As Final Negotiations Begin, Here's Where Key N.H. Budget Issues Stand

Jun 8, 2017

Credit NHPR Staff

New Hampshire legislators begin the final stage of the state budget-writing process this week. On Friday, a handful of senators and House members will gather to hammer out a compromise plan for state spending over the next two years.

Billions of dollars are at stake, and NHPR’s newsroom has been keeping an eye on several key policy areas. Here's an overview on where several big-ticket items stand.

Business Taxes

by Todd Bookman

You may remember that two years ago, during negotiations of the last state spending plan, there was a partisan showdown over tax cuts. Then-Governor Hassan vetoed a Republican-backed budget that included a series of cuts to business taxes. That was eventually resolved when the GOP included safeguards that if tax receipts fell, the cuts would be reversed.

This time around, Republicans are backing a second round of cuts to business taxes. And in Governor Chris Sununu, they have an advocate.

The theory here is very-much ‘trickle-down economics’ - if you put more money back in the hands of business leaders, they will spend more, stimulating the economy.

Andy Sanborn, a state Senator from Bedford, says if you need any proof, just look at how business tax revenues have gone up in 2017, despite the lower rates.

“I sit here today and will tell you that I believe the same thing will happen. That just because you cut the rate doesn’t mean you’ll get less money in.”

But Democrats argue tax cuts don’t guarantee more money. And they say this budget--especially in a strong economy--should invest more in healthcare and higher education. They likely don’t have the votes, however, to implement that vision.

Health and Human Services

by Casey McDermott

Coming into this session, all eyes were on what lawmakers would do to tackle ongoing shortages in mental health beds and persistent problems at the state’s child protection agency.

The Senate’s budget includes more money for the Division of Children, Youth and Families. That’s to cover more employees and to create a new director position to oversee the division, after an outside review found the agency was understaffed.

While DHHS Chief Jeff Meyers says the extra DCYF money is a good thing, he’s concerned the Senate budget overlooks the need to fund more support services for low-income families that are referred to the agency. That’s because the legislature’s also pushing changes that would create a middle-of-the-road referral option for cases where kids might be at risk but not in immediate need of DCYF oversight.

Instead, the state would refer those families to outside, voluntary support services.

“Many of them are on Medicaid, many of them receive SNAP benefits, food stamp benefits, many receive other services, which is good but it's an indication that many of these families are low-income and would not necessarily have the funds to pay for the voluntary services that could help them and their families remain outside the DCYF system.”

The Senate’s version of the budget includes more money for mental health funding, also with an eye toward legislators’ separate efforts to add more treatment beds, supportive housing and mobile crisis supports.

Elsewhere, the Senate budget also adds more money for the disability waitlist, for domestic violence crisis centers and foster grandparents, a growing need in light of the state’s opioid crisis.

Education

by Jason Moon

When it comes to education, the big ticket item this budget season is full-day kindergarten. For years, the state has funded kindergarten at half the level as other grades – meaning towns that do offer full-day programs, do so on their own dime.

Many superintendents in districts with full day programs, like Bolgen Vargas of Manchester, say it is past time for the state to pitch in.

“Now we have a good economy, and we’re still debating whether we’re going to give children kindergarten. There are 43 states in this nation that provide free kindergarten and many of them provide pre-k.”

Governor Sununu has made full-day kindergarten a big priority for this budget, urging his otherwise reluctant party to go along on the issue. There have been several ideas floated on how to do this.

The proposal that is currently on the table calls for $9 million dollars in new spending on full day kindergarten paid for by taxing the electronic gambling game Keno. While that would be an increase, it would still leave the state funding kindergarten at a lower rate than other grades.

Other groups that stand to gain in the budget as it stands include charter schools. They would get a few hundred more dollars per-student.

The community college system would also see a modest increase in funding. There’s also a 5 million dollar scholarship program proposed by the governor that is designed to keep graduating high school students in the state.

Meanwhile, there are a few items that many hoped for that haven’t survived this far in the budget process.

School building aid is the state program which used to help school districts pay for construction projects. It will remain frozen. But there is $15 million dollars in the budget for the governor to spend at schools with the most pressing facility needs.

Then there’s the public university system. For years it’s had the distinction of receiving the lowest amount of state funding for any university system in the country. Their funding levels will remain flat, meaning they’ll get to hang on to that distinction over the next biennium.

