By GARRY RAYNO, InDepthNH.org

CONCORD — Some communities could prevent their students from using Education Freedom Account grants under a bill presented Tuesday.

House Bill 1512 would allow cities, towns or villages to hold a referendum on whether their students would be able accept grants from the state’s voucher program, which nearly doubled this school year when the earnings cap was removed by the Legislature.

In its five years, the program’s annual cost has grown from $8 million to $52 million this school year.

The bill’s prime sponsor, Rep. Ellen Read, D-Newmarket, said public schools take a hit when students use vouchers and go elsewhere.

“The cost does not go down when one student leaves,” she told the House Municipal and County Government Committee Tuesday. However, she said, the school district loses the state aid for that student.

“That leads to an increase in property taxes“ and places an undue burden on the other taxpayers of the community, Read said.

According to Read, the voucher program is an unconstitutional unfunded mandate, which her bill would fix.

If students could not take the grants to other educational facilities, the state aid would remain with the school district.

Her bill would let cities and towns opt out of the program, she noted, and bring greater transparency and local control.

If the program is popular in a community, it would likely vote not to opt out, she said.

Local property taxes are the purview of municipalities, Read said.

Regardless how you feel about the policy of EFAs, she said, her bill allows for local control, which they all support.

But Matt Southerton, director of policy and compliance for the Children’s Scholarship Fund NH, which administers the program for the state, opposes the bill, saying it has equal protection issues. Southerton noted that while every child is eligible for an EFA grant, if the bill passes one child would be able to accept a grant and a child in a neighboring town that opted out would not.

The bill would allow a municipality to nullify a benefit the state granted to all students, he said, by revoking the benefit at the local level.

Southerton questioned what would happen if a child is on the program and midyear his town decides to opt out, and the child is receiving special-education benefits that have already been paid for.

“How do we claw back those funds?” Southerton asked, noting it would also apply to students on free and reduced lunch programs, English language learners and others receiving differentiated state aid.

“We have an assortment of problems and concerns about legal liability with this bill,” he said.

Rep. Eleana Colby, D-Bow, said the prime sponsor talked about transparency and local control, and wondered if millions of dollars of taxpayer money should be diverted to a nonprofit to administer the program without some local process.

Southerton said the EFA program is a carefully crafted state program that lawmakers did not want the state to administer, but wanted oversight so the money is spent in the right areas.

He noted the Department of Education has an EFA administrator who oversees compliance and monitors the program so the money is not misspent.

The organization files yearly reports and 990 forms the IRS requires so the public can see where the money is spent, how much staff is paid and what the administrative costs are, he said.

“We believe the transparency is there and every cent is reconciled with the DOE each year,” Southerton said.

Yearly reports of where state money has been spent was previously not available, but at the end of December the organization released numbers for the first four years of the program.

Reports of the spending for the first two years of the program were taken off the organization’s website last summer after Executive Director Kate Baker Demers said she wanted to protect vendors who could be targeted, although the statute requires the organization to report where the money is spent and for how many students annually.

For example, Portsmouth Christian Academy received $542,534.20 for the 2024-2025 school year, which is reported, but the number of students attending the school is not.

At the hearing, Committee Chair Diane Pauer, R-Brookline, asked Southerton if he knew of any other state program that is available to all those eligible but could be revoked by a local legislative body, and he said he did not.

“That is one reason I brought up the equal protection clause,” he said.

Rep. Stephanie Grund, D-Amherst, said school districts are held accountable for their budgets and the testing results for their students, and questioned why all state education programs shouldn’t be held accountable in the same way.

Southerton said EFA students have three options: take the state assessment test, take other known tests or submit a portfolio. If they don’t do one of the three, they no longer qualify for the program, he said.

But Grund said they have no insight into whether EFA students meet the grade-level requirements or if the money was used appropriately.

Southerton said the students meet the requirements in the statute and if lawmakers want additional information they should submit a bill.

But Rep. Julie Gilman, D-Exeter, pushed further, saying a current bill would require students to take four years of math to graduate and questioned if it would impact EFA students who also use public money.

Southerton said it would depend on which school the student attends. “The best judge if a student is making progress is the teacher that teaches the student and the parents,” he said.

If the parents are not satisfied with the school or the tutor, they should find another school or another tutor, he said.

Rep. Laurel Stavis, D-Lebanon, asked if there are any concerns that taxpayer money is being spent on private religious schools.

Southerton said the organization does not base decisions on religion, but does make a judgment if a 5-year-old wants to buy a math book written for a 12th grader.

“We do not get into value judgements,” Southerton said.

Charles Smith of Orford requested that if the committee passes the bill, that interstate compact schools be exempted from it.

He said his town along with three Vermont towns comprise the compact, noting it is very confusing as it is. Vermont has school choice and access to other educational options that New Hampshire does not have, he said, and the bill would make things more confusing.

The committee did not make an immediate recommendation on the bill.

Garry Rayno may be reached at garry.rayno@yahoo.com.