What exactly is a Donor Town?

According to the Coalition of Communities of which Moultonborough is a member, donor towns began "...  in 1999 after the Legislature implemented a state property tax in an effort to meet the N.H. Supreme Court's directives to provide an "adequate" education statewide. Because it primarily relied on equalized property values to determine education grants, this system severely penalized communities that were rich in property values even if their citizens were not -- forcing them to raise and "donate" extra tax dollars to pay for education in towns that were home to people who often had much higher incomes. "


Donor towns existed from 1999-2004. Look at the tax history chart below and see the impact that this has had on Moultonborough's property tax rate: