Lawmakers examine foundation opportunity budget (HB772) and a base increase tied to ConVal (HB675); special education and transportation discussed

Committee members spent a large portion of the session on two bills that would reshape how New Hampshire calculates and funds school budgets.

Representative Luna described HB772 as a formula that first calculates a “foundation opportunity budget” for each district using weighted student counts (for special education, free and reduced-price eligibility, English-language learners, and district size) and then funds that budget by requiring a local contribution up to a capped per-thousand rate and a state share for the remainder. “The foundation contribution is limited to $5.38 per thousand,” a sponsor explained; the bill’s approach phases the state share in and applies a 90% efficiency factor and a transition schedule before full implementation.

HB675 was discussed as a separate, more aggressive approach that would raise base adequacy to figures tied to the ConVal superior-court order (discussants cited a per-student figure from the decision) and increase the SWEP allocation — changes that would raise total costs and potentially increase the number of towns that would be classified as having excess SWEP.

Why it matters: Both bills would change the state–local balance of school funding. HB772 would aim to equalize local effort (a uniform per‑thousand local contribution up to a dollar cap) and then distribute state dollars to fill the remainder; HB675 would raise the baseline cost of an adequate education, with consequent budget and distributional effects. Committee members flagged distributional risk, transitional complexity and administrative burden, and repeatedly asked staff to produce town-level fiscal simulations.

Special education, transportation and data concerns

- Special education. Members debated whether to move special-education funding entirely into a more explicit reimbursement model (like an insurance product or “circuit breaker”) that pays a larger share of actual high-cost placements rather than a single per‑student allowance. One staff summary noted that lowering the catastrophic threshold (for example, from 3.5x to 2x) would expand the universe of reimbursable claims and add administrative work for the Department of Education.

- Transportation and small districts. Lawmakers urged that transportation be considered separately because geography and routing make per-pupil transportation costs highly variable. Members also discussed smaller districts’ lack of economies of scale and how a district-based allocation could include size-adjustment weights.

- Data and measurement. Multiple members requested clearer disaggregation of DOE financial reports (the MS-25/MS-1 data) so the committee can separate “core adequacy” costs from extracurricular or discretionary expenditures that currently enter per‑pupil averages.

Quotes and mechanics

- On local contribution and state share: Representative Luna explained the funding flow: first a capped local share (designed to equalize effort around $5.38 per thousand) and then a state grant covering the remainder; “once the Department of Education has calculated the foundation opportunity budget... the first dollars to fund that budget come from the local share,” he said.

- On the formula’s weights and calculations: Staff and sponsors explained the model uses a base unit (presented in committee materials as about $7,031 in the draft) and multiplies that by weights for special education, free and reduced, English learners and district size; special-education students are counted in every applicable category when appropriate.

Next steps and staff assignments

Members asked for a set of concrete fiscal analyses: town-by-town and district-by-district runs of HB772 and HB675, tax-rate simulations using current grand lists, and sensitivity checks for different phase-in schedules and thresholds for catastrophic aid. Sponsors pledged to provide Excel simulations and to share models that let members test assumptions; the Legislative Budget Assistant and DRA will be asked to verify numbers and provide fiscal notes.

Ending

No votes were taken. Members scheduled follow-up work and requested updated fiscal notes and models before the next executive sessions.