Monadnock Regional School District v. Monadnock District Education Association, NEA-NH

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THE SUPREME COURT OF NEW HAMPSHIRE

___________________________

Cheshire
No. 2019-0134

MONADNOCK REGIONAL SCHOOL DISTRICT

v.

MONADNOCK DISTRICT EDUCATION ASSOCIATION, NEA-NH

Argued: November 20, 2019
Opinion Issued: July 8, 2020

Drummond Woodsum & MacMahon, of Manchester (James A.
O’Shaughnessy and Demetrio F. Aspiras on the brief, and Mr. O’Shaughnessy
orally), for the plaintiff.

NEA-New Hampshire, of Concord (Lauren Snow Chadwick and Esther
Kane Dickinson on the brief, and Ms. Chadwick orally), for the defendant.

HANTZ MARCONI, J. The defendant, Monadnock District Education
Association, NEA-NH (the Association), appeals an order of the Superior Court
(Ruoff, J.) granting summary judgment to the plaintiff, Monadnock Regional
School District (the District), and denying the Association’s cross-motion for
summary judgment. The superior court ruled that $392,381 in unexpended
appropriations set aside over a period of four years pursuant to the parties’
collective bargaining agreement had lapsed. See RSA 32:7 (2000) (amended
2017). We reverse and remand.
 The parties stipulated to the following facts. The District is a duly
constituted municipal corporation, specifically, a cooperative school district
established pursuant to RSA chapter 195. The Association is the exclusive
labor representative of all members of the bargaining unit in the District, which
includes high school department heads, classroom teachers, school-assigned
counselors, librarians, specialists, speech education teachers, media
generalists, and elementary teaching assistant principals. The District and the
Association were parties to a collective bargaining agreement (CBA) that was in
effect from July 1, 2012, to June 30, 2016.

Article 9.1 of the CBA contained the parties’ agreement as to health
insurance. It stated, among other things, that the District “will budget
$2,300,000 for the first year of this agreement for health insurance,” and that
the District “agree[d] to fund the health care budget amount by the lesser of the
insurance provider’s average ‘guaranteed maximum rate’ or 5% for each
additional year of the agreement.” It stated further that the Association was
“responsible for selecting the insurance plans and determining the amount of
contribution for each eligible employee.” Finally, as is most relevant to this
appeal, Article 9.1 established a health insurance “pool,” specifying that “[a]ny
amount of money in the healthcare budget not expended from the [District’s]
contribution to annual healthcare premiums and buyout payments will be
placed in a pool to offset healthcare coverage for [employees] electing plans that
exceed the District’s allotment per employee.” Article 9.1 further provided that
monies from the pool “will be distributed equally among all employees in each
plan classification to offset premium costs, as determined by the [Association].”

The District appropriated $2.3 million to fund employees’ health
insurance benefits for 2012-2013, the first year of the CBA. Although the
funds appropriated would have been sufficient to satisfy 100% of each
employee’s health insurance premiums for that year, the Association
determined that employees should bear 15% of the premium costs and that the
District should pay 85%. Accordingly, as of June 30, 2013, the end of the
2012-2013 fiscal year for the District, see RSA 197:1 (2008), $213,655 of the
$2.3 million remained unspent. That money was placed in the “pool” called for
in Article 9.1.

The District continued to appropriate funds for employees’ health
insurance benefits for each of the subsequent three years of the CBA. For each
of those three years, the Association determined that employees should pay
10% of yearly premium costs and the District should pay 90%. As a result,
there was a surplus of $192,309 from the CBA’s second year, and a surplus of
$154,633 from the CBA’s third year. When combined with the first year’s
surplus, the total amount of pool funds was approximately $560,000 going into
the 2015-2016 fiscal year, which was the CBA’s fourth and final year.

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 That year, the parties reached an agreement on a successor CBA that
contained a provision whereby the pool funds remaining at the expiration of the
current CBA would be used to fund health insurance costs during the
successor CBA. The District’s legislative body, however, voted to not fund it,
and as a result no successor CBA went into effect. When the successor
agreement did not go into effect, the Association requested, prior to the end of
the 2015-2016 fiscal year, that the pool funds be used to reimburse employees
for premium payments made in the current fiscal year as well as the three prior
fiscal years. In June 2016, the District voted to use some of the pool funds to
reimburse employees for their 2015-2016 premium payments, but refused to
reimburse employees for prior years’ payments. After the employees were fully
reimbursed for their 2015-2016 premium payments, the balance of the pool
funds was $392,381.

