The Barre Unified Union School District started the 2026-27 school year as the only district in Vermont without a voter-approved budget, after voters rejected spending plans in March and May 2026. The district is operating under a state statute that allows borrowing up to 87 percent of its most recently approved budget, a bridge that carries monthly interest costs of up to $22,000 and has already forced cuts to summer school and open teaching positions.
Two rejections, three budgets
Voters turned down the first budget, worth about $57.8 million, on March 3, 2026, by a margin of 371 votes: 991 in favor and 1,362 against, according to the Times Argus. A second proposal of roughly $57.5 million failed on May 12 by a narrower 207-vote gap, with 1,229 supporting and 1,436 opposed, as WCAX reported. In that second vote, Barre City residents approved the budget by about 100 votes while Barre Town residents rejected it by roughly 300 votes.
The district board has since prepared a third proposal of $57.1 million, a 2.1 percent increase over the prior year. Each successive budget cut $350,000 in costs from the previous version, reducing the spending increase from 3.36 percent in March to 2.73 percent in May and finally to 2.11 percent in September, according to VTDigger. The third vote is scheduled for Sept. 15, 2026, after an informational meeting on Sept. 8 at Spaulding High School.
Divergent tax impacts drive split votes
The repeated deadlock is driven in part by a structural divide within the merged district, according to VTDigger. Barre City property owners face a 25 to 27 percent decrease in property tax rates under the proposed spending, while Barre Town property owners face tax increases tied to the town's share of school costs, VTDigger reported. That asymmetry has produced consistent voting patterns: city voters approve, town voters reject.
The same split occurred during the 2024-25 school year, when the district needed four budget votes before finally passing a plan in September 2024, narrowly avoiding the need to borrow under the 87 percent authority. In that cycle, Barre City voters supported the third attempt while Barre Town voters rejected it by a margin of 1,330 to 1,175, according to WCAX.
How the state's 87% bridge works
Under Vermont law (16 V.S.A. § 566), a school district that fails to pass a budget by June 30 may borrow funds to operate at up to 87 percent of its most recently approved budget. The Barre district is using a bank line of credit under this authority, incurring interest charges of up to $22,000 per month, according to VTDigger. The Vermont Agency of Education describes the mechanism as a short-term bridge, not a permanent solution, in its May 2024 guidance.
Districts without a budget also receive reduced state education payments. Under 16 V.S.A. § 4028, a district that has not adopted a budget 30 days before a scheduled payment date receives only one-quarter of the base education amount, rather than one-third of its education spending. The base education amount for fiscal year 2025 was $13,063 per equalized pupil. Tax bills for property owners are initially set at the lowest statewide rate and later trued up after a budget is passed, according to the Agency of Education.
Comparative: previous failed-budget cycles
Barre is not the first Vermont district to enter a fiscal year without a budget. In 2024, six districts — Alburgh, Barre, Barstow, Enosburgh-Richford, Missisquoi Valley, and Slate Valley — began the year without voter-approved spending plans, VTDigger reported. Some, like Slate Valley, had already cut summer programs and left coaching and department head positions vacant while awaiting a vote.
In 2020, during the COVID-19 state of emergency, 19 Vermont districts lacked approved budgets for fiscal year 2021. The Vermont General Assembly considered legislation to establish default budgets at either the prior year's education spending level or the most recently warned amount. Legislative testimony at the time documented concerns that a flat-funded default would force program cuts in districts with rising enrollment or new mandated costs such as statewide health insurance bargaining.
Research evidence on the 87% mechanism
The Vermont Agency of Education's guidance frames the 87 percent borrowing authority as a temporary measure, warning that prolonged operation without a full budget carries long-term consequences. An Agency of Education official, Nicole Lee, told WCAX in 2024 that operating without a budget can carry financial consequences beyond the current year, as districts may spend down savings accumulated over years to cover day-to-day operating costs. The Agency has not published a formal evaluation of outcomes across multiple districts operating under the 87 percent authority.
The state's school finance statute (16 V.S.A. chapter 133) defines education spending as the district budget minus offsetting revenues such as federal funds, endowments, grants, and special education funds. Per-pupil education spending is calculated by dividing that figure by weighted long-term membership. This statutory structure means the dollar amount voters approve differs from the total expenditure figure, a distinction that can contribute to public confusion during failed-budget cycles, according to the statute.