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Just days after a New Hampshire Department of Education report showing public school enrollment plunging amid spending hikes, a judge has ordered the state to pay even more.

Rockingham Superior Court Judge David Ruoff released his long-awaiting ruling in the ConVal education funding lawsuit on Monday, declaring the state must pay a per-pupil minimum state adequacy grant of $7,356. The net cost to state taxpayers would be nearly $538 million per year. And, Ruoff said, that’s likely just the beginning.

“What is the base cost to provide the opportunity for an adequate education 239 years after that fundamental right was ratified in our Constitution? The short answer is that the Legislature should have the final word, but the base adequacy cost can be no less than $7356.01 per pupil per year, and the true cost is likely much higher than that. At a minimum, this is an increase of $537,550,970.95 in base adequacy aid to New Hampshire Schools,” Ruoff wrote.

Ruoff wasn’t done. In a separate ruling in the Rand vs. State of New Hampshire case, Ruoff ruled that property-rich communities can no longer keep excess Statewide Education Property Taxes revenue in reserve. That practice allowed these communities to set a negative SWEPT tax rate.

Ruoff initially tried to avoid setting a number in the ConVal case. He ruled for ConVal in 2019, finding that the state’s education funding system results in an inadequate amount per pupil, and is therefore unconstitutional. However, he originally ruled that it is up to the legislature to determine the number, not a judge.

After the state appealed, the New Hampshire Supreme Court ordered Ruoff to hold a trial and determine what the cost per pupil ought to be. 

Ruoff’s order still faces a possible challenge from the state. Gov. Chris Sununu called Ruoff’s decision an overreach.

“New Hampshire currently spends among the most per capita on public education than nearly any other state. Today’s decision is deeply concerning and an overreach into a decades-long precedent appropriately placed in the hands of our elected representatives in Concord,” Sununu said.

New Hampshire Department of Education Commissioner Frank Edelblut’s office declined to comment. Michael Garrity, communications director for New Hampshire Attorney General John Formella, said Ruoff’s decisions are being reviewed.

“We have received the court’s order. We will review it and consider potential next steps,” Garrity said.

But the Josiah Bartlett Center for Public Policy, a pro-education-reform think tank, immediately blasted the premise of the judge’s ruling, noting that education spending in New Hampshire has exploded, even as the number of students in the k-12 fallen drastically.

“NH public schools are not ‘underfunded’ and have not experienced a decline in funding this century. On the contrary, as school district enrollment fell by 30,000, spending, adjusted for inflation, rose by nearly $1 billion,” the Barlett Center posted on X.

As for the judge’s arbitrary price of an “adequate” education, the center responded:

“Trying to figure out the true cost of an adequate education by measuring what monopoly school districts spend is like trying to figure out the true cost of package delivery by measuring Post Office prices before the arrival of FedEx and UPS. Markets, not judges, set prices.”

But Democrats, who’ve been pushing for more state spending for decades, were delighted.

State Sen. Democratic Caucus Leader Donna Soucy (D-Manchester) is ready to start charging. Ruoff’s decision will be the template she and other Democratic lawmakers will use going forward as they look to increase school spending to at least the $7,300 minimum,

“Our caucus will closely review the court decisions released today, and we will examine legislative action to ensure that a constitutional formula is enacted,” she said.

Zack Sheehan, the executive director of the left-leaning New Hampshire School Funding Fairness Project, called the decisions big wins for students and property taxpayers. He said that the legislature’s refusal to fund education at the state level has pushed the bill down to local property taxes and burned homeowners.

“These are exciting rulings, but for their impact to be felt, the legislature has to get to work and bring our school funding statutes into line with this and all past school funding rulings,” Sheehan said. “The changes promised in the Claremont decisions have been denied to Granite Staters for too long already, so I want to see the state accept this ruling and not continue wasting time by appealing it to the New Hampshire Supreme Court.”

In actuality, New Hampshire hit a state-spending record on k-12 education in the current budget, while few communities cut their property taxes.

In deciding that $7,300 is the minimum adequate education amount, Ruoff used numbers provided by public school districts and the Department of Education. There was no data from public charter schools or private schools, Cline said. He added that it is like deciding what the price of a hamburger ought to be based on just the McDonald’s Big Mac while ignoring Burger King and Wendy’s.

“Markets, not judges, determine prices. That’s the fundamental flaw in this whole game. New Hampshire needs a market for educational services,” Cline said.

The ConVal and Rand lawsuits are the ideological, if not legal, sequels to the Claremont lawsuits of the 1980s and 1990s. In Claremont, the New Hampshire Supreme Court ruled all New Hampshire children have a constitutional right to an adequate education, and the state is on the hook to make sure that happens. The Supreme Court, however, left the funding details up to lawmakers.

The Peterborough-based Contoocook Valley Regional School District filed the lawsuit in 2018, arguing the state’s then-adequate education grant of $3,600 per pupil was far below the true cost and, therefore, was unconstitutional. ConVal and the dozens of school districts that joined the lawsuit wanted closer to $10,000 per pupil.

Since the ConVal suit was filed, lawmakers and Sununu bumped up the grants to $4,100 per pupil, an amount Ruoff still found unconstitutionally low. The total cost of education in New Hampshire, including the portion paid through local property taxes, averages just shy of $20,000 per pupil. 

The Rand lawsuit saw parents in property-poor towns challenging the way they claimed wealthier communities were able to game the SWEPT system, increasing the propeller of education funding inequality.

SWEPT accounts for 30 percent of education funding in New Hampshire. Under the law, as many as 30 wealthy Granite State communities keep a portion of the money raised through the SWEPT, while some poorer towns are paying more, according to the lawsuit.

Could the next 60 days see an end to New Hampshire’s school funding system as we know it?

Rockingham Superior Court Judge David Ruoff told lawyers Wednesday he is set to rule sometime in the next 60 days on either the final decision in the Contoocook Valley Regional School District adequacy grant lawsuit or the summary judgment for the Grafton County lawsuit seeking to cancel the Statewide Education Property Tax or SWEPT.

“Time is of the essence here for everyone involved,” Ruoff said.

New Hampshire lawmakers, education leaders, and local school boards have been tussling for decades over how to fund a constitutionally-mandated adequate education. Despite hundreds of millions in new funds going to education this year alone, there is still no agreement on how to pay for public schools.

Ruoff is now the one man in the state who could change everything thanks to the lawsuits which landed before him in court. 

The original judge on the Grafton County case, Grafton Superior Court Judge Lawrence MacLeod, recused himself last year, citing a potential conflict of interest. MacLeod is a property owner in one of the property-rich towns pushing to keep the current SWEPT system in place.

MacLeod’s recusal sent the case to Ruoff. Ruoff is also under orders from the New Hampshire Supreme Court to decide in the ConVal case exactly how much the state should pay per pupil.

In both cases, the school districts claim the way the state is currently funding education, using an unevenly enforced SWEPT to pay for adequacy grants that do not cover all necessary expenses, is unconstitutional.

Ruoff initially ruled in ConVal’s favor, agreeing the state is not paying enough per pupil, but he left setting a particular amount to legislators. On appeal, the Supreme Court ruled Ruoff needed to hold a trial and set a specific dollar amount.

New Hampshire upped its per pupil adequacy grant this year to $4,100. But the plaintiffs in the ConVal case are looking for just short of $10,000 per pupil. Ruoff listened to weeks of testimony this year; his highly anticipated ruling is pending.

With approximately 160,000 students in the state’s K-12 public schools, a $10,000 adequacy payment would cost state taxpayers $1.6 billion yearly.

Meanwhile, lawyers representing the state and the Grafton County plaintiffs argued in court Wednesday over an injunction to set the SWEPT rate at 0, as the plaintiff wants. Ruoff indicated he would issue a judgment in the case without need for a trial since neither side disputes the facts about how schools are funded.

SWEPT accounts for 30 percent of education funding in New Hampshire. Under a law change in 2011, a loophole was created. Now as many as 30 wealthier communities in New Hampshire are keeping a portion of the money raised through SWEPT, essentially getting to set a negative property tax rate, while poorer communities end up with higher SWEPT rates to make up for their low property values.

Michael Jaoude, an attorney for the plaintiffs, said the uneven SWEPT burden violates the Claremont decision from the 1990s, which ruled there is a constitutional right to adequate education and that the cost needs to be shared equally.

