Merrimack budget committee hears detailed special-education briefing as costs and mandates rise

MERRIMACK, N.H. — District student-services staff told the Merrimack School District Budget Committee that special-education demand and state funding rules are driving volatility in next year’s proposed budget.

Sarah Reinhardt, the district’s director of student services, told the committee the district currently serves 775 students with individualized education programs (IEPs), roughly 20% of enrollment, and noted the number fluctuates as students enter and leave services. “These out-of-district numbers will ebb and flow as students age out and move,” she said.

The presentation outlined why costs can spike unpredictably: when the district cannot fill required positions it must hire contracted providers, which shows up as overexpenditure in contracted-service lines while the corresponding salary lines remain underexpended. Those underexpenditures are then used to offset the contracted-service overages. Reinhardt and committee members repeatedly cautioned that federal and state law require the district to provide a free and appropriate public education (FAPE) in the least restrictive environment, limiting local discretion to curtail mandated services.

Committee members pressed for fiscal clarity. One member noted the district received federal IDEA funding but that special-ed aid (historically called catastrophic aid) arrives a year in arrears and at variable reimbursement rates, so relying on it in the current budget is risky.

Reinhardt also explained the district’s cap on out-of-district tuition: the school budgets a $68,000 cap per placement for the educational portion of tuition, with any amount above that eligible for state reimbursement subject to documentation. She said the district had 23 out-of-district placements this year and can inherit placements when students move into Merrimack.

Medicaid reimbursements are another uncertain revenue stream. Reinhardt described changing state rules and administrative requirements that have reduced district Medicaid receipts and made future amounts difficult to predict. “Medicaid numbers are very much in flux,” she said, noting that billing rules have changed and that some previously eligible families were redetermined during state Medicaid redetermination efforts.

Committee members sought detail on IEP mechanics, 504 plans and ESOL counts. Reinhardt summarized the process: anyone can refer a student; the district convenes a disposition-of-referral meeting within 15 business days and, with parental consent, completes evaluations within 60 calendar days. Separately, the district reported 478 students have 504 plans, and 131 students are English language learners (98 receiving direct services).

Reinhardt said the district is reallocating some specialized-staff training costs to federal IDEA grant funds so the local budget reflects fewer training line items while continuing staff development. She also stressed that IEPs and related documentation are prepared in-house by district special-education teachers and reviewed by local educational agency representatives.

The committee did not take a final vote on special-education funding; members asked for follow-up documents tracing historical spending shifts by line item and clearer projections for contracted services and potential out-of-district placements.

What’s next: the committee signaled it will continue asking for more line-item detail and historical context to better assess the district’s proposed numbers as it prepares recommendations to present to voters.