2/14/02 2627s

17apr02...3273h

5/2/02 3756eba

2002 SESSION

02-3189

04/10

SENATE BILL 425-FN-LOCAL

COMMITTEE: Finance

AMENDED ANALYSIS

This bill:

I. Makes changes to the base cost formula for calculating adequate education grants and provides that the base cost per pupil shall be adjusted by the northeast consumer price index.

II. Amends the calculation of transportation costs by deducting revenues received from other school districts, individuals, organizations, or federal aid.

III. Amends the definition of "attendance" for purposes of determining average daily membership in attendance and average daily membership in residence.

IV. Deletes the home education pupil exclusions from the cooperative school district apportionment of expenses laws.

V. Requires that the adequate education and education financing commission shall review the base cost per pupil formula and report its findings no later than November 1, 2007.

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

2/14/02 2627s

17apr02...3273h

5/2/02 3756eba

02-3189

04/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Two

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

1 Statement of Purpose; Legislative Findings. The general court recognizes the inherent imprecision and subjectivity involved in determining the cost of providing the opportunity for an adequate education. In the exercise of its constitutional authority and discretion, to provide the opportunity for pupils to obtain an adequate education, the general court has adopted an average costing methodology. The general court recognizes that this costing methodology may produce spending pressures and results that may not accurately reflect the cost of continuing to provide adequate educational opportunity over time. As a result, the general court finds that changing the base cost per pupil by reference to the consumer price index is the most appropriate way to calculate changes in the cost of an adequate education.

2 School Money; Definitions. Amend RSA 198:38, XI to read as follows:

XI. "Transportation costs" means the costs of transporting pupils in grades kindergarten through grade 12 to and from school and other [school] pupil-related activities, less

applicable revenues from other school districts, individuals, organizations, or federal aid as reported by school districts on the [MS-25] DOE-25 form.

3 School Money; Determination of Per Pupil Adequate Education Grants. RSA 198:40, I is repealed and reenacted to read as follows:

I. For the bienniums beginning July 1, 2003, July 1, 2005, and July 1, 2007, the department of education shall calculate the base cost per pupil by multiplying the base cost per pupil calculated in the immediately preceding biennium by an amount equal to one plus 2 times the average annual rate of inflation taken from the 4 calendar years immediately preceding the calendar year in which the calculation in this subparagraph is made. Inflation shall be measured by the most recent available northeast region consumer price index as published by the Bureau of Labor Statistics, United States Department of Labor.

4 School Money; Duties of the Department of Education. Amend RSA 198:44, I to read as follows:

I. The department of education shall, on or before September [30] 1 of each year, collect from the school districts final data concerning all aspects of student attendance for the school year ending June 30 of that year necessary to establish the average daily membership, average daily membership in residence, and weighted average daily membership in residence, including the municipality of residence for each pupil for that year. The department of education shall submit a report by December 31 of each year to the speaker of the house of representatives and the senate president to be used for purposes of determination by the legislature of the appropriation to the education trust fund. A copy of such report shall, at the same time, be given to the department of revenue administration.

5 School Boards, Teachers; Definitions Amended. RSA 189:1-d is repealed and reenacted to read as follows:

189:1-d Definitions. In this chapter:

I. "Attendance" means full-time participation in a program of instruction under the direction of a teacher employed by the school district. Educationally disabled home educated pupils educated at school district expense under the direction of a teacher employed by the school district shall be included.

II. "Membership" means pupils of whom attendance is expected, whether a pupil is present or absent on any given day.

III. "Average daily membership in attendance" means the aggregate half-day membership of pupils attending schools operated by a school district divided by the number of half-days of instruction offered. The average daily membership in attendance for preschool and kindergarten pupils shall be divided by the number of instructional days offered to higher level elementary grades.

IV. "Average daily membership in residence" means the average daily membership in attendance of pupils who are legal residents of the school district pursuant to RSA 193:12 or RSA 193:27, IV and are attending any public school, or who are attending any charter school or private school program approved by the department of education at the expense of the school district.

6 Procedure for Formation of Cooperative School Districts; Apportioning Operating Expenses; Exclusion of Home Education Pupils Deleted. Amend RSA 195:18, III(e) to read as follows:

(e) The method of apportioning the operating expenses of the cooperative school district among the several preexisting districts and the time and manner of payment of such shares. [Home education pupils who do not receive services from the cooperative school district, except an evaluation pursuant to RSA 193-A:6, II shall not be included in the average daily membership relative to apportionment formulas.]

7 Procedure for Formation of Cooperative School Districts; Apportioning Capital Expenses; Exclusion of Home Education Pupils Deleted. Amend RSA 195:18, III(g) to read as follows:

(g) The method of apportioning the capital expenses of the cooperative school district among the several preexisting districts, which need not be the same as the method for apportioning operating expenses, and the time and manner of payment of such shares. Capital expenses shall include the costs of acquiring land and buildings for school purposes, including property owned by a preexisting district; the construction, furnishing, and equipping of school buildings and facilities; and the payment of the principal and interest of any indebtedness which is incurred to pay for the same or which is assumed by the cooperative school district. [Home education pupils who do not receive services from the cooperative school district, except an evaluation pursuant to RSA 193-A:6, II, shall not be included in the average daily membership relative to apportionment formulas.]

8 School Money; State Aid for Educational Adequacy; Definitions. Amend RSA 198:38, VI to read as follows:

VI. "[Average] Base cost per pupil of an elementary school pupil" means the amount as determined in accordance with RSA 198:40.

9 School Money; Determination of Per Pupil Adequate Education Cost. Amend RSA 198:40, III to read as follows:

III. For each fiscal year, the statewide cost of an adequate education for all pupils shall be calculated by multiplying the [average] base cost per pupil [cost of an adequate education] by the statewide weighted average daily membership in residence of pupils and then adding 70 percent of total statewide transportation costs.

10 School Money; Determination of Adequate Education Grants. Amend RSA 198:41, I (a) to read 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;

11 New Paragraph; Adequate Education and Education Financing Commission; Duties Amended. Amend RSA 198:49 by inserting after paragraph IV the following new paragraph:

IV-a. In addition to the duties set forth in paragraph IV, and notwithstanding the deadlines established in paragraph V, the commission shall review the formula for determining the base cost per pupil required under RSA 198:40, I, and shall report its findings, including any recommendations for proposed legislation, no later than November 1, 2007.

12 Applicability. The provisions of this act shall apply to adequate education grant calculations made for the fiscal year beginning July 1, 2003.

13 Repeal. RSA 198:38, V, relative to the base expenditure per pupil, is repealed.

14 Effective Date. This act shall take effect July 1, 2002.

LBAO

02-3189

Amended 3/25/02

SB 425 FISCAL NOTE

FISCAL IMPACT:

METHODOLOGY: