East Haven: School Choice Leads to Real Estate Boom, Growing Pains

The building formerly housed the East Haven River School, which voters decided to close in 2011 after enrollment declines reduced the number of pupils to fewer than a dozen.

Since the school closed, and East Haven became a school choice town, the town of about 300 between East Burke and Island Pond on VT Route 114, has seen families locate there.

That means kids, and tuition bills, from neighboring schools.

"You got hammered," said Hankinson, of the 14 extra tuitions the town needs to pay.

Where there once were no residents attending school board meetings, at last week's meeting there were not enough chairs.

"We've gone from no participation to a lot," said Donna Loynd, school board chair.

Loynd said, "People are moving in, and they're moving in because we have school choice."

Nine new kids moved into town, two students who were formerly home-schooled are now enrolled in schools; there is one new pre-kindergarten child; and two new kindergarten students.

Fortunately, East Haven had long benefitted from the state's 'hold harmless' formula designed to cushion the blow for schools losing students. And they received additional funding for students who were no longer there - hence the formula's nickname of "phantom students."

As a result of that formula, East Haven School District has a tax stabilization fund where it has saved money over time.

The deficit of $159,953 can be covered with some $211,244 remaining in the tax stabilization account.

To pass the school budget this year, the board used $100,000 from the fund to help keep the tax increase lower.

Loynd said the turnaround of the number of pupils in East Haven, and the fact young families are coming back and investing in homes - many built during mid-20th-century development for the military base - is a double-edged sword.

"The development had been pretty depressed with foreclosures and in disarray," Loynd said. "If the people moving in make improvements (a number already have), the property values go up, the tax rates go up."

School Choice Driving Growth

The growth in the number of students residing in East Haven began about a year after the vote to close the school, on Sept. 20, 2011. During that vote, 64 voted to close the school, and 35 voted against the closure.

In Fiscal Year 2012, East Haven had 30 students, which inched to 34 in FY13; 38 in FY14; and 45 in FY15; according to the information distributed at this week's meeting.

"It took about a year, and it started going up," said Loynd of the growth trend. "It started snowballing."

There are 27 houses in the development which consist of a few streets in a fairly compact arrangement just in from VT Route 114.

The radar station was built as a warning station to alert of an attack by the Soviet Union in the Cold War era, and closed more than a half century ago.

The base opened in 1956, and was in operation for less than seven years.

Values on the old radar base homes in some cases were pretty low. Some were is disrepair and some had been taken back by banks when people couldn't make mortgages, said Higgins.

This year so far, there have been 19 home sales in town, with half of October and the full months of November and December still to come. Last year, there were 16, and the year before, 13, so the home sale trend is mirroring the student enrollment growth.

"It's good and bad," said Loynd of the growth. "Ultimately, it's good, but we'll be in the grave by the time anything comes together," she said of the investments in the homes driving property values up. "Everything is in transition."

The town has many people on fixed incomes, and Loynd.

She knows of two of those people who are worried about taxes going up and are thinking of selling their homes.

"They're having a hard time," said Loynd.

Loynd said, "It's good for some people and it sucks for others."

One house that needed a lot of TLC, for example, sold for $28,000, said Higgins, flipping through recent sales.

That home has been fixed up a lot, and its value will increase substantially, the town clerk predicts.

Town lister Jim Wiggins observed, "The problem for East Haven is Montpelier." He said if the state would allow school choice completely, towns like East Haven wouldn't see the painful bubble of growth that is taking place.

"It should be school choice all over the state," said Wiggins, saying the teachers' union has too much power, "Nobody over there has any intestinal fortitude."

Homes Selling

Former school board member and town resident Kelly Deth, who owns StoneCrest Properties, was on the school board when the school closed.

"From a real estate perspective, I believe it has made houses easier to sell in East Haven," said Deth. "I don't believe the school choice option has increased property values significantly as of yet, but they are taking less time to sell than in the past."

As a former school board member, she knows those new kids in town have a cost.

"The budget has suffered recently due to the number of families that have moved in," said Deth. "I do believe it will level out simply due to the limited number of homes available. I am hopeful that property values will increase due to the demand as well."

Deth said, "In my opinion, for so long East Haven was not viewed as a desired town, in part due to geographical location and in part due to the internal town turmoil. With the school choice option and Burke (ski resort) developing as it has, things are looking very different for our small town."

New Life, Hope

"It is great to see the neighborhood fill up with children and give new life to an aging town population," said Deth. "Ultimately, it would be nice to see some businesses come in and help with the tax base and I do think that will happen over time. In the meantime, I think it's a privilege to live in a small town with school choice so close to such incredible outdoor activities like mountain biking, swimming, hiking, skiing and snowmobiling."

One of the things that's sprouted in the old school space is a new town library, run by volunteers.

The library is planning a parade on Halloween Day and the parade route will go right through the development.

Jodi Wheeler and her family are new homeowners in East Haven; she moved from Lyndon Center, and bought a fixer-upper this year in the development that is seeing new life. Her children attend Thaddeus Stevens School, a private school in Lyndon Center on the campus of Lyndon Institute.

"It really is quite nice living there with all the kids playing outside and people walking around with their dogs in the evening," Wheeler said. "Kind of like living in a Norman Rockwell painting."