The Association filed unfair labor practice charges with the Public
Employee Labor Relations Board (PELRB), arguing that the CBA required the
District to reimburse employees’ premium payments for the first three years of
the agreement. The parties agreed to submit the dispute to arbitration, which,
per the terms of the CBA, “shall not be binding on either party, but shall be
advisory only except when the parties have mutually agreed . . . that the
arbitrator’s decision shall be final and binding.” The arbitrator rendered a
decision awarding the pool funds to the Association and/or its members. The
CBA stated that, “[u]pon receipt of the advisory arbitration award, the School
Board shall meet within twenty (20) days of the receipt of the award to accept
or reject the recommendation of the arbitrator.”

The District did neither. Instead, it filed this declaratory judgment
action, arguing that, despite the arbitrator’s award, “it would . . . be unlawful
to transfer th[e pool] funds to the Association” because “the funds in the pool
lapsed in prior years pursuant to RSA 32.” The parties later filed cross-
motions for summary judgment on a set of stipulated facts. The trial court
granted the District’s cross-motion and denied the Association’s.

The court stated that, under RSA 32:7, ordinarily “a school district
cannot retain unexpended funds from year to year without voter
authorization.” The trial court then discussed the statutory exceptions to the
lapse rule enumerated in RSA 32:7 and determined that “[t]he only exception
that could apply to the case at bar is RSA 32:7, I.” The court ultimately ruled,
however, that RSA 32:7, I, did not prevent the funds at issue from lapsing. The
trial court interpreted RSA 32:7, I, to provide an exception from lapse only to
legally enforceable obligations that arise prior to the end of a given fiscal year.
Applying this interpretation of RSA 32:7, I, and construing the CBA without
deference to the arbitrator’s interpretation, the court concluded that “[t]he CBA
did provide a legally enforceable obligation in regard to the pool funds, but that
obligation did not arise during any of the . . . years . . . concerned, as the
Association did not seek [to] offset [the cost of premiums] from the pool funds”

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during those years. The Association filed a motion for reconsideration, to
which the District objected. The trial court denied the Association’s motion,
and this appeal followed.

The primary issue presented by the Association’s appeal is whether the
trial court erred in granting the District’s cross-motion for summary judgment,
and denying the Association’s, on the basis that the funds at issue lapsed
pursuant to RSA 32:7. In reviewing rulings on cross-motions for summary
judgment, we consider the evidence in the light most favorable to each party in
its capacity as the nonmoving party and, if no genuine issue of material fact
exists, we determine whether the moving party is entitled to judgment as a
matter of law. JMJ Properties, LLC v. Town of Auburn, 168 N.H. 127, 129
(2015). If our review of that evidence discloses no genuine issue of material
fact and if the moving party is entitled to judgment as a matter of law, then we
will affirm the grant of summary judgment. Id. at 129-30. If, as in this case,
the parties filed cross-motions for summary judgment on a set of undisputed
facts, we need only review, de novo, the trial court’s application of the law to
the facts. Id. at 130.

Resolution of the issue before us requires statutory interpretation. We
review matters of statutory interpretation de novo. Id. This court is the final
arbiter of the intent of the legislature as expressed in the words of a statute
considered as a whole. Id. We first examine the language of the statute and
ascribe the plain and ordinary meanings to the words used. Id. Furthermore,
we interpret statutes in the context of the overall statutory scheme and not in
isolation. Id. Our goal is to apply statutes in light of the legislature’s intent in
enacting them and in light of the policy to be advanced by the entire statutory
scheme. Id.

RSA chapter 32 pertains to municipal budgets. Olson v. Town of
Grafton, 168 N.H. 563, 567 (2016); see RSA ch. 32 (2019). It “was designed to
control the appropriation and expenditure of money in municipalities including
school districts.” Board of Selectmen v. School Bd., 113 N.H. 598, 600 (1973);
see RSA 32:1 (stating that a purpose of RSA chapter 32 is “to establish
uniformity in the manner of appropriating and spending public funds in all
municipal subdivisions to which this chapter applies”); see also RSA 32:2 (“RSA
32:1-13, shall apply to all . . . cooperative school districts . . . .”). In
accordance with the chapter’s purpose, RSA 32:7 provides that “[a]ll
appropriations shall lapse at the end of the fiscal year and any unexpended
portion thereof shall not be expended without further appropriation, unless” an
enumerated statutory exception within RSA 32:7 applies. RSA 32:7; see also
RSA 197:1 (“A meeting of every school district shall be held annually between
March 1 and March 25, inclusive, . . . for raising and appropriating money for
the support of schools for the fiscal year beginning the next July 1 . . . .”).
Thus, under RSA 32:7, a school district cannot carry unexpended

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appropriations from one fiscal year into the next unless the voters authorize a
“further appropriation” or an exception applies.

