action:article | category:OPINION02 | adString:OPINION02 | zoneID:67

Home » Opinion » Columns

November 27. 2012 6:39PM

Charles Arlinghaus: Department heads play make-believe with the budget


 

There are many phases to the state budget process. The first one can be described as mythological. As part of the design of our state budget, the semi-independent heads of each state department get to lobby state budget writers for spending based not on the priorities of the Legislature or the governor-to-be, but on their hopes and wishes. In exchange, lawmakers can look tough. It may make everyone feel better, but it is little more than political theater.

In New Hampshire, preparations for the state budget are well under way long before the election determines who the governor is going to be. Each agency and department of state government submits a budget by October 1, five weeks before the election. These are called maintenance budgets under the law, but they are more accurately termed "agency requests" in and around the State House.

A governor who is returning or expects to return can tell the agency heads to draft these requests a certain way. For example, two years ago Gov. John Lynch directed the agency heads to submit budgets at 95 percent of previous spending levels to deal with an expected $800 million shortfall. But when the governor is retiring, the agency budget requests are unfettered and add up to a ridiculous, pie-in-the-sky fantasy.

The agency requests are a large document that few people manage to get through. My colleague Grant Bosse said "if you're only going to read one 5,000-page document about New Hampshire's budget, this is the one." Fortunately, Grant read it so we don't have to. If every agency budget were adopted as submitted, state spending would increase by almost $2 billion in total funds, a 19 percent increase.

Even this number is misleading. Some departments submitted a reasonable maintenance budget with a 3 or 4 percent increase in costs. Others didn't maintain, they wished and hoped. So the 19 percent is an amalgam of some departments maintaining current programs and others asking for the kitchen sink.

Some politicians enjoy the agency budgets. Agencies have always asked for the moon. The total requests then add up to an impossible number. The governor and the Legislature in their initial budget documents can talk about how they cut agency requests by $1.4 billion and thereby portray an increase of a half a billion as a cut. Nifty, isn't it?

Technically, departments are also supposed to submit by Nov. 15 a 10 percent reduction budget. But the wording of the law (as opposed to the intent of the law) seems to allow them to just submit a one-page document that is simply a math worksheet: we spent $90 million last year so a 10 percent reduction would leave us with a budget of $81 million. It's very useful for any legislator who has trouble with simple multiplication and doesn't own a calculator, but otherwise it is useless.

That leaves this week's hearing as much ado about nothing. Agency heads come in and talk about their part of the mammoth, 5,000-page document. The governor-elect tells us that these budgets are a non-starter. She'll pick a better number for each department - soon, I hope - and base her budget on that. In addition, department heads are, for the most part, unwilling to discuss what might be cut from each of their budgets.

So, we already have a 5,000-page wish list. Both the governor and the Legislature are going to use a yet-to-be-determined number as a starting place and ignore the wish list. The discussion of cuts has been forestalled by imprecise language in the current state law. It's unclear what exactly these hearings are intended to accomplish. I suppose that it's fun theater and gives the local papers some copy during a slow season.

Instead of this charade, the hearings should be held with the agency heads being given more direction or being made to provide different information. The legislative finance chiefs or the governor should set an actual useful parameter for the agency heads and ask them to discuss the tradeoffs needed to reach that number. After all, what good does it do the governor-elect to listen to commissioners wax poetic about a spending level that isn't actually being considered?

Next, the spending cut law should be changed. The language should make clear that commissioners must present details, not merely one-line math problems. The current submissions are mocking, not helpful. Change the percentage to 95 percent or level-funding if you must, but with such limited time no one is helped by having a nonsensical theatrical phase to the budget process.

Charles M. Arlinghaus is president of the Josiah Bartlett Center, a free-market think tank in Concord. His email address is arlinghaus@jbartlett.org.


Follow us:
Twitter icon Facebook icon RSS icon
Sorry, no question available

 New Hampshire Business Directory

  

    ADD YOUR BUSINESS TODAY!

 New Hampshire Events Calendar
    

    SHARE EVENTS FOR PUBLICATION, IT'S FREE!

Upcoming Events