Education funding: Judge's order spotlights a debate that never went away

A student raises his hand in Dorene Decibus’s fifth-grade science class at South Meadow School in Peterborough, which is part of the ConVal Regional School District, one of the districts involved in the lawsuit.

CONCORD — If there’s one message that comes through loud and clear in the nearly 100-page ruling on education funding handed down late Wednesday by a Cheshire County Superior Court judge, it’s this: A child’s educational opportunity should not be determined by his or her ZIP code.

In a sweeping order issued in the middle of budget deliberations at the State House, Judge David Ruoff did not mince words as he described the consequences of the state’s persistent reliance on local property taxes to fund education.

“The distribution of a resource as precious as educational opportunity may not have as its determining force the mere fortuity of a child’s residence,” he wrote. “It requires no particular constitutional expertise to recognize the capriciousness of such a system.”

The fact that New Hampshire continues to rely almost exclusively on property taxes to fund education — more than 20 years after state Supreme Court rulings in Claremont I and II found that method unconstitutional — illustrates just how intractable the problem has been.

“We are simply unable to fathom a legitimate governmental purpose to justify the gross inequities in educational opportunities evident from the record,” wrote Ruoff.

The town of Pittsfield has to tax its residents at a rate of $18 per thousand of assessed property value to support expenditures of $14,723 per pupil, while Rye taxes its residents at an equalized rate of $6.20 per thousand to fund $19,535 per pupil.

It is wishful thinking for the state to contribute $3,636 per pupil and call that adequate funding for an adequate education, said Ruoff. “The parties agree that not a single school in the state of New Hampshire could or does function at $3,562 per student.”

Education funding: Judge's order spotlights a debate that never went away

Students work on algebra skills Friday in teacher Lance Flamino’s class at ConVal Regional High School in Peterborough. The education-funding lawsuit filed by four school districts, including ConVal, wanted the courts to set a new base amount for the state to contribute to communities.

According to the four school districts that filed the lawsuit, the actual cost of an education — based on Department of Education data — is approximately $18,901 per student.

The school districts — Contoocook Valley, or ConVal, in Peterborough, Mascenic in Greenville, Monadnock in Swanzey, and Winchester — wanted the court to set the base adequacy amount at $9,929 per student for fiscal year 2020 and $10,843 for 2019, but the judge declined. Such a move would add $1.6 billion to the state’s $13 billion budget.

Ruled unconstitutional

Ruoff struck down the current funding formula as unconstitutional, but declined to set a new one.

“Such a decision should not rest in the hands of judges,” he wrote. “However, as the Supreme Court has repeatedly warned in school-funding cases: Constitutional rights must be enforced or they cease to exist. Almost every constitutional challenge to the Legislature’s attempts to define and provide funding for an adequate education has been successful.”

Gov. Chris Sununu agrees that “critical funding decisions are best left to local elected leaders — who represent the people of New Hampshire — not judges in a courtroom,” but he offered little in the way of education-funding reform in his state budget.

He’s proposing some targeted school building aid and stabilization grants, the method by which the state “stabilizes” per-pupil funding even as enrollment declines.

The most ambitious proposal to address education funding is contained in the House version of the state budget, with $170 million in new aid, mostly to property-poor school districts, funded by a new capital gains tax.

The Senate has about $60 million in additional educational funding in its budget, along with $40 million in revenue sharing to municipalities that cities and towns might allocate to education, or might not.

Nobody has a plan that even comes close to addressing Judge Ruoff’s order, nor is there any likelihood that one will be developed soon. The state’s most likely course of action will be to appeal the ruling and buy some time.

Dueling budgets

“The dueling (House and Senate) budgets have more or less some building blocks to respond to the Claremont principles,” said Executive Councilor Andru Volinsky, an attorney who represented property-poor school districts in the original Claremont lawsuits. “The House has more, the Senate has far less.”

The most promising component of the House and Senate legislation, according to Volinsky, is the appropriation of $500,000 for an independent commission that will study the current funding formula and make recommendations to the Legislature in 2021.

“We need to have careful plans to finally meet responsibilities that are more than 20 years old,” said Volinsky, a potential Democratic challenger to Sununu in the 2020 election.

Study commissions on the issue are nothing new. Gov. Jeanne Shaheen convened one soon after the Claremont decisions. In the end, lawmakers settled on the statewide education property tax (SWEPT).

For a while, SWEPT money collected from property-rich communities that exceeded their allocation from the state funding formula was redirected to property-poor communities, creating the “donor town” vs. “receiver town” tension that was resolved when that system was abandoned by a vote of the state Legislature in 2010.

Stabilization grants

As an alternative to help the property-poor communities, the Legislature introduced the stabilization grants, but then began to cut away at them over the years, so it comes as little surprise that both parties are back in court.

Republicans over the years have proposed constitutional amendments that would remove judicial authority over school-funding decisions, in the hope of settling the matter that way.

Democratic Gov. John Lynch proposed such an amendment himself, but there is little trust among many lawmakers that the Legislature would do the right thing on educational funding without court oversight.

“I concur with what they’re saying in court,” says Rep. Rick Ladd, R-Haverhill, the ranking Republican on the House Education Committee and a former educator himself. “We have a legislative responsibility for this.”

Meeting that mandate might require a greater sense of shared responsibility for students throughout the state, no matter what town they live in. Volinsky is optimistic that the tide might finally be shifting in that direction.

He and other attorneys involved in the original Claremont lawsuits have been touring the state in the past year, conducting workshops on education funding and the need for relief to the property-poor districts.

The last one will be June 19 at Kearsarge Middle School in New London starting at 6 p.m.

Consensus building?

“The problem of insufficient funding has impacted more and more communities,” Volinsky said. “If you think about it, back in the mid- to late-1990s, the state as a whole was green and thriving, and there were a couple of dark spots. Well, the dark spots have grown, and the thriving areas have shrunk.”

“We have done 35 forums around the state, and I can assure you that the consensus is building. There is recognition on two levels — one is in terms of understanding the social compact … that we are responsible for one another … and also on the level of enlightened self-interest, because the wealthy communities require educated workforces, and the way in which we fund schools makes it harder to produce well-educated, well-trained participants in the economy.”

Ladd agrees that “maybe conditions have changed,” but predicts that any effort to raise the kind of money needed for the state to truly fund an adequate education will be met with stiff opposition.

For now, everyone is just awaiting the next step in the legal process.

New Hampshire Center for Public Policy Studies Director Doug Hall, who has participated with Volinsky in the New Hampshire School Funding Fairness Project, says Ruoff was anticipating that next step in his ruling: “He has put everything together so the justices on the Supreme Court will have a ready reference and won’t accidentally miss an important point when this case gets to them.”