HB 1473-FN-LOCAL – AS INTRODUCED
2012 SESSION
04/10
HOUSE BILL 1473-FN-LOCAL
AN ACT relative to the calculation and distribution of adequate education grants.
COMMITTEE: Special Committee on Education Funding Reform
This bill:
I. Determines the per pupil cost of the opportunity for an adequate education which includes aid distributed to schools based on the number of pupils eligible to receive special education, or eligible for a free or reduced-price lunch, or who are English language learners.
II. Provides fiscal capacity disparity aid, in addition to aid for the cost of the opportunity for an adequate education, based on a municipality’s equalized valuation, including utilities, per pupil and median family income.
III. Provides that for the biennium ending June 30, 2013, no municipality shall receive an adequate education grant in a fiscal year which is greater than the adequate education grant received in the 2011 fiscal year.
IV. Requires a municipality which is scheduled to receive an adequate education grant in a fiscal year which is less than the grant such municipality received in the 2012 fiscal year to receive an additional grant from the education trust fund.
V. Limits a municipality’s total education grant beginning July 1, 2013.
VI. Provides additional funds for certain third grade pupils who test at the proficient level or above in the reading component of the state assessment.
VII. Repeals the statutory provisions requiring that excess education tax payments be remitted to the department of revenue administration thereby permitting municipalities to retain any excess education tax revenues.
VIII. Establishes a joint legislative oversight committee on accountability for an adequate education.
IX. Amends the amount of funding provided to chartered public 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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
12-2416
04/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twelve
AN ACT relative to the calculation and distribution of adequate education grants.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Adequate Education; Definitions. RSA 198:38 is repealed and reenacted to read as follows:
198:38 Definitions. In this section:
I. “Average daily membership in attendance” or “ADMA” means the average daily membership in attendance of pupils in kindergarten through grade 12, as defined in RSA 189:1-d, III of the second school year preceding the year in which the calculation is made, provided that no kindergarten pupil shall count as more than 1/2 day attendance per calendar year.
II. “Average daily membership in residence” or “ADMR” means the average daily membership in residence of pupils in kindergarten through grade 12, as defined in RSA 189:1-d, IV of the second school year preceding the year in which the calculation is made, provided that no kindergarten pupil shall count as more than 1/2 day attendance per calendar year.
III. “Commissioner” means the commissioner of the department of education.
IV. “Department” means the department of education.
V. “Determination year” means the fiscal year that was 3 years prior to the fiscal year for which aid is to be determined. Unless otherwise indicated, determination year data shall be used to calculate aid.
VI. “Educationally disabled child” or “educationally disabled pupil” shall mean “educationally disabled child” as defined in RSA 186-C:2, I.
VII. “English language learner” means a child who has a predominant language other than English or who is educationally disadvantaged by a limited English proficiency, and who is receiving regularly scheduled English language instruction.
VIII. “Pupils eligible for a free or reduced-price meal” means pupils in kindergarten through grade 12 who are eligible for the federal free or reduced-price meal program.
IX. “School district” means school district as defined in RSA 194:1 and shall include cooperative school districts as defined in RSA 195:1, I.
2 Adequate Education; Base Cost Per Pupil. RSA 198:40-a is repealed and reenacted to read as follows:
198:40-a Adequate Education; Base Cost Per Pupil.
I. For the biennium beginning July 1, 2011 only, the commissioner shall determine the base cost per pupil of the opportunity for an adequate education in each school district using the most recent statewide salary data available, divided into quartiles, as follows:
(a)(1) The average of the 3rd and 4th quartiles of salary for a teacher possessing at least a bachelor’s degree with one year of experience, multiplied by 1.33, then multiply the product by 1.05.
(2) For a teacher teaching art, music, world languages, media/technology, health, or physical education, multiply the amount determined under subparagraph (a)(1) by .20.
(b) The average of the 3rd and 4th quartiles of salary for a principal possessing at least a master’s degree and 3 years of educator experience, and one year of experience as a principal, multiplied by 1.33, then multiply the product by 1.05.
(c) The average of the 3rd and 4th quartiles of salary for a guidance counselor possessing at least a master’s degree with one year of experience, multiplied by 1.33, then multiply the product by 1.05.
(d) The average of the 3rd and 4th quartiles of salary for a library/media specialist possessing at least a bachelor’s degree with one year of experience, multiplied by 1.33, then multiply the product by 1.05.
(e) The average of the 3rd and 4th quartiles of salary for a technology coordinator possessing at least a bachelor’s degree with one year of experience, multiplied by 1.33, then multiply the product by 1.05.