“No resident should have a greater burden of funding that constitutional right than another,” Jaoude said.

SWEPT started in 1999 as a response to the Claremont decision, which found the state has a constitutional obligation to fund adequate education. The money raised, more than $360 million estimated in the coming year, is used to fund state adequacy grants. 

Senior Assistant Attorney General Sam Garland said ruling for the Grafton County plaintiffs would have disastrous impacts on local town and school budgets. Garland said the plaintiffs have not shown that the SWEPT system is unconstitutional, and their arguments don’t hold up.

“We don’t think they’ve made that showing, and we don’t think they can make that showing as a matter of law,” Garland said.

Garland said even if the 2011 law creating the SWEPT exemptions might be unconstitutional, the tax itself is not, and Ruoff should allow the rate to be set.

Ruoff indicated the whole SWEPT issue might be moot depending on his eventual ruling in the ConVal case.

As the legal battle over school funding plays out in the ConVal lawsuit trial in the Rockingham Superior Court this week, new data show the massive increase in school spending is tied to the nearly 60 percent increase in the number of district administrators.

School superintendents are among the highest-paid public employees in the state, with salaries more than double that of the average teacher. That is certainly the case in the Contoocook Valley Regional School District, which is currently in court demanding more state funding.

According to data compiled by the New Hampshire Department of Education, Superintendent Kimberly Rizzo Saunders’s salary is more than $171,000 a year. That makes her one of the highest-paid superintendents in the state.

A study released this week by the Josiah Bartlett Center for Public Policy showed taxpayer spending on New Hampshire school districts rose by $1.5 billion over the last 30 years even as the number of students fell by 14 percent. Even adjusting for inflation, taxpayers poured in an additional $937 million to educate fewer kids.

“This massive spending increase–40 percent when adjusted for inflation–occurred as public school enrollment was cratering. From 2001-2019, New Hampshire district public school enrollments fell by more than 29,946 students or 14 percent,” the report stated.

It was particularly true for administrative costs. According to the report, that 14 percent drop in enrollment was accompanied by a 15 percent increase in district administrative staffing.

“Adjusted for inflation, per-pupil spending increased 83 percent for support services, 82 percent for general administration, [and] 74 percent for school administration.”

The trend appears to be at work in ConVal schools. For example, in 2001, the Contoocook Valley Regional School District had 3,227 enrolled students. By 2019, it had fallen to 2,176, or 32.5 percent.

At the same time, school spending — mostly paid for by property taxpayers — rose from $37.3 million a year to more than $47 million, an increase of 26 percent.

The numbers don’t lie, said Ben Scafidi, the author of the report and a professor of Economics at Kennesaw State University and director of the school’s Education Economics Center. “Taxpayers are spending more money on fewer students,” he said.

The problem isn’t teacher pay, which has risen modestly. Instead, one of the biggest cost drivers in public schools has been the number of district-level administrators and staff, up 57 percent, Scafidi said. They are employees who do not teach and who generally do not interact with students.

“Most of the spending increase went outside the classroom,” Scafidi told WFEA radio’s Drew Cline Wednesday. Cline is also the president of the Josiah Bartlett Center.

While the number of students dropped 14 percent, the number of school principals overseeing their education dropped by just two percent.

“It’s very out of whack with the decrease in students,” Scafidi said.

In the same period, schools were beefing up spending and losing students, and the rest of New Hampshire’s government was growing at a much smaller pace, Scafidi said. He said that public colleges and universities saw an 8 percent increase in the number of students and responded with a more than 7 percent increase in staff. All other state agencies grew by about 1.2 percent, with more than 300 employees, even though the state population went up 8 percent.

New Hampshire is now spending thousands more per pupil than other states; he said, around $3,900 more. The average state spending per pupil is close to $19,000. This hasn’t stopped districts like ConVal from fighting the state for more per-pupil spending.

The state sends nearly $4,000 per pupil to each school district as part of the adequate education grants. ConVal’s lawsuit claims the real cost of the constitutionally mandated adequate education is much higher, and it wants the state to send $10,000 per pupil.

In addition to Rizzo Sanders’ $171,000 a year — which puts her in the top bracket of school superintendents — the assistant ConVal superintendent earns more than $141,000. That’s more than many superintendents in nearby districts, where the pay ranges from about $100,000 to $150,000.

