New Hampshire's tax structure is unique among the states -- it has no broad-based income or sales tax. Local property taxes fund 90 percent of education costs -- about 25 percentage points greater than any other state and twice the national average.

But in 1997 the state Supreme Court ordered the legislature to equalize funding. One way to comply is to adopt a uniform statewide property tax and redistribute the income between poor and rich districts. But such tax equalization would have negative economic effects, say researchers.

With a statewide property tax, donor towns pay a portion of their property taxes to the state, and receiver towns get donor monies, filtered through the state. Assuming the goal is to equalize funding at $5,000 per student across all districts:

• If property taxes alone were used to equalize funding, tax rates would go up in donor towns about twice as much as they go down in receiver towns -- increasing 30 percent in donor towns and decreasing 15 percent in receiver towns.

• The poorest towns in terms of residents' household income, about 20 percent of the total state population, would face the highest property tax increases -- 18 percent, or $62 million.

• The property tax rate would be $14.79 per thousand dollars of assessed value.

By comparison, all states outside of New England have effective rates lower than $4.00 per thousand for residential property.

Because tax increases would outweigh decreases, and business property and jobs are concentrated in donor towns, job growth in New Hampshire would decrease by at least 3,395 jobs over the next decade, and perhaps by as many as 6,000 to 20,000 jobs.

Source: Lisa Shapiro, et al., "The Economic and Fiscal Impacts of a Uniform Statewide Property Tax," Executive Summary, February 1999, Josiah Bartlett Center for Public Policy, P.O. Box 897, Concord, N.H. 03302, (603)224-4450.