This bill amends existing laws related to local tax caps and budget procedures, specifically addressing the adoption and implementation of tax caps in towns, cities, and school districts. It repeals and reenacts sections of RSA 32:5-b, clarifying that the estimated amount of local taxes for the fiscal year must include the operating budget and any other warrant articles with a tax impact. The bill introduces a new formula for adjusting tax caps based on inflation and changes in population or school attendance, ensuring that local taxes do not exceed the previous year's amount adjusted for these factors. Additionally, it specifies the wording for ballot questions related to tax cap adoption, differentiating between fixed dollar amounts, fixed percentages, and multiplication factors.

Moreover, the bill establishes a new section, RSA 32:5-e, which outlines a budget cap specifically for school districts, based on the current per pupil cost multiplied by the average daily membership in residence, with provisions for annual inflation increases. It allows the legislative body to override the budget cap with a supermajority vote for any appropriations that exceed the cap. Key amendments include stipulating that if a school district's operating budget exceeds the budget cap without a 3/5 majority "yes" vote, the budget will be reduced to comply with the cap. The bill also modifies the language regarding inflation increases, changing the reference date for the inflation index from January to October 1, and allows local political subdivisions with existing budget caps to consider new caps using the outlined methods. The act will take effect 60 days after passage.

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