How taxes rise while enrollment drops in N.H. school districts like Merrimack Valley

  • The 10th Annual Literacy Day was held at Merrimack Valley High School on Saturday. ELODIE REED

Monitor staff
Published: 6/12/2017 12:15:45 AM

It’s a familiar struggle in school districts around the state: The number of students continues to drop as budgets and taxes continue to increase.

In Franklin, school and city officials once again raided special funds to find one-time cash injections to avoid pink-slipping more than a dozen teachers, and three teachers will still likely be let go next year.

In the Concord School District, where enrollment has dropped 10 percent while taxes have increased 50 percent since 2008, the school board decided in March its residents couldn’t afford full-day kindergarten at this time.

And earlier this year, the superintendent of Merrimack Valley School District – whose tumbling enrollment and rising tax burden mirrors many districts across the state – implored legislators in an open letter to rethink the way it pays for education.

“The state’s process for funding public education puts school systems and property owners in adversarial roles,” Mark MacLean, the superintendent for SAU 46, wrote in a November letter. “The lack of control property owners feel with increasing tax bills at times compels folks to look scornfully at their local education system. As a result, the public perception of the value of education is eroding.”

Total enrollment in Merrimack Valley – the second-largest school district in the area – has fallen a little more than 10 percent over a 10-year period, declining from 2,873 students in 2006 to 2,575 in 2015. Meanwhile, over the same period, spending has gone up about 25 percent, from $29.3 million to $36.5 million.

That’s made some residents angry. This March, Merrimack Valley voters floated a motion to cut the budget by a flat 1 percent at the district’s annual meeting. It didn’t pass, and school taxes will rise again.

To explain the disconnect between spending and student numbers, MacLean often repeats that “context matters.”

Take retirement contributions. The district spent a little over $2.51 million on them in the 2015-16 school year. If the state were still pitching in at 35 percent – as they did before 2010 – the district’s bill would have been $880,660 less, MacLean calculates. The state actually once pitched in to fund retirement at 40 percent before reducing it to 35 percent in 1977. The state made additional 5 percent annual reductions during the recession – and then zeroed contributions altogether 2011.

There are other examples of so-called downshifting. Next year, Merrimack Valley will have to make up for $117,000 in cuts to stabilization funding, a grant program put in place for mostly property-poor, low-income districts that would have seen dramatic reductions in funding with the last overhaul of the state’s education formula. The $150 million program will zero out in 25 years, as a result of 4 percent annual cuts.

School administrators across the state also often point to growing special education needs. And in Merrimack Valley, the costs have skyrocketed. Minus state and federal reimbursements, the district spent $5.2 million on special education during the 2006-07 school year. Ten years later, it spent $10.3 million.

MacLean said that, aside from a growing complexity and severity of needs, the biggest cost driver is paying for specialists, especially when a district can’t retain someone in-house.

One example, he said, is that many school districts would like to hire speech pathologists, but they can’t compete with wages being offered in the private sector or health care industry. That means contracting out the work.

“A contracted service is much more expensive,” MacLean said. “Sometimes you’re paying for certain things $100 an hour. Teachers don’t make $100 an hour.”

The bulk of the district’s other costs are in staff. The number of teachers and administrators under the Merrimack Valley umbrella has basically stayed the same over the period between the 2006-07 and 2015-16 school years, according to state data, and collectively bargained contracts typically require salary bumps each year. Merrimack Valley teachers make $55,400 a year on average, a little more than $2,000 less than the state average.

Echoing administrators across the state, MacLean said it’s difficult to cut teachers as enrollments dwindle, because the reduction in students is spread thinly over grade levels.

The district also has over two dozen more para-educators than it did a decade ago, mostly to deal with special education needs.

But that’s precisely where Loudon resident Roy Merrill said he thinks the district should trim – staff.

“Only one year in 20, they haven’t had a raise. That doesn’t happen in the rest of the world,” he said.

Merrill also thinks the district should have fewer people on staff. That doesn’t mean laying teachers off, he said – just don’t replace people who retire or move on.

As for arguments that the state has downshifted retirement costs, Merrill’s still not sympathetic.

“The school board needs to look at them and say, ‘We picked up your retirement; we picked up your health insurance, that’s a raise,’ ” he said.

The school board has made efforts to cut personnel costs. It negotiated a cheaper health insurance plan into its contract with teachers this year, cutting more than $400,000 in spending. But Merrill said that was long overdue, and that benefits were already too generous.

“The elderly, it’s killing them to keep bumping this up. Seventy percent of their taxes goes right to the school,” he said.

(Lola Duffort can be reached at 369-3321 or

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