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HB 292 - AS AMENDED BY THE SENATE
26Mar2025... 1030h
01/07/2026 3101s
2025 SESSION
25-0652
02/06
HOUSE BILL
292
AN ACT
establishing a revolving loan fund for school districts.
SPONSORS: Rep. Ladd, Graf. 5
Committee: Education Policy and Administration
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AMENDED ANALYSIS
This bill establishes a revolving loan fund for school districts.
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Explanation: Matter added to current law appears in
bold italics.
Matter removed from current law appears [
in brackets and struckthrough.
]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
26Mar2025... 1030h
01/07/2026 3101s 25-0652
02/06
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Five
AN ACT
establishing a revolving loan fund for school districts.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Subparagraph; The State and Its Government; State Treasurer; Application of Receipts. Amend RSA 6:12, I(b) by inserting after subparagraph (410) the following new subparagraph:
(411) Moneys deposited in the school district adequacy revolving loan fund established in RSA 194:63.
2 New Subdivision; School District; Funding. Amend RSA 194 by inserting after section 61 the following new subdivision:
School District; Funding
194:62 Declaration of Intent. The intent of this subdivision is to provide a targeted, temporary fiscal stabilization mechanism through the establishment of a school district adequacy revolving loan fund administered by the state treasury to assist the district with cash flow in anticipation of adequacy payments owed to them by the state pursuant to RSA 198:40-a and paid under the schedule set forth in RSA 198:42.
194:63 School District Adequacy Revolving Loan Fund. There is hereby established in the department of treasury a fund to be known as the school district adequacy revolving loan fund, which shall be kept separate and distinct from all other funds. Moneys in the fund shall be nonlapsing and shall be continually appropriated to the treasury, and shall be used to provide loans to school districts.
194:64 Outstanding Loan Amount. At no time shall the total outstanding amount of loans made under this subdivision exceed 75 percent of total adequacy funding to be distributed to school districts, pursuant to RSA 198:41, in any given year.
194:65 Certification of Disclosure. Notwithstanding any other provision of law to the contrary, the school district adequacy revolving loan fund shall be considered an allowable use of the education trust fund pursuant to RSA 198:39. Moneys may be appropriated from the education trust fund to the school district adequacy revolving loan fund, with such funds then being loaned to school districts. Prior to the school district drawing upon the adequacy revolving loan fund, the governing body of the school district shall authorize such use of the fund by an affirmative vote of a majority of its members present and voting. Additionally, prior to drawing any funds from the revolving loan fund, the school board and superintendent shall file with the department of education a certification disclosing any activity in the preceding 2 fiscal years relative to reimbursement anticipation notes issued pursuant to RSA 198:20-d. The governor is authorized to draw a warrant from the education trust fund to be placed in the school district adequacy revolving loan fund within a fiscal year not to exceed the sum of the following:
I. Seventy-five percent of total adequacy funding to be distributed to the applying school district pursuant to RSA 198:41 within the fiscal year of the warrant; and
II. Seventy-five percent of the district's total adequacy funding estimated by the department of education to be distributed on September 1 of the following fiscal year pursuant to RSA 198:41, IV and RSA 198:42, I.
194:66 Loan Terms and Interest. Loans issued from the school district adequacy revolving loan fund shall bear interest at a rate established by the state treasurer, which shall be based on the state’s current cost of borrowing. A quorum of a school district's governing body, the commissioner of the department of education, and the state treasurer shall all agree to the terms of the loan which shall include terms requiring the school district to report monthly deficit, status, cashflows, audits and status of any outstanding audits to the treasury, the department of revenue and the department of education, and timely submit all required reports consistent with RSA 198:4-d to the department of education. When an adequacy payment is due to be distributed pursuant to RSA 198:42:
I. The portion of the adequacy payment equivalent to the outstanding principal and interest balance of the revolving loan shall first be credited against such balance; and
II. Any remaining adequacy payment shall then be distributed to school districts.
III. If the commissioner of the department of education and the state treasurer determine that a school district fail to comply with loan terms pursuant to this section, a school district’s ability to receive future loan funds shall be withheld until the school district complies with required loan terms received and accepted by the commissioner of the department of education and the state treasurer.
194:67 Loan Conditions.
I. Funding under the school district adequacy revolving loan fund shall be available to any school district that makes a request and receives approval from the commissioner of the department of education, the state treasurer, and the joint fiscal committee of the general court.
II. Interest rates for funding received under the school district adequacy revolving loan fund shall be determined by the state treasurer, but shall be no lower than the effective federal funds rate (EFFR) published by the Federal Reserve Bank of New York.
III. Funds received under the school district adequacy revolving loan fund may be used to fulfill the obligations under a revenue anticipation note or tax anticipation note, but no school district shall receive funds if they would still have an outstanding obligation under a revenue anticipation note or a tax anticipation note.
IV. No school district shall apply for loans under the school district adequacy revolving loan fund for more than 3 consecutive academic years.
V. No school may submit a new application for funds under the school district adequacy revolving loan fund after June 30, 2030.
194:67 Condition for Acceptance.
