CONCORD, NH — An effort to reach a state budget deal for the next two years is coming down to the wire now as House and Senate representatives roll up their sleeves to find common ground on a single document by Thursday.
After a number of hearings across the state in which they heard from many citizens on their priorities and after coming up with respective budgets in the Senate and House, the two bodies began to come to terms on about $13 billion in spending priorities.
When they do that, it goes to the governor, who has his own budget priorities on a similar amount of money.
Sen. Lou D’Allesandro, D-Manchester, who has been around for these things since 1972 agreed it is the “Super Bowl” of bills that go through the chambers every two years.
“Welcome, great to see everyone here. Love to see a full house,” D’Allesandro said to the packed hearing room in the Legislative Office Building on Monday. He is the Senate Finance Committee Chair.
Rep. Mary Jane Wallner, D-Concord, chair of the committee of conference and House Finance Chair, thanked those who attended hearings throughout the state.
“I am certain we will produce a budget at the end of this conference that we will be proud of and able to support. Will we please everyone? Probably not,” Wallner said, but there will be lots to agree on in House Bill 1 and the trailer bill, House Bill 2 that legislators can be proud of passing, she said.
Wallner laid out the guidelines for the committee and said the deadline for their work was on Wednesday afternoon so that legislative drafting work can be completed for signatures on Thursday.
“I have talked with the Speaker and the Speaker will not stop the clock,” she said, noting that the deadlines would be firm.
They began Monday with that which they could agree upon, which was more than half the items on the two bills.
They then created a list of items or programs to hold on to for further discussion. Funding for the following programs is still to be debated:
- UNIQUE Program
- Education Trust Fund
- Governor’s Scholarship Fund
- County nursing home funds
- Medicaid care management
- Public school stabilization grants
- Municipal Aid
- Funding adequacy
- Repurposing of the NH Hospital
- Education trust fund (purpose)
- Appropriations to the Secure Psychiatric Unit
- Enhancing provider rates for mental health and substance abuse, safe stations and Medicaid rate increases
- Funding for the drinking and groundwater trust funds
- Business profits tax funding
- Taxation of incomes
- Gambling, tobacco, and e-cigarettes
- Right-to-know provisions
- Controlled drug prescription health safety information
The committee reviewed revenue and estimates for Fiscal Years 2020 and 2021 which were improved by $15 million.
Sen. Dan Feltes, D-Concord, said real estate transfer tax revenues have gone down from the Senate position as have liquor and Medicaid recoveries but going up are business taxes as have rooms and meals taxes.
The growth in rooms and meals is about 4 percent. And on balance the net result and extra $15.1 million over the Senate position, he said.
The committee did agree to keep in the budget money for a new cold case homicide attorney for the Department of Justice for a total biennium cost of $214,644.
They agreed to keep on hold $1.6 million for a regional drug task force for the north country, which does not currently exist.
They also agreed to a reduction in money within the Department of Employment Security which was redundant and covered in another area of state spending.
The issue of the Ossipee dam and aquatic invasive species was discussed but not resolved.
D’Allesandro said the Ossipee Dam will fail if there is not enough money for it to be saved. The Senate took $1.5 million from the Aquatic Invasive fund to pay for that dam repair, noting that there will be a decal for out-of-state boaters and that money will help with the invasives. The House wanted to retain the funding for the invasives for more discussion.
They also did not come to an agreement on the management system for Medicaid care. It is essential but problematic, D’Allesandro said.
“It’s got to be taken care of because of the functioning of the department,” he said of the $12 million which has a federal match but that percentage has been reduced over time.
Wallner asked to hold on to that to work on the funding match aspect.
The committee grappled with the Education Trust Fund and agreed to talk about it later. The committee adjourned after about two hours and agreed to come back on Tuesday at 10 a.m.
Sununu has said he would veto a budget that includes paid family and medical leave, which he has called an “income tax,” despite the fact it is very popular among residents, according to polls.
He also wants rollbacks in business tax rates scheduled to begin this calendar year at 7.7 percent.
The two-term governor offered proposed changes to education funding reforms in the budget, rate increases for Medicaid providers, and a new Secure Psychiatric Unit.
The House and Senate restored stabilization grants to school districts to their original level before annual 4 percent reductions began three years ago, created a commission to study the cost of an adequate education and changes to state aid, and reestablished disparity aid but at different levels. The House increased state education aid by $160 million while the Senate plan is slightly less than $100 million.
Sununu said he would agree to increasing stabilization aid but at a lower level than the House and Senate. Sununu suggested targeted Medicaid provider rate increases instead of across-the-board 3.1 percent annual increases proposed by the Senate, and reducing the cost from about $52 million to $30 million. He said he believes the department should have flexibility.
Sununu had proposed a 60-bed forensic hospital costing $26 million during his budget address, while the Senate approved a 25-bed Secure Psychiatric Unit facility costing $17.5 million. Last Wednesday, Sununu proposed a compromise – a 36-bed facility.
And Sununu agreed to a $40 million revenue-sharing plan with cities and towns instead of the $52 million Capital Infrastructure Revitalization Fund he proposed in his budget. He also focused on taxes saying the legislature’s mandatory paid family and medical leave plan is funded by an income tax, and that will not happen on his watch.
The House and Senate have approved retaining business tax rates at 2018 levels instead of lowering the rates for this calendar year, as the current law would do. Freezing the rates produces about $90 million.
The conference committee reports have to be voted on by June 27. The new fiscal year begins July 1.
(Garry Rayno contributed to this report)
