After filing suit in July to challenge New Hampshire’s school-funding system, attorneys representing five property taxpayers have raised the stakes by asking the court to issue an injunction forbidding the state Department of Revenue Administration from setting the rate of the Statewide Education Property Tax for the coming year.
Initially, attorneys Andru Volinsky, John Tobin and Natalie Laflamme brought suit charging the state has failed to fulfill its duty to fund an adequate education with taxes that are “equal in valuation and uniform in rate” throughout the state as ordered by the NH Supreme Court in its landmark Claremont decisions in 1993 and 1997.
The plaintiffs are now asking the Grafton County Superior Court — where the trial will be held in August 2023 — to order the state to “discontinue its unconstitutional public education funding scheme” and replace it with one that incorporates the full cost of a constitutionally adequate education to every school district amounting to not less than the average expenditure per pupil and including allowances for transportation, capital investment and debt service.
From left, attorneys Natalie Laflamme, Andru Volinsky and John Tobin are spearheading a lawsuit challenging New Hampshire’s schoolfunding system. (Photo by Kate Brindley Photography)
The State Education Property Tax, or SWEPT, is a surcharge on the local property tax levied at a fixed rate to raise $363 million. It represents the single largest share of the Education Trust Fund, which contributed $1.1 billion, or 28.6 percent, toward the $3.3 billion spent operating public schools in 2021-2022.
The Department of Revenue Administration has announced that the SWEPT rate for the next fiscal year would be $1.44 per $1,000 of assessed value. The Department is expected to confirm the rate before the year is out.
If the SWEPT was enjoined, the Education Trust Fund would face a deficit of $363 million.
State law provides that deficits in the Education Trust Fund be offset by transfers from the general fund allotted to other departments or by increasing taxes to raise additional revenue. The Education Trust Fund draws more than $270 million, a third of its revenue, from the two business taxes — the business profits tax and business enterprise tax.
— MICHAEL KITCH
