Maggie's money: A wishful state budget
It is inadvisable to base a budget, whether a household's or a state's, on income that is unlikely to materialize. Alas, Gov. Maggie Hassan has done that. Again.
When Hassan presented her two-year state budget on Thursday, she called it "fiscally responsible" and said she based it on "conservative projections" of revenue. That simply is not so.
For starters, the governor included $80 million in casino licensing revenue in the two-year budget, $40 million for each year. New Hampshire, of course, has no casino. Hassan is betting $80 million of her budget on legislators passing a casino gambling bill by July - and at least one casino paying $80 million in licensing fees to the state. So many things could go wrong during that process. Although the Senate probably would pass expanded gambling, whether the House would is an open question. Including that revenue in the state budget is hardly using "conservative" revenue estimates.
Hassan assumes a $29 million increase in tobacco tax revenue in the next fiscal year alone, from a 30-cent increase in the tobacco tax (restoration of the 10-cents cut last year, plus another 20 cents). She campaigned on restoring the 10 cents, but that would not bring enough revenue so she's tripling the tax hike.
She also assumes that business taxes will bring in $16 million more next year than in the current fiscal year. She makes this assumption after the U.S. economy shrank in the last quarter, and as President Obama proposes more tax hikes at the federal level and an increase in the minimum wage.
These three questionable revenue projections alone account for $85 million in just the first year of her budget. Granite Staters should have expected such magical budgeting. As a state senator, Hassan led the effort to count on revenue from a new tax on limited liability companies, an illegal raid on a private insurance fund, and dozens of tax and fee increases.
We had hoped she would have learned her lesson. Alas, Gov. Hassan is little better than Sen. Hassan. She would rather spend money we don't have by inventing new ways of gathering it than do the truly fiscally responsible thing and make state government live within its means.