Part 2: What Goes Into a New Hampshire Property Tax Bill — And Why School Spending Drives It

Read Part 1 of this series on New Hampshire's property tax system here.

Property tax bills in New Hampshire are made up of four major components: local school, municipal (town), county, and the Statewide Education Property Tax (SWEPT).

In a typical community, the breakdown looks like this:

• Local School Spending - 60%

• Town/City Spending - 25%

• SWEPT - 8%

• County Spending - 7%

Importantly, 85% of the property tax bill is directly determined by the elected officials at the local level, most commonly the School Board Members and the town Selectmen. More on this in part 3.

Because these percentages never rise or fall evenly, understanding how each part behaves is critical to understanding why taxes change. And the biggest driver, by far, is local school spending. While the county tax can jump substantially — as it did in Hillsborough County this year, where the Democrat-led county delegation raised the levy by more than 20% — even those increases are small compared to the long-term growth of local school budgets.

This has become especially true as school enrollment has steadily declined. The New Hampshire Department of Education’s 2025–26 enrollment report shows statewide public continuing a decades-long downward trend.

Despite that decline, most districts continue approving budget increases, a dynamic reinforced by New Hampshire’s longstanding political preference for local control when concerning school spending. Legislators in Concord have rarely been willing to impose caps or limits, leaving decisions to annual school meetings where budgets frequently rise year over year.

Graniteborough’s Tax Bill Before and After New Spending

Graniteborough, our fictional Hillsborough County town, has 10 taxable properties:

• 4 homes whose assessments rose 10% in the recent revaluation

• 4 homes whose assessments rose 40%

• 2 businesses whose assessments did not change (yes, our defunct 2nd business is back!)

After revaluation, Graniteborough still needed to raise $100,000, and the revaluation simply redistributed who paid what:

Before Any Budget Increases (Baseline Bills)

Property Type	Per-Property Tax	Block Total	Share of Town’s $100k Levy
Homes +10%	$9,166.67	$36,666.67	36.7%
Homes +40%	$11,666.67	$46,666.67	46.7%
Businesses	$8,333.33	$16,666.67	16.7%
Total	—	$100,000	100%

These percentages—36.7%, 46.7%, and 16.7%—are the shares each block contributes toward the levy. We now keep those shares constant to show how new spending affects each group.

Graniteborough Increases Spending

Like most New Hampshire towns, Graniteborough’s school board proposes a 10% increase despite declining enrollment (consistent with statewide patterns shown in the DOE data). Town government spending also rises 10%, and the Hillsborough County Delegation increase hits Graniteborough with a 20% hike in its county portion. SWEPT remains unchanged.

Applying the statewide average proportions:

• School: from $60,000 → $66,000 (+$6,000)

• Town: from $25,000 → $27,500 (+$2,500)

• County: from $7,000 → $8,400 (+$1,400)

• SWEPT: stays at $8,000

  
  

A 9.9% overall tax increase, with the school increase alone accounting for over 60% of the total hike.

How the Increase Falls on Each Type of Property

Using the same percentage shares created by the revaluation:

• Homes +10% group → 36.7% of $109,900 = $40,296.67

• Homes +40% group → 46.7% of $109,900 = $51,286.67

• Businesses → 16.7% of $109,900 = $18,316.67

New Per-Property Bills

Property Type	Before Increase	After Increase	Dollar Change	% Change
Homes +10%	$9,166.67	$10,074.17	+$907.50	+9.9%
Homes +40%	$11,666.67	$12,821.67	+$1,155.00	+9.9%
Businesses	$8,333.33	$9,158.33	+$825.00	+9.9%

The town’s tax base didn’t change — only the spending did. And school spending, as in nearly every New Hampshire community, drove the overwhelming majority of the increase.

The effect of this increase is felt the hardest on the 4 homeowners in the second residential group whose homes have appreciated faster than their neighbors and the businesses. While everyone went up 9.9%, the gross effect is harder on those with higher property values.

Property Type	Before Increase	After Increase	Dollar Change	% Change
Homes +10%	$9,166.67	$10,074.17	+$907.50	+9.9%
Homes +40%	$11,666.67	$12,821.67	+$1,155.00	+9.9%
Businesses	$8,333.33	$9,158.33	+$825.00	+9.9%

Why School Spending Dominates Tax Growth

The Graniteborough example reflects the same pattern seen statewide:

1. Local school budgets make up most of the tax bill

At roughly 60%, even small increases in school spending outweigh large increases elsewhere.

2. County increases — even big ones — barely move the needle

Hillsborough’s 20% county hike produces just a $1,400 increase for Graniteborough, compared to $6,000 from the school budget.

3. Enrollment has declined, but budgets haven’t

The DOE’s statewide enrollment data confirms long-term decline, yet school budgets continue to rise in most districts. This means more money on fewer kids. While local property tax payers shoulder the brunt of the decisions to increase spending, and thus their taxes, at the local level. Reminder- 85% of property taxes are locally determined.

4. State funding is at an all-time high

Despite ongoing lawsuits—driven primarily by progressive and teacher union-aligned groups seeking to change the structure of SWEPT and claim insufficient state support, total per-pupil state aid (adequacy aid + differentiated aid + special programs + grants) is at historic levels, even as student counts fall.

5. Local control makes restraint politically difficult

For decades, lawmakers—especially Democrats—have opposed state-level spending caps, arguing that decisions should remain local. The result is predictable: local school budgets rise faster than any other part of the property tax bill. A review also shows that most school boards are controlled by members who tend to favor increased spending.

Graniteborough shows what New Hampshire homeowners already understand: Your revaluation doesn’t raise taxes — your school budget does.

For part 3, we will explore how the people making these decisions are elected and the now ongoing battle in Concord as State politicians grapple with bringing property tax relief while respecting local control.