House Budget Takes Center Stage

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House budget writers will spend the next two weeks reshaping and refining the budget proposed by Gov. Chris Sununu.

Much of his 1,300-page proposed budget will not be changed by the House, but other areas will little resemble the original document.

Several key areas will be decided this week by the House finance and ways and means committees as they hold executive sessions to decide on bills whose policy has already been approved by the House, but the financial elements have not.

On Wednesday, both committees can expect long sessions as they decide the fate of their remaining House bills and their impact on the next biennium’s budget.

Beginning at 10 a.m. in Rooms 210-211 of the Legislative Office Building, the House Finance Committee will vote on 14 bills ranging from including money to control milfoil and other invasive aquatic plants and changing the job classifications of retirement system employees, to whether to halt scheduled business tax rate reductions and establishing a child abuse medical evaluation program in the Department of Health and Human Services.

The committee will also have to decide how much funding is needed to establish the family and medical leave insurance program. The House and Senate have passed the Senate version of the program and that is on its way to Sununu’s desk where its fate is uncertain, but the House’s version of the program is still before finance.

Budget writers need to decide how much money to put in the budget for startup costs.

State retirees, education

Another bill would require substantial appropriations, but not general fund money. The bill would give members of the state retirement system a cost-of-living raise in their monthly benefits.

And there are four bills addressing the education funding crisis that many school districts face with decreasing state aid and increasing costs.

One bill would restore the stabilization grants to their former level with additional money for the few growing school districts.

Another would return disparity aid targeted to districts that struggle to raise money for education due to low property values, would increase aid for poor students, and would continue stabilization grants for another year before eliminating them.

Another bill would increase the adequate education grant, include capital gains under the interest and dividends tax and reduce the statewide education property tax.

And the final education funding bill would establish a commission to study the current system and determine the current cost of an adequate education.

RTK ombudsman

Other bills to be decided by finance include the cost of taping House committee meetings, establishing a right-to-know appeals commission and an ombudsman, and creating supervised visitation centers.

While the Finance Committee is deciding what all those bills will cost and whether those appropriations should be included in its proposed budget, the House Ways and Means Committee will decide the fate of nine bills that would produce revenue beyond the state’s major taxes such as the business enterprise and profits taxes, rooms and meals, etc.

The committee meets at 10 a.m. in Room 202 of the LOB to decide how much money the state would derive from legalizing, regulating and taxing the sale of marijuana.

Another bill would allow municipalities to collect an occupancy fee for room rentals, and another would expand the tobacco tax to include all tobacco products — outside of premium cigars — including anything used for vaping.

Another bill would establish a water resources fund paid for by application and permit fees, and another would use money from boat decals to pay for milfoil removal.

How much revenue

Budget writers first have to establish the amount of money state taxes and fees will raise before determining how much is spent.

Sununu’s budget projected relatively small increases in revenues from the major tax sources so expect the House Ways and Means Committee to be a little more optimistic about the state’s economy and revenue projections.

The Senate will further refine the revenue numbers in their version of the budget, but will have two more months of real numbers to study than the House or Sununu.

For the past five years, the state has had significant revenue surpluses, which means budget writers did not spend all the money that was available. Some believe that is a good thing sending the extra money into the state’s saving account or rainy-day fund.

But the fund is about to hold a record-setting amount, well above what Wall Street bond rating agencies say the state needs for a healthy future.

Sununu decided to use last fiscal year’s surplus, and projected surpluses this fiscal year and next to spend on one-time expenditures — a tried and true way to keep the lid on government services — by creating the $168 million Capital Infrastructure Revitalization Fund.

One-time money

The theory is one-time money will disappear in an economic downturn and programs established or expanded with the money will not be sustainable.

While a lot of the money from the infrastructure fund would build mental health-related facilities and related programs as well as for University System of New Hampshire health-related programs, millions of dollars would be used on specific capital projects in more than two-dozen communities around the state.

How the projects were selected has been questioned because there was no qualifying process that allowed the more than 200 other communities across the state to compete for the funds.

That is one problem, another is that it is an end run around the capital budget process which traditionally is determined by lawmakers with the governor’s suggestions.

Fairness

And with surplus money, the bigger issue is shouldn’t everyone in the state benefit from it instead of a select few?

Reinstating revenue sharing for example would be a way to ensure all communities benefitted.

House budget writers at the moment are taking the longer view and voted last week to eliminate the Capital Infrastructure Revitalization Fund which was included in House Bill 2, the bill that contains the changes in law to make the numbers in House Bill 1 work.

By the end of the session, HB 2 often resembles what Sununu proposed, but not at the beginning.

Sununu last week held a press conference with elected officials — Democrats and Republicans — from the communities that would benefit from his “revitalization fund” touting the great things the money would do for their communities.

Politically speaking, Sununu created expectations by doling out the money and Democrats through their budget writers will be blamed for taking it away.

Twenty years ago when lawmakers were scrambling to find an acceptable solution to the two Claremont education lawsuit decisions by the state Supreme Court, then-Gov. Jeanne Shaheen understood once the state checks went to the school districts there would be no turning back, the state would be obligated to pay significantly more for public education.

That is not the case today with the revitalization fund because no one has the money.

Pet projects

Democrats may be doing Sununu a favor by killing his slush fund before the other state communities believe they, too, should have their day at the candy store for a pet project.

Earmarks were eliminated in the federal budget for a good reason and it makes little sense to revive the practice in the Granite State.

Spreadsheet politics almost prevented lawmakers from reaching an agreement on education funding, but ultimately lawmakers knew they needed to find a solution that could get a majority of votes, which they did.

Times change and the state’s greater good may not be a motivation it once was for lawmakers seeking to ensure reelection.


Distant Dome by veteran journalist Garry Rayno explores a broader perspective on the State House and state happenings for InDepthNH.org. Over his three-decade career, Rayno covered the NH State House for the New Hampshire Union Leader and Foster’s Daily Democrat. During his career, his coverage spanned the news spectrum, from local planning, school and select boards, to national issues such as electric industry deregulation and Presidential primaries. Rayno lives with his wife Carolyn in New London. InDepthNH.org is New Hampshire’s only nonprofit, online news outlet dedicated to holding government accountable and giving voice to marginalized people, places and ideas. Garry Rayno can be reached at garry.rayno@yahoo.com