(f) The average of the 3rd and 4th quartiles of salary for a reading specialist possessing at least a master’s degree at step 2 of the teacher salary schedule for that position, multiplied by 1.33, then multiply the product by 1.05.
(g) The average of the 3rd and 4th quartiles of salary for an administrative assistant, multiplied by 1.33, then multiply the product by 1.05.
(h) The average of the 3rd and 4th quartiles of salary for a custodian, multiplied by 1.33, then multiply the product by 1.05.
II. For the biennium beginning July 1, 2011 only, the commissioner shall calculate the base cost per pupil of the opportunity for an adequate education in each school district as the sum of the following:
(a)(1) For teachers of pupils in kindergarten through grade 2, divide the ADMR of pupils in the municipality in kindergarten through grade 2 by 25, then multiply the result by the salary for teachers determined in subparagraph I(a)(1).
(2) For teachers of pupils in grades 3 through 12, divide the ADMR of pupils in the municipality in grades 3 through 12 by 30, then multiply the result by the salary for teachers determined in subparagraph I(a)(1).
(3) For a teacher teaching art, music, world languages, media/technology, health, or physical education to pupils in kindergarten through grade 2, divide the ADMR of pupils in the municipality in kindergarten through grade 2 by 25, then multiply the result by the amount determined in subparagraph I(a)(2).
(4) For a teacher teaching art, music, world languages, media/technology, health, or physical education to pupils in grades 3 through 12, divide the ADMR of pupils in the municipality in grades 3 through 12 by 30, then multiply the result by the amount determined in subparagraph I(a)(2).
(b) For principals, divide the ADMR of pupils in the municipality in kindergarten through grade 12 by 500, then multiply the result by the salary for principals determined in subparagraph I(b).
(c)(1) For guidance counselors for pupils in kindergarten through grade 8, divide the ADMR of pupils in the municipality in kindergarten through grade 8 by 500, then multiply the result by the salary for guidance counselors determined in subparagraph I(c).
(2) For guidance counselors for pupils in grades 9 through 12, divide the ADMR of pupils in the municipality in grades 9 through 12 by 300, then multiply the result by the salary for guidance counselors determined in subparagraph I(c).
(d) For library/media specialists, divide the ADMR of pupils in the municipality in kindergarten through grade 12 by 500, then multiply the result by the salary for library/media specialists determined in subparagraph I(d).
(e) For technology coordinators, divide the ADMR of pupils in the municipality in kindergarten through grade 12 by 1,200, then multiply the result by the salary for technology coordinators determined in subparagraph I(e).
(f) For reading specialists, divide the ADMR of pupils in the municipality in kindergarten through grade 8 by 500, then multiply the result by the salary for reading specialists determined in subparagraph I(f).
(g) For administrative assistants, divide the ADMR of pupils in the municipality in kindergarten through grade 12 by 500, then multiply this amount by the salary for administrative assistants determined in subparagraph I(g).
(h) For custodians, divide the ADMR of pupils in the municipality in kindergarten through grade 12 by 500, then multiply this amount by the salary for custodians determined in subparagraph I(h).
(i) For instructional materials, multiply the ADMR of pupils in the municipality in kindergarten through grade 12 by $130.
(j)(1) For technology costs for pupils in kindergarten through grade 8, multiply the ADMR of pupils in the municipality in kindergarten through grade 8 by $25.
(2) For technology costs for pupils in grades 9 through 12, multiply the ADMR of pupils in the municipality in grades 9 through 12 by $65.
(k) For transportation costs, multiply the ADMR of pupils in the municipality in kindergarten through grade 8 by $304.
III. In addition to the base cost calculated under paragraphs I and II:
(a) An additional $1,770 for each pupil who is in kindergarten through grade 12, who is eligible for the federal free and reduced-price meal program, and who attends a public school in which at least 12 percent of pupils reported in the school’s ADMR in the determination year are eligible for the federal free and reduced-price meal program.
(b) An additional $690 for each pupil reported in the public school's ADMR in the determination year who is an English language learner and who is receiving English language instruction.
(c) An additional $1,904 for each pupil reported in the public school's ADMR in the determination year who is receiving special education.
(d) To encourage early literacy and provide accountability to local school districts, for each third grade pupil in the public school’s ADMA in the determination year who is not eligible to receive special education, English language learners, or federal free or reduced-price meal program funds in the determination year, a school district shall receive an additional $300 for each such pupil who has tested at the proficient level or above in the reading component of the state assessment.
IV.(a) The sum total calculated under paragraphs I-III of this section shall be the cost of the opportunity for an adequate education in each year of the biennium ending June 30, 2013.
