5/9/01 1150s

2001 SESSION

01-1061

04/10

SENATE BILL 138-FN-LOCAL

COMMITTEE: Education

AMENDED ANALYSIS

I. Provides for a division between the instructional and operational costs in providing an adequate public education, requires that the state shall be responsible for the full cost of instructional services provided for an adequate education, and that local school districts shall be responsible for the operational costs of providing an adequate education.

II. Beginning July 1, 2002, decreases the rate of the education property tax by $1.00 per year until July 1, 2007 when the education property tax shall be repealed.

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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

5/9/01 1150s

01-1061

04/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand One

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Purpose; Intent. The general court finds that the duty of the state is to provide an opportunity for every child to receive an adequate elementary and secondary education. Educational competence is accomplished through capable and thoughtful instruction. It shall be the responsibility of the state to provide educational instruction. This responsibility includes instructional costs related to providing an adequate education including, but not limited to, classroom teachers, classroom materials, professional development, building aid, and special education costs.

2 Application of Receipts; Excess Property Tax Payments. Amend RSA 6:12, I (www) to read as follows:

(www) Money received under 77-A, RSA 77-E, RSA 78, RSA 78-A, RSA 78-B, RSA 83-F, [RSA 198:46,] and from the sweepstakes fund, which shall be credited to the education trust fund under RSA 198:39.

3 Education Property Tax. RSA 76:3 is repealed and reenacted to read as follows:

76:3 Education Property Tax.

I. Through the fiscal year ending June 30, 2002, an annual education property tax at the uniform rate of $6.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

II. Beginning July 1, 2002, an annual education property tax at the uniform rate of $5.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

III. Beginning July 1, 2003, an annual education property tax at the uniform rate of $4.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

IV. Beginning July 1, 2004, an annual education property tax at the uniform rate of $3.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

V. Beginning July 1, 2005, an annual education property tax at the uniform rate of $2.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

VI. Beginning July 1, 2006, an annual education property tax at the uniform rate of $1.60 on each $1000 of the value of taxable property is hereby imposed on all persons and property taxable pursuant to RSA 72 and RSA 73, except property subject to tax under RSA 82 and RSA 83-F.

4 State Board of Education Rulemaking Authority Amended. Amend RSA 21-N:9, II (l) to read as follows:

(l ) Special education programs affecting all educationally disabled individuals, as authorized by RSA 186-C:5[,] and 186-C:16 [and 186-C:18, V].

5 Special Education; Educationally Disabled Children in State Institutions. Amend RSA 186-C:19, II to read as follows:

II. For an educationally disabled child in a state institution, the responsible school district shall be liable for all expenses incurred in administering the law in relation to educationally disabled children except as follows: For the 1982 and 1983 fiscal years, the responsible school district's annual financial liability for a child who was enrolled at the Laconia state school and training center as of July 1, 1981, shall not exceed the applicable state average per pupil cost as determined by the state board of education, and the state shall be liable for the balance of such costs[, which shall in no case be taken from the $ 10,000,000 appropriated for state aid under RSA 186-C:18]. If more than one school district is liable for such a child during a single fiscal year, the total annual financial liability to the school districts shall not exceed the applicable state average per pupil cost, said liability to be prorated on a per diem basis. For such a child who is enrolled at Laconia developmental services for less than a full year, the liability for such costs shall be prorated on a per diem basis by Laconia developmental services.

6 Pupils; Compulsory Attendance Amended. Amend RSA 193:1, I (c) to read as follows:

(c) The relevant school district superintendent has excused a child from attendance because the child is physically or mentally unable to attend school, or has been temporarily excused upon the request of the parent for purposes agreed upon by the school authorities and the parent. Such excused absences shall not be permitted if they cause a serious adverse effect upon the student's educational progress. Students excused for such temporary absences may be claimed as full-time pupils for purposes of calculating [state aid under RSA 186-C:18 and] adequate education grants under RSA 198:41.

7 School Money; Reimbursement Anticipation Notes Amended. Amend RSA 198:20-d to read as follows:

198:20-d Reimbursement Anticipation Notes. Notwithstanding any other provision of law to the contrary, a school district or a city with a dependent school district may incur debt in anticipation of reimbursement [under RSA 186-C:18 and] under RSA 198:42. The governing body, after notice and public hearing, may elect to borrow such funds and to recognize the proceeds of the borrowing as revenue for property tax rate setting purposes by providing written notification to the commissioner of the department of revenue administration stating the specific amount of borrowing to be recognized as revenue. Any borrowing under this section shall be exempt from the provisions of RSA 33, relative to debt limits.

8 School Money; State Aid for Instructional Costs for Providing an Adequate Education. RSA 198:40 is repealed and reenacted to read as follows:

198:40 State Aid for Instructional Costs for providing an Adequate Education.

I. For the biennium beginning July 1, 2002, and every biennium thereafter, the essential elements of an adequate education shall be:

(a) High quality classroom teachers.

(b) A commitment to ongoing professional development.

(c) Sufficient classroom materials to facilitate quality instruction.

(d) Adequate classroom space for instruction, and other school building construction and renovation needs pursuant to the school building aid grant program set forth in RSA 198:15-a through 198:15-h.

