spending was attributable to student needs, demographics,
special education costs, facility bond payments of over $500,000 per year, and transportation costs.
He opined that there was a need for additional opportunities for Twin Valley students. Boyd and
other witnesses testified that districts the size of Twin Valley do not have the benefit of some
economies of scale that are available to larger schools because the costs of maintaining required
staff such as principals, nurses, and librarians, are spread over fewer students. In addition, they
asserted that Twin Valley incurs higher costs for transportation than many schools due to
geography and other factors.
¶ 16. According to data from the Vermont Agency of Education, in fiscal year 2018,
Whitingham had 182.56 equalized pupils, $20,981.32 in “budgets per equalized pupil,” and
education spending of $19,982.75 per equalized pupil. This placed Whitingham third in the state
in education spending per equalized pupil. Whitingham’s homestead equalized tax rate in 2018
was 2.0974, also among the highest in the state. A Whitingham selectboard member asserted that
the Town could not impose higher local taxes to support local infrastructure and services because
its education taxes were already so high.
¶ 17. Plaintiff Madeleine Klein owns a home and forty-one acres of land in Whitingham.
Her property’s assessed value increased from $241,800 in 2007 to $379,800 between 2010 and
2015, then decreased to $361,900 in 2016 and 2017. Over this period, her assessed property
education tax ranged from $3513 to $5320. She was eligible for an income-sensitivity tax
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adjustment, which reduced her actual education property tax payment to approximately $3000-
$4200 per year.3 She struggles each year to pay her taxes.
III. Analysis
¶ 18. Plaintiffs argue that the civil division erred in granting summary judgment to the
State because there is a genuine dispute regarding whether Whitingham students such as plaintiff
Boyd are deprived of equal educational opportunities. Plaintiffs further argue that they provided
sufficient evidence to prove that the State’s education property taxation system requires plaintiff
Klein to make a disproportionate contribution to the funding of education in Vermont because she
pays more in education property taxes than similarly situated taxpayers in other towns. Finally,
plaintiffs claim that the court improperly granted summary judgment on the Town’s claims
because they presented evidence that the taxation scheme harms the Town by depriving it of
revenue and compels the Town to collect an unconstitutional tax from its revenue.
¶ 19. On appeal from a decision granting summary judgment, we review the evidence
and law without deference, applying the same standard as the superior court. Newton v. Preseau,
2020 VT 50, ¶ 4, 212 Vt. 445, 236 A.3d 1270. “Summary judgment is appropriate when,
construing the facts as alleged by the nonmoving party and resolving reasonable doubts and
inferences in favor of the nonmoving party, there are no genuine issues of material fact and
judgment is appropriate as a matter of law.” Sheldon v. Ruggiero, 2018 VT 125, ¶ 14, 209 Vt. 33,
202 A.3d 241. “Where the moving party does not bear the burden of persuasion at trial, it may
satisfy its burden of production by showing the court that there is an absence of evidence in the
record to support the nonmoving party’s case.” Ross v. Times Mirror, Inc., 164 Vt. 13, 18, 665
A.2d 580, 583 (1995). The nonmoving party must then show that there are material facts in
3
Certain taxpayers are entitled to a “homestead property tax income sensitivity
adjustment.” 32 V.S.A. ch. 154. The adjustment applies only to a property owner’s “housesite,”
which includes no more than two acres surrounding the property owner’s dwelling. Id.§§ 6061(11), 6066.
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dispute. Id. “Evidence which merely makes it possible for the fact in issue to be as alleged, or
which raises a mere conjecture, surmise or suspicion is an insufficient foundation for a verdict.”
Fuller v. City of Rutland, 122 Vt. 284, 289, 171 A.2d 58, 61 (1961). “[W]here the jury could only
find for the plaintiff by relying on speculation, the defendant is entitled to judgment.” Bernasconi
v. City of Barre, 2019 VT 6, ¶ 11, 209 Vt. 419, 206 A.3d 720.
¶ 20. As discussed below, we agree with the civil division that plaintiffs failed to present
evidence sufficient for a jury to find that the current statewide education funding system deprived
plaintiff Boyd of a substantially equal educational opportunity. We conclude that plaintiffs
likewise failed to demonstrate that the property education taxation system arbitrarily discriminates
against plaintiff Klein. Because plaintiffs have not met their burden of proving that the current
education taxation scheme is unconstitutional, the Town’s claims that it is being compelled to
collect an unconstitutional tax and is deprived of revenue by that tax necessarily fail as well.
A. Equal Educational Opportunity Claim
¶ 21. We first address plaintiffs’ argument regarding the proper constitutional analysis to
be applied to their claim that the State’s education funding system deprives plaintiff Boyd of an
equal educational opportunity. According to plaintiffs, Brigham I held that equal education
opportunity is a fundamental right and therefore the challenged statutes are subject to strict
scrutiny. The State responds that, although framed as a challenge to the education funding system,
what plaintiffs are really complaining about is the property taxation system, and therefore we
should review their claim using a rational-basis standard.
¶ 22. We need not resolve this dispute because we conclude that under any standard,
plaintiffs have failed to provide evidence sufficient to show that the existing statewide education
funding and taxation scheme is to blame for the number of courses and sports offered at Twin
Valley or its students’ relatively poor performance in testing and attendance.
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¶ 23. Statutes are presumed to be constitutional and reasonable. Badgley v. Walton, 2010
VT 68, ¶ 20, 188 Vt. 367, 10 A.3d 469. “In an action challenging a legislative enactment on the
basis of equal protection, one who seeks to void such an enactment on equal protection grounds
undertakes a very weighty burden.” Colchester Fire Dist. No. 2 v. Sharrow, 145 Vt. 195, 199, 485
A.2d 134, 137 (1984) (quotation omitted).
¶ 24. Viewed in the light most favorable to plaintiffs, the limited evidence they presented
showed that between 2016 to 2019, Twin Valley offered approximately half as many in-person
courses as the largest high school in the state. Its students had access to many other in-person and
online courses at nearby institutions. Its students performed somewhat worse than the statewide
average in testing and attendance. At least one student, plaintiff Boyd, would have preferred to
have more in-person course options and more extracurricular sports.
¶ 25. Assuming for the purposes of summary judgment that these facts are sufficient to
establish a claim that plaintiff Boyd or her fellow students were denied substantially equal
educational opportunities, plaintiffs have failed to demonstrate that the deprivation was caused by
the State’s current educational funding and taxation system. The facts of this case are a far cry
from Brigham I, where there was overwhelming evidence that school districts in property-poor
towns spent far less per pupil than districts in wealthy areas, resulting in vast inequality of
educational opportunities between students in rich and poor towns. By contrast, the evidence here
shows that Twin Valley’s per-pupil spending is nearly the highest in the State, despite having
average property values. During the years at issue, it spent approximately $3600 more per pupil
than the statewide average, and $4000 more per pupil than other districts of a similar size.
Plaintiffs’ own expert testified that education spending at Twin Valley is above the threshold at
which increases in spending are associated with increases in student performance. He agreed that
at the current level of spending, more spending would not create higher levels of educational
opportunity. Thus, unlike in Brigham I, it is not obvious that more spending in Twin Valley would
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translate to better opportunities for students. The record reveals no clear link between the way the
State currently funds public education and Twin Valley’s alleged deficiencies.
¶ 26. Plaintiffs argue that the Town’s Rule 30(b)(6) witness, Seth Boyd, opined that the
“funding formula that is hinged on per-pupil spending doesn’t allow the midsize or smaller schools
to take advantage of the economies of scale” available to larger districts. They argue that this
demonstrates that the current system requires Whitingham to spend more to get the same services,
thereby denying Whitingham students equal educational opportunities. However, this conclusory
statement was unsupported by any specific facts or expert testimony and was therefore insufficient
to defeat summary judgment. See Starr Farm Beach Campowners Ass’n v. Boylan, 174 Vt. 503,
506, 811 A.2d 155, 160 (2002) (mem.) (“Testimony which presents nothing but conclusions is
insufficient to defeat a motion for summary judgment.”).
¶ 27. The record also does not support plaintiffs’ argument that, but for the excess-
spending penalties imposed by the State, the Twin Valley district would have additional funding
that it would use to improve educational opportunities for students. Plaintiffs presented no
evidence that Twin Valley would have offered the in-person courses or sports desired by plaintiff
Boyd, or other opportunities not currently available, if the district had not been subject to the
penalties. The fact that Twin Valley, a relatively small high school, offers fewer courses and sports
may simply reflect a lack of interest or an insufficient number of students to justify offering them.
The evidence connecting the alleged shortcomings of the Twin Valley school to the way the State
currently funds public education is simply too tenuous to support plaintiffs’ claim.
