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Bob Odell
State Senator
District 8

February 13, 2011

Senator Odell is Chairman of  the Ways and Means Committee; Chairman of the Energy and Natural Resources Committee; Vice Chairman of the Finance Committee; Vice Chairman of the State Parks Advisory Council; and member of the  Capital Budget Committee.

Senate District 8 towns: Acworth, Alstead, Charlestown, Claremont, Gilsum, Goshen, Langdon, Lempster, Marlow, New London, Newbury, Newport, Roxbury, Stoddard, Sullivan, Sunapee, Sutton, Unity, Walpole, Washington and Westmoreland.

 


There was bipartisan support for the educational funding plan rolled out by the Senate majority last Thursday. The plan, in concept, is pretty straightforward. Local communities will receive for the next two years the same amount, as bill sponsor Senator Jim Rausch (Derry) said, "to the penny" that they are receiving this year.

At the press conference announcing the plan, a letter from Governor Lynch was read which said "I believe your proposed legislation moves us in the right direction, helping us meet the goals of ensuring sustainability, avoiding dramatic decreases in state aid to some communities, and averting the return to donor towns."

Behind the scenes, Governor Lynch has been working with Senator Rausch, the other key bill sponsor, Senator Nancy Stiles (Hampton) and other Senate leaders to craft the bill. There should not be partisan agendas when it comes to school funding and I think Governor Lynchís support of the Senateís majority plan helps move away from partisanship on this issue.

The elements of the new funding plan are important because they change some of the philosophy underlying the current formula.

First, the basic adequacy grant of $3,450 remains the same. This is the money constitutionally mandated to pay for an adequate education as defined by the legislature in 2007.

Secondly, rather than look at an entire school, indicators of poverty will be based upon each child. That means for every child qualified for free and reduced meals, often referred to as a measure of poverty, the community will receive $1,725.

And, a new aid category dedicated to third grade students testing below "proficient" on the reading component of some standard state tests, would trigger a $675 per student payment. These two compoents replace a series of other measurements in the current distribution formula.

Third. The prospect of donor towns is removed. In simple terms, that means that money raised within a community through the statewide property tax remains in the community. The donor town concept has been a divisive factor in school funding deliberations. For now, that discussion can end.

Fourth, through a state stabilization grant, an appropriation will be made to assist cities and towns that would otherwise lose funding and end up with less money in each of the next two years than they received this year.

This new funding formula, with the Governorís support, gives school districts and voters preparing for budget votes and annual school meetings the confidence that the state will provide the same amount of money as this year.

The House, too, is looking at a new approach to school funding. In a bill introduced by Representative David Hess (Hooksett), communities would get the same level of support as they are getting this year. That is the same general approach as the Senate bill offers, so both legislative bodies are moving in the same direction.

This certainty, while not yet law, is important to voters and school administrators alike. Over the years, the legislature has waited until the final budget had passed in late June to determine the allocation of school funding grants. Thatís months after school meetings and budget votes have occurred.

Many Senators feel the Rauch-Stiles legislation solves many problems and keeps the overall spending for education at the state level, affordable and sustainable.

*

The Governor makes his much-awaited budget address on Tuesday. In the budget process, the Governor is required by Feb. 15 to present his plan for a balanced budget for the next biennium beginning on July 1.

Budget submissions from departments and agencies were made late last year. There is a maintenance budget and another requested by the Governor seeking spending budgets of 95 percent below the current budget. Reducing budget requests from departments lowers the gap between revenues and overall spending over the next two years.

On the revenue side, the Governor will give us his take on economic growth over the couple of years. First question: what will he say about the rest of this fiscal year? Through last month, the state was right on target in terms of revenue, but March and April are the largest months for filings and payments from businesses.

Observers will be looking to see if the Governor sees revenue meeting goals through the end of June. Finishing up this fiscal year in balance would even the playing field to start the new biennium.

The Governor will be making revenue projections going out more than two years. I shudder when I listen as some analysts try to predict cigarette sales or other individual revenue lines for June, 2013, the last month of the next biennium. It seems to me that past trends are the best indicators of economic growth and therefore state revenue over the upcoming two years.

Is a projection of three percent growth a good number as suggested by some State House experts? Or, should we project four percent economic growth? The one percent difference is worth about $50 million.

The House gets the budget first and then it comes to the Senate at the end of March. The House has already released its revenue projections for the next biennium. Following past precedence, as Ways and Means Committee Chair, I will wait until we have the business tax revenue numbers for March and April to ask my committee to come up with our overall revenue projections during the first week of May.

 

Bob Odell
State Senator
New Hampshire State House
107 North Main Street
Concord, NH 03301-4951

Telephone:  603-271-6733
Email:  rpojr@aol.com

 

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