June 11. 2013 6:15PM

House Ways and Means Committee ups revenue estimates as budget talks start

By GARRY RAYNO
State House Bureau


CONCORD — The House Ways and Means Committee Tuesday upped its revenue estimate for the next two fiscal years before House and Senate budget writers sit down Friday to begin negotiations over the state’s two-year spending plan.

The Committee estimates are $49.2 million more than the Senate’s with sizable increases in business, meals and rooms and real estate transfer taxes.

The additional money could help House budget negotiators in arguing against the Senate’s $50 million across-the-board cut in compensation and benefits that could result in an estimated 700 layoffs.

House budget writers were briefed Tuesday on the Senate budget, which does not include Medicaid expansion under the Affordable Care Act, which the House and Gov. Maggie Hassan support, but does include the state employee layoffs, which the House does not support.

Much of the differences in the two budgets are in House Bill 2, or the trailer bill that includes changes in law needed for the operating budget.

Along with the differences over Medicaid, the two sides differ on tobacco tax increases and the gas tax. The House wants a 20-cent increase in the tobacco tax, but the Senate does not and also rejected a 12-cent increase in the gas tax over three years that was approved by the House.

The Senate wants business tax credits approved last year to go into effect this year as planned, but the House wants to suspend them for two years to save $13 million.

The Senate also removed some programs Hassan wants such as an efficiency and innovation commission and the Green launching pad the House likes.

The Senate included greater reductions in the Health and Human Services budget than the House and used $20 million in general fund money to help hospitals with uncompensated care costs.

All these issues will be fought over the next week as budget negotiators sit and try to reach compromise.

Budget negotiations will begin at 10 a.m. Friday and are expected to adjourn by noon. Negotiators will meet again Monday at 9 a.m. and then continue for the next three or four days. The deadline for reaching agreement is noon on June 20 for the Senate and 4 p.m. for the House.

After the budget briefing, House Ways and Means chair Susan Almy, D-Lebanon, said her committee believes the economy is recovering and as a result upped the estimates of some key levies for the next two years.

She said recent business tax returns caused her panel to increase its estimates for business taxes by $17.7 million more than the Senate to track national economic recovery data over the years.

But Senate Ways and Means Chair Bob Odell, R-Lempster, said the House numbers were overly optimistic. He said New Hampshire used to lead New England out of an economic slowdown but now we are next to last in economic recovery in the region.

“If you ignore that, that’ll put the state in jeopardy,” he said. “The senators at the table at the committee of conference feel strongly about our revenue estimates.”Almy also explained the committee’s rationale for increasing the meals and rooms tax $12 million more than the Senate estimate and the real estate transfer tax $11 million more than the Senate.

The ranking Republican on Ways and Means and its former chair, Rep. Norm Major, R-Plaistow, said the figures were overly optimistic.

He said Republicans on the committee agree there will be more money than the Senate estimates, but about $45 million less than the Democrats who control the committee.

grayno@unionleader.com