This report represents the State Board of Education's recommended FY 2007 budget as adopted by the Board on January 17, 2006. This budget supports the important work of Vermont's education system as the state invests in its future to help all Vermont students to achieve success. The FY 2007 budget proposal increases General Fund amounts by 6.15 percent (about $800,000). However, this is primarily from funding shifts and increased charges from other state departments and not due to department program increases. The largest increase results from a $525,000 shift from Transportation Funds to the General Fund for the driver education program as part of an effort to limit the use of Transportation Funds. The driver education program is level-funded and only the funding source changed. An increase of $50,000 was made by the Administration, requesting that the department add a part-time consultant to work with technical education activity clubs around the state. Increased charges from the Department of Innovation and Information account for another $156,000, and finally another $115,000 cover salary and benefit changes for department staff. The Education Fund budget increases $65 million (5.8 percent). This is primarily due to a projected $52 million (5.4 percent) increase in school district education spending, a $9 million increase (7.9 percent) in the special education aid formula, and $2 million increase (15.3 percent) in state-placed student funding. The increase in Essential Early Education funding of $500,000 (10.5 percent) is due to a correction in the way the department calculates the increase required by statute. This report is divided into the following sections: (1) Organizational Chart; (2) Vermont Education Overview; (3) Budget Recommendations & Summaries; and (4) Stand-Alone Appropriations.