New Hampshire voters to decide property tax cap

(The Center Square) — New Hampshire voters will decide whether to set a local property tax cap after Gov. Kelly Ayotte signed a bill putting the referendum on the November ballot.

Ayotte signed legislation Wednesday that will ask voters to amend the state's constitution to cap local school district property taxes at the previous year's level, adjusted for inflation and new construction. 

"New Hampshire is at its best when we’re putting decision making power in the hands of the people," Ayotte, a first-term Republican, said in a statement. "This bill gives voters a say about their local property taxes and ensures Granite Staters’ voices are heard."

The measure, which will appear on both the 2026 and 2028 ballots, requires at least 60% of voters to approve an amendment to the state constitution. 

Megan Tuttle, president of the New Hampshire chapter of the National Education Association, criticized the proposal, saying it sidesteps the question of whether the state is adequately funding school districts, as required by the constitution. 

“New Hampshire voters already have the authority to place caps on local school budgets and taxes, and time and again they have chosen not to because they understand the real costs schools face, including rising utility expenses, health care premiums, and the growing cost of student support services," she said in a statement.

"Instead of supporting students and working to address New Hampshire’s broken and unequal school funding system, this legislation will further constrain local schools and make it harder for districts to meet the needs of their students," Tuttle said. 

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The "Live Free or Die" state of New Hampshire doesn't have a personal income or sales tax, but still has some of the highest property taxes in the nation. It was ranked 29th in the Tax Foundation's latest report, which found that Granite Staters pay an average $5,949 a year in local property taxes, which are collected by cities and towns and vary widely.

Democrats say the lack of a statewide personal income tax forces many cities and towns to increase property taxes to cover the cost of doing business. 

In March, a group of Democratic lawmakers filed a bill that would impose a 3% flat income tax and a statewide property tax to raise an estimated $1 billion a year for public schools. They said the move would ease the pressure on local governments to increase property taxes and provide much-needed funding for public schools. 

But the move was quickly swatted down by Ayotte and Republicans, who control the state Legislature. Conservative groups took to social media to ridicule Democrats for even proposing the plan in a state that has long prided itself as a haven from income taxes. It was later rejected by legislative leaders.

In the 2012 elections, New Hampshire voters approved an anti-income-tax amendment, but the referendum fell short of the two-thirds supermajority needed to amend the state Constitution.

Americans for Prosperity New Hampshire Deputy State Director Sarah Scott praised Ayotte for approving the "commonsense" proposal to cap local property tax increases, saying she is "putting the power back where it belongs — with the people." 

"This law gives Granite Staters a direct say over school property tax growth and ensures education dollars are spent in the classroom, not on administrative overhead," Scott said.