Published: January 6, 2005

Finance Snapshots

New Hampshire

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Responding to rulings by the New Hampshire Supreme Court in the several Claremont cases against the state’s school finance system, the state made major changes in 1999, switching from a local to a statewide property tax. New Hampshire also has tried to incorporate the concept of an adequate education into its foundation formula. The state calculated the foundation level for the formula, the “average per-pupil adequacy cost,” based on the actual spending in certain districts. Each biennium, the state adjusts the figure for inflation. For fiscal 2005, it is $3,390. This amount is then multiplied by the average daily membership for each district. The state adds money for students in poverty, with each student eligible for free or reduced-price meals counting as 1.6 students in the formula. The state also provides equalization aid for property-poor districts. School systems with a per-pupil assessed valuation that is below 90 percent of the state’s per-pupil assessed valuation receive more state aid. New Hampshire dedicates 100 percent of the proceeds from its state lottery to education. Additional money comes from the tobacco tax, the business-enterprise tax, real-estate-transfer taxes, and state property taxes.

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