NH Senate: School Funding Bill Provides Stability (NH)

February 10, 2011

New Hampshire Senate members said Wednesday they’ve crafted a public school funding bill that provides stability to state and school district budgets and treats all students equally.

The plan designed by Republican Sens. Jim Rausch of Derry and Nancy Stiles of Hampton establishes the current funding levels as the baseline and allows those levels to increase or decrease based on student enrollment.

It allows some property-rich towns to keep the state education taxes they raise instead of sending some of the money to the state, to be redistributed to poorer towns. These wealthier towns, commonly called "donor towns," have complained for years that they were overtaxed.

It also provides communities a set amount of money each year.

Senators say the bill would maintain the state’s current investment in education and guarantee a level of funding in the coming budget. They say compared to the current school funding law, their proposal will save $140 million in the next fiscal year.

"This legislation will provide the stability our local communities require and it stops the perpetuation of battles between winning and losing communities," Rausch said. "But most importantly, it ties our education dollars directly to the children they are meant to support."

Stiles said the communities would get a set amount for each poor child by counting the number of children who need free and reduced lunches. That amount would be $1,725 per child.

The proposal also would establish a new aid category linked to third-grade students testing below proficient on the reading component of state assessment tests, and who don’t qualify for other aid categories. Stiles said studies have shown third-grade reading proficiency is a critical marker for educational development.

State Sen. Jeb Bradley, R-Wolfeboro, said under the current law, about 125 towns would be losing money. He said the proposed formula makes sure "that everybody stays in the same place."

"We believe that it’s constitutional, we believe it’s equitable and we believe that at a time the state is facing such a humongous budget deficit, that we are keeping our commitment to property taxpayers," Bradley said.

In a letter to Stiles and Rausch, Gov. John Lynch said he believes their proposal moves the state in the right direction, helping to meet the goals of ensuring sustained aid, avoiding dramatic decreases to state aid for some communities, and averting the return of donor towns.

"I look forward to continuing to work with you to refine and pass this legislation," he said.

Republican House Speaker William O’Brien said the Senate’s plan was worth considering but the House plan more aggressively targets aid to the neediest communities.

O’Brien said all the Legislature’s efforts to better distribute state aid will fall apart ultimately if the constitution isn’t amended so it nullifies a landmark court decision that requires New Hampshire to provide an adequate education for all public schoolchildren. A hearing on the House proposal is scheduled Friday.

The state has struggled over the school funding issue for years. In 1991, Claremont and four other property-poor towns sued over the state’s reliance on local property taxes to pay for schools. A series of state Supreme Court decisions held that the state has a duty to provide an adequate education that is adequately funded.

Rausch said he’s been in the Legislature long enough to know he wanted to reform the school funding formula without opening past funding debates. "I wante d to solve a problem — not fight old battles," he said.