Not that ConVal is at the top of the heap for administrative salaries.

Hanover’s superintendent brings in $178,000, and Nashu pays its superintendent $172,500. Oyster River’s superintendent is the top earner, taking home more than $192,000.

Part of the blame for the increase in the number of outside-the-classroom administrators falls on state and federal governments issuing rules and mandates for local schools.

“Public schools get funding from the federal government, the state government, and local property taxes,” Sacfidi said. “You have many layers of government telling schools what to do, and each layer of government has its preferences, and they impose them on public schools.”

According to Sacfidi, the result is more taxpayer money going to schools that teach fewer students, and more of that money goes to employees who do not step inside the classrooms as part of their jobs.

New Hampshire taxpayers are spending as much as 100 percent more per student as school enrollment continues to slide, and some school districts are fighting to have the state pay more per student.

“The tax burden is incredible, and half of it goes to the schools,” said Dublin’s Leo Plante.

Plante is a local activist who tried unsuccessfully to get his town to withdraw from the Contoocook Valley School District, citing the town’s dwindling student population. As part of the ConVal district, Plante thinks too much Dublin money is leaving and going for students in the eight other towns in the district. 

ConVal has been losing students for 20 years. At the same time, spending on K-12 education has risen. On a per-pupil basis, it’s up more than 100 percent.

And it is not just in Dublin. According to data released by the New Hampshire Department of Education, across the state the cost per pupil has gone up an average of 78.4 percent since 2000. That was faster than the rate of inflation.

The steady increase is coupled with a 22 percent drop in the number of students since 2002. That year, there were 207,648 students enrolled in schools. The number has fallen to 161,755 enrolled for the current school year.

As a result, taxpayers are spending an average of nearly $20,000 per pupil, with the total cost of New Hampshire’s education system coming in at $3.5 billion in the 2021/2022 school year.

ConVal’s 20-year trend has seen a 34.6 percent decline in the number of students while the cost per pupil has shot up 103.5 percent. ConVal started the 2022/2023 school year with 1,969 students, and 10 years ago there were more than 2,200 students in the district.

Taxpayer activists want to know when declining enrollment means lower property taxes for Granite State homeowners.

“Clearly, school boards and SAUs are shrinking class sizes and padding school administration,” said Dan McGuire with Granite State Taxpayers. “If student performance was improving this extra spending might be justified, but unfortunately it is not. Voters need to pay attention to who they put on school boards, and those boards in turn need to rein in their superintendents.”

Janine Lesser, vice chair of the Contoocook Valley School District, has heard the argument that it should not cost more to educate fewer students. She said looking just at enrollment figures and the cost per pupil data is misleading.

“There’s a lot of the perception that if you have fewer students your costs should decrease, that the general budget should somehow decrease, and in some sense that’s true,” Lesser said.

But there are many factors behind the steady cost increases. Pay for employees, health insurance, electricity costs, heating costs, and building maintenance have all gone up in price throughout the economy, and school districts are no different, she said.

Critics note that doesn’t explain how school costs have risen faster than inflation, nor does it factor in the key elements in classroom education whose costs have declined — most notably tech like laptops, tablets, etc. Even the claim about energy costs is dubious. The price of heating oil and gasoline both plunged significantly during the downturns of 2007 and the COVID pandemic. And yet, taxpayer advocates say, somehow school property taxes kept going up.

The student enrollment decline is steady, but usually slight year to year, Lesser said. ConVal shrunk by 13 students this year, not enough to really impact the budget for a district that includes nine towns and several school buildings.

“All of the overhead costs don’t decrease that way. You can’t do away with a bus route for 13 students, you can’t decrease heating costs by 13 students, and you can’t decrease building repairs by 13 students. All of the costs remain,” Lesser said.

Plante doesn’t buy that argument, saying ConVal is top-heavy with too many administrators uninterested in watching out for the taxpayers who fund a large part of the education.

“It’s the inability of the administration to reduce costs in line with enrollment,” Plante said. “Someone has to have the courage on these school boards to say we can’t keep doing it this way.”

