The proposed bill, known as the "Property Tax Relief Act of 2025," aims to alleviate the financial burden on municipalities by requiring the state to cover 7.5 percent of retirement system contributions for group I teachers and group II members, starting in fiscal year 2026. The bill amends existing law by changing the requirement that employers, other than the state, pay the full amount of contributions to instead mandate that they pay 92.5 percent, with the state covering the remaining 7.5 percent. This change is intended to provide property tax relief and enhance public services such as education and safety.

The fiscal impact of the bill indicates that while it does not provide funding, it will result in a significant shift in expenditures. The state is expected to incur additional costs of approximately $28 million in FY 2026, increasing to nearly $30 million by FY 2028, while political subdivisions will see a corresponding decrease in their expenditures. The New Hampshire Retirement System has noted that this change will not affect the overall contributions due to the retirement system but will shift the financial responsibility from local governments to the state.