Corrections

by Emily Corwin

The big problem facing New Hampshire prisons is staffing. Especially correctional officers.

Already the state is spending about $10 million a year on overtime costs, because there just aren’t enough correctional officers to cover all shifts.

Baby boomers are retiring, unemployment is low, and it turns out young people don’t want prison jobs any more. At least not when the starting salary is about $35,000.

Add to that the opening of a bigger, brand-new women’s prison? And you’ve got a problem. On the one hand, the Department of Corrections requested funding for 75 new positions to open the women’s prison.

Jeff Lyons is that department’s public information officer.

"Out of the 75, the Senate unfunded twenty of the ones we requested."

The Senate also delayed funding of most of the remaining hires to the second year of the two-year budget.

"The women’s is on target to be completed by the end of September, October, and we’re coming in under budget. But given our ability to hire staff and the positions available to us, it’s going to take longer than the end of October to get the prison up and running."

A few things to note here:

Lawmakers okayed construction on the new women’s prison four years ago. That came after several court orders requiring a new facility for women inmates. Now, without enough staff, the prison will stand finished, and empty.

Lyons says he doesn’t know when it will open. At best, it would open partially the year after next.

But lawmakers may simply be being realistic when it comes to unfunding some of these new positions.

Already, the Department of Corrections has over 100 funded but vacant staff positions – they can’t find qualified people to fill them.

Lyons says the department is looking to contract a firm to help with recruiting.

"If we can find an experienced marketing agency that specializes in job recruitment, someone who has some national resources, national contacts…"

But, as the commissioner himself has said, until union negotiations lead to higher salaries, little may change.

Substance Abuse

by Paige Sutherland

The state’s opioid crisis continues to be a major concern – so substance abuse services were a priority in all three spending plans for the state’s new budget.

The Governor doubled the state’s so-called alcohol fund, which is earmarked for substance abuse prevention and treatment, and the House and Senate followed suit, so it looks like that increase in funding will happen.

That means a total of $14 million dollars over the next two years will go into this fund.

Kate Frey is the vice-president of advocacy for the nonprofit New Futures, which focuses on substance abuse issues in the state.

“The beauty of the alcohol fund is it is non-restricted funds so it can go towards opportunities that federal funding cannot address such as bricks and mortar, recovery housing, early intervention.”

But in the senate’s version, the budget that’s being debated now, some of that money could get set aside for operations at the Sununu Youth Center – that’s the state’s only youth detention center in Manchester.

Advocates say this is a raid of designated funds.

There’s also a proposal in the Senate’s plan to build a drug treatment center for young people at one of the Sununu Youth Center’s underutilized wings. The Mayor of Manchester, Ted Gatsas, likes this idea. He says it’s a service the community is lacking.

“Well there is no program in the state for anybody under the age of 18 and I think that’s something that when we start talking about what do we do to try to prevent the opioid epidemic we need to make sure we find something that we can do to the younger generation.”

But there are still a lot of questions – like how many beds this center would provide, how it would be staffed, and when it would open.

All three budget plans also include added money for the state’s “Granite Hammer” program. That program is designed to take drug dealers off the streets, and fund new drug interdiction troopers to patrol the state’s roadways.

Infrastructure

by Todd Bookman

Infrastructure is one of the only things Democrats and Republicans seem to agree upon these days. In Concord during this budget cycle, that continues to hold mostly true.

Lawmakers are backing a plan to spend approximately $37 million next fiscal year on roads and bridges...that’s double this year’s spend. The money doesn’t technically come through the next budget, but instead is being pulled from this year’s budget surplus.

Of that $37 million, the state is divvying $30-million up for local road projects...construction and maintenance of smaller streets. Not highways.

And then the remaining $6.8 million is going toward so-called red list bridges, those in most serious need of repair.

State Senator Dan Feltes, a Democrat, co-sponsored the plan.

“It’s not going to necessarily put a dent in our needs across the state, but it is certainly a step in the right direction.”

When Feltes says it won’t make a dent, he’s referencing what the Department of Transportation says it needs to tackle bridge projects. DOT estimates it would cost an additional $21 million to begin reducing the watch list. That’s a far cry from the $7 million it’s likely to get for the next 12-months.