Hassan Signs $10.7 Billion Bipartisan State Budget

Concord — Gov. Maggie Hassan signed the $10.7 billion budget yesterday that reduces the wait for services by the disabled and mentally ill but fails to address deteriorating highways or the expansion of Interstate 93, and could result in an unknown number of state worker layoffs.

The two-year budget takes effect Monday.

“With our budget now in place, we have been able to make true and meaningful progress on the priorities that matter to the people of New Hampshire. We must continue working together in the spirit of bipartisanship to keep our state moving forward toward a stronger, more innovative economic future,” Hassan said in a statement.

The Legislature passed the bipartisan budget almost unanimously Wednesday.

Republicans praised the budget for containing no new tax increases, though it counts on money from a 10 cent increase in the cigarette tax automatically due to take effect this summer. Democrats praised it for providing more aid to colleges and college scholarships and increasing funding for social services.

“Like all budgets, this plan required compromise and difficult decisions. But the overwhelming, bipartisan support for the priorities in this budget — job creation, public safety, education, caring for our most vulnerable citizens, and preserving our natural resources — demonstrates that our shared values as Granite Staters are far more significant than our differences,” Hassan said.

The budget does not authorize Hassan to expand Medicaid to 58,000 poor adults under the new federal health care law that calls for changes starting Jan. 1, but establishes a commission Hassan and Democrats hope will provide the answers reluctant Republicans need to support it.

The nine-member commission is charged with studying expanding Medicaid, the potential impact of expansion on New Hampshire and possible alternatives, such as using the federal funds to subsidize insurance for some residents. The commission is to report by Oct. 15. Hassan has said a special legislative session may be needed in the fall to authorize Medicaid expansion and begin capturing the estimated $2.5 billion in federal funding the state would get over seven years.

The budget failed to address the need for highway improvements or how to keep the Interstate 93 expansion project going after the fall of 2015. About $250 million is needed to finish the project. The Senate proposed legalizing a casino to fund the expansion and other highway improvements as well as higher education and development in the North Country. The House rejected the casino bill and the Senate killed a House proposal to phase in a 12-cent increase in the gas and diesel tax to pay for roads and bridges.

While increasing funds for services for the disabled and mentally ill, the budget also requires the Department of Health and Human Services to make $7 million in unspecified cuts, which some fear could affect those programs.

Funding was included to give state workers their first raise in 4 1/2 years, but the budget also requires the governor to cut $10 million in staff and benefits that could result in layoffs.

Perhaps the biggest hurdle to winning compromise on a package was getting Senate Republican leaders to agree to a 3 1/2 month study on Medicaid expansion rather than a study taking more than a year.

States can choose to expand Medicaid as part of a key component of the federal health care overhaul. If New Hampshire were to expand the program, the U.S. government would pick up the full cost for the first three years and 90 percent over the long haul. States can withdraw from covering adults at any time without penalty.

New Hampshire’s Medicaid program covers low-income children, parents with nondisabled children under 18, pregnant women, senior citizens and people with disabilities. The expansion would add anyone under age 65 who earns up to 138 percent of federal poverty guidelines, which is about $15,000 for a single adult.