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Constitutional Amendment
CACR 12 provides that "the legislature shall have full power and authority and the responsibility to define reasonable standards for elementary and secondary public education, to establish reasonable standards of accountability, and to mitigate local disparities in educational opportunity and fiscal capacity. Further, the legislature shall have full power and authority to determine the amount of, and the method of raising and distributing, state funding for public education." The proposal originated in, and passed, the House. As amended by the Senate, the House did not concur with the change, but requested a Committee of Conference. The Speaker appointed Reps L.Ober, Hess, Balboni, and Renzullo to the negotiations, with Rep. Foose named as an alternate. In late March, the Senate agreed to the Committee of Conference, but President Bragdon has yet to name Senators to serve on the committee.
ACTION ITEM
Please contact your local representatives and senator to express your opposition to this proposal. NHSBA has a long history of opposing constitutional amendments that seek to break the promise of a state commitment to public education for all children everywhere. The resolution states, "NHSBA opposes any constitutional amendment that vacates the spirit and intent of the Claremont and Londonderry lawsuits and attempts in any way to limit or redirect funding in a manner that is contrary to the New Hampshire Supreme Court's ruling and present interpretation of the New Hampshire Constitution." The proposed change diminishes the current "fundamental right" to an education, and removes the obligation to ALL public school students. At risk are millions of dollars in state support. Significantly reducing the amount of state aid will place even more strain on the local property tax, if those lost revenues are indeed replaced. If not replaced but followed by budget cuts, losses and reductions to educational programs will lead to fewer educational opportunities for our youth.
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Other Post Employment Benefits (OPEB) Trust Bill
SB 83, enabling municipalities to establish trusts for other post-employment benefits (OPEB), received the House Municipal & County Govt. Committee recommendation to include school districts. The proposed amendment gives school districts the authority to establish an irrevocable trust for post-employment benefits such as medical, disability, or other health benefits as are covered by GASB Statement 45. Establishing such an OPEB trust provides more favorable accounting treatment and lower liabilities. School districts that have such a liability may utilize this trust as a way to manage the long-term cost implications of their OPEB benefits. The bill is scheduled for House consideration next week.
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Defined Contribution Plan and the NHRS
SB 229 is the Senate position that establishes a Study Commission to make recommendations on whether the current NHRS system should be replaced with a defined contribution plan for all new hires. Specific areas to be addressed include: Evaluation and comparison of defined contribution plans in place in other states, and the employee/employer contribution requirements; Evaluation of the effect on retirement account balances and member retirement outcomes of allowing participant loans or hardships withdrawals; Evaluation of various investment management options; Evaluation of a plan design with a fixed employer and employee contribution, but which provides a hybrid defined benefit and defined contribution member benefit. The study will also provide a legislative history of the existing retirement system and the financial impact that major legislative decisions have had on the funding of the corpus of the plan, as well as challenges facing the system in the future. The Commission's report is due on or before December 1, 2013. A public hearing on SB 229 in the House has yet to be scheduled.
HB 1460 is the House position that implements a Defined Contribution Plan, essentially mirroring the original version of SB 229. The bill is scheduled for a public hearing in the Senate next Thursday, April 12 at 10:00 in the Senate Executive Departments and Administration Committee . Despite concerns with the high cost of transition associated with the plan, the House adopted its position assuming the House Special Committee on Public Employee Pensions Reform can quickly study implementation issues. Pension Reform Subcommittees have been created to study different aspects of moving to a Defined Contribution Plan. The six subcommittees will focus on plan design, transition, public interest issues including employee benefits, "best practices" learned elsewhere, legal issues and a possible hybrid plan. Efforts to address the estimated $1.2 billion addition to the unfunded liability are paramount for the committee. The schedule is very tight, as committee members recognize that resolution of these issues is necessary by early May.
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Building Aid on Both the House and Senate Calendars Next Week
SB 383, making grants available beginning in FY 2014, at a total amount determined by the legislature, is scheduled for a public hearing before the House Finance Committee on Tuesday, April 10 at 10:00. SAU office facilities and temporary space, including modulars or trailers, is not eligible for aid. 50% of the total eligible aid is paid "up front", with the balance paid upon completion of construction. The amount of the grant varies from 20-80%, based on property and income wealth. Available aid will be allocated based on a priority ranking system to be developed by Dept. Educ. by Nov. 2013 based on unsafe conditions; obsolete, inefficient, or unsuitable facilities; and overcrowding. Applications will be due by December 1 of the fiscal year prior to the biennium in which school building aid is to be disbursed.
HB 533, also resuming state aid beginning in FY 2014 but capped at an annual amount of $50 million, is also scheduled for a public hearing next Tuesday, before the Senate Education Committee at 2:00. The amount of a grant is 30% of the cost of construction, paid up front with SAU facilities still eligible. Applications must include the least costly plan that meets minimum state building standards, as well as a 20-year maintenance plan to achieve the design life expectancy of the building. A similar ranking system to that described above for SB 383 is to be developed by the Dept. of Education. Proposed interim rules are due by November 2012, and final rules no later than April 30, 2013. Applications must be submitted by Sept. 1 of each year, with Dept. Educ. rankings of prioritized projects available by January 15 of each fiscal year.
Under both proposals, funding will be available until the cap/appropriation is exhausted.
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Additional House Hearings Next Tuesday, April 10
EDUCATION, Room 207, LOB
10:30 a.m. SB 300, relative to special education services in chartered public schools. For students choosing to attend a state approved charter school, the bill places financial responsibility on the resident school district, and further states that the charter school shall be considered the least restrictive environment. Under federal law, for charter schools not approved by the local district, the state would have financial responsibility, but may transfer that responsibility to local districts. Under our NH constitution, such a transfer represents a clear violation of the unfunded mandate provision.
11:00 a.m. SB 402 requires school districts to develop policies for the management of concussion and head injury in youth sports and limits a school district's liability for injuries occurring on school district property resulting from the action or inaction of a person employed by, or under contract with, a youth program, provided such program furnishes proof of insurance.
11:30 a.m. SB 404 clarifies definitions of sending and resident district for funding pupils enrolled in vocational education programs.
FINANCE, Rooms 210-211, LOB
11:00 a.m. SB 401, relative to average daily membership of pupils and adjustments to adequate education grants. Beginning in FY 2014, pupil data for determining Adequacy Grants will be based on the school year immediately preceding the fiscal year for which aid is distributed. During the course of the school year, the commissioner may make adjustments in grant payments necessitated by variations in the ADMA data for a school district. The commissioner shall adjust the April adequate education grant disbursement to the extent necessary to ensure that the total education grant for each school district is within 5 percent of the school district's estimated total education grant amount that was provided in November of the prior year.
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Additional Senate Hearings Next Tuesday, April 10
EDUCATION, Room 103, LOB
1:00 p.m. HB 1202 amends the definition of "sending district" as it applies to students attending regional vocational education programs and adds specific language relative to chartered public school students attending such programs. For students attending a chartered public school, the sending district shall be the school district in which the student resides. This places financial responsibility on school districts for placement/attendance decisions over which the district has no authority
1:15 p.m. HB 1589 establishes a committee to study and propose a recodification of the education laws.
1:45 p.m. HB 1167 removes the requirement that the equivalent number of hours for the 180 day school year be provided for in department of education rules.
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