A House budget: Preparing for bigger tax hikes
April 01. 2013 5:27PM
The New Hampshire House is to vote on a state budget on Wednesday. We are somewhat surprised to conclude that the House budget, though a mess, is more responsible than the one proposed earlier this year by Gov. Maggie Hassan. It is far from a good budget, though, and to pass it the House leadership will rely on the same message used to win election: Trust us, we don't really want to raise taxes and spending to astronomical levels, we just want to undo what those crazy Republicans did in the last session.
Gov. Hassan proposed spending far more than the state had to spend. To do it, she raised a bunch of taxes and fees and included $80 million in revenue from casino licenses. The House cannot include the casino revenue because it did not pass the bill authorizing new casinos. So it had to scale back Hassan's spending by more than $50 million.
So the House budget is more realistic than Hassan's. Yet it includes enough new spending, paid for by tax and fee hikes, that it should not pass. There is the 30-cents per pack cigarette tax hike, which has been in the news a lot. But did you know that the budget hikes saltwater fishing license fees by 50 percent and increases marriage license fees? It also raises the gasoline tax by 12 cents per gallon and contains business tax hikes. For instance, the Legislature last year let businesses "carry forward" operating losses of up to $10 million on future tax returns. The budget postpones that law for a year.
It also contains policy changes that have no place in state budgets. Legislators in the last session finally zeroed out the state's Certificate of Need Board, which increases health care expenses by forcing providers to get board approval before buying certain new equipment or opening new centers. