Revision: May 7, 2010, midnight
SB 465-FN-LOCAL – AS AMENDED BY THE HOUSE
03/24/10 1131s
05May2010… 1636h
2010 SESSION
04/09
SENATE BILL 465-FN-LOCAL
AN ACT establishing a committee to study the sustainability of the existing state programs for funding K-12 education and relative to the carrying forward of a school district fund balance.
SPONSORS: Sen. Kelly, Dist 10; Sen. DeVries, Dist 18; Sen. Hassan, Dist 23; Sen. Fuller Clark, Dist 24
This bill:
I. Establishes a committee to study the sustainability of the existing state programs for funding K-12 education, including adequate education grants, fiscal capacity disparity aid, and catastrophic aid.
II. Allows a school district which estimates that it will receive less in total state aid for an adequate education plus fiscal capacity disparity aid in the 2012 fiscal year than it received in the 2011 fiscal year to carry forward any unreserved fund balance from the 2010 and 2011 fiscal years for use in the 2012 fiscal year.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/24/10 1131s
05May2010… 1636h
10-2809
04/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Ten
AN ACT establishing a committee to study the sustainability of the existing state programs for funding K-12 education and relative to the carrying forward of a school district fund balance.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Committee Established. There is established a committee to study the sustainability of the existing state programs for funding K-12 education, including adequate education grants, fiscal capacity disparity aid, and catastrophic aid.
2 Membership and Compensation.
I. The members of the committee shall be as follows:
(a) Three members of the senate, at least one of whom shall be a member of the education committee, and at least one of whom shall be a member of the finance committee, appointed by the president of the senate.
(b) Four members of the house of representatives, at least one of whom shall be a member of the education committee, and at least one of whom shall be a member of the finance committee, appointed by the speaker of the house of representatives.
II. Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.
3 Duties. The committee shall study the sustainability of the existing state programs for funding K-12 education, including adequate education grants, fiscal capacity disparity aid, and catastrophic aid.
4 Chairperson; Quorum. The members of the study committee shall elect a chairperson from among the members. The first meeting of the committee shall be called by the first-named senate member. The first meeting of the committee shall be held within 45 days of the effective date of this section. Four members of the committee shall constitute a quorum.
5 Report. The committee shall report its findings and any recommendations for proposed legislation to the president of the senate, the speaker of the house of representatives, the senate clerk, the house clerk, the governor, and the state library on or before December 1, 2010.
6 School District Fund Balance. If, based on the reasonable belief of the school board after consultation with the commissioner of the department of education, a school district’s estimated total state aid for an adequate education pursuant to RSA 198:40-a plus fiscal capacity disparity aid pursuant to RSA 198:40-c in the 2012 fiscal year will be less than its total state aid for an adequate education pursuant to RSA 198:40-a plus fiscal capacity disparity aid pursuant to RSA 198:40-c in the 2011 fiscal year, then notwithstanding RSA 32, the school district’s governing body may vote to carry forward any school district unreserved fund balance from the 2010 and 2011 fiscal years for such school district to use as a revenue source to reduce the tax rate in the 2012 fiscal year. A school district that intends to carry forward a fund balance shall report this to the departments of education and revenue administration on financial reports pursuant to RSA 198:4-d and RSA 21-J:34, V.
7 Repeal. Section 6 of this act, relative to school district fund balances, is repealed.
8 Effective Date.
I. Section 7 of this act shall take effect July 1, 2011.
II. The remainder of this act shall take effect upon its passage.
LBAO
10-2809
Amended 05/07/10
SB 465 FISCAL NOTE
AN ACT relative to the transition period for implementing the adequacy aid formula.
FISCAL IMPACT:
The Department of Education states this bill, as amended by the Senate (Amendment #2010-1131s), will decrease state education trust fund expenditures and local revenue by $69,242,978 in FY 2012. There will be no fiscal impact on county and local expenditures or state and county revenue.