(b) Prior to or coinciding with the first disbursement of each fiscal year under RSA 198:42, the department shall notify a school district of the total amount of funds that have been allocated for each school within its jurisdiction during the fiscal year based on the sum of the school district’s adequate education grant amount plus the amount available to the school district from the education tax. In addition, the department shall furnish to each municipality a report showing the municipality’s cost of an adequate education sorted by a pupil’s municipality of residence.
V. The department shall notify school districts of the estimated amounts of grants by the November 15 preceding the fiscal year for which aid is determined. The commissioner shall provide to the general court all data or reports requested by the general court in a form which the general court determines will facilitate the calculations required in this section.
3 Adequate Education; Provisions for Grants to Municipalities. RSA 198:40-b is repealed and reenacted to read as follows:
198:40-b Provisions for Grants to Municipalities.
I. For the biennium ending June 30, 2013, no municipality shall receive a total education grant in a fiscal year which is greater than the total education grant received in the fiscal year ending June 30, 2011.
II. Each fiscal year, the commissioner of the department of education shall determine if a municipality is scheduled to receive a total education grant which is less than the total education grant received in the fiscal year ending June 30, 2012, and shall disburse to such municipality an additional grant from the education trust fund in an amount equal to 100 percent of the amount of the decrease.
III. Beginning July 1, 2013, and each fiscal year thereafter, the department of education shall not distribute a total education grant on behalf of all pupils who reside in a municipality that exceeds 105.5 percent of the total education grant distributed to such municipality in the previous fiscal year.
4 Adequate Education; Provisions for Grants to Municipalities; Version Effective July 1, 2013. RSA 198:40-b is repealed and reenacted to read as follows:
198:40-b Provisions for Grants to Municipalities. Each fiscal year, the commissioner of the department of education shall determine if a municipality is scheduled to receive a total education grant which is less than the total education grant received in the fiscal year ending June 30, 2012, and shall disburse to such municipality an additional grant from the education trust fund in an amount equal to 100 percent of the amount of the decrease.
5 New Section; Adequate Education; Fiscal Capacity Disparity Aid. Amend RSA 198 by inserting after section 40-d the following new section:
198:40-e Fiscal Capacity Disparity Aid.
I. In addition to aid for the cost of the opportunity for an adequate education provided under RSA 198:40-a, each fiscal year the department shall provide fiscal capacity disparity aid to a municipality’s school districts as follows:
(a) The department of revenue administration shall calculate the equalized valuation per pupil for each municipality in the state and shall sort the results into quartiles based on equalized valuation per pupil. The quartile containing municipalities with the lowest equalized valuation per pupil shall then be divided in half.
(b) A municipality with an equalized valuation per pupil in the lower half of the lowest quartile and which has a median family income which is less than the state average median family income shall receive fiscal capacity disparity aid in the amount of $3,360 multiplied by the municipality’s average daily membership in residence.
(c) A municipality with an equalized valuation per pupil in the upper half of the lowest quartile which has a median family income which is less than the state average median family income shall receive fiscal capacity disparity aid in the amount of $2,100 multiplied by the municipality’s average daily membership in residence.
II. Aid under this section shall be distributed pursuant to RSA 198:42.
III. In this section:
(a) “Equalized valuation per pupil” means a municipality’s equalized valuation, including properties subject to taxation under RSA 82 and RSA 83-F, as determined by the department of revenue administration, that was the basis for the local tax assessment in the determination year, divided by the school district’s average daily membership in residence, as defined in RSA 189:1-d for the determination year, provided that no kindergarten pupil shall count as more than ½ day attendance per calendar day.
(b) “Median family income” means the most recent census data published for New Hampshire counties and municipalities by the United States Census Bureau, United States Department of Commerce, as of October 1 preceding the beginning of the biennium for which aid is to be determined.
6 Adequate Education; Determination of Grants; Excess Tax. RSA 198:41 is repealed and reenacted to read as follows:
198:41 Determination of Education Grants.
I. Except for municipalities where all school districts therein provide education to all of their pupils by paying tuition to other institutions, the department of education shall determine the amount of the total education grant for the municipality as follows:
(a) Add the per pupil cost of providing the opportunity for an adequate education for which each pupil is eligible pursuant to RSA 198:40-a, I-III, and from such amount;
(b) Subtract the amount of the education tax warrant to be issued by the commissioner of revenue administration for such municipality reported pursuant to RSA 76:9 for the next tax year, and from such amount; and
(c) Add the fiscal capacity disparity aid pursuant to RSA 198:40-e.
