Informal Education Series: On the Verge of Collapse

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berlin city chambers
Berlin City Chambers. PHOTO: Liz Canada

This is the first installment of our new “Informal Education” series, which will explore education through the eyes of real people. In this article, our Policy Director Liz Canada writes about her experience in Berlin and how legislation has shaped their schools and their community.

Senate Finance has finished deliberating, debating, and discussing their budget recommendations, which the full Senate passed on Thursday, June 6. With that in mind, as well as the court’s recent ruling that the school funding formula is unconstitutional, a comment made at a public hearing in front of lawmakers a few weeks ago continues to echo: “we are on the verge of collapse.” The speaker? The mayor of Berlin. And the reason? Education funding.

Berlin receives the largest stabilization grant in terms of amount per student – wait, let’s rewind.

Here’s what you need to know about stabilization grants: in 2012, the legislature changed the education funding formula, which removed targeted aid for vulnerable communities.

Time out: what do we mean by “vulnerable communities”? We mean the communities that have struggled to raise money through property taxes–whether that’s because of low property values or parts of non-taxable land (like federal and state parks). These communities may also have higher proportions of students qualifying for free and reduced lunch – and to be really specific, in 2018-2019, the federal government determined that a family of four with a total income below $46,435 qualified for the program.

As a result of that change by the legislature, many communities were going to see a loss in funding from the state. For Berlin, it meant a loss of approximately $5 million in funding per year. For context, their school budget is $18 million. So that loss of $5 million would have been a significant hit – and the same is true for two-thirds of NH communities, that also would have lost funding.

So, the legislature put stabilization grants in place. Think of these grants as a way to “stabilize” the funding change, and would ensure that districts would not lose money. Each year since 2013, communities received the same amount of stabilization money from the state, based on the 2012 formula change.

Well, until 2015, when the state legislature passed a bill to decrease stabilization grants by 4% each year until they were completely gone, which would take 25 years.

What’s the big deal, right? It’s just 4%.

But wait, let’s rewind once more: remember why the legislature put stabilization grants in place? Because the funding formula meant a loss in state money for these communities…communities where it could be really difficult to raise money locally. Yet, with the reduction of stabilization grants, there was no additional money for these communities: the expectation was that the community would have to adapt to the decrease.

For Berlin, the reduction in stabilization has been about $220,000 each year.

What’s the big deal, right? It’s just $220,000.

Here’s the thing: Berlin’s annual school budget has, for the past 10 or so years, remained between $16 and $18 million. This is the third year of stabilization cuts, which means that they received about $660,000 less from the state this year alone. Over the past three years? The community has had to make up the difference of $1.3 million.

What does it mean to “make up the difference”?

We went to Berlin to find out. Berlin has been the canary in the coal mine for the loss of stabilization grants over the last three years. To quote the outgoing Superintendent, Corinne Cascadden, “If it can happen here, it can happen anywhere.” The mayor himself has said the city is “on the verge of collapse” – but what does that mean? Over the next few weeks, we’ll provide insights into what we learned speaking to city and district leaders, educators, family members, and students.