A bill sponsored by N.H. Rep. Richard Ames, D-Jaffrey, would provide additional help for some homeowners who can’t afford their property taxes.

His House Bill 569 would require towns to send the state any excess money generated by the statewide education property tax, known as SWEPT. The state could then use this money to significantly boost an existing property tax-relief program for homeowners of low and moderate income.

Ames is proposing reform of just one aspect of the state’s system for raising money for education. The entire system is the subject of litigation led by the ConVal School District, with plaintiffs arguing the state does not provide adequate support for public education as required under the N.H. Constitution.

New Hampshire, which has no general sales or income tax, is unusual in its system for funding schools.

“We’re more dependent than any other state on property tax,” Ames said in an interview Friday. “One of the other features of New Hampshire that I think is more extreme than elsewhere is the variation from community to community or school district to school district so that we’ve got very high expenditures or very low expenditures per pupil depending where you live.”

About 45 towns end up with excess SWEPT money adding up to a total of about $30 million per year, according to a fact sheet Ames provided based on state figures.

The statewide tax is applied per $1,000 of assessed valuation, so some “property-rich” towns such as Meredith, Moultonborough and Portsmouth end up with more of this source of funding than is required to meet the state’s definition of an adequate education.

Some small towns, such as Harrisville, are also in this category, having a small population of students in comparison to their assessed valuation.

Relatively high assessed values in these towns also make it easier to raise local property taxes for education and they are able to spend more per student. For example, the cost per pupil in Rye in 2022 was $27,572 versus $17,766 in Keene, according to the state Department of Education.

Current law allows municipalities to retain excess SWEPT money.

Under Ames’ proposal, this $30 million would go back to the state and be available for the Low and Moderate Income Homeowners Property Tax Relief program. According to the state department of revenue, this program distributed only $821,400 to property taxpayers in 2021.

The maximum tax relief per property taxpayer would be capped at $1,100 per year based on a sliding scale of income ending at $63,000 for a single person or $75,500 for a married couple.

Nobody opposed the measure when Ames presented it to the House Ways and Means Committee on Jan. 31, although opposition is expected from those towns that would have to send their excess SWEPT money back to the state.

Former N.H. executive councilor Andru Volinsky, a Concord attorney, is involved in litigation against the state over its system for funding public education.

Commenting as a private citizen and not on behalf of his legal team, Volinsky said Ames’ bill should meet the approval of lawmakers for most towns and cities in New Hampshire.

“There are 45 communities that benefit from the excess SWEPT but they probably have less than a third or a quarter of the state’s population,” he said.

Manchester, Nashua, Keene, Dover and Concord aren’t among those communities, he said, noting their representatives should be in favor of changing the current system.

No vote has been scheduled yet by the Ways and Means Committee on HB 569. Following committee action, it will go to the full House for consideration.

Rick Green can be reached at rgreen@keenesentinel.com or 603-355-8567.

These articles are being shared by partners in The Granite State News Collaborative. For more information visit collaborativenh.org. 

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