Work Begins Anew on N.H. Budget

With Casino, Higher Taxes Axed, Lawmakers Face Hard Choices

West Lebanon — The New Hampshire House and Senate are at odds over how to pay for spending now that each chamber has rejected the other’s proposals for more revenue.

Several revenue-generating ideas were taken off the table last week when the House turned down a Senate-backed casino proposal and the Senate, in turn, rejected both gas and cigarette tax increases proposed by the House. Now, Senate budget writers are searching for fat to trim in advance of next month’s committee conference, in which both chambers will look to carve out a spending plan for the next two years.

Though the stage is set for a contentious round of budget negotiations, Senate Ways and Means Chairman Bob Odell, R-Lempster, said yesterday that the Senate’s finance panel would likely finalize a budget proposal tomorrow that would not reduce critical services, add major fees or increase taxes.

“I’m very optimistic that what we’re doing is a good plan,” Odell said.

Odell mentioned Health and Human Services as a place where the Senate is looking to shave expenditures, but he said the spending cuts would only target proposed increases, meaning that those already receiving services would be largely spared from the cost-cutting.

“We have made very few adjustments in current programs,” he said. “Almost nothing has been reduced.”

As was the case two years ago, Odell said the Senate is also likely to propose a personnel cut of anywhere from $20 to $50 million to be managed and implemented by Democratic Gov. Maggie Hassan. House Ways and Means Chairwoman Susan Almy, D-Lebanon, said that such a cut could be “catastrophic.

“It’s already been catastrophic,” Almy said. “We’ve lost some of the most experienced people in state government because of last term’s cuts.”

Almy added, “When you’re trying to work with a lot less people who don’t know what they’re doing yet, you’ve got quite a problem, and the service levels have been going down considerably. People have been complaining all over the state.”

Both Odell and Almy chided at revenue decisions made by their bicameral counterparts.

Odell stressed a major split between the two bodies in the way House Democrats, as well as the governor, have estimated revenues for the Medicaid Enhancement Tax, which is charged to hospitals. Over the two years of the next biennium, Odell said the revenues from that tax were overshot by Democrats to the tune of $80 to $90 million.

“There’s absolutely no way that one can figure out how they got to the numbers they have,” Odell said.

Almy critiqued the Senate for refusing revenue streams that were included in the governor’s budget, and faulted the Senate for turning aside proposals to increase the cigarette tax by 20 cents, as well as refusing to delay tax credits for businesses and choosing not to employ more state auditors.

She contended that a lack of revenue would likely lead to a reduction in services and highway improvements while “doing nothing with broadband communications when all the states around us and everywhere in the country are doing more.

“We’re hurting our economy,” said Almy. “That means our tax situation will get even worse.”

Odell said that, differences aside, his focus would remain on finding compromise in what are sure to be tense budget negotiations.

“The key element is to get to an agreement so we can get a budget,” he said.

The Senate will vote on its own budget by June 6, allowing for a committee of conference to negotiate a final budget, which must be decided before the next fiscal year starts on July 1.

Ben Conarck can be reached at bconarck@vnews.com or 603-727-3213.