HB 340-FN – AS INTRODUCED
2011 SESSION
04/09
HOUSE BILL 340-FN
AN ACT promoting parental choice in education and providing for an abatement from the education taxes for parents of children not enrolled in the public school system.
SPONSORS: Rep. C. Vita, Straf 3; Rep. L. Christiansen, Hills 27; Rep. DeJong, Hills 9; Rep. L. Jones, Straf 1; Rep. L. Vita, Straf 3; Rep. Shuler, Rock 11; Rep. Cebrowski, Hills 18; Sen. Forsythe, Dist 4
COMMITTEE: Municipal and County Government
This bill requires the governing body of a municipality to grant an abatement from the education property tax for each resident taxpayer’s child who is not enrolled in a public elementary or secondary school. The bill also allows a municipality to elect to grant an additional abatement from the education property tax for each child not enrolled in a public elementary or secondary school.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
11-0070
04/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eleven
AN ACT promoting parental choice in education and providing for an abatement from the education taxes for parents of children not enrolled in the public school system.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Statement of Intent. The general court recognizes that parents who choose not to educate their children in the public school system provide an avoided cost to the school district in the municipality in which they reside. This avoided cost is the result of lower variable costs in consumables, and lower costs associated with teaching staff and school physical plant. Moreover, the removal of these pupils from the public schools results in greater per pupil resources available for the education of pupils remaining in the public schools.
2 New Section; Assessment and Abatement of Taxes; Abatement; Abatement for Each Child Not Enrolled in the Public School System. Amend RSA 76 by inserting after section 19-a the following new section:
76:19-b Abatement for Pupils Not Enrolled in the Public School System.
I. The governing body of the municipality, to the extent it determines that nonpublic school enrollment benefits the public welfare through avoided per pupil public school costs, shall grant an abatement to a resident taxpayer in an amount not to exceed $3,500 or the amount of the annual portion of the local education tax assessed in the municipality, whichever is less, against the education property tax imposed under RSA 76:3 for each resident taxpayer’s child who is not enrolled in a public elementary or secondary school. Nothing in this paragraph shall be construed to remove control of education curricula from the municipality.
II. A municipality may, by a majority vote of the legislative body, elect to grant an additional abatement from the education property tax imposed under RSA 76:3, in an amount to be determined by the municipality, to a resident taxpayer for each resident taxpayer’s child who is not enrolled in a public elementary or secondary school. Nothing in this paragraph shall be construed to remove control of education curricula from the municipality.
3 Effective Date. This act shall take effect July 1, 2011.
LBAO
11-0070
Revised 02/17/11
HB 340 FISCAL NOTE
AN ACT promoting parental choice in education and providing for an abatement from the education taxes for parents of children not enrolled in the public school system.
FISCAL IMPACT:
The Department of Education states this bill will decrease state education trust fund revenue by $89,674,060 in FY 2012, and $186,147,446 in FY 2013 and each year thereafter, decrease state education trust fund expenditures and local revenue by $50,548,941 in FY 2012, and $101,097,935 in FY 2013 and each year thereafter, and decrease local expenditures by $55,131,206 in FY 2012, and $86,294,623 in FY 2013 and each year thereafter. There will be no fiscal impact on county revenue or expenditures.
METHODOLOGY:
The Department of Education states this bill requires the governing body of a municipality to grant an abatement not to exceed $3,500 or the amount of the annual portion of the local education tax assessed in a municipality, from the education property tax for each resident taxpayer’s child who is not enrolled in a public elementary or secondary school. The bill also allows a municipality to grant an additional abatement from the education property tax for each child not enrolled in a public elementary or secondary school. The Department of Education states there are many unknowns that make the determination of the fiscal impact difficult to determine (such as the number of households who will apply for an abatement, but who would have sent their children to private school anyway). The Department assumes all households will request an abatement who are educating their children outside of the public school system; all households will be eligible for the abatement and that the abatement will not reduce the adequacy aid given to the school district (except as their ADM is reduced); towns will vote to increase the abatement amount to the average state aid per pupil; and funds given in an abatement, will not change the aid given to the school (unless there are less children in the school). So for example if an existing private school household applies for an abatement, then the town will still receive the same adequacy funding. Since they will have paid less property tax it means their aid will be larger in terms of the state grant, and less in terms of the proportion of aid that the town receives based upon their education property tax funds.
The Department assumes the average total non public school enrollment at approximately 16,070 students. In addition, the Department assumes approximately 5% of public school students (9,551.16 students) will enroll in non public schools in the first year after enactment of this bill, and 10% of public school students (19,102.33 students) will enroll in non public schools in the second year after enactment of this bill and each year thereafter. The Department estimates state education trust fund revenue from the education property tax will decrease by $89,674,060 [(16,070 non public school students X $3,500 abatement = $56,245,000) + (9,551.16 X $3,500 abatement = $33,429,060)] in FY 2012. The Department assumes towns will vote to increase the abatement amount to the average state aid per pupil of $5,292.44 in FY 2013 and each year thereafter. As a result, the Department estimates state education trust fund revenue will decrease by $186,147,446 [(16,070 non public school students X $5,292.44 abatement = $85,049,511) + (19,102.33 X $5,292.44 abatement = $101,097,935)] in FY 2013 and each year thereafter.
Based on the assumptions above, the Department states the total amount of state education aid to school districts will decrease by $5,292.44 per public school pupil who will now attend a non public school as a result of this bill. The Department estimates the decrease in state education trust fund expenditures and local revenue will total $50,548,941 (9,551.16 students X $5,292.44 per pupil) in FY 2012, and $101,097,935 (19,102.33 students X $5,292.44 per pupil) in FY 2013 and each year thereafter.
The Department states the total average tuition cost per public school students based on 2008-2009 school year date is approximately $11,746. The Department states the remaining tuition amount after state aid would total $8,246 ($11,746 - $3,500) in FY 2012, and $6,453.56 ($11,746 - $5,292.44) in FY 2013 and each year thereafter. Of this remaining amount, the Department assumes 70% would result in a decrease in local expenditures. Assuming a decrease in public school students of 9,551.16 in FY 2012, and 19,102.33 in FY 2013, local expenditures would decrease by approximately $55,131,206 (9551.16 X $5,772.20) in FY 2012, and $86,294,623 (19,102.33 X $4,517.49) in FY 2013 and each year thereafter. In summary, the Department estimates the fiscal impact of this bill as follows –
FY 2012 FY 2013 & Thereafter
State Education Trust Fund Revenue $(89,674,060) $(186,147,446)
State Education Trust Fund Expenditures
& Local Revenue (State Education Aid) $(50,548,941) $(101,097,935)
Local Expenditures $(55,131,206) $(86,294,623)
Although home school parents may also apply for the abatement, this was not included in the Department’s estimates. If these parents also receive abatements, then the cost of this program will increase.