nhsba

Legislative Bulletin
April 24, 2009

A Brief Summary of Education Issues at the State House

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Senate Begins Budget Deliberations
Next Monday, the Department of Education will be presenting its budget to the Senate Finance Committee.  At that time, it is anticipated that specific information will be presented on the several categorical aid programs administered by the Department.  Building aid, currently pro-rated at $42.8 million, is not in the budget and should receive special attention.  Funding for this program, originally allocated in the governor's capital budget, was omitted when the House chose not to bond for this obligation.  Regarding other state aid, catastrophic special education aid, currently pro-rated at $34 million, is budgeted for $32 and $33 million for the next biennium.  Tuition and Transportation aid, currently at $8 million, is budgeted for $7.3 and $7.5 in each year.  Dropout prevention, currently at $1.75 million, is level funded for both years.  Statewide special education is currently at $300,000 and budgeted for $291,000 and $300,000 respectively.  Local Education Improvement is currently at $500,000 and budgeted for $485,000 and $500,000 respectively.  Another $3.6 million for kindergarten construction is budgeted for only the first year of the biennium.  State aid for an adequate education is fully funded at over $950 million (inclusive of the statewide education property tax) for each year of the biennium.
 
Also impacting local budgets is the "trailer bill", HB 2.  It contains provisions to reduce the state share of payments on annual employer retirement contributions for teachers, police and fire.  The employer teacher contribution rate is currently scheduled to increase by 20% on July 1st.  HB 2 lowers the state 35% share of the teacher rate to 30% for FY 2010, then down to 25% for FY 2011.  Absent any other provision, the impact of this reduction on teachers alone will downshift $5 million next year and $10 million the following year onto local education budgets.  However, in a controversial move, the House version of HB 2 also increases the contribution rates for retirement system members for the coming biennium (employees and teachers, from 5.0 to 7.0%; permanent police and fire from 9.3 to 11.0%).  Monies from the temporary increase would be used to reduce employer contributions for fiscal years 2010 and 2011.  The state share is scheduled to return to 35% beginning in FY 2012, as well as employee rates dropping back to 5% and 9.3% respectively.
 
ACTION ITEM
Please contact your senator and explain the impact of downshifting costs to the local level.  Budgets have been adopted based on expectations of state aid, not only the Adequacy grants, but Cat Aid and Building Aid as well.  Historically, Cat Aid was underfunded in two recent fiscal years: fy 2004 at 92% and fy 2005 at 69%.  Since then, 100% of entitlements were funded, but we are now facing a shortfall with current year funding at 90% of entitlements.  The shortfall this year, as well as anticipated pro-ration next year, forces unexpected impacts on local budgets.  Building aid has historically been fully funded; even when unanticipated shortfalls occurred, the legislature made up the difference in supplemental appropriations.  These grants to communities are the basis of a partnership that is created when school districts adopt local construction projects and bond the expense.  The state commitment is an important part of this process and is often needed to get the necessary super-majority approval.  Loss of this commitment would have a profound impact at the local level.
 
On top of all this is the disturbing potential for the state to back away from its commitment to local public employers regarding a shared stake in the state retirement system.  School districts, and other political sub-division employers, have no direct voice in the policy of the retirement system because the State is the plan sponsor and the legislature makes the rules.  State law requires that members of the NHRS Board be familiar with finance or business management, but 8 of the 14 members are employee representatives, and political subdivisions only received their single representative voice just over one year ago.  The retirement system was created with the understanding that a joint pooled system would benefit both employees and employers, and the promise made to political sub-divisions was that the State would be a partner and pay 35% of the employer share for teachers, police and firefighters.
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Accountability for an Adequate Education - SB 180
The subcommittee reviewing SB 180, which establishes both an input-based and performance-based accountability system to ensure schools are providing the opportunity for an adequate education, will be recommending certain changes to the full House Education Committee when it meets next week to take action on the bill.  The subcommittee worked to soften the aggressive schedule/timeline for implementation, providing for certain targeted goals to be implemented "by the end of" the school year.  In addition, a process for legislative review and adoption of the performance model is also recommended for inclusion in the bill.
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Retirement and "Spiking"
HB 641, which modifies the calculation of the retirement system employer assessment for excess benefits (125% Rule) and phases in the required payments over 4 years, passed the House in late March and was referred to the Senate Executive Departments and Administration Committee.  A public hearing on the bill remains to be scheduled.
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Truancy
HB 332, relative to truancy, was supported by NHSBA at a public hearing before the Senate Education Committee.  The bill changes the definition of "habitual truancy" by reducing the required number of unexcused absences from twenty to ten.  It removes parental permission of absences and requires school boards to adopt policies that define administratively excused absences and identify a system of intervention steps designed to reduce the number of habitual truants in the school district. The policy shall also designate an employee in each school as the person responsible for truancy issues.
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Study of School Discipline
HB 332, establishing a commission to study school discipline, was supported by NHSBA at a public hearing before the Senate Education Committee.  Specific duties of the study commission include a review of the use of out of school suspensions and the effect on suspended students who miss instructional time, examining student behaviors or infractions requiring disciplinary action and the types of violations for which students are suspended, studying the frequency of using out of school suspensions for non-violent behavior and infractions which are not drug or alcohol related, investigating alternative forms of discipline that do not involve removing students from school, and looking at methods for increasing opportunities for suspended students to make up class work missed for disciplinary reasons.
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Economic Stimulus Update
Distribution of ARRA IDEA Funds
The New Hampshire Department of Education, Bureau of Special Education, continues to offer a series of teleconferences regarding the American Recovery and Reinvestment Act (ARRA) and IDEA Recovery Funds. The teleconferences provide guidance to school districts regarding the application and spending of IDEA Recovery Funds.  A PowerPoint of the presentation has been posted on the Departments Recovery Web Site.
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For the complete text of any bill, go to the general court web site and enter the bill number, e.g. HB114, SB38 or CACR2 (no spaces!), and make sure the Session Year is 2009.
 
For more information on specific legislation, please call Dean Michener, NHSBA Director of Governmental Affairs at 603-228-2061, or email: [email protected].

 

Dean Michener
NHSBA Director of Governmental Affairs