¶ 28. Plaintiffs argue that in Brigham v. State (Brigham II), 2005 VT 105, ¶ 13, 179 Vt.
525, 889 A.2d 715 (mem.), we held that the plaintiff students adequately stated a claim that they
were being denied equal educational opportunities by alleging that the State provided inadequate
funding to the Whitingham school, resulting in a limited curriculum compared to students at larger
high schools. While such allegations may have been sufficient to withstand a motion to dismiss,
11
at the summary judgment stage it was plaintiffs’ burden to put forth admissible evidence to support
their allegations. Mello v. Cohen, 168 Vt. 639, 641, 724 A.2d 471, 474 (1998) (mem.) (“Even
though a plaintiff’s allegations present a cognizable claim sufficient to withstand a motion to
dismiss, the same allegations may well prove insufficient to withstand a motion for summary
judgment.”). As noted above, the only evidence presented by plaintiffs in support of this argument
was that Twin Valley, which spends more per pupil than most schools in Vermont, offers fewer
courses than the largest high school in the state. But this disparity may simply be due to inherent
“differences among school districts in terms of size,” which we have recognized “will invariably
create unavoidable differences in per-pupil expenditures” and, by extension, educational
opportunities. Brigham I, 166 Vt. at 268, 692 A.2d at 397. The record here is simply insufficient
to show that the current statewide funding model is the reason for Twin Valley’s alleged
deficiencies. Accordingly, the court properly granted the State’s motion for summary judgment.
B. Proportional-Contribution Claim
¶ 29. We next address plaintiff Klein’s claim that the education property taxation system
violates the Vermont Constitution’s Proportional Contribution Clause because it requires her to
pay a disproportionate contribution to the funding of education in Vermont. The Proportional
Contribution Clause provides “[t]hat every member of society hath a right to be protected in the
enjoyment of life, liberty, and property, and therefore is bound to contribute the member’s
proportion towards the expence of that protection.” Vt. Const. ch. I, art. 9. The clause
“establish[es] two fundamental requirements for the valid imposition of taxes in Vermont: first,
that any legislative classification of taxpayers bear a reasonable relation to the purpose for which
it is established; and second, that the classification scheme be fairly and equitably applied among
like classes of taxpayers.” In re Prop. of One Church St. City of Burlington, 152 Vt. 260, 266, 565
A.2d 1349, 1352 (1989).
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¶ 30. We have recognized that “reasonable schemes of taxation must have flexibility, and
some difference of treatment between citizens is virtually inevitable.” Schievella v. Dep’t of
Taxes, 171 Vt. 591, 593, 765 A.2d 479, 482 (2000) (mem.). Accordingly, in assessing the validity
of a taxation scheme under the Proportional Contribution clause, we apply a rational-basis test.
Town of Castleton v. Parento, 2009 VT 65, ¶ 10, 186 Vt. 616, 988 A.2d 158 (mem.). To prevail
on their proportional-contribution claim, plaintiffs must show that the government “arbitrarily
treated similarly situated taxpayers differently.” Id. But “[i]f there is a rational basis for the
distinctions, serving a legitimate policy objective, there is no equal protection violation. In
applying this standard, we must look at any of the purposes that are conceivably behind the
statute.” Alexander v. Town of Barton, 152 Vt. 148, 157, 565 A.2d 1294, 1299 (1989) (quotation
omitted).
¶ 31. We conclude that the trial court properly granted summary judgment to the State
on plaintiffs’ proportional-contribution claim because they failed to demonstrate that plaintiff
Klein was treated differently than other similarly situated taxpayers. Plaintiffs proffered very little
evidence in support of their claim. They relied primarily on data showing that Whitingham had
one of the highest education property tax rates in the State in 2018 because of its high per-pupil
spending. However, the fact that a town has a high tax rate does not necessarily mean that a
particular resident pays more taxes, in dollar terms, than similarly situated residents in other towns.
The amount of education tax paid depends on the value of the property, the income level of the
owner, the local per-pupil spending amount, and other factors. Here, the evidence is that plaintiff
Klein paid approximately $2000 per year after credits on her housesite, and an additional $1000-
$2200 per year on the 39 acres surrounding her housesite, for a total education tax of approximately
$4000 per year. Without an analysis of property tax rates, education spending, property values,
and income levels in other towns, we are left to speculate about how Klein’s tax burden compared
to similarly situated individuals in those towns. And given the complexity of the education
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property taxation scheme, we conclude that it would not be reasonable for a jury to simply infer
from this evidence that plaintiff Klein is treated differently than others like her. See Bernasconi,
2019 VT 6, ¶ 11 (“[W]here the jury could only find for the plaintiff by relying on speculation, the
defendant is entitled to judgment.”); Mello, 168 Vt. at 641, 724 A.2d at 474 (“[T]o defend against
a summary judgment motion, a plaintiff cannot rely on conclusory allegations or mere
conjecture.”).
