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updated 11/12/2010 12:56:15 PM ET 2010-11-12T17:56:15

New Hampshire would keep half the $41 million in emergency federal funding intended to protect teachers' jobs for other state spending under a plan facing a legislative committee's approval.

The joint legislative Fiscal Committee takes up the plan Monday afternoon. Documents provided to the Associated Press show the plan is to distribute all the money through the existing school aid formula in place of state tax dollars. The state would then distribute $20 million in additional aid from the freed up state funds.

The total aid distribution for this fiscal year would rise from $957 million to $978 million.

Federal education officials estimated the $41 million would save 700 teachers' jobs in New Hampshire but a survey by school administrators last summer determined roughly 200 jobs had been cut going into the school year.

In documents filed with the Fiscal Committee, Christopher Clement, director of the state's Office of Economic Stimulus, said the state increased school aid by more than $100 million in the current two-year-budget, which fully funded its aid commitment.

He said the federal law requires schools to use the funds for pay and benefits and other expenses needed to retain existing employees, to recall or rehire former employees and to hire new employees. Schools that have excess funds at the end of this school year can use the money to hire new teachers through the end of September 2011, he said.

The state's tactic is not new. The state — with Gov. John Lynch's support — substituted federal education stimulus funds for state-funded school aid in the current budget. State tax money was freed up from being spent on school aid and used instead for other spending, including state aid to communities.

The federal law calls for the money to be distributed either to schools under the Title I formula — which target schools with high concentrations of low-income students — or through the state's aid formula. Not all schools receive Title I money.

Mark Joyce, executive director of the New Hampshire School Administrators Association, said Friday that schools are squeezed by rising costs and voters opposing property tax increases to pay those costs. Districts could use all the money, he said.

"I guess that's half a help," he said.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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