New Hampshire’s “Freedom of Education Account” program is slated to roll out across the state this month following a critical vote by the state’s Joint Legislative Committee on Administrative Regulation (JLCAR) on Thursday.
But the vote – which approved a number of tentative rules designed to allow the program to go live early in the school year – came after a number of concerns from advocates for the committee that the rules require significant clarification.
In a summary of the rules presented to lawmakers ahead of Thursday’s session, the committee’s lawyers said the preliminary rules lack clear guidelines on how to monitor freedom of education accounts, how to protect confidential information, and how much jurisdiction the state has over the private organization that runs the program.
The attorneys identified other key issues, including whether the new accounts can be tax-free and whether tutors and education providers approved under the program are required to have criminal background checks.
In response to the price increase, Education Department attorneys made a number of changes this week to address concerns. But many of the broader issues identified by the committee’s lawyers have not yet been addressed.
“Since this is a brand new program, there might just be practical issues that can’t be resolved,” said Kim Reeve, the committee’s attorney who helped write the markup.
The New Hampshire Education Freedom Account Program is designed to allow parents of children who do not attend public school to access the state money that would have been sent to their local public school and use it for private school tuition, tutoring, classroom materials, and other expenses.
Republicans and supporters of school choice have hailed it as an opportunity for low-income children and families whose local public school is not well placed to find other options. The Democrats have warned that it will divert resources from public schools and government revenues, and divert public funds to religious schools.
A legal framework for the new program was approved in the state budget in June. However, lawmakers and the members of the State Board of Education must put in place a set of administrative rules that clarify how the program will work in order for it to move forward.
On Thursday, the ten-member Administrative Rules Committee voted 6-4 to move forward on a series of expedited provisional rules, with the understanding that the Department of Education strive to get approval of permanent rules within six months. The votes fell according to party lines, the Democrats were against.
However, the transitional provisions approved on Thursday contained a number of provisions that are of concern, according to the committee’s lawyers.
Under the EFA program, the state will contract with a private scholarship organization to manage the family savings accounts and determine which education providers and services the parents can use the money for.
However, the rules do not outline clear oversight mechanisms over this organization, the lawyers said.
For example, the rules require the organization to provide parents with a comprehensive agreement informing them of how the program works and what is expected. However, there is no obligation for the Ministry of Education to sign this agreement, the committee’s lawyers noted.
There is also confusing language when it comes to criminal background checks, the lawyers wrote. While the rules require the grant organization to publicly disclose the general employee background check process for its approved education providers, there is no legal authority to specifically allow the private organization to conduct criminal background checks, and there is no direct obligation to carry this out.
How the money will be spent is also not fully specified, said the lawyers. The rules require that government-funded Internet and technology be used “primarily” for educating students, the lawyers noted. But the rules do not specify the meaning of “primary”. And there is no clear approval process for what types of “computing devices” are covered by the law.
The rules are also written to take into account a single grant organization, although the statute allows multiple grant organizations. “The board has no clear authority to have more than one scholarship organization,” wrote the committee’s lawyers.
The tentative rules on the freedom of education account – which did not receive any public hearings – are slated to last just six months and put the program into effect for the 2021-22 school year. The Ministry of Education must now use the traditional procedure to establish permanent rules, which means that there must be public opinion and hearings.
But even if the formal rulemaking process fixes some of the kinks in the original draft of the rules, JLCAR lawyers said there are a number of issues that may require new legislation to fix.
For one thing, the law on which the program is based has shown savings accounts as tax-free income for families. “This can collide with federal tax law,” the lawyers stated.
The law is silent about the safeguards that need to be taken to protect health care information received from the scholarship organizations, including for students with disabilities.
And it doesn’t make clear what protections will apply to students with disabilities when their families pull them out of the public school system and they use an EFA.
Then the question arises whether too much power has been given to the private scholarship.
“The statute grants powers to the grant organization that are typically conferred on the Executive Agency and which may constitute an improper delegation of authority,” the JLCAR lawyers wrote.
Education Department lawyers dismissed many of these concerns as testimony to the committee, noting that they had removed many of the ambiguous language reported by the committee’s attorneys earlier this week.
On the one hand, not all educational service providers who could benefit from the savings accounts have to be checked by the criminal police, argued the department’s lawyers.
“I think it’s important for context to point out that the concept of an education service provider is very broad,” said Chris Bond, legal advisor for the Department of Education. “… So many educational service providers will not have direct interaction with children.”
Bond added that the state Department of Education had no authority over the rights parents of students with disabilities would have if they left the public school system, noting that the Disabled Education Act became the jurisdiction of the U.S. Ministry of Education fall. But he said the State Department will work to get better answers in the future.
And he noted that the state already has a formal agreement with the Children’s Scholarship Fund – the nonprofit that ran the program in the first year – that addresses some of the areas that are not touched upon in the rules or bylaws. This contract was approved by the Executive Board earlier this month.
“We already have a contract with a scholarship organization that will guide us through the transition period,” added Bond. “For example, the protection of confidentiality is addressed in this contract, which is why we felt we did not have this in the transitional arrangement.”
A lawyer who testified before the committee objected to the continuation of the transitional arrangement. Gerald Zelin, an attorney representing the New Hampshire Association of Special Education Administrators, said the rules shouldn’t continue until there is better clarification about the rights of parents of students with disabilities attending EFAs.
“Once a government benefit has been granted, we all know it’s difficult to withdraw,” said Zelin. “People rightly rely on it. That is why we have to get these transitional regulations right the first time, even if they are only transitional regulations. “
Democrats on the committee agreed, arguing that more time should be taken to address any concerns raised by committee attorneys.
Rep. William Hatch, a Gorham Democrat and former chairman of the rules committee, noted that the number of concerns raised by the committee’s staff was unusual.
“While it’s not uncommon for conditional rulemaking concerns to be incorporated into regular rulemaking, I’ve never seen so many addressed in this way,” he said.
Others said the rules did not provide enough transparency.
“These are public dollars – we are giving public money away with virtually no oversight of a private company that is not under our right to know,” said Senator Becky Whitley, a Concord Democrat. “Regardless of your political position on this program, we cannot violate public confidence and allow a deeply flawed program to be hastily implemented without adequate protection and control by this committee.”
The Republicans countered, however, that the Democrats exceeded the powers of the committee, which is supposed to review the rules, not the statutes on which they are based.
“The objections I’ve heard so far are purely political,” said Rep. Terry Roy, a Republican from Deerfield. “The legislature has spoken; the governor spoke; the people spoke. These rule questions can be dealt with in permanent rule-setting. “
Senator John Reagan, another Deerfield Republican and chairman of the committee, expressed a similar view.
The transitional regulations have not yet been fully adopted; They will be presented to the State Board of Education for final approval at its meeting on Friday.
But even Reagan admitted the process to complete it this week was a leap.
“This has been a complicated rule in a very short time,” he said. “It’s been a back and forth between JLCAR staff and the Department of Education, and it’s been a tough road.”