Budget & Taxes

HB 197 requires the state to pay 7.5% of retirement contributions for group I teachers and group II members (including local police and firefighters) employed by cities, towns, and other local governments. This shifts the payment responsibility from local employers to the state, beginning in fiscal year 2026. The bill directly affects local governments that fund these retirement contributions, reducing their costs by approximately $28 million annually starting in 2026. The state will cover this 7.5% share using General Fund resources, while local governments will see a corresponding decrease in their retirement-related expenses.

HB 651 increases the base cost of an adequate education per student from $4,100 to $7,356.01 and raises differential aid amounts for specific student groups: free or reduced-price meal eligible students by $1,733.28 (to $4,126.20), English language learners by $602.88 (to $1,435.20), and students with special education needs by $1,582.56 (to $3,767.40). The bill also expands the definition of an adequate education to include additional resource elements like teacher benefits, technology, and facility maintenance. This change, effective July 1, 2025, will require higher state funding for school districts, charter schools, and education freedom accounts, with an estimated $576 million increase for school districts in fiscal year 2026.