NH Department of Education
Division of Program Support
Bureau of Data Management
HB 608 for FY04
HB 608 for FY04 modified the Adequacy Aid formula. It also established a second, "targeted" aid distribution. Modifications to the FY03 formula are as follows:
Statewide Property Tax Rate
When enacted in 1999, the statewide property tax rate was set at $6.60 per $1,000 beginning with the 2000 tax year. For the 2002 year the rate was dropped to $5.80. HB 608 reduced the rate to $4.92 for FY04.
The FY 03 formula allocations included 70% of the town's expenditure for all types of transportation. Federally funded expenditures were excluded. HB 608 changed this to 100% of the cost of transporting students in kindergarten through grade 8, to and from school. Excluded were transportation expenditures for high school, athletics, field trips and special education.
Average Daily Membership in Residence
Each town's ADM-R includes students that attend school in the local district, attend school in another district, or attend nonpublic special education schools. The old definition of ADM-R included students educated at home by their parents. HB 608 changed the definition of ADM-R to exclude home schooled students, but makes a special aid allocation for those students that use school services. Each home schooled student that participates in athletics or other non-academic activities is included in the student count as a 0.1. An additional 0.15 is added for each academic course.
The old formula set a biennium base cost every other year by analyzing the expenditures of a select pool of school districts. The pool includes those districts where 40% to 60% of the elementary students scored at the basic level or better on the state's assessment test. The base expenditure per pupil is determined for each district and the pool is sorted from high to low by expenditure per pupil. The per pupil expenditure of the lowest spending half of this pool is averaged. Since districts provide some services that go beyond the requirements for adequacy, the average base expenditure per pupil is reduced by 9.75% to arrive at the Base Cost.
HB 608 eliminated that base cost calculation formula. The base cost is updated by adjusting for the rate of inflation, as measured by the Northeast Consumer Price Index. This occurs annually, rather than every other year. Since the CPI can vary considerably from one year to the next, a four year average is used.
This formula distributes any level of appropriation. The bill specifies that the appropriation for this component shall be $10,000,000 for fiscal year FY04. A town's aid is based on it's ADM-R without any weighting, median family income and median owner-occupied home value as most recently published by the U.S. Census, and the most recent equalized valuation that includes utilities as published by the Department of Revenue Administration.
For each town the formula is as follows
Complete FY04 Formula
Total the weighted students
Determine cost of adequacy plus targeted aid