NH education subcommittee recommends ITL for adequacy bill, orders interim study on property-tax and opportunity proposals

The Education Funding Committee's Subcommittee on Adequacy and Funding Sources met in a work session and recommended against advancing the principal adequacy bill, HB 651, while pushing two major proposals into interim study and recommending ITL for a study bill on revenue methods.

Representative Ames, chair of the subcommittee, opened the session by noting the group's charge to evaluate four bills (numbers discussed as 491, 651, 734 and 772) and to return a recommendation to the full committee before November 21. "These bills will all be reported out of the committee before November 21 and brought to the house floor in the first session of January," Ames said, framing the timetable the panel considered.

Why it matters: The panel's recommendations shape which measures the full Education Funding Committee will consider in the 2026 session. The debate tied technical questions about how to compute a constitutionally adequate base per pupil — including figures cited from recent litigation — to the politically fraught question of where the state would find the money.

Main outcome and votes

- HB 491 (study committee on funding methods): subcommittee recommended ITL (Inexpedient to Legislate). Motion by Representative Ames; seconded by Representative Erf. Vote: 4–3 in favor of ITL. The subcommittee recorded this as a recommendation to the full committee.

- HB 651 (changes to the adequacy formula and differential aid): subcommittee recommended ITL. Motion by Representative Ladd; seconded by Representative Papovich Muller. Vote: 4–3 in favor of ITL. The bill was debated longest and drew the most sharply divided views.

- HB 734 (proposal to change the statewide property tax/swept tax and related redistribution): subcommittee recommended interim study (interim study vote: 6–1). Motion by Representative Ames; seconded by Representative Popovich Muller.

- HB 772 (foundational opportunity / budget program): subcommittee recommended interim study (vote: 7–0). Motion by Representative Damon; seconded by Representative Bridal.

Debate highlights

HB 651: adequacy numbers and court rulings

Representative Vaines and Representative Damon argued HB 651 or similar measures are urgent responses to court rulings. Vaines described HB 651 as building on judicial findings and said the bill would raise the statutory base adequacy from roughly the current $4,200 per pupil to about $7,300 per pupil (a multiplier of about 1.73). "The current base number is far removed from the reality that our school districts face," Vaines said, calling the change "a significant" correction to funding levels. Damon agreed, saying the court's figure should be treated as a minimum and urging legislative action.

Opponents, including Representative Ladd and others, argued the bill lacks a funding mechanism. Ladd said a separate, more deliberative LSR (legislative service request) to study revenue options would better let the Legislature design both spending and revenue changes together. Ladd also underscored that special education funding and the inputs to a base-cost calculation need deeper study.

Special education and parallel workstreams

Representative Flannen provided a detailed briefing on special education funding, which many members said must be treated alongside adequacy reform. Flannen noted the state spends about $977 million on special education annually and described large growth in some special-education categories (for example, autism and "other health impaired" classifications). She said high-cost special-education students are handled through a statutory catastrophic-aid structure that has struggled with proration; last year the legislature appropriated $34 million for high-cost special-education aid but providers experienced a shortfall that required proration. "We need a better understanding of actual costs," Flannen said; she mentioned an SB 57 commission scheduled to convene to examine special-education issues and said the subcommittee's work will intersect with that commission's efforts.

Swept tax / property-tax redesign (sponsor LSR)

Representative Ames described an LSR that would substantially expand the state\'s swept education property tax, increasing the statewide pool from roughly $363 million to a figure in the neighborhood of $1.5 billion (Ames described that as "rough, tentative" and said the OLS drafting process would refine the math). That LSR, as Ames outlined, would: set a higher statewide foundation or "excellence in education" grant (Ames used an illustrative figure of about $10,000 per student in a tentative outline), shift more property tax revenue into a statewide pool (remitted to the Department of Revenue Administration), preserve local authority to raise additional funds for local budgets, and include phased credits for some taxpayers (for example, a primary-residence credit, an empty-household credit and a senior credit). Ames repeatedly described the figures as provisional and said the LSR was intended to open discussion on how to pair spending with revenue.

Public testimony in the record

Representative Ricky read written testimony from Jessica Wheeler Russell of the Merrimack Valley School Board. Her submission said New Hampshire ranks last among states in the share of school costs borne by the state and warned that the state regularly imposes mandates on districts without funding them. In her written testimony she said, "If we truly care about local control, then we should demand that the state meet its funding obligations, and HB 651 would be a good start." The subcommittee discussed that testimony while debating urgency and local control.

Process and next steps

Members who supported ITL on HB 651 emphasized they do not oppose higher funding in principle but want a more integrated spending-plus-revenue vehicle. Members who opposed ITL said the bill is a first concrete step and that perfection should not delay action.

All four subcommittee recommendations will be forwarded to the full Education Funding Committee for consideration before the November 21 cutoff. Several members signaled intent to pursue LSRs and to refine provisions in the coming months; the subcommittee chair said the votes were meant to frame an agenda for the full committee rather than to shut down discussion.

Ending note

The subcommittee paused for a short caucus before returning to make the motions and votes. The chair closed by saying the session had been "a very fruitful discussion" and that the subcommittee had aimed to set priorities and a work plan for the 2026 session.