I. School districts shall report monthly deficit, status, cash flows, audits, and the state of any outstanding audits to the legislative budget assistant of the general court, the state treasurer, the commissioner of the department of education, the commissioner of the department of revenue administration, the governor, the president of the senate, and the speaker of the house of representatives.
II. A school district that accepts funding under this subdivision shall be referred to the joint fiscal committee of the general court, who shall require that a financial and performance audit of the district be performed by the legislative budget assistant, to be reviewed by the joint fiscal committee, unless the committee unanimously votes that an audit of the school district should not be conducted.
III. Any school district participating in this program shall place a question of whether to adopt the provision of RSA 32:5-b on the ballot at its next annual school district meeting, unless the school district has already adopted the provisions of RSA 32:5-b.
IV. Any school district within a school administrative unit that is comprised on 2 or more school districts and participates in the school district adequacy revolving loan fund shall place a question of whether to adopt the provisions of RSA 194-C:9-a on its local ballot at its next annual school district meeting, unless the school district has already adopted the provisions of RSA 194 C:9-a.
194:68 Default. A school district's failure to fulfill all of the obligations and conditions of this subdivision shall constitute default. Notwithstanding any other provision of law to the contrary, the state treasurer shall orchestrate the return of all outstanding loan proceeds and withhold any other funds or state grants from the school district in default until the default is cured and the school district has repaid the loan in full.
3 New Paragraph; Education; Adequate Education; Education Trust Fund; Education Trust Fund Created and Established. Amend RSA 198:39 by inserting after paragraph IV the following new paragraph:
V. Notwithstanding any other provision of law to the contrary, funds under this section may be used for the purpose of funding the school district adequacy revolving loan fund established in RSA 194:63.
4 Education; Education Freedom Accounts; Definitions. RSA 194-F:1, XIII is repealed and reenacted to read as follows:
XIII. "Priority guidelines" means the ordered list:
(a) A student currently enrolled in the EFA program;
(b) A sibling of a student currently enrolled in the EFA program;
(c) A child with disabilities as defined by RSA 186-C:2;
(d) A student whose family income is less than or equal to 350 percent of the federal poverty guidelines as updated annually by the United States Department of Health and Human Services under 42 U.S.C. section 9902(2).
(e) A student residing in a school district participating in school district adequacy revolving loan fund.
5 Department of Education; Directive. The department of education shall amend rule 510.03(b), pursuant to RSA 541-A, to read as follows:
"(b) Unprofessional conduct shall include, but not be limited to:
(1) Gross financial mismanagement;
(2) Misappropriation of public funds; and
(3) Failure to account for public funds or to keep adequate records of public funds in the credential holder’s care."
6 Repeals. The following shall be repealed:
I. RSA 6:12, I(b)(411), relative to moneys received by the school district adequacy revolving loan fund.
II. RSA 194:62 through RSA 194:67, relative to the school district adequacy revolving loan fund.
III. RSA 198:39, V, relative to the use of education trust funds for the school district adequacy revolving loan fund.
7 Effective Dates.
I. Section 6 of this act shall take effect July 1, 2030.
II. The remainder of this act shall take effect upon its passage.
LBA
25-0652
Revised 04/07/2026
HB 292-FN-
FISCAL NOTE
AS AMENDED BY THE SENATE (AMENDMENT #2025-3101s)
AN ACT
establishing a revolving loan fund for school districts.
FISCAL IMPACT:
Estimated State Impact
FY 2026
FY 2027
FY 2028
FY 2029
Revenue
Indeterminable
Revenue Fund(s)
Expenditures*
Indeterminable
Funding Source(s)
Education Trust Fund
Appropriations*
Open Warrant Included in Bill
Funding Source(s)
Education Trust Fund
*Expenditure = Cost of bill *Appropriation = Authorized funding to cover cost of bill
Estimated Political Subdivision Impact
FY 2026
FY 2027
FY 2028
FY 2029
Local Revenue
Indeterminable
Local Expenditures
Indeterminable
METHODOLOGY:
This bill establishes a temporary revolving loan fund within the State Treasury to provide short-term, interest-bearing loans to school districts experiencing cash flow gaps while awaiting adequacy payments. It sets approval requirements, limits tied to adequacy funding, and mandates financial reporting, oversight, and automatic repayment through future state aid. The program is funded through the Education Trust Fund and is repealed effective July 1, 2030. Per the bill, terms and conditions of the loan would be as follows:
Loans are not to exceed 75% of their adequacy funding for the current and first payment of the following fiscal year.
Interest rate on the loan would be based on the State’s cost of borrowing, but not lower than the Federal Funds Rate. (Effective Federal Funds Rate as of 01/14/26 = 3.64%).
Adequacy payments to districts will first be applied to repay outstanding principal and interest before any remaining funds are distributed.
In case of default, the State Treasurer can withhold other State funds and grants and orchestrate recovery of loan proceeds.
Loan terms require monthly financial reporting and compliance to the State Treasurer and other State officials.
This bill has no direct fiscal impact. Any impact on state or local revenue or expenditures would result from a school district applying for a loan authorized by this bill. To the extent such future applications cannot be predicted, this bill’s fiscal impact, if any, is indeterminable.
AGENCIES CONTACTED:
Treasury Department and Department of Education