(e) Special education services sufficient to provide a free and appropriate education to special needs pupils.

(f) Supplemental assistance to needy communities.

II. For the biennium beginning July 1, 2002, and every biennium thereafter, the cost of the essential elements of an adequate education as set forth in paragraph I shall be calculated as follows:

(a) The state shall be responsible for the cost of instructional services necessary to provide an adequate education to all public elementary and secondary school pupils. Each school district in the state shall receive an amount equal to $42,500 multiplied by the most recent available average daily membership in residence for the school district, the product of which shall be divided by 20.

(b) The state shall be responsible for the cost of professional development of instructional staff. The department of education shall determine the cost of professional development of instructional staff, provided that each school district in the state shall receive an amount equal to not less than $50 per pupil multiplied by the most recent available average daily membership in residence for the school district.

(c) The state shall be responsible for the cost of sufficient classroom materials, textbooks, and other instructional supplies. The department of education shall determine the cost of such materials, textbooks, and supplies, provided that each school district in the state shall receive an amount equal to not less than $100 per pupil multiplied by the most recent available average daily membership in residence for the school district.

(d) The state shall be responsible for the cost of programs and services for educationally disabled children in public elementary and secondary schools of the state and for programs and services related to English as a second language offered in public elementary and secondary schools of the state. Special education funds shall be distributed to school districts on a per pupil basis calculated by the number of educationally disabled children in each school district on September 1 of each school year, provided that not less than 10 percent of state funds appropriated in each fiscal year shall be held in reserve for the purpose of reimbursing school districts for extraordinary special education costs incurred in each fiscal year. An extraordinary special education fund is established in the department of education. The moneys in this fund shall be nonlapsing and shall not be diverted to any other purpose. School districts shall submit their extraordinary special education costs to the state board of education by June 30 of each fiscal year. The state board of education shall then verify the cost and distribute the appropriate amounts for the previous fiscal year on or before January 1 of each fiscal year.

(e) The state shall provide supplemental assistance to needy school districts:

(f) The state shall be responsible for salaries, materials, programs, or services which are deemed in legislation to be instructional in nature and necessary for the provision of an adequate education.

III. State aid for instructional costs of providing an adequate education shall be paid to school districts legally responsible for the education of pupils who attend approved schools within the district or in other districts. Payment of such state aid for instructional costs shall be made during the fiscal year in which such aid is due.

IV. State aid for instructional costs of providing an adequate education shall be disbursed to school districts in the form of block grants calculated on a per pupil basis using the school district's most recent available average daily membership in residence.

V. At the beginning of each biennium, the general court shall review the provisions of this section to determine the need, if any, to adjust the instructional costs of providing an adequate education.

9 New Section; Operational Costs for Providing an Adequate Education. Amend RSA 198 by inserting after section 40 the following new section:

198:40-a Operational Costs for Providing an Adequate Education.

I. In addition to the provisions set forth in RSA 194, the school districts of this state shall be responsible for the operational costs of providing an education to all elementary and secondary school pupils. Such operational costs shall include, but are not limited to:

(a) Building maintenance.

(b) Transportation of pupils.

(c) School district administration, including the costs of maintaining a school administrative unit.

(d) Extracurricular activities.

(e) Lunch programs and other food service programs provided at the local level.

II. A school district shall be responsible for any other programs which the school district determines are necessary to meet local educational goals and objectives.

10 School Money; Determination of Adequate Education Grants Amended. Amend RSA 198:41, I to read as follows:

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 adequate education grant for the municipality as follows:

(a) [Multiply the average base cost per pupil of an elementary pupil by the weighted average daily membership in residence for the municipality;

(b) Add to the product of subparagraph (a), 70 percent of the municipality's apportioned transportation cost;] Add the sums resulting from the calculations set forth in RSA 198:40, II(a)-(f).

[(c)] (b) Subtract from the sum of subparagraph [(b)] (a) the amount of the education property 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.

11 Repeal. The following are repealed:

I. RSA 76:3, relative to the education property tax.

II. RSA 186-C:18, relative to state aid for special education.

III. RSA 198:39, V-VII, relative to the definitions of "base expenditure per pupil," "average base cost per pupil of an elementary school pupil," and "weighted pupils."

IV. RSA 198:39, I(g), relative to excess education property tax payments deposited into the education trust fund.

V. RSA 198:46-47, relative to excess education property tax payments.

VI. RSA 198:50-55, relative to education property tax hardship relief.

VII. 1999, 338:21, relative to the repeal of the education property tax and the determination of per pupil adequate education costs.

VIII. 1999, 338:22, relative to the repeal of education property tax hardship relief.

IX. 1999, 338:25, I-II, relative to the effective dates of the repeals of the education property tax, the determination of per pupil adequate education costs, and the education property tax hardship relief.

12 Effective Date.

I. Paragraphs I, V, and VI of section 11 of this act shall take effect July 1, 2007.

II. The remainder of this act shall take effect July 1, 2002.

LBAO

01-1061

2/8/01

SB 138-FN-LOCAL - FISCAL NOTE

FISCAL IMPACT:

METHODOLOGY: