New Hampshire

New Hampshire operates on a biennial budget cycle. The state budget for fiscal years 2016-2017 was enacted in September 2015. The comparable general and education-trust-fund budget increase from 2016-17 is 4.9%, and the total increase is 6.4% over the previous biennium (NH Department of Administrative Services, 2017). Total government spending in New Hampshire has grown by approximately $335 million, an increase of 6.1% between fiscal years 2015 and 2016 (National Association of State Budget Officers, 2016).

New Hampshire schools are funded mostly through local property taxes. However, the state doles out $3,600 per pupil to school districts in the form of adequacy payments. Additionally, school districts receive an extra payment based on the number of free and reduced eligible students.

The most recent data available for the average K-12 per-pupil expenditure amount in New Hampshire is for the fiscal year 2015-16. The per-pupil amount of all expenses is $17,648.76.

In 2015, elementary and secondary education accounted for $1,126 million of the state budget and higher education accounted for $132 million, 20.7% and 2.4% of the budget, respectively (National Association of State Budget Officers, 2016).

FUNDING PRIORITIES AND PRESSING ISSUES FOR EDUCATIONAL FINANCE

Full-Day Kindergarten Program

New Hampshire requires school districts to offer half-day kindergarten. The state does not provide funding for full-day pre-kindergarten programs. Accordingly, the state only funds one-half of the per-pupil state grant for kindergarten students. About 70% of the school districts in New Hampshire, serving 80% of students, have already adopted full-day kindergarten using local property taxes to pay for the second half of the day (Solomon, 2017). However, the state only pays half the standard per-student amount for those pupils, which comes to about $1,800. The governor proposed a grant program called Kindergarten Initiative Development Support (KIDS). The KIDS program intended to provide full kindergarten funding for low-income/property-poor schools that offer full-day kindergarten programs. The initial budget amount for the KIDS program was $9 million. The House Education Committee amended Senate Bill 191 to fully fund full-day kindergarten statewide (for all school districts that offer full-day kindergarten, regardless of the low-income/property/poor status). The Senate Finance Committee recommended cutting the kindergarten funding altogether meaning that current funding levels would remain in place. Full-day kindergarten funding, however, was resurrected in the last month of the legislative session before the 2017-19 budget was finalized. Senate Bill 191 establishes Keno Gambling in the state, with revenues from the Keno to be directed towards funding full-day kindergarten programs. Funding amount estimated about $1100 per student, on top of what districts receive the state aid (The New Hampshire General Court, 2017). It is short of the $1800 that was being advocated for per-pupil funding. However, this funding will not be effective until FY 2019 because the Keno revenue will need to be established and running in order to generate a revenue stream for school districts.

Cuts to "Stabilization Aid"

New Hampshire school funding is based primarily on the number of students attending a school, and because many New Hampshire school districts are facing significant declines in student population, the state funding for those students is decreasing. For 2017 and each year thereafter, the Department of Education will distribute a grant to each municipality in an amount equal to the total education grant for the fiscal year (The New Hampshire General Court, 2017). Stabilization aid was introduced to maintain the steady financing of those districts that are losing students. However, the legislature amended the stabilization aid statute in 2016. Districts will now see a 4% cut in that funding per year for 25 years.

State Grant for School Construction

Facing declining state revenues, the New Hampshire Legislature placed a moratorium on state funding for new school building projects in 2012. Before the moratorium, the state was paying between 30% and 45% of the amount of the yearly payment of the principal amount of all outstanding borrowings/bonds of the school...