One such exception is contained in RSA 32:7, I. The trial court
determined that this exception was the only avenue by which the lapse of the
unexpended pool funds could have been prevented at the end of each fiscal
year; however, the court concluded that the exception did not save the funds
from lapsing. The Association does not dispute that the exception in RSA 32:7,
I, is the only statutory exception that could have applied in this case. The
Association does argue, however, that the trial court erred in ruling that RSA
32:7, I, did not save the unexpended pool funds from lapsing at the end of each
fiscal year.

Looking first to the text of RSA 32:7, I, see JMJ Properties, 168 N.H. at
130, we note that the statute prevents the lapse of unexpended funds
appropriated for a given fiscal year when the unexpended “amount has, prior to
the end of that fiscal year, become encumbered by a legally-enforceable
obligation, created by contract or otherwise, to any person for the expenditure
of that amount,” RSA 32:7, I. Ascribing the plain meaning to the words used in
the statute, we construe RSA 32:7, I, to prevent the lapse of an unspent portion
of an appropriation if the following two conditions are satisfied. First, the
unspent funds must be encumbered by a legally enforceable obligation for their
expenditure. See id. Second, the obligation must attach to the funds before
the end of the fiscal year for which they were appropriated. See id.

The obligation required may be “created by contract.” RSA 32:7, I. A
collective bargaining agreement is a contract. Appeal of Alton School Dist., 140
N.H. 303, 306 (1995). Thus, as the trial court recognized, an obligation created
by the CBA could have prevented the pool funds from lapsing under RSA 32:7,
I. Whether such an obligation was in fact created requires us to interpret the
CBA.

Before turning to that interpretation, however, we address an argument
raised by the Association regarding the proper standard of review. The
Association argues that the superior court erred in interpreting the CBA de
novo rather than deferring to the interpretation of the CBA rendered by the
arbitrator. We disagree; the deferential standard of review normally applied to
arbitral interpretations of collective bargaining agreements does not apply in
this case.

Although we normally interpret contractual provisions de novo, “the
general rule is that the interpretation of a CBA is within the province of the
arbitrator.” Univ. Sys. of N.H. Bd. of Trs. v. Dorfsman, 168 N.H. 450, 457
(2015) (quotation omitted). That is because, ordinarily, by including an
arbitration clause in their CBA, the parties choose to have an arbitrator settle
disputes concerning constructions of the CBA. Appeal of Merrimack County,

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156 N.H. 35, 40 (2007). “‘Because the parties have contracted to have disputes
settled by an arbitrator . . . , it is the arbitrator’s view . . . of the meaning of the
contract that they have agreed to accept.’” Id. (quoting Paperworkers v. Misco,
Inc., 484 U.S. 29, 37-38 (1987)). Thus, in reviewing an arbitral interpretation
of a collective bargaining agreement, the court’s task is “ordinarily . . . limited
to determining whether the arbitrator’s construction . . . is to any extent
plausible.” Id. (first alteration in original) (quotation omitted).

This general rule of deference to arbitral interpretations of CBAs
recognizes that the “policy of settling labor disputes by arbitration would be
undermined if courts had the final say on the merits of the awards,” and that
“plenary review by a court of” the CBA “would make meaningless . . . provisions
[in the CBA] that the arbitrator’s decision is final.” Steelworkers v. Enterprise
Corp., 363 U.S. 593, 596, 599 (1960). See generally Rizzo v. Allstate Ins. Co., 170 N.H. 708, 714 (2018) (discussing benefits of arbitration). These policies
are not advanced, however, by deferring to an arbitrator’s interpretation of a
CBA rendered in a nonbinding capacity.

Although the arbitrator decided, based in part upon his interpretation of
the CBA, that the pool funds should “be used to reimburse bargaining unit
employees for . . . premium costs they paid in each of the first three years of
the contract,” it is undisputed that this decision was nonbinding. Article X of
the CBA, which governs grievance procedures, states that if a grievance is
referred to arbitration, “[t]he arbitrator’s decision shall not be binding on either
party, but shall be advisory only except when the parties have mutually agreed”
otherwise. Furthermore, in the stipulated facts submitted to the trial court
alongside the parties’ cross-motions for summary judgment, the parties agreed
that, “[p]er the terms of the CBA, the arbitration was non-binding.”

Parties to a contract generally have “the freedom to agree to binding or
non-binding alternative dispute resolution.” Rizzo, 170 N.H. at 715. The
nonbinding nature of the arbitration process provided for in the CBA “clearly
indicates that the parties did not bargain for the arbitrators’ final interpretation
of the contract.” Appeal of Board of Trustees of U.S.N.H., 129 N.H. 632, 635
(1987); see also School Dist. #42 v. Murray, 128 N.H. 417, 420 (1986) (“[T]he
extent of an arbitrator’s jurisdiction depends upon the extent of the parties’
agreement to arbitrate.”); Appeal of Merrimack County, 156 N.H. at 40.
Because the arbitrator’s interpretation of the CBA was nonbinding, we do not
agree with the Association that the superior court erred by affording no
deference to it. See Appeal of Campton School Dist., 138 N.H. 267, 270 (1994);
Appeal of Hooksett School Dist., 126 N.H. 202, 204 (1985) (per curiam)
(holding that PELRB had jurisdiction to interpret the CBA where “the language
of the teachers’ contract does not provide for final or binding arbitration or
other final disposition that is binding upon the parties”). The appropriate
standard of review for the CBA, in the context of this case, is de novo.

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 We now turn to our review of the CBA. We apply the general rules of
contract interpretation in doing so. See Behrens v. S.P. Constr. Co., 153 N.H.
498, 500 (2006); Appeal of Alton School Dist., 140 N.H. at 306. The
interpretation of a contract is ultimately a question of law for this court to
decide; thus we review the trial court’s interpretation of the CBA de novo. See
Town of Pembroke v. Town of Allenstown, 171 N.H. 65, 69 (2018). When
interpreting a written agreement, we give the language used by the parties its
reasonable meaning, considering the circumstances and the context in which
the agreement was negotiated, and reading the document as a whole. Id. at 70.
We give an agreement the meaning intended by the parties when they wrote it.
Behrens, 153 N.H. at 503. Absent ambiguity, the parties’ intent will be
determined from the plain meaning of the language used in the agreement. Id.

As noted above, Article 9.1 of the CBA set forth the parties’ agreement on
health insurance. It included an agreement that the District would appropriate
$2.3 million for health insurance for the first year of the CBA, and, for each
subsequent year, would “fund the health care budget amount by the lesser of
the insurance provider’s average ‘guaranteed maximum rate’ or 5% for each
additional year of the agreement.” The Association was “responsible for
selecting the insurance plans and determining the amount of contribution for
each eligible employee.”

Article 9.1 also set forth the parties’ agreement regarding the pool funds:

Any amount of money in the healthcare budget not expended from
[the District’s] contribution to annual healthcare premiums and
buyout payments will be placed in a pool to offset healthcare
coverage for [employees] electing plans that exceed the District’s
allotment per employee. Monies will be distributed equally among
all employees in each plan classification to offset premium costs,
as determined by the [Association]. In no case will an employee
receive more money than the cost of an annual plan premium.

Each sentence in the portion of Article 9.1 containing the parties’
agreement regarding the pool funds used mandatory language. The first
sentence of Article 9.1 stated that any amount of money remaining in the
annual healthcare budget after the District made its contribution to annual
premiums and buyout payments “will be placed in a pool.” (Emphasis added.)
The second sentence of this Article stated that monies in the pool “will be
distributed” to employees. (Emphasis added.) The plain meaning of a phrase
stating that a certain event “will” occur is that the occurrence of the event is
mandatory or obligatory, not permissive or discretionary. See Bigwood v.
Merrimack Village District, 108 N.H. 83, 87 (1967); see also Behrens, 153 N.H.
at 503. Accordingly, the provision in Article 9.1 stating that remaining funds
in the annual healthcare budget “will be placed in a pool” created an obligation
to pool those funds, and the provision stating that funds in the pool “will be

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distributed” created an obligation to distribute the pool funds. See Bigwood,
108 N.H. at 87.

Article 9.1 also set forth certain requirements as to the manner in which
the pool funds were to be distributed. The Article stated that the funds were to
be dispensed “equally among all employees in each plan classification to offset
premium costs, as determined by the [Association].” It also stated that
employees could not “receive more money than the cost of an annual plan
premium.” Construing Article 9.1 as a whole, we conclude that the Article
created an obligation to distribute pool funds to employees but gave the
Association discretion in implementing those distributions, so long as: (1) all
employees within each plan classification received an equal distribution; (2) the
distributions were made to offset premium costs; and (3) no distribution
resulted in an employee receiving a greater amount than the cost of an annual
premium.

Construing these obligations and RSA 32:7, I, together, we conclude that
the funds at issue did not lapse. As discussed, to prevent lapse under RSA
32:7, I, two conditions must be satisfied. First, the unspent portion of the
appropriation must be encumbered by a legally enforceable obligation for its
expenditure. See RSA 32:7, I. Second, the obligation must attach to the funds
before the end of the fiscal year for which they were appropriated. See id.
Here, both conditions of RSA 32:7, I, were satisfied as to the amount of each
year’s health insurance appropriation that remained unexpended at the end of
the fiscal year.

First, the unexpended health care funds that were budgeted each year
were placed in the pool. The funds in the pool were encumbered by an
obligation that such funds “will be distributed” to employees. This constituted
an enforceable obligation for the expenditure of those funds under RSA 32:7, I.
Second, Article 9.1 also created an obligation that any money left in the
healthcare budget after the District made its contribution to annual premiums
and buyout payments “will be placed in a pool.” Because the pool funds were
encumbered by an obligation for their expenditure, and because each year’s
unexpended health insurance appropriation was required to be placed in the
pool once the District satisfied its yearly contribution to premiums and buyout
payments, the required obligation arose each year no later than at the moment
the District satisfied its yearly contribution. Thus, both conditions of RSA
32:7, I, were satisfied as to the unspent amount of each year’s health
insurance appropriation.

For the 2012-2013 fiscal year, for example, the first fiscal year in which
the CBA was operative, the District appropriated $2.3 million to fund the
healthcare budget. After the District made its required yearly contribution to
employee premiums and buyouts, which was before the end of the fiscal year,
$213,655 remained from that appropriation. The CBA obligated these funds to

8
be “placed in [the] pool,” and further obligated that pool funds “be distributed.”
The obligation under the CBA that the pool funds be distributed to employees
constituted an enforceable obligation for the pool funds’ expenditure under
RSA 32:7, I. Because this obligation applied to funds in the pool, and because
the District was required to place the $213,655 remaining from the 2012-2013
appropriation in the pool after it satisfied its contribution to annual premiums
and buyout payments, which occurred before the end of the fiscal year, that
fiscal year’s unexpended health insurance appropriation did not lapse. See id.

The same operative facts existed in the 2013-2014 fiscal year as well as
the 2014-2015 fiscal year. For each of those years, the District appropriated
money to fund the yearly healthcare budget. There was money remaining in
each year’s healthcare budget after the District made its contribution to
employee premiums and buyout payments. The amount of money remaining
was required to be pooled, and, once pooled, was subject to an obligation that
it be distributed to employees. Thus, the unexpended portion of each year’s
health insurance appropriation did not lapse.1 See id.

The District argues that the funds at issue lapsed because the
Association, with the exception of 2015-2016, “never requested access to the
Pool Funds [and] never requested that the District use the Pool Funds to offset
its members’ premiums.” The District essentially argues that, because “no
other action was taken to encumber the funds,” the Association was required
to actually seek a distribution of pool funds in a given fiscal year in order for
that year’s unexpended appropriation to be saved from lapse under RSA 32:7,
I. (Bolding omitted.) We do not agree. RSA 32:7, I, requires that the obligation
be “enforceable,” not that its enforcement be sought. RSA 32:7, I. The
obligation that the pool funds be distributed to employees was established by
the CBA’s plain language; the Association needed to take no further action to
create that obligation.

In addition, that the CBA provided for distributions to be made “as
determined by” the Association does not lead us to conclude that the CBA did
not create an enforceable obligation for the pool funds’ expenditure. As
previously noted, Article 9.1 stated that funds in the pool “will be distributed
equally among all employees in each plan classification to offset premium
costs, as determined by the [Association].” It further stated that “[i]n no case
will an employee receive more money than the cost of an annual plan
premium.” Thus, as discussed, the CBA required that funds in the pool be

1The stipulated facts submitted alongside the parties’ cross-motions for summary judgment do
not clearly specify whether any of the monies appropriated for the 2015-2016 fiscal year remained
unexpended at the end of that fiscal year. The parties stipulated that the District appropriated
$2.53 million for that year’s health insurance budget. To the extent any amount of that $2.53
million remained unexpended after the District made its yearly contribution to premiums and
buyouts, that amount did not lapse for the reasons discussed above.

