Panel considers bill clarifying funding, payments for open-enrollment public schools

Representative Katie Petternel introduced House Bill 771 to the Senate Funding Committee as a Department of Education-requested clarification to RSA 194-d, the open-enrollment statute. The bill seeks to clarify which district pays tuition for students who enroll in an open-enrollment public school and to codify a funding split in which the sending district pays the receiving district no less than 80 percent of its per-pupil cost and the receiving school retains 20 percent.

"This bill corrects some of the issues that arose when Prospect Mountain High School became eligible to receive open enrollment students," Petternel said, and she emphasized that the bill does not ask the state for additional funding but rather aims to make the statute operate as intended.

Supporters described the measure as a way to keep public dollars in public schools and to permit smaller districts or schools with available seats to sustain and expand programming. Rick Ladd reiterated that open enrollment is voluntary for receiving districts and said the 80/20 split was developed in consultation with the Department of Education: "Open enrollment keeps public dollars in public schools," Ladd said, adding that the receiving school maintains curricular control and disciplinary policies and that parents are responsible for transportation costs when students cross district lines.

Operational witnesses described the current practice and financial strains. Dr. Timothy Broderick, superintendent for Alton and Barnstead, which jointly operate the state—s only open-enrollment school, Prospect Mountain High School, said the districts have incurred unpaid receivables under the present arrangements. "My school currently has about $98,000 in unpaid receivables for students we've already educated," Broderick said; he added that last year Prospect Mountain had 11 open-enrollment students and that the district had received roughly 40 percent of invoiced payments.

Committee members probed fiscal mechanics. Senators asked whether sending districts realize marginal savings when a student leaves. Witnesses said districts may realize savings only after enrollment declines enough to allow staff or facility reductions; conversely, receiving districts with unused capacity may have near-zero incremental costs when they add students. Senator Sidorias noted that incremental cost can be close to zero where empty seats exist; Broderick and others said districts often budget conservatively and that a line item for estimated open-enrollment tuition could be established and adjusted.

Local finance and school officials suggested technical refinements. Scott Rose (also identified in the hearing as business administrator for SAU 19) recommended clarifying language to identify the sending district as responsible for specified decisions and to require districts to include a budget line item estimating open-enrollment tuition expenditures and corresponding offsetting revenues. Rose also noted special education and Section 504 accommodations can create added per-student costs that should be considered in the funding arrangement.

Opponents expressed concerns about equity and fiscal pressure on property taxpayers. Caitlin Bernier, a member of her town—s budget committee, told senators she opposed the bill, arguing it would widen disparities by directing limited local dollars and potentially forcing program cuts in property-poor districts. "This bill will cause a greater inequity among our most vulnerable population and further divide our New Hampshire communities," Bernier said, urging the Legislature first to address broader state funding for public and special education.

The committee received technical questions and suggestions but took no final vote at the hearing. Sponsors and witnesses urged additional language clarifying who pays for special education services, how tuition lines should be budgeted at the local level, and how to treat districts with differing per-pupil costs.