In part, Lesser blames lawmakers in Concord and Washington D.C. for fueling the rising cost per pupil by shoving unfunded mandates onto the districts, forcing local taxpayers to pay more.

“The unfunded mandates come down fast and furiously from the legislature, from both sides,” she said.

The federal government mandates local districts provide services for special education students, and it mandates transportation for students, but it does not help the district pay for these services. In 2020, the state started mandating a new STEM curriculum starting in kindergarten, but it does not come close to covering the costs.

Lesser said more is coming, as there are already 218 bills introduced in the New Hampshire legislature dealing with education that could end up costing local taxpayers more. All of this leaves school boards and school administrators struggling to put together budgets that will give students the best education possible, while not spiking local property taxes.

“It’s a fight every year to balance the needs of students with the needs of taxpayers,” Lesser said.

Claremont School Board Chair Michael Petrin is working hard on striking that balance. He’s trying to get the district to put together a budget that includes a needed raise for teachers, and one that won’t give taxpayers any more sticker shock.

“Purse strings are starting to tighten and going to this community to ask for money to help our teachers is really a tough topic,” Petrin said. “My grocery bills at least doubled over the last year and a half. There are families out there struggling to make ends meet.”

Last week, the Claremont School Board sent the district’s budget proposal back to Superintendent Michael Tempesta and his team to find another $1 million in cuts, hoping to bring the total budget number in low enough for voters to support the plan at the ballot box in March.

“We’re working hard to not kill the taxpayers and keep the teachers at the pay rate that keeps them here in the district,” Petrin said.

Petrin’s balancing act is complicated by the fact the Claremont district has also been steadily losing students. Last year’s average daily attendance in Claremont schools was a little more than 1,600 students. The figure was more than 1,700 a decade ago.

During that time, Claremont taxpayers have seen the cost to educate the shrinking number of pupils rise nearly every year, typically around 3 percent a year, according to state data.

Over the past twenty years, the district lost 24.6 percent of its student population while the annual cost per pupil rose 57.2 percent.

Rep. Walter Stapleton, R-Claremont, said part of the rising cost is that the buildings in Claremont’s district are obsolete. They were built for a time when the district had more people, and the city had more jobs.

“We used to be a big industrial town here with a lot of students and a lot of people,” Stapleton said. “It costs a lot to maintain that big infrastructure to support a shrinking number of students. It’s a tough problem.”

Department of Education Commissioner Frank Edelblut said the main drivers of the student decline are New Hampshire’s aging population and the state’s low birth rate. There are simply fewer school-aged children living in New Hampshire. School districts need to understand the decline is likely to continue, he said.

“It is important for school leaders to understand how declining enrollment numbers may be impacting their districts and how to plan accordingly for the future,” Edelblut said.

Zack Sheehan, project director with New Hampshire School Funding Fairness Project, said the cost to educate students in New Hampshire will keep rising as long as the state and federal government continue to push down unfunded mandates.

“Schools are providing more services to students today than ever before, many of which are laws and regulations passed by the state that do not include increased funding. Many of these are important standards that support our students and schools, but they are not free,” Sheehan said.

How taxpayers will keep paying for fewer students is still being contested decades after the legal battle that was supposed to settle the question. Claremont’s district became the epicenter of the education funding fight with the Claremont education funding lawsuits of the 1980s and 1990s. That resulted in the New Hampshire Supreme Court decision that found every child has the right to an education and that the state has an obligation to fund that education.

Now, ConVal is taking the state to court claiming that the state’s $3,600 per pupil a year adequacy grant does not come close to paying for all the required services.

“This is our way to say, ‘this is what you require us to do, and yet this is what you actually give us money to do,’” Lesser said.

ConVal wants the state to fund closer to $10,000 per student per year. For a student population of 160,000, adding another $6,400 per pupil would cost state taxpayers more than $1 billion in new spending per year. With no guarantee that new state revenue would be used to reduce local property taxes.

As the ConVal lawsuit moves closer to trial, the original Claremont lawsuit attorneys are suing the state again, this time challenging the way the state-wide property tax is collected and distributed.

Attorney Andru Volinsky declined to comment on this story.

Stapleton said the state has money now in the form of a budget surplus, and he expects that to be used for education spending. He’s not sure what the long-term outlook will be if the ConVal and Volinsky lawsuits are successful.

