Douglas didn't outline a new system during his Inaugural Address - instead he proposed a statewide collaboration to consider new ideas to fund Vermont schools.

VPR's Bob Kinzel reports:

(Kinzel)Douglas devoted the majority of his 4th Inaugural Address to education financing because he says it represents more than 25% of all General Fund spending in Vermont.

The Governor says over the past five years, overall spending on education has increased by roughly 23% while the number of students across the state has decreased by just over 4%.

He argues that the current system isn't sustainable and that all areas of state government, including education, must share some of the burden to help balance the state budget in a difficult year:

(Douglas)"The Education Fund has not shared any of the sacrifice seen by other areas of state government. If we continue to excuse education spending from equal treatment, we force health care and human services, the lion's share of the remaining general fund to shoulder the burden of balancing a responsible budget. That is not a realistic or compassionate option."

Douglas blamed the current funding system for most of the state's education financing problems. He says the law is virtually impossible to understand and he says it's failed to control local spending:

(Douglas) "Our current education funding system is failing taxpayers and local voters. For over a decade Vermonters in every corner of the state have borne the heavy burden of rising property taxes under Act 60... Act 60 and Act 68 are fundamentally broken and beyond repair. Piecemeal changes cannot mend a system that is so far out of balance. Only a wholesale transformation will return control to communities and put education funding on a sustainable course for the future."

Douglas didn't propose a specific alternative to replace Act 68, instead he called for a statewide collaboration to draft a new approach.

In the meantime, he wants to freeze state spending on education for a year:

(Douglas) "In order to create a funding bridge until a new system is established, I propose a common sense measure to freeze per pupil spending for schools and categorical grants at current levels. When we consider what government businesses and families are facing, level funding is a fair approach. Further we will strengthen local control by holding school districts directly responsible fir tax increases. "

Douglas also says the current system of linking a homeowner's property tax burden to their income is too generous.

He wants to reduce the top income cap for this program from $90,000 to $75,000.

For VPR News I'm Bob Kinzel in Montpelier.