II. For municipalities where all school districts therein provide education to all of their pupils by paying tuition to other institutions, the department of education shall determine the amount of the total education grant for each municipality as the lesser of the 2 following calculations:
(a) The amount calculated in accordance with paragraph I of this section; or
(b) The total amount paid for items of current education expense as determined by the department of education minus the amount of the education tax warrant to be issued by the commissioner of revenue administration for such municipality reported pursuant to RSA 76:9 for the next tax year.
7 Joint Legislative Oversight Committee on Accountability for an Adequate Education.
I.(a) There is hereby established the joint legislative oversight committee on accountability for an adequate education. The members of the committee shall be as follows:
(1) Three members of the house of representatives, which shall include 2 members of the house education committee and one member of the house finance committee, appointed by the speaker of the house of representatives.
(2) Three members of the senate, which shall include 2 members of the senate education committee and one member of the senate finance committee, appointed by the president of the senate.
(b) Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.
II. The committee shall review and study the assessment and assistance methods, reporting requirements, and other methods of accountability presently being used by the department of education and local school districts to determine whether such methods, programs, and standards will ensure the delivery of an adequate education as set forth in RSA 193-E:2-a.
III. Following a public hearing, the committee shall report its findings and recommendations concerning the sufficiency of existing statutory law to provide accountability for the delivery of the opportunity for an adequate education as defined in RSA 193-E:2-a, and the possible need for additional legislation, to the governor, the speaker of the house of representatives, the president of the senate, and the state librarian no later than November 15, 2011.
8 Chartered Public Schools; Funding. Amend RSA 194-B:11, I(b) to read as follows:
(b) For any chartered public school authorized by the state board of education pursuant to RSA 194-B:3-a, the state shall pay [tuition] the greater of $5,450 or the sum of $2,000 plus the amount calculated pursuant to RSA 198:40-a [plus an additional grant of $2,000] and RSA 198:40-e directly to the chartered public school for each pupil who is a resident of this state in attendance at such chartered public school.
9 Cooperative School Districts; State Aid. Amend RSA 195:15 to read as follows:
195:15 State Aid. The state aid to which a cooperative elementary and/or secondary district shall be entitled shall be the total of those shares of the aid to which the pupils attending the cooperative district would have entitled the pre-existing districts, had they remained in the pre-existing districts. For the purposes of crediting the cooperative district’s adequate education cost to the pre-existing districts, each such pre-existing district shall have its adequate education cost under RSA [198:38, VII] RSA 198:40-a credited against its share of the cooperative school district budget. However, cooperative school districts formed by 2 or more pre-existing districts whose boundaries approximate those of a single township in which they are located shall be treated as a single school district for the purposes of this section.
10 References Amended. Amend the following RSA sections by replacing “statewide education property tax” or “education property tax” or “education property taxes” with “education tax” or “education taxes,” as the context dictates: RSA 76:8, I; the introductory paragraph in RSA 198:57, IV, and RSA 198:57, VI(a).
11 Severability. If any provision in sections 1-9 of this act or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of such sections which can be given effect without the invalid provision or application, and to this end the provisions of such sections are declared to be severable.
12 Effective Date.
I. Section 4 of this act shall take effect July 1, 2013.
II. The remainder of this act shall take effect July 1, 2012 at 12:01 a.m.
LBAO
12-2416
Revised 01/31/12
HB 1473 FISCAL NOTE
AN ACT relative to the calculation and distribution of adequate education grants.
FISCAL IMPACT:
The Department of Education states this bill may increase state expenditures and local revenue by an indeterminable amount in FY 2014 and each year thereafter. This bill would have no fiscal impact on state and county revenue, or county and local expenditures.
