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School Finance Talk of Race for N.H. Governor

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Concord, N.H.

School-finance reform has emerged as the hottest political topic in the Granite State this fall, thanks in part to a gubernatorial hopeful who has been called a "kamikaze candidate" and "the Howard Stern of New Hampshire."

Over the past year, a state supreme court decision has put pressure on Gov. Stephen Merrill and the legislature to rethink a finance system that relies almost entirely on local property taxes.

And while the state's recession-battered economy is on the upswing, property-tax bills that skyrocketed in recent years as property values plummeted remain steep.

But credit for the topic's prominence is also due to the single-issue crusade of Fred Bramante, who is challenging Mr. Merrill in the Republican primary next week.

The quirky entrepreneur--who owns Daddy's Junky Music, a New England chain of musical-instrument stores--was once a G.O.P. stalwart. But he has been a colorful thorn in the Governor's side since June, stumping relentlessly for adoption of a statewide property tax.

For example, Mr. Bramante pledged at a news conference to donate $1,000 to Mr. Merrill's campaign if he would agree to a series of seven debates. When the Governor declined, Mr. Bramante began brandishing a rubber chicken.

Though few think he can win the Sept. 13 primary, Mr. Bramante looks to the 1969 New York Mets and the 1980 U.S. Olympic hockey team for inspiration.

"We don't have an office, we don't have buttons, we don't have campaign signs," he acknowledged. "But they are paying attention."

Last December, the state supreme court ruled unanimously that New Hampshire has a constitutional obligation to pay for an equitable system of education. (See Education Week, Jan. 12, 1994.)

Although other states have wider gaps between high- and low-spending districts, New Hampshire's situation is unique because of its particularly heavy reliance on local property taxes, which pay 90 percent of the cost of education.

It is the only state with neither a sales tax nor a property tax, and ranks last among the 50 states in the percentage of school funds provided by the state government.

An 'Awesome' Plan?

New Hampshire residents can afford to pay more for education, argued Dick Goodman, the director of the Center for Educational Field Services at the University of New Hampshire, noting that the state is one of the nation's wealthiest in per-capita income yet has one of the lowest tax burdens.

However, he added, voters are apparently not ready for either an income or sales tax. Tax resistance is a proud tradition in this independent-minded state, where license plates bear the motto "Live Free or Die."

The attention candidates are paying to education issues "is the real good news," Mr. Goodman said. "It's the first time in the 18 years since I returned to my native state that education is the major issue in the campaign."

Mr. Bramante thinks he has a workable solution to the state's education-finance dilemma.

"I have a great plan, my plan is awesome," he declared enthusiastically in a recent interview.

Under the plan, he said, the state would collect $585 million each year in property taxes and redistribute it among school districts. The net effect would be to shift $98 million from property-rich districts to property-poor districts. The percentage of school aid provided by the state would increase from 7 percent to 60 percent. Mr. Bramante asserted that 78.4 percent of residents would see their taxes drop.

Governor Merrill has, for the most part, tried to ignore Mr. Bramante and his barbs. Despite the court ruling, he has stuck to his position that no dramatic change is necessary--especially not if it involves new taxes.

In July, the Governor released his own education plan. In addition to continuing to send about $50 million in aid to districts, he proposed that the state contribute $17 million to fund kindergarten classes, which are not offered everywhere.

Staying the Course

Elizabeth Twomey, the state's new commissioner of education, says that Mr. Merrill's 1992 defeat of a Democratic opponent who advocated an income tax sent "a dramatic message that the public did not want any change to the tax system that would change the New Hampshire way of life."

Mr. Merrill has instead concentrated on altering the equalization formula used to distribute the state's small share of school funding, and asked John Augenblick, a prominent school-finance consultant, to help in the redesign.

While a statewide property tax "may, at first blush, appear to be an equalizing force," argued Ovide Lamontagne, the chairman of the state board of education, "it tends to undermine local control over the expenditures that are made locally for public education."

"I think there are always going to be disparities, and I don't want to penalize a community that has the wherewithal and the willingness to spend the money," he added. "That's the way it is in America; some people drive Cadillacs and other people drive Fords. There are going to be disparities, I don't care what system you devise."

