The bill amends existing laws related to local tax caps and budget preparation, specifically by repealing and reenacting RSA 32:5-b. This update clarifies the procedures for adopting local tax caps and introduces new provisions for adjusting these caps based on inflation and changes in population or school attendance. It defines key terms such as "base amount," "attendance," and "population" to enhance clarity. Additionally, the bill modifies the language used in voter questions regarding tax cap adoption, ensuring it accommodates various calculation methods. A new paragraph allows local political subdivisions to propose a new tax cap while retaining the existing one if the new proposal fails. The bill also includes the deletion and reenactment of RSA 32:5-e, indicating a comprehensive update to municipal budget law concerning tax caps.

Furthermore, the bill establishes a budget cap for school districts that have adopted this provision under RSA 32:5-e, limiting the total amount raised and appropriated for the fiscal year based on the current per pupil cost and average daily membership in residence (ADMR), adjusted for inflation. The inflation factor can be determined by a fixed percentage or an index published by the U.S. Bureau of Labor Statistics. The legislative body can override the budget cap through a ballot vote requiring a 3/5 majority. If the budget exceeds the cap without the necessary votes, it will be reduced to comply. The bill also clarifies the voter question regarding the budget cap and ensures that its provisions apply to existing local tax caps and school district budget caps without needing re-adoption. The act is set to take effect 60 days after passage, on September 13, 2025.

Statutes affected:
Introduced: 32:5-c, 32:5-e, 32:5-f
As Amended by the House: 32:5-c, 32:5-f
As Amended by the Senate: 32:5-c, 32:5-f
Version adopted by both bodies: 32:5-c, 32:5-f
CHAPTERED FINAL VERSION: 32:5-c, 32:5-f