Area Schools to Receive Windfalls

Valley News Staff Writer
Thursday, September 08, 2016

Grantham — Several Upper Valley school districts are set to cash in on a recent court decision that abolishes the cap on New Hampshire education funds and awards roughly $11 million to districts statewide.

A Sullivan County Superior Court judge on Tuesday ruled the state’s cap on adequacy funding is unconstitutional. In the decision, the court awarded about 40 districts across the state with money school officials said was lost in the past fiscal year due to the cap.

Those districts include Grantham, which could recoup $520,926; Orford, $50,532; Lyme, $27,482; and Lebanon, $19,480. The largest payouts will be to southern-tier cities and towns, where districts are under greater strain to meet the demands of increasing school enrollments.

Adequacy aid is partially determined by enrollment.

As part of New Hampshire’s constitutional obligation to provide every child with an adequate education, the state funds are based on a formula that considers a district’s student enrollment, the number of children using free and reduced lunch programs, those in English as a second language classes and special education programs, said Caitlin Davis, an internal auditor at the state Department of Education.

Since 2009, each district’s adequacy aid also has been subject to a cap based on a percentage of what the district received in previous years.

Since 2012, the cap on the city of Dover, N.H., short-changed the Seacoast community by more than $7 million and left other communities without $79 million in necessary funding, according to the city’s lawsuit against the state.

In its lawsuit, Dover argued the cap violated the New Hampshire constitution, which previous court rulings have determined calls for state funding of education. Dover also wanted the state to repay all of the money lost to each affected community.

Judge Brian Tucker ruled in the city’s favor on the first argument, but said school districts only are able to collect on the 2016 fiscal year because the money needed to reimburse school districts for previous fiscal years hasn’t been raised.

The affected Upper Valley school districts celebrated the decision, but were cautious of a possible appeal.

As intervenors in the case, House Speaker Shawn Jasper and Senate President Chuck Morse, both Republicans, can pursue further court action.

“Thinking that this ruling may be appealed, it could be a while before we know if this (reimbursement) will actually happen or not for Grantham,” Superintendent Jacqueline Guillette said in an email on Wednesday. “In the meantime, we will be working with our attorney to review the judge’s ruling and to explore all options that the (School Board) will have should Grantham receive this money.”

While Grantham is expected to receive a sizable sum as a result of the case, it’s not because of enrollment, Davis said. The number of students enrolled in grades one through six in the Grantham School District has hovered around 230 since 2012, a decrease from around 250 students in 2010.

Instead, a technical change in the funding formula caused the district to hit its cap, Davis said, although she noted she wasn’t sure what the modification was or when it occurred.

When asked on Wednesday why Grantham hit the cap, Guillette also said she didn’t know.

Lyme also has reached its cap since 2014, but since officials there continued to receive increased school funding, they didn’t feel there was cause for concern.

“That sounded like pretty good news,” Superintendent Mike Harris said of the funds, adding that school officials never imagined how much the district actually was losing.

Neither the Lyme School District nor the Rivendell Interstate School District, which includes Orford, has “been party to these proceedings up to this point,” said Harris, who is superintedent of both districts.

If the money does come through without an appeal, it likely would go into the districts’ general funds, he said.

Although some area school districts can be considered winners in the case, others could lose out on future funding, said Rep. Andrew Schmidt, D-Grantham.

Schmidt, a member of the House Education Committee, said he has been supportive of efforts to repeal the cap, which was scheduled to happen anyway in 2018, but said he still worries about communities with declining enrollment, such as Plainfield and Cornish, which are not expected to gain from the ruling.

“Districts that lost enrollment are more apt to be significant losers in funding,” he said on Wednesday. “This could really hurt districts that lost enrollment.”

Rep. Susan Almy, D-Lebanon, also worried the decision could impact other state functions, since the Legislature made its current budget assuming the cap would remain in place.

“I just hope the $11 million comes out of the extra money that was going in the rainy day fund, rather than forcing bigger cuts in (the state Department of Health and Human Services) and other departments,” she said in an email.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.