Supporters say HB 669 would make statewide education tax constitutional and reduce local disparities; opponents caution about distribution and local impacts

Representative Mike Smith opened the public hearing on House Bill 669 by describing the measure as a simple, constitutionally‑oriented reform that would set a statewide education tax rate of $5 per $1,000 of equalized property valuation and remit proceeds directly to the Education Trust Fund.

Smith said a flat rate collected at the state level would address what he called inequitable local variations in school funding and eliminate the practice of districts retaining state tax “swept” revenue that currently reduces the state‑level component of school funding. He and other supporters said the rate would raise an estimated $1.62 billion in FY2026 (Smith cited an estimated $1.26 billion additional revenue above the current $363 million statewide amount) and that directing that revenue to the Education Trust Fund could allow the state to assume high‑cost responsibilities such as special education or reduce local burden through targeted relief.

Multiple members of the public and legislative colleagues testified for and against the bill. Supporters said a uniform rate aligns with the New Hampshire Constitution’s equal‑rate requirement and would produce a more equitable distribution of education resources; Representative Wheeler described growing up in one district with many academic opportunities and a neighboring district with far fewer and said a statewide equal rate would level that disparity.

Critics urged caution. Members asked how collections would be administratively handled, whether the Department of Revenue Administration (DRA) or municipalities would collect and remit the tax, how the money would be distributed to school districts, and whether the bill could be used later to increase the rate. Witnesses from the DRA and analysts provided high‑level budget context: DRA staff later explained that recent revenue trajectories have reduced an earlier projected surplus in the Education Trust Fund and that careful fiscal planning would be required.

Policy advocates offered possible pairing scenarios. Zach Sheehan of the New Hampshire School Funding Fairness Project presented a modeling exercise that paired a $5 statewide rate with two pending education funding bills — one to fully fund special education costs and another to raise base adequacy — and showed how many towns’ equalized school rates would decline and how some would rise slightly depending on distribution choices. Douglas Hall, former House member and finance committee member, walked members through the 1999 reform history and argued that a fixed equalized mill rate had previously produced substantial reductions in local school taxes and that returning to a statewide rate would address legal risks identified by current lawsuits.

Supporters and experts emphasized that this bill sets how money is raised and does not itself prescribe the distribution formula; they said follow‑on legislation or committee work would determine how funds are allocated to districts and which responsibilities (for example, special education or homestead exemptions) the state would choose to fund.

The public hearing closed without action; members asked for more detailed fiscal tables and for DRA to provide updated revenue projections and community‑level impact figures as the committee considers the bill.