“I personally can’t give you the forecast,” Stapleton said.

Plante thinks it’s time for New Hampshire to give parents their tax money back to make their own decisions about how to fund schools, but he admits that kind of a proposal is unlikely.

“I would give every parent the right to use school taxes to send their kids wherever they need to go, I would hand over the school tax to the parent and say, ‘take this money and do whatever you want with it.’ But that’s a pipe dream,” Plante said.

The way New Hampshire funds education could be completely upended as two separate lawsuits advance in court. One suit seeks to halt education property tax rates and the other attempts to increase the amount the state pays per pupil. 

Plaintiffs in the Grafton County education lawsuit are set to argue Friday that the state should not be able to set a rate for the Statewide Education Property Tax (SWEPT), arguing the tax is unconstitutional as implemented.

Meanwhile, Gov. Chris Sununu won’t be forced to sit for a deposition in the Contoocook Valley Regional School District lawsuit. Rockingham Superior Court Judge David Ruoff ruled the plaintiff school districts failed to show the governor is in possession of any unique knowledge.

Both lawsuits are attempting to force the state to pay more of the costs for local schools, with plaintiffs in both cases alleging the state has never followed the New Hampshire Supreme Court’s rulings in the 1980s and 1990s Claremont cases.

The Grafton County case involves several state residents who are also commercial and residential property owners. They claim New Hampshire is violating the 1997 Supreme Court’s Claremont II decision.

In Claremont, the court ruled New Hampshire has a constitutional obligation to provide an adequate education. That decision found, in part, that the use of local property taxes with varying rates to pay for the state’s obligation to provide its students with an adequate education is unconstitutional.

The ConVal case, which now includes dozens of school districts as plaintiffs, seeks to force the state to increase the per-pupil grants for an adequate education from $3,600 per pupil to around $10,000 per pupil, alleging the current grant does not cover the necessary services.

According to attorneys in the Grafton County case, Andru Volinsky, John Tobin, and Natalie Laflamme, the state continues to ignore the Supreme Court by using varying rates for the SWEPT, which in effect continues to punish poor communities with lower property values.

“Ever since (Claremont II,) the state has tried numerous mechanisms to avoid implementing an equitable tax system that would have the effect of imposing a fairer tax burden on wealthier towns, requiring the courts to intervene and protect the constitutional rights of New Hampshire citizens. Now, the state is primed to once again impose a tax using the same mechanisms previously held unconstitutional that will result in some taxpayers paying up to seven times as much for education funding as their wealthier counterparts,” the attorneys write in a new filing with Grafton County Superior Court.

The Grafton County plaintiffs are now seeking an injunction to prevent the state from setting a tax rate, asking the court to keep the SWEPT rate at $0. A hearing on the injunction is set for Friday.

The SWEPT accounts for 30 percent of education funding in New Hampshire. The tax started in 1999 as a response to the Claremont decisions, which found the state has a constitutional obligation to fund an adequate education. The money raised, more than $360 million estimated in the coming year, is used to fund state adequacy grants.

According to the plaintiffs, wealthy communities raise more funds per pupil through SWEPT than the state’s low standard for what it asserts is the cost of a state-funded adequate education. And since 2011, the state has allowed those wealthy towns to keep the surplus, which flies in the face of the Claremont decisions, according to the motion.

“The SWEPT tax as currently administered is not uniform in rate as the state allows towns with surplus SWEPT funds to either set a negative local education tax rate to offset the state’s official equalized SWEPT tax rate or retain the excess,” the motion states. “Both of these mechanisms have been previously deemed unconstitutional by New Hampshire courts.”

In the ConVal case, the plaintiffs sought to depose Sununu in order to get him to testify about the reasons he vetoed a bill that would have increased education spending by $140 million. The bill would have paid for the increase by rolling back some of Sununu’s business tax cuts.

Ruoff found the plaintiffs did not articulate how Sununu’s veto was directly related to the issues involved in the lawsuit, like funding for transportation, meals, and other necessary services.

Ruoff has already found the state is not following the Claremont decisions and that it is unconstitutionally underfunding education. The ConVal case is slated for trial in the spring to try and determine what the adequate education grant should be per pupil.