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distributed to employees, but gave the Association the discretion to determine
the amount employees would receive, so long as distributions: (1) were
equalized within each classification; (2) were used to offset premium costs; and
(3) did not result in an employee receiving a greater amount than the cost of an
annual premium. That the Association had some amount of discretion in
implementing mandatory distributions does not mean the distributions were
not, in fact, mandatory.

The District also contends that “[e]ven if the Pool Funds could be deemed
as having been ‘encumbered’ in any of the four fiscal years,” RSA 32:7, I,
requires the funds saved from lapse to be expended before the end of the next
fiscal year. The District’s argument finds no support in the text of RSA 32:7, I.
Although the statute requires the obligation for the expenditure of the funds to
arise before the end of the fiscal year for which the funds were appropriated, it
places no requirements on the time at which the required expenditure must
occur. See RSA 32:7, I.

The District argues in the alternative that, even if the funds did not
lapse, it cannot lawfully provide them to the Association because “the
legislative body was never put on notice that the Pool Fund would not lapse at
the end of each fiscal year.” The District essentially argues that the provisions
in Article 9.1 governing the pool funds had to be submitted to, and approved
by, its legislative body. See Appeal of Sanborn Regional School Bd., 133 N.H.
513, 520-22 (1990); see also RSA 273-A:1, VII (2010) (amended 2014) (defining
“[l]egislative body” as “that governmental body having the power to appropriate
public money”). We do not agree.

“Only cost items shall be submitted to the legislative body . . . for
approval . . . .” RSA 273-A:3, II(b) (2010) (amended 2013); accord Appeal of
Laconia Patrolman Assoc., 164 N.H. 552, 555 (2013). Thus, if a contractual
provision is not a cost item, it need not be submitted to the legislative body for
approval. See Appeal of Milton School Dist., 137 N.H. 240, 247 (1993). Cost
items are defined by statute as “any benefit acquired through collective
bargaining whose implementation requires an appropriation by the legislative
body of the public employer.” RSA 273-A:1, IV (2010). The parties to a CBA
are not bound by its cost items unless the legislative body ratifies them.
Appeal of Alton School Dist., 140 N.H. at 307. Ratification requires knowledge,
to some reasonable degree, of the extent of a cost item’s financial burden.
Appeal of Town of Rye, 140 N.H. 323, 327 (1995). The extent need not be
precisely ascertainable at the time the cost item is approved, however. Id.; see
also Appeal of Sanborn Regional School Bd., 133 N.H. at 522 (“[I]nclusion in
the warrant of language apprising the voters of the financial consequences of
their actions would seem to be sufficient.”).

We need not decide whether the provisions of Article 9.1 establishing the
pool and requiring the distribution of funds in the pool were cost items

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requiring an appropriation in order to be implemented. Even assuming that
they were cost items, the legislative body had sufficient knowledge of their
financial burden.

The warrant article pertaining to health insurance informed the
legislative body that “[t]he District will fund a total of $2,300,000 for . . .
[employees’] health care costs for the first year of this contract,” and that “[t]he
amount contributed by the District in years two, three and four of the contract
will increase by the lesser of the Guaranteed Maximum Rate increase or 5%
each year.” Thus, the legislative body was informed of the financial
consequences of voting to fund the health insurance benefits agreed to between
the District and the Association. By approving the CBA, the legislative body
authorized the appropriation — and expenditure — of the money necessary to
fund employees’ health insurance benefits, including the provisions governing
the pool funds. See RSA 32:3, I (2019) (“‘Appropriate’ means to set apart from
the public revenue of a municipality a certain sum for a specified purpose and
to authorize the expenditure of that sum for that purpose.” (emphasis added)).
Thus, because the legislative body approved the CBA with requisite knowledge
of the financial burden required to fund employees’ health insurance benefits,
it must now “fund whatever benefits the [employees] decide to enjoy pursuant
to [the CBA’s] terms.” Appeal of City of Franklin, 137 N.H. 723, 730 (1993).

In summation, we hold that the funds at issue did not lapse because
they were encumbered by an enforceable obligation for their expenditure that
arose prior to the end of the fiscal years for which they were appropriated. See
RSA 32:7, I. We therefore reverse the trial court’s ruling to the contrary.

Reversed and remanded.

HICKS, BASSETT, and DONOVAN, JJ., concurred.

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