Revision: Jan. 28, 2025, 3:47 p.m.
HB 769-FN - AS INTRODUCED
2025 SESSION
25-0565
02/11
HOUSE BILL 769-FN
SPONSORS: Rep. Gould, Hills. 2
COMMITTEE: Education Funding
─────────────────────────────────────────────────────────────────
ANALYSIS
This bill increases the base cost of providing the opportunity for an adequate education, and changes the statewide education property tax rate.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
25-0565
02/11
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Five
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Cost of an Opportunity for an Adequate Education. Amend RSA 198:40-a, I-II(a) to read as follows:
I. For the biennium beginning July 1, [2023] 2025, the annual cost of providing the opportunity for an adequate education as defined in RSA 193-E:2-a shall be as specified in paragraph II. The department shall adjust the rates specified in this paragraph in accordance with RSA 198:40-d.
II.(a) A cost of [$4,100] $7,356.01 per pupil in the ADMR, plus differentiated aid as follows:
76:3 Education Tax. Beginning July 1, [2005] 2025, and every fiscal year thereafter, [the commissioner of the department of revenue administration shall set] the education tax rate [at a level sufficient to generate revenue of $363,000,000 when] shall be set at $2.50 per $1,000 and imposed on all persons and property taxable pursuant to RSA 76:8, except property subject to tax under RSA 82 and RSA 83-F. [The education property tax rate shall be effective for the following fiscal year. The rate shall be set to the nearest 1/2 cent necessary to generate the revenue required in this section.]
2 Effective Date. This act shall take effect July 1, 2025.
25-0565
Revised 1/28/25
HB 769-FN- FISCAL NOTE
AS INTRODUCED
FISCAL IMPACT:
|
| |||||
Estimated State Impact | ||||||
| FY 2025 | FY 2026 | FY 2027 | FY 2028 | ||
Revenue | $0 | FY 2026 $447.9M Increase
FY 2027 and FY 2028 Indeterminable increase, but expected to be greater than $450M | ||||
Revenue Fund(s) | Education Trust Fund | |||||
Expenditures* | $0 | FY 2026 District Adequacy - Approximately $540.4M Charter School Grants - Approximately $28.3M Education Freedom Accounts - Approximately $25.6M Total - Approximately $594.3M
FY 2027 and Beyond Indeterminable, but similar magnitude expected (see methodology below) | ||||
Funding Source(s) | Education Trust Fund | |||||
Appropriations* | $0 | Statutory Open Warrant | ||||
Funding Source(s) | Education Trust Fund | |||||
*Expenditure = Cost of bill *Appropriation = Authorized funding to cover cost of bill | ||||||
| ||||||
Estimated Political Subdivision Impact | ||||||
| FY 2025 | FY 2026 | FY 2027 | FY 2028 | ||
Local Revenue | $0 | FY 2026 Approximate $540.4M Increase
FY 2027 and Beyond Indeterminable, but similar magnitude expected (see methodology below) | ||||
Local Expenditures | $0 | $0 | $0 | $0 | ||
METHODOLOGY:
This bill, effective for FY 2026, increases the base per pupil aid amount for the cost of an opportunity for an adequate education under RSA 198:40-a, II(a), as illustrated in the table below, and modifies the amount of statewide education property tax (SWEPT) collected from $363 million per year, to a fixed rate of $2.50 per $1,000 (the SWEPT rate for FY 2026 is $1.12 per $1,000).
Base Adequacy Aid, Per Pupil | FY 2026 | FY 2027 | FY 2028 |
Current Law | $4,265.64 | $4,350.95 | $4,437.97 |
Proposed | $7,356.01 | $7,503.13 | $7,653.19 |
Increase | $3,090.37 | $3,152.18 | $3,215.22 |
This bill will impact state education trust fund (ETF) revenue, district adequacy grants, charter school grants, and education freedom accounts.
Education Trust Fund Revenue Impact
Under current law, SWEPT is required to raise $363 million per year. Under this bill, SWEPT would be set at $2.50 per $1,000, which based on FY 2026 figures would raise approximately $811 million, an increase of approximately $448 million. The annual impact in FY 2027 and beyond indeterminable, however, is expected to be greater than $450 million, as it can be assumed property valuations will increase.
District Adequacy
Based on preliminary data, this bill will increase adequacy grants to school districts by an estimated $540,411,764 in FY 2026:
| Current Law | Proposed | Increase |
Adequacy Grant | $716,948,319 | $809,485,131 | $92,536,812 |
Statewide Education Property Tax (SWEPT) | $363,516,836 | $811,391,788 | $447,874,952 |
Final State Grant | $1,080,465,155 | $1,620,876,919 | $540,411,764 |
Data for FY 2027 and FY 2028 is not yet available, therefore, this bill’s impact on district adequacy beyond FY 2026 is indeterminable, however expected to be in the $560 million to $580 million range per year.
It should be noted that this bill, in FY 2026, would increase “excess SWEPT” from approximately $28.6 million to $99.2 million (an increase of $70.6 million, which is included in the “final state grant” figures above). The term “excess SWEPT” is assumed to be the amount of a municipality’s SWEPT collection that exceeds the amount of its calculated cost of an opportunity for an adequate education.
Charter School Grants
Based on the estimated student count of 7,868, this bill would increase aid to charter schools by $24,315,031 in FY 2026 ($3,090.37 x 7,868 students). Data to estimate FY 2027 and FY 2028 student counts is not yet available, therefore, this bill’s impact on charter school grants beyond FY 2026 is indeterminable, however expected to be approximately $25 million per year.
Education Freedom Accounts
Based on the estimated student count of 6,500 this bill would increase aid to charter schools by $20,087,405 in FY 2026 ($3,090.37 x 6,500 students). Data to estimate FY 2027 and FY 2028 student counts is not yet available, therefore, this bill’s impact on education freedom accounts beyond FY 2026 is indeterminable, however expected to be approximately $20 million per year.
AGENCIES CONTACTED:
Department of Education and Department of Revenue Administration