Board of Education to vote on rules for ‘education freedom accounts’

A new state program creating “educational freedom accounts” could receive more clarity this week, as the New Hampshire Board of Education meets Thursday to take up rules governing the program. 

Republican lawmakers passed the EFA program last month, allowing parents who withdraw their child from public school to take their child’s per-pupil state funding with them. The law, inserted into the budget, allowed the money to be spent on private school tuition, homeschooling costs, or other expenses.

But the statute did not touch on specifics over how to administer the program. On Thursday, the Board of Education will vote on a set of administrative rules designed to fill in the gaps. 

Under the new program, parents making up to 300 percent of the federal poverty level, or roughly $80,000 a year for a household of four, may apply to a scholarship organization designated by the state to access an educational savings account for their child. 

That account will be filled with the student’s “base adequacy aid” – the standardized $3,787 per student per year – plus any additional “differentiated aid,” which includes money for receiving free or reduced lunch assistance and special education funding. Currently, that aid flows from the state to the schools; the EFA program will allow it to be diverted to a savings account at the request of a family. 

The proposed rules, a draft of which was released Wednesday, lay out ground rules for how those savings accounts must be managed.

To start, the rules state, the scholarship organizations must accept applications from parents on a rolling basis, must accept eligible students within 30 days, and must clearly inform parents what the money can be spent on. That includes private school tuition, tuition to online education courses, textbooks, computers and internet technology, uniforms, software, standardized testing fees, and other expenses laid out in the statute.

The rules add some clarifications to those expenses. Computer reimbursements, for instance, are limited to one per student every three years. Internet services apply only to those directly related to online learning programs; Netflix does not count. 

Students who have already received a high school diploma or are older than 21 would not be eligible for the program, the rules stipulate.

Once the money has been approved, it must be released to parents four times a year, in portions between 20 percent and 30 percent, according to the draft rules.

Meanwhile, the scholarship organizations must keep track of what parents spend the money on, and parents must report the expenses to the organizations, the suggested rules state. Those spending amounts must be sent to the Department of Education, but the scholarship organizations need only designate how much money was spent in each general category – such as textbooks or computers – not exactly what was paid for.

The rules also detail how organizations must monitor abuse of the program. The organizations must report any suspected cases of intentional misuse of funds to the department “within five days,” the rules state. Depending on the extent of the fraud, parents could be charged with a felony. 

Parents and students are able to appeal any decisions to the department, the rules state.

One provision not included in the draft rules: a requirement that the education service providers be approved by the Department of Education. Under the draft rules, instead, the scholarship organizations have discretion over which programs they believe can be approved, and must inform the department which have been selected.

That lack of direct approval could draw opposition from state Democrats, who have opposed the EFA program, which they say will hurt public schools.  

But the rules state the organizations can also disqualify education providers they determine have intentionally misrepresented themselves, failed to provide promised goods or services, or have failed to issue timely refunds. 

The rules up for a vote are just interim regulations; they’ll last for six months until the Department of Education passes permanent rules later this year.

If the Board of Education votes to pass the rules Thursday, they’ll go before the Joint Legislative Committee on Administrative Rules, a panel of House and Senate lawmakers, for final approval.