The nonprofit organization managing New Hampshire’s rapidly expanding Education Freedom Account program received a clean bill of financial health this week, bolstering arguments for the education choice program.
Independent auditor Grant Thornton LLP issued an unqualified opinion to the Children’s Scholarship Fund New Hampshire (CSFNH), the contractor responsible for administering the state-funded grants. An unqualified, or “clean,” audit is the highest level of assurance an outside auditor can provide, indicating that the financial statements are fairly presented and free of material errors under generally accepted accounting principles.
“We take seriously the trust that families, taxpayers, and state leaders place in this program,” said Kate Baker Demers, CSFNH executive director. “Our priority is to provide the highest level of service with the utmost accountability. This audit reinforces that commitment.”
Administrative operations costs to oversee the program declined this year to 7.83 percent. That is the share of funding CSFNH spends on its own overhead operations to administer the EFA grants and programs. Baker Demers compared that with other nonprofits that typically have an administrative cost rate of 10 percent or more.
“The program’s administrative rate of 7.83 percent directs the vast majority of funds straight to children for educational expenses,” Baker Demers said.
The positive financial review comes at a critical juncture for the EFA program. Originally designed for lower-income households, Gov. Kelly Ayotte and the GOP-controlled Legislature expanded access to all New Hampshire students earlier this year, a move opposed by Democrats. Currently, more than 10,000 students are enrolled, using state funds to pay for private school tuition, tutoring, and other nonpublic educational expenses.
Baker Demers views the 2024 audit as confirmation that CSFNH is a responsible steward of these growing public resources.
“In a time when transparency and accuracy matter more than ever, we are proud that this independent audit confirms our commitment to integrity and responsible administration,” she said.” New Hampshire families rely on us to manage this program with care, and this audit reflects the high standards we hold ourselves to every day.”
The audit results were immediately embraced by Republican leadership, who have championed the EFA model against Democratic opposition. House Majority Leader Jason Osborne, R-Auburn, argued the findings validate the decision to use a third-party contractor and prove the program’s efficacy.
“These results are further proof that this wildly successful program continues to serve Granite State families with excellence. Republicans have said all along that EFAs are transparent, accountable, and life-changing for families,” Osborne said. “Democrats desperately hoped to find something wrong because the program is Republican-led and tremendously popular. Instead, they got a clean bill of health, again.”
The audit comes out as House Democrats have been looking for ways to discredit the program. The House Office of Legislative Budget Assistant is currently conducting a performance audit of the entire EFA program, which is expected to criticize the program’s oversight.
Christine Young, director of the Legislative Budget Assistant Audit Division, told members of the Joint Legislative Performance Audit Oversight Committee last week that the audit has already listed 40 “observations” to be addressed. In performance audit terminology, an observation refers to any deviation or area that needs improvement.
But Young’s statements come months before the performance audit is anticipated to be completed, and Young herself said the findings are fluid as auditors work through the facts. The audit will not result in a public report until the spring.
Democratic lawmakers have long tried to obtain a financial audit of CSFNH but were legally blocked. Under New Hampshire law, state contractors control their own financial data and are not required to share that information. Osborne said the results of CSFNH’s independent audit put concerns about money management to rest.
“Our gratitude goes to CSFNH for their stewardship and to the thousands of families who continue to demonstrate why school choice works,” Osborne said. “The EFA program is doing exactly what it was designed to do — and doing it extraordinarily well.”
