NH puts school administration pay in the hands of the people

New Hampshire voters will now have a say in how much school districts spend on administrative costs, thanks to a bill that takes effect next month.

School districts must now craft separate administrative budgets – typically covering leadership and non-teaching positions – alongside budgets for teachers and school buildings, which will then go to voters for approval at annual town meetings.

“This bill would allow future voters to vote on the (administration) budget. Not just to look at it but vote on it as well,” New Hampshire State Rep. Michael Vose, R-Rockingham, who proposed the bill in January 2025, said, as reported by the New Hampshire Bulletin.

House Bill 564, signed June 19 by Gov. Kelly Ayotte, requires all school districts to separate the administrative portion, called school administrative units, or SAUs, from the overall school district budget. Voters will be asked to approve that budget annually, and a no vote means spending will remain at the prior year’s level.

“The administrative costs of running the SAU are buried in the school district budget, and it’s virtually impossible for the average person to dig through that budget and find the line items that apply to the SAU,” Vose said in a hearing last year, according to the Bulletin.

In New Hampshire, school administrative units manage the education system within their respective districts. Each unit is typically composed of one or more towns that share oversight of their public schools’ finances and administration. Each administrative unit generally receives a federally capped percentage of the budget that allows local education agencies to recover administrative and overhead costs.

Previously, those costs were embedded within the overall school district budget. If an administrative unit served more than one district, each district listed its budget separately, but not the administrative costs specifically, making it difficult to determine how much was being spent.

The new policy will hold school boards accountable and require administrators to justify budget increases, according to Eric Pauer, president of the School District Governance Association of New Hampshire, a group that supports policies to reduce school spending, according to the Bulletin.

“HB 564 is a major step toward transparency, accountability and responsible management of education spending statewide,” Pauer said in a statement. “SDGA is proud to have assisted in developing and advancing this legislation,” which he called “a big win for taxpayers, parents and students across the Granite State.”

Before the law was passed, multi-district administrative units could opt to present a separate administrative budget, something that is now mandatory for all school administrative units.

Pauer told the Bulletin the opt-in approach is “cumbersome,” and that most districts avoided the option to keep voters from having a direct voice over administrative costs.

“I think that’s part of the problem in the growth in SAU budgets, because there’s this process where the voters have very little control,” Pauer said.

The legislation responds to a nationwide trend of rising administrative costs.

For instance, Iowa public schools reported in 2023 that spending on administrative positions increased 20% over six years, while Louisiana experienced a 6% increase in administrative positions despite a 7% enrollment decline from 2014 to 2024.

The new law takes effect Aug. 18.