State Budget – Dangerous Deal

Those of you who have had to sit through a hearing with me have my heard my rant about keeping it simple. If it takes an accountant and a tax attorney to explain what we did to you, we did it wrong. The state budget writers did it wrong. They included enough stuff that you want to make you want the budget. Unfortunately, this is like those high risk mortgages that collapsed the housing market. It will seem wonderful at first, probably past the next election, and then it will collapse. You won’t have that stuff that you wanted, and you will have a giant bill… just like all those victims who had their property foreclosed.

Weyler: HB 1 “Minority Report”

In the last ten budgets, it was unusual to see a large increase in the revenue from one biennium to another. Most of the time it was about 200 million increase, unless there had been tax increases. Then it might be more. The revenue we are seeing available from the last budget is a one-billion-dollar increase. That is after a tax decrease! The people who do the revenue estimates are all saying this is likely a one-time event driven by repatriation with an 8% Federal Tax. All are predicting revenue will decrease after 2021. This is a wonderful opportunity to do some one-time projects and still allow for some increases where needed in state government. This budget does not follow that sensible approach. Instead it uses all the money to grow government to a level where it cannot be sustained in future. With the growth of government comes a reduction in our population’s freedom, and likely increases in future taxes. It gives big increases to education and does not recognize that school districts need to make decisions that reflect the reality of major declines in enrollment. As the adequacy payments go down with the shrinking student counts, districts need to adjust. The evidence is that they are not, but are instead insisting on more state money. This will be followed by higher property taxes. This budget leads us in the wrong direction.

Weyler: HB 2 “Minority Report”

Since HB 1 by law, can only contain the budget numbers, HB 2 is the device by which the enabling legislation is included. This could mean tax changes, reassignments of personnel, department reorganizations, and descriptions of new programs created in the budget. Unfortunately, there is always room for abuses. So, bills that were retained, or amended, sometimes find new life in this bill. The greatest abuse is to add programs which did not have any public hearing in either body, and may be a last-minute idea by one of the conferees. A very controversial “Pet Vendor licensing” was added with little public hearing, as was the tax on vaping as well as adding the 21-age requirement. The wish to add more money for public education does not seem to recognize that this demographic is shrinking, while the elderly population is growing. Areas where the money was taken from to increase Education funding by 45 million dollars, show the bias of the Democrats. The rate increase for Public Charter School Students of 2.5 million was repurposed for regular public education; and the Secretary of States 1.5 million in “Investor Education Funds” which was destined for the FRM Settlement, was included in that 45 million. The 45 also included a highway project, and a trooper reallocation money. Although we keep hearing the basic adequacy number of $3,636 per pupil, the real average contribution, with all the differentiated aid is about $6,000 per pupil. HB 2 started with a little over 200 sections, and ends with well over 400. It is difficult to track all the changes, and perhaps that is by design.


About Rep. Steven Smith

Steven Smith is a member of the New Hampshire House of Representatives, serving his 7th term. Rep. Smith currently represents Charlestown, Newport, and Unity. Rep. Smith is the Deputy Speaker of the NH House.
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