Targeted aid plans perpetuate funding ‘gap’



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A number of proposed targeted education aid plans under consideration claim to help “needy” or “property-poor” communities by providing additional funding to them and not providing funding to “property-rich” communities. The New Hampshire Citizens’ Voice Project analyzed the effect of two targeted aid plans on the 12 poorest communities in New Hampshire, chosen based on their equalized assessed property valuation per pupil. We found that these targeted aid plans do not live up to their claims, and in some cases provide less revenue than current law. Our analysis shows that these plans are just another effort by the state to shift educational costs on to local taxpayers. For example, the towns of Allenstown, Newport and Claremont have very low property values and relatively high local property taxes. Under the targeted aid plan proposed by Governor Lynch, Allenstown receives only $97 more per student and Claremont receives $200 per student more as compared to what current law would provide them next year. Newport actually loses $65 per pupil. Under the targeted aid plan proposed by Rep. Fred King, all of these communities receive less money per pupil next year as compared to current law. The plans do not fund the bare educational necessities in property-poor communities. Our “Fund the Gap” report shows that, on average, it costs $6,153 per pupil just to pay for some teachers, cover some building expenses, provide transportation to students and provide system leadership services (SAU and school board costs). This does not even consider the costs of so many other important items, like books, computers and professional development. The plans we have analyzed do not provide $6,153 per pupil to any of the poorest communities in New Hampshire and only provide $6,153 or more per pupil to one community in the entire state. The King plan provides $7,208 per pupil to Stratford, but no other community gets an amount close to that figure. Allenstown receives $4,753 per pupil under Lynch’s plan and $4,251 per pupil under King’s. Claremont receives $4,832 per pupil under the Lynch plan and $4,533 under King’s plan. This means that there will be a continued gap in property-poor communities between what it costs to provide the most basic educational services and what the state provides in funding. This gap must be paid by local property-tax payers with local property taxes. The “Fund the Gap” figures represent only a portion of what it costs to provide educational services in a community. For example, Allenstown’s proposed budget for 2005/2005 is $8,179,847. It receives only $3,718,480 under Lynch’s plan and $3,325,656 under King’s. The roughly $4.5 million that is unfunded by these plans must be paid by local property taxes at a rate of $17 to $18 per thousand. Similarly, Claremont’s current proposed education budget for all of its educational expenditures for 2006 is in the $24 million range. The $9 million provided by Lynch’s targeted aid plan will leave almost $15 million unfunded. Rep. King’s plan provides even less to Claremont leaving even more of Claremont’s educational expenses unfunded. By contrast, communities with high property values, like Moultonborough, New London, Newington and Rye, are able to spend similar or more per pupil with tax rates in the $3-to-$5 range. As a result, the targeted aid plans will perpetuate the wide tax disparities from community to community to pay for educational services. The full details of the plans we analyzed and their impact on every New Hampshire community are on our Web site, nhcvp.org. We note that these two plans are not the only ones that will lead to these results. There are currently five or six other “targeted aid” plans in the Legislature, and they distribute between $300 million and $450 million in 2006. The total cost of educational services in New Hampshire was around $2 billion in 2004. The state simply cannot “fund the gap” or provide an adequate education with 20 percent of what it actually costs to educate our children. This year, March 10 is “Gap Day,” the day that, on average, state funding for educational services runs out. Funding for the remainder of the school year comes from local communities through local property taxes. If the targeted aid plans as currently proposed are passed into law, Gap Day will come a lot sooner for many communities next year. Scott F. Johnson is “Fund the Gap” project director for the New Hampshire Citizens Voice Project and an attorney for the plaintiffs in the Claremont school-funding lawsuit.

 

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