Open Enrollment: What it Costs and Who Pays
February 4th, 2026
Last week, the Senate passed SB 101, the mandatory open enrollment bill, and then attached the text of the bill to an entirely different piece of legislation, HB 751, to allow it to go straight to the House floor without a public hearing. Now, the complete package of HB 751 is about creating a study committee on licensure of outpatient substance use disorder treatment facilities, mandating public school open enrollment, and allowing schools to use audio and video recording for certain school activities. The House may vote on HB 751 as early as this Thursday.
On the Senate floor, lawmakers shared different, often opposing visions for what open enrollment will mean in communities. To help communities understand some of the potential consequences – positive and negative – of this bill, Reaching Higher NH dug into the finances.
The bill says the following about how open enrollment will be funded:
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The student’s resident district, also known as the sending district, will pay to a receiving district between 80% and 100% of the sending district’s average cost per pupil (so, cost is based on where a student lives, not where they enroll).
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If the sending district’s average cost per pupil is less than the receiving district’s average cost per pupil, the student’s family pays the difference.
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The sending district is responsible for all special education expenses.
Given these parameters, we created a calculator that allows you to see how much local taxpayer money would change hands using different sending and receiving district combinations and how much those combinations might cost families. The calculator lets you select a sending district, a receiving district, and either the 80% or 100% cost per pupil rate. You can also model the effects of different numbers of students choosing that pathway. As you look through these numbers, remember that the vast majority of money paid by sending districts will come from local tax dollars.
Calculate the Costs
Below we created a calculator using publicly available cost per pupil expenditures published by the New Hampshire Education Department. To use this calculator, simply select the resident or "sending" district and the "receiving" district to which students may be transferring. Then, enter the number of students. Lastly, select the tuition rate to be paid from the "sending" district to the "receiving" district. The calculator allows you to choose 80% of the sending district's cost per pupil, the lower limit in HB 751, or 100% of the sending district's cost per pupil, the upper limit.
Let’s look at an example. Consider a student from Somersworth transferring to Portsmouth. In Somersworth, the most recent average cost per pupil was $21,990. In Portsmouth, the average cost per pupil is $27,610. If Somersworth is asked to pay its full cost per pupil, an option under the bill, Somersworth would pay $21,990, and the family of the transferring student would pay $5,620. If Somersworth only has to pay 80% of its cost per pupil – an option under the bill, though it’s unclear who decides which amount districts will pay – the city’s obligation drops to $17,592, but the family’s tuition now rises to $10,018. In both scenarios, Portsmouth nets $27,610.
Implications
As we’ve discussed before, cost per pupil is a blunt metric that doesn’t actually reflect the cost of educating a single student. Instead, it represents the cost of running a school, divided by the number of students who are enrolled. But when one student leaves, that cost drops only marginally, if at all. If four students left Somersworth for Portsmouth, even with the lower tuition rate (80% cost per pupil), Somersworth would be sending more than $70,000 to Portsmouth. This is roughly equivalent to a teacher’s salary, yet there’s no chance Somersworth can pay one fewer teacher just because four students have left.
Expenses Increase, Not Decrease
The result will be that Somerworth’s costs stay about the same, but now the district is also sending $70,000 – roughly $40,000 of that coming from local property taxes – to Portsmouth. Until transfers hit a critical mass, costs will grow while student population shrinks, resulting in a higher cost per pupil (even if costs remain the same, if the number of pupils decreases, cost per pupil will increase). This higher cost per pupil will increase the amount Somersworth owes on behalf of open enrollment students in subsequent years, making it increasingly difficult for Somersworth to improve its offerings for students who can’t drive to Portsmouth or whose parents can’t pay the tuition. A rising cost per pupil is also likely to draw scrutiny from taxpayers, whose money is increasingly leaving the district and who might be less willing to approve budget increases necessary to help Somersworth retain and serve its students. (Reaching Higher NH explored this dynamic with a case study of Newport and Sunapee.)
Parents' Pay
The parental tuition is also a key part of the story. The bill says: “If the transferring student's resident district average cost per pupil is less than the receiving district's average cost per pupil, such difference shall be charged as tuition and paid by the pupil's parents or guardians to the receiving district prior to the start of each semester.” It’s possible that even if Somersworth pays just 80% of its cost per pupil, parents will only be charged the difference between Portsmouth’s and Somersworth’s total cost per pupil, around $5,620. But it’s also possible that parents will be asked to make up the full difference between Somersworth’s contribution and Portsmouth’s cost per pupil, in which case, parents will pay more than $10,000. These numbers will functionally put the program out of reach for many, even if they could provide their own transportation.
But there may also be situations where the tuition is worth it to parents, particularly those who might be paying out of pocket for private school right now. And as families make different decisions, districts might face surprise bills. Imagine a family living in Somersworth and sending their child to Portsmouth Christian Academy, where tuition ranges from $7,500 to $14,800. With Portsmouth’s public schools now available as an option, potentially at a lower tuition rate than Portsmouth Christian, this family might choose to use open enrollment (capacity allowing, of course). But when they do, Somersworth will get a bill from Portsmouth for a student who has never been on its roster and for whom it has never received state adequacy aid. For the first year, Somersworth will be footing the bill for this student with no help from the state.
Local Property Owners Pay
The potential for students to enroll without ever having attended their district school creates a level of unpredictability that will be challenging for districts to manage. In districts with tax caps, families’ enrollment decisions could break budgets, and it’s not clear how districts should respond when open enrollment costs cause them to exceed mandatory spending caps. At a time when state lawmakers seem increasingly interested in controlling school district budgets, open enrollment will introduce a new level of volatility.
Even proponents of open enrollment have said that 80% of cost per pupil “would be extraordinarily generous, more than compensating New Hampshire’s school districts for the marginal costs of serving incoming transfer students.” But that generosity comes at the expense of local taxpayers whose money no longer goes to their own district and of students who can’t or choose not to transfer. The high performing districts, which are generally those with the greatest property wealth, will get richer on the dollars sent from less wealthy districts. And while some students might benefit from accessing the school next door, those who don’t get a seat or can’t find transportation may find their district school has even less to offer.