METHODOLOGY:
The Department of Education states this bill makes changes to the calculation and distribution of adequate education grants. The Department does not collect average salaries for the following positions: principal, library media/specialist, technology coordinator, custodian and administrative assistant as described in this bill. For the purposes of the fiscal note, the Department assumes the salary for library media/specialist and technology coordinator at a step 1 teacher with a BA on the 2010-2011 salary schedule. For the position of principal, the Department used the 2010-2011 Salary Survey – Average Salary of the 25th percentile collected by the NH Association of School Principals. The Department conducted a survey of school districts in January 2012 to address the average 3rd and 4th quartiles for the salary of administrative assistant and custodian. 102 of the 161 school districts operating schools, or 63%, responded to the survey. Additionally, although the Department collects average teacher salary and step information, the exact average based upon this bill is not available. The Department’s calculations assume an even divide between steps and using this methodology were able to estimate teacher salary. The estimated adequacy calculations are as follows -
K-2 Teacher Adequacy $61,225,322
3-12 Teacher Adequacy $232,095,805
K-2 Art Teacher Adequacy $12,245,070
3-12 Art Teacher Adequacy $46,419,182
Principal Adequacy $42,069,721
K-8 Guidance Counselor Adequacy $12,140,899
9-12 Guidance Counselor Adequacy $10,495,485
Library/Media Science Adequacy $16,987,014
Technology Coordinator Adequacy $7,077,923
Reading Specialist Adequacy $12,567,813
Administrative Assistant Adequacy $15,125,352
Custodian Adequacy $13,284,372
Instruction Materials Costs $24,606,391
K-8 Technology Costs $3,115,854
9-12 Technology Costs $4,201,974
Transportation Costs $37,888,788
Total Base Adequacy Costs $551,546,965
This bill would distribute differentiated aid to students with Free and Reduced Lunch (F&R) status based on the number of eligible students only. The per pupil rates for Free and Reduced Lunch status students if the school has at least 12% of students identified would be $1,770 (current law distributes $1,725). The Department estimates the cost of F&R Differentiated Aid would total $62,338,503 in FY 2013.
The bill would distribute $690 (current law distributes $675) for each pupil reported in the public school’s ADMR who is an English language learner (LEP) and who is receiving English language instruction, at a cost of $2,101,906 in FY 2013.
The bill would also distribute $1,904 (current law distributes $1,856) for each pupil reported in the public school’s ADMR who is receiving special education, at a cost of $57,569,258.
The bill also provides $300 for each third grade pupil who has tested at the proficient level or above in the reading component of the state assessment (current law distributes $675 for each 3rd grade student who has not tested proficient) and is not eligible to receive special education, English as a second language, or free or reduced-price meal program funds. The Department estimates the cost of the 3rd grade reading proficiency aid would total $2,463,378 in FY 2013.
In total, the Department estimates the FY 2013 cost of an adequate education as follows –
FY 2014
Base Adequacy $551,546,965
F&R Differentiated Aid $62,338,503
LEP Differentiated Aid $2,101,906
SPED Differentiated Aid $57,569,258
3rd Grade Reading $2,463,378
Total Calculated Cost of an Adequate Education $676,020,010
The Department states the proposed bill would also re-establish Fiscal Capacity Disparity Aid with per pupil amounts of $3,360 for municipalities with an equalized valuation per pupil in the lower half of the lowest quartile and which has a median family income below the state average, and $2,100 for municipalities with an equalized valuation per pupil in the upper half of the lowest quartile and which has a median family income below the state average. The Department estimates the cost of Fiscal Capacity Disparity Aid would total $114,906,726 in FY 2013. The bill makes no changes the State-Wide Education Property Tax (SWEPT) provisions, and the Department estimates the amount of SWEPT raised will total $363,674,748 in FY 2013, with approximately $30,908,586 of that amount considered excess SWEPT to be retained locally. The Department estimates education grant amounts as follows -
FY 2013
Total Cost of an Adequate Education $676,020,010
Fiscal Capacity Disparity Aid $114,906,726
Minus SWEPT (not including excess SWEPT retained locally) $(332,766,162)
Total Education Grants $458,160,574
The bill provides that for the biennium ending June 30, 2013, no municipality shall receive a grant in a fiscal year which is greater than the adequate education grant received by such municipality in FY 2011. The bill also states that in each fiscal year, in the event that the calculated grant is less than the FY 2012 amount, the Department would be required to distribute an additional grant equal to the amount of the decrease. Historically, the Department has interpreted the funding law such that a district whose calculated aid was lower than their SWEPT contribution, would not receive a grant. Procedures that ensured grants maintained a prior level of funding were not increased to that level if the town’s SWEPT was higher than the adequacy funding determination. For the purposes of this fiscal note, and based on the Department’s understanding of the intent of the proposal, the Department assumes grants will be given even when the SWEPT amount is greater than the adequacy funding determination. As a result of the proposed additional grant and cap provisions, the Department would provide net additional adjustment grants of $120,076,031 ($140,743,041 in hold harmless grants LESS $20,667,040 in cap reductions). As a result, the total calculated education grant amount would equal $578,236,605 ($458,160,574 + $120,076,031) in FY 2013.
Beginning in FY 2014 and each fiscal year thereafter, both current law and the proposed bill would cap a municipality’s education grant at 105.5% of the total education grant distributed in the previous fiscal year. However, the proposed bill may increase state expenditures (and local revenue) by an indeterminable amount in FY 2014 and each year thereafter due to the differences between the stabilization grant provisions contained in current law and the hold harmless provisions in the proposed bill as previously discussed above. The exact fiscal impact cannot be determined at this time.