METHODOLOGY:
The Department of Education made the following assumptions when calculating the FY 2012 / FY 2013 cost of an opportunity for an adequate education (RSA 198:40-a), fiscal capacity disparity aid (RSA 198:40-c), and municipal grants and excess statewide education property taxes (RSA 198:41 and RSA 198:46):
• Average daily membership (ADM) is calculated based on 2008-2009 school year (FY 2009) end-of-year data provided by each school district. Data are preliminary but provide the best estimate of anticipated finalized data for FY 2009.
• Special education (SPED) status is determined based upon FY 2009 end-of-year and special education submissions to the Initiative for School Empowerment and Excellence (i4see) data system.
• English language learner (ELL) status is determined based upon the fall 2008 data collection. All students receiving services are included.
• Free or reduced-price meal (F&R) eligibility status is determined based upon the fall 2008 data collection. All students receiving free milk, reduced meals, or free meals and in a school on October 1 are included.
• ADM for SPED, ELL, and F&R include all ADM for students identified in any of these categories as students move from school to school.
• FY 2009 school F&R concentrations are based upon student ADM for F&R students, excluding kindergarten students.
• To calculate fiscal capacity disparity aid, the Department utilized 4/1/2008 equalized valuation including utilities as provided by the NH Department of Revenue Administration.
• To calculate fiscal capacity disparity aid, the Department assumed the 1999 median family income data published by the US Census Bureau will still be the most current town-level data as of November 2010, when the FY 2012 / FY 2013 calculation must be published, although the data may be updated by then.
• To calculate municipal grants and excess statewide education property taxes, the Department assumed the statewide education property tax warrant in FY 2012 will be identical to the FY 2011 warrant. The 4/1/09 equalized valuation not including utilities, which will be used to calculate the FY 2012 warrant, are not available at this time. The 4/1/08 equalized valuation not including utilities is the most currently available at this time, and is therefore used to estimate the FY 2012 warrant. The statewide education property tax is estimated to raise a total of $363,594,112 in FY 2012.
• The consumer price index (CPI) adjustment required by RSA 198:40-d will be 2.7% for the FY 2012 / FY 2013 biennium. The adjustment is a three-year average (2007-2009) of the annual change in the Northeast Urban Services Less Medical Care Services CPI. Annual changes were 2.9% for 2007, 3.3% for 2008, and is estimated to be 2.0% for 2009, resulting in an average of 2.7%.
The Department calculated the following changes to the per pupil amounts contained in RSA 198:40-a based on the assumed 2.7% adjustment pursuant to RSA 198:40-d:
FY 2010/FY2011 FY 2012/FY2013
per pupil cost of providing
the opportunity for an
adequate education $3,450 $3,543
per eligible pupil, F&R
school concentration
< 12% $431 $443
per pupil, F&R
school concentration
>= 12%, < 24% $863 $886
per pupil, F&R
school concentration
>= 24%, < 36% $1,725 $1,772
per pupil, F&R
school concentration
>= 36%, < 48% $2,588 $2,658
per pupil, F&R
school concentration
>= 48% $3,450 $3,543
per pupil, ELL $675 $693
per pupil, SPED $1,856 $1,906
The Department estimates the cost of an opportunity for an adequate education will be $942,111,427 for the FY 2012 / FY 2013 biennium, and further estimates fiscal capacity disparity aid will be $68,397,385 for the FY 2012 / FY 2013 biennium, for total education aid of $1,010,508,812 in both FY 2012 and FY 2013 under current law. This bill provides that for FY 2012, no municipality shall receive a total education grant that exceeds the FY 2009 education grant by 15%, and no municipality shall receive less total state aid than it received in FY 2009. This bill also provides that municipalities may retain all statewide education property taxes under certain circumstances in FY 2012, and the Department assumes all municipalities will retain all statewide education property taxes under this bill. The Department calculated state education grants and retained statewide education property taxes under both current law and this bill to determine the change in state expenditures and local revenue that would occur under this bill in FY 2012:
Estimated State Expenditures / Local Revenue – Current Law
State Property Tax
Retained by Town $347,863,092
Education Grant $662,645,720
Total $1,010,508,812
Estimated State Expenditures / Local Revenue – This Bill
State Property Tax
Retained by Town $363,594,112
Education Grant $577,671,722
Total $941,265,834
Change ($69,242,978)