Mr. Merrill was unavailable for an interview.

State Sen. Wayne King, who is running unopposed in the Democratic gubernatorial primary, is a former public school science teacher, as is Mr. Bramante. Mr. King, a member of the part-time state legislature, works as an adjunct professor of government and politics at the New Hampshire Technical Institute in Concord and owns a real-estate company in Plymouth.

While he praised Mr. Bramante's tax plan, Senator King said it fails to deal with inequities within communities and would hurt less wealthy residents in property-rich districts. He said his own plan will include a homestead exemption to address this question.

Bipartisan Criticism

Meanwhile, Mr. King is trying to draw attention to broader education issues and their relationship to economic development.

Early one summer morning, in an interview on "Coffee Chat" at radio station WKXL in Concord, he argued that the state must "create a brain-fed economy."

That means nurturing the small high-tech companies that have sprung up in the region, he said, and insuring that students develop critical-thinking and problem-solving skills.

"I have a 2-year-old who is the ninth generation of my family to be born in New Hampshire," he remarked later. "In the last 10 years, I have seen good opportunities for young people who grew up here and went to college here disappear, and I'd like for him to be able to stay here."

Observers agree that Mr. King has a much better chance to unseat Governor Merrill than Mr. Bramante. But even Carol Castarphen, a spokeswoman for the New Hampshire affiliate of the National Education Association, which has endorsed Mr. King, acknowledged that he faces an uphill battle in this Republican-dominated state.

The two challengers share a deep frustration with the status quo. At a debate at the Londonderry Lions' club, for example, Mr. Bramante and Senator King sounded more like old college pals than political rivals as they joined in bashing Governor Merrill. Although the event was billed as the first Bramante-Merrill debate, the incumbent did not attend.

Mr. Bramante used stacks of Lego blocks to illustrate how his plan will ease the tax burden on poor communities by forcing wealthy ones to pay more.

Mr. King displayed a photograph of a modest, $80,000 home in Claremont, followed by a photo of a luxurious $400,000 home in Newcastle. Both houses carry a $3,000 tax bill. The first house, he said, could fit in the garage of the second.

"The issue is not how we spend," he said, "but how we raise what we spend."

A Renegade Is Born

Mr. Bramante traces the origins of his campaign to a 1990 visit to the palatial home of an acquaintance in Newcastle, who he learned paid only $1,500 in property taxes.

"And I'm paying multiples of what he's paying in taxes," he recalled. "I knew every town didn't have the same taxes, but that's the first time I realized it was so disproportionate."

In 1991, Gov. Judd Gregg appointed Mr. Bramante to the state school board. His interest in a statewide property tax rose further when he served on a bipartisan legislative panel that studied the idea.

After the state supreme court rendered its decision, Mr. Bramante said he tried to get an appointment with Governor Merrill to discuss the tax plan.

"I couldn't get the time of day from him," he complained.

"When somebody tells [Mr. Bramante] you can't do something, that only makes him more convinced that he ought to do it," observed State Rep. Douglas Hall, a Republican. "A Governor saying 'Sit down and shut up' is what drove him into the campaign."

And Mr. Merrill has found himself faced with an unusual opponent, as evidenced by the vast array of memorabilia scattered about Mr. Bramante's office in Salem: Elvis Presley dolls, several '57 Chevy models, a plush Green Bay Packers football. Like a one-man Hard Rock Cafe, Mr. Bramante is a collector of pop-culture relics. He even has a 1975 Cadillac once owned by Elvis himself.

During the interview, Mr. Bramante disappeared briefly to fetch a box containing Ringo Starr's costume from the movie "Caveman." He pondered whether he should use it to illustrate his view of Governor Merrill's education policy.

Mr. Bramante remains convinced that the Governor's opposition to a statewide property tax will hurt Republican legislative candidates in November.

Mr. Bramante said he would not endorse Mr. King if his own bid fails in the primary, but he may continue to stump for his tax plan.

"My goal is this plan," he said. "Success to me is that this plan is implemented, and it's implemented in a fiscally conservative manner."

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