¶ 32. Furthermore, to the extent that plaintiff Klein’s claim is based on the fact that the
education property taxation scheme requires residents of high-spending school districts like Twin
Valley to pay an excess-spending penalty, which in turn drives up their education property tax rate,
we agree with the trial court that plaintiffs failed to show this classification is invalid. See
Schievella, 171 Vt. at 594, 765 A.2d at 483 (explaining that when challenging constitutionality of
tax statute, “plaintiffs’ burden is to show that every conceivable basis for the legislative
classification is invalid” (quotation omitted)). The Legislature may have properly concluded that
the excess-spending penalty was necessary to allow districts to continue to exercise local control
over their budgets, while at the same time equalizing inter-district spending by requiring high-
spending districts to contribute to districts that could not afford to spend as much. See Brigham I,
166 Vt. at 265, 692 A.2d at 396 (describing local control as “laudable goal” but requiring State to
ensure access to substantially similar per-pupil spending). The Legislature could also have
concluded that because the State now funds the entirety of school district budgets, an excess-
spending penalty was necessary to encourage districts to control their overall spending and avoid
depleting the Education Fund. See Holton v. Dep’t of Emp. & Training, 2005 VT 42, ¶ 30, 178
Vt. 147, 878 A.2d 1051 (holding that “ensur[ing] the financial integrity and liquidity of” state
unemployment compensation fund was legitimate governmental interest). These are legitimate
governmental interests that support the disparate treatment of residents in high-spending districts.
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For these reasons, we conclude that the court properly granted summary judgment to the State on
plaintiffs’ proportional-contribution claim.
C. The Town’s Claims
¶ 33. We turn to whether the court properly granted summary judgment to the State on
the Town of Whitingham’s claims. Plaintiffs alleged that the State’s unconstitutional property
taxation scheme harmed the Town by depriving it of revenue and forced the Town to collect an
illegal tax from its residents. The trial court concluded that the Town’s claims failed because
plaintiffs failed to establish as a threshold matter that the property education tax statutes were
unconstitutional, and the Town otherwise lacked capacity to sue the State. We agree.
¶ 34. Capacity is “defined as a party’s personal right to come into court and is usually
conceived of as a procedural issue dealing with the personal qualifications of a party to litigate.”
Town of Andover v. State, 170 Vt. 552, 553, 742 A.2d 756, 757 (1999) (mem.) (quotation omitted).
“[T]he traditional principle throughout the United States has been that municipalities and other
local governmental corporate entities and their officers lack capacity to mount constitutional
challenges to acts of the State and State legislation.” City of New York v. State, 655 N.E.2d 649,
651 (N.Y. 1995). This Court has recognized an exception to the general rule barring local
government challenges to state legislation “where municipalities assert that compliance with a
state statute will force them to violate the constitution.” Town of Andover, 170 Vt. at 553, 742
A.2d at 757. Plaintiffs argue that the Town falls within this exception because the State’s education
tax laws require it to collect an unconstitutional tax from its residents. According to plaintiffs, the
Town could be subject to liability for the allegedly unconstitutional education taxation system
because the law permits the Town to retain 0.225 of one percent of the total education tax it collects
if it timely remits payment to the State Treasurer. See 32 V.S.A. § 5402(c). Plaintiffs further
claim that the allegedly unconstitutional taxation system harms the Town by depriving it of
15
revenue because Whitingham taxpayers are unwilling to pay more for town services on top of their
existing education tax burden.
¶ 35. The trial court properly granted summary judgment to the State on the Town’s
claims. The Town’s claims are based on the premise that the education property taxation and
funding scheme is unconstitutional because it deprives Whitingham students of equal educational
opportunities and requires Whitingham taxpayers to pay a disproportionate amount of taxes. As
discussed above, plaintiffs failed to put forth evidence sufficient for a jury to find in their favor on
these constitutional challenges. Because plaintiffs did not establish their underlying claims that
the education property taxation scheme is unconstitutional, the Town’s derivative claims likewise
fail.
Affirmed.
FOR THE COURT:
Associate Justice
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