Evelyn Sirrell, et al.


State of New Hampshire, et al.




The petitioners request that this Court clarify its Order dated January 17, 2001, in which the Court ruled that the statewide property tax in HB 999 was unconstitutional as applied, and ordered the State to "reimburse all towns for the tax dollars paid and collected since the enactment of HB 999." See Order at pages 57-58.

Specifically, the petitioners request the Court to clarify whether this reimbursement is limited to the $48 million dollars paid by the donor towns to the State for education funding in receiver towns, or whether this reimbursement refers to the entire $880 million dollars in property tax payments collected statewide. The Court finds that the remedy contained in its January 17, 2001 Order is clear and that it was acknowledged by the State, through the Attorney General's Office, in its opening statement at trial on October 16, 2000. The State specifically represented to the Court that:

This is really a $440 million dollar issue, because if the Court determines that the statewide property tax is unconstitutional, it's not just the $24 million dollars that has to be credited, refunded or offset, it's the $440 million dollars, because that whole tax was collected to fund adequacy even though some portion of it remained in the communities. It is that whole tax that was collected under the statewide education property tax, and by December 1st it will be two years that the tax is collected, which will be a total of $880 million dollars at this point.

Moreover, the State has repeatedly and unequivocally reminded the Court that if the statewide property tax were declared unconstitutional it would be solely the State's obligation to fully refund, credit, or otherwise remedy all taxpayers who had made payments under this tax.

When this litigation began, the State objected to a request for class certification and made representations to the Court regarding their positions therein. The Court acknowledged these representations in its February 29, 2000 Order and stated:

A request for class certification was filed by the plaintiffs, and as a result of the State's stipulation that if the statute is declared unconstitutional the money will be returned, the request for class certification has been withdrawn.

The State never asked for reconsideration, clarification or otherwise objected to this Order.

Further, on March 9, 2000, seventeen "donor" towns filed a Bill of Interpleader in a companion case, asking the Court to escrow the tax dollars collected under the statute pending resolution of the dispute over its constitutionality and validity. These towns claimed in part, that if the Court found the statute unconstitutional, the State would be unable to reimburse the taxpayers. The State objected to this claim and moved to dismiss the Bill of Interpleader. At the March 23, 2000 hearing on interpleading the funds the State, through the Attorney General's Office, verbally instructed the Court that:

First of all, if this tax is unconstitutional, it is not only unconstitutional in the so-called donor communities, Your Honor, it is unconstitutional throughout the State. Anything, any refund or any credit or any remedy that the State is required to give to any taxpayer, applied to every said taxpayer in this State. Every taxpayer who owns property in this State is having assessed against them a statewide property tax . . . .

. . . if the tax is collected and determined to be unconstitutional, it is the State who's responsible to the taxpayers in the State, to refund or credit or otherwise remedy the situation . . . .

Based on the State's representations at the March 23, 2000 hearing, the Court in its March 30, 2000 Order denying the Bill of Interpleader stated:

The State has taken the position that, if the tax is declared unconstitutional or otherwise invalid, they will repay all of the taxes collected, both to the "donor" communities and to the "receiver" communities.

The State never asked for reconsideration, clarification, or otherwise objected to this Order. Accordingly, the above representations led to the paragraph on page 58 of the January 17, 2001 Order that states:

The appropriate remedy for the constitutional violations found in HB 999 as applied, has already been agreed to by the State. The State agreed, by objecting to the request for interpleader of the tax funds, that if the tax was declared unconstitutional or otherwise invalid, they would repay all of the taxes already collected. See City of Portsmouth v. State of New Hampshire, Rockingham Co. Super. Ct. Docket No. 00-E-136 (decided April 2000)(Galway, J.). Therefore, this Court orders that the State of New Hampshire, in accordance with the agreement, reimburse all towns for the tax dollars paid and collected since the enactment of HB 999.

This is the paragraph which the petitioners have requested the Court clarify through the present Order.

Clearly the State stipulated to the obligation of the State of New Hampshire to repay or reimburse all monies collected under the tax, namely $880 million dollars, if the tax as applied was found unconstitutional.

However, the particular method or manner of repayment or reimbursement was neither stipulated to, subject to a hearing, nor ordered.

Accordingly, the remedy ordered in this case, which was based on the State's representations as to the State's obligation to repay/reimburse the $880 million dollars stands. However, the method or manner to satisfy this obligation has neither been agreed to nor ordered. If a hearing on the method or manner of repayment is necessary, the State may raise the issues of repayment, credit, setoff, etc. as they have stated.


Presiding Justice