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Garry Rayno's State House Dome: Budget numbers not easy to crunch

New Hampshire Union Leader

March 09. 2013 5:21PM

The House Finance Committee faces some staggering decisions in the next few weeks as members finalize the House's version of the state's two-year operating budget.

It will have to craft the budget without $80 million in gaming licensing fees Gov. Maggie Hassan included in her budget. The money would allow funding increases for higher education, the mental health system, developmental disabilities services and CHINS (children in need of services).

With no House-passed expanded gaming bill, budget writers could not assume the $80 million in licensing fees.

Hassan also included a 30 cent hike in the tobacco tax, which she estimates would produce about $40 million in revenue. The House may decide it can only agree to a 20 cent increase.

That is not the only problem.

The House Ways and Means Committee gave Finance revenue estimates last week that are $33 million less over two years than the governor's revenue-estimating panel proposed.

The House also thinks Hassan's proposal overstates revenue projections by $7 million for the real estate transfer tax, $4.3 million in lottery receipts and $3 million in business taxes.

On the other side, the House expects insurance premium tax revenues to be $17 million more than the governor guesses, once the Medicaid managed care system is in place.

Another big difference between the House and Hassan is the Medicaid Enhancement Tax hospitals pay.

Hospitals used to get most of the money back through the federal-state Disproportionate Share Hospital program (DSH), but now only the small critical-access hospitals receive help.

The hospitals and the state have been in a battle for the last two years over what they owe. The state believes the hospitals owe about $34 million a year more than the hospitals do.

Hassan's budget assumes the hospitals will pay their full liability, because if they do, they would receive about half their money back, but the House assumes the hospitals will pay about what they have the last two years, or $70 million annually.

Start tallying up the differences and it goes over $100 million pretty quickly and could be as high as $150 million.

While the number may be small compared with the total budget of $11 billion, it still would affect programs and services for some people.

House Finance Committee Chairman Mary Jane Wallner, D-Concord, has said her members are looking for "savings" in the budget to address the shortfall.

No one should have been surprised when the subcommittees began cutting last week in nonbinding votes. One of the targets is an additional $55 million earmarked for the University System of New Hampshire.

The $20 million in additional money for the Community College System of New Hampshire could be at risk, too.

Other likely targets are $28 million to upgrade the state's mental health system.

Budget writers will begin seriously paring back the budget in the next couple of weeks. The House is scheduled to vote on the budget April 3.

When the Senate has the budget, the Senate Finance Committee will start from a different platform because budget writers will be able to count on about $130 million in additional money. That money comes from allowing one "high-end, highly regulated casino on the southern border of the state."


Up the Ante: The Senate will vote this week on Senate Bill 152, the expanded gambling bill that has Hassan's support. The Senate is likely to have a strong vote - between 16 and 18 senators - for the bill.

That is Step 1. Step 2 - the House - is a lot more difficult.

The House has never voted for video slots or casinos and right now is poised to continue that tradition.

Last week, the House Ways and Means Committee voted to retain two other expanded gaming bills, House Bills 665 and 678, and the next day turned around and voted, 12-6, to recommend killing each bill.

Retaining the bills would not have allowed gambling "supporters" - read "lobbyists" - to take a "test vote" to see whom they need to persuade.

Sending the two bills to the floor, where they face almost certain defeat, sends a different message: "We don't like gambling, senators."


Running on Empty: While Rep. David Campbell, D-Nashua, the prime sponsor of House Bill 617 - the gas tax increase - said nice things about the House realizing the immediate need for fixing the state's highway system, the vote was less than it should have been to build momentum for the plan before it heads to the Senate and almost certain defeat in its present form.

Former House Speaker William O'Brien, R-Mont Vernon, muddied up the waters with a proposed amendment that would have stopped highway funds from being used to help pay for state troopers, district courts and other things related to highway safety and use.

His proposal was soundly defeated - by a larger margin than the bill passed - but he is not going to be deterred.

O'Brien said he will present the amendment again when the House Ways and Means Committee holds a public hearing on the bill Thursday at 1 p.m. in Representatives Hall.

"Come in and tell the current Democrat members of the committee how much you want a Billion Dollar tax increase . . . or Not,'' O'Brien wrote on his Facebook page.


Intramurals: The gas tax and O'Brien's amendment created a flurry of emails among Republicans. Rep. Steve Vaillancourt, R-Manchester, wrote to his colleagues saying the Republican leadership voted on the opposite side of the GOP majority on some key bills.

Of particular concern was House Republican Whip Shawn Jasper's, R-Hudson, rather searing comments about O'Brien's amendment to the gas tax.

After much back and forth, House Minority Leader Gene Chandler wrote an email saying the leadership backs the recommendations of the majority of Republicans.

"The truth of the matter is that in the vast majority of instances, we as leadership rely on the work and expertise of the policy committees when voting on the floor. We do this because we believe that you as individual legislators have the expertise in your given policy area due to hearing the testimony and debating the issue on its merits while in committee. In nearly every instance, members of leadership first support the leadership recommendation, or if there is no recommendation, support the majority of Republicans on the committee," Chandler wrote, then went on to say the party is ill-served by Republican-on- Republican debates, which are occurring with regularity.

Some "Tea Party Republicans" have contested bills with unanimous committee votes, meaning all the Republicans on the committee backed the committee's recommendation.

"Being in the minority is not an easy task, but if we stay together, keep our focus on the Democrats and choose our battles wisely, then we can work to take back the majority and keep New Hampshire prosperous," Chandler wrote.


Saint Patrick's Day: Former state Sen. and Manchester restaurateur Bobby Stephen will hold his annual St. Patrick's Day Party March 16 at the Executive Court Banquet Facility beginning at 5:30 p.m.

Stephen's 35th celebration, like those before, will draw politicians from governor to city ward clerk and regular folks, as well. The event benefits the Bobby Stephen Fund for Education.

Last year, Stephen said, the fund was used for 22 scholarships. It was used for 35 the year before that, and it has been used for 300 since he began the effort, in 1995.

"My wife asks me when I'm going to stop this," Stephen said, "but I get cards and notes from the kids saying, 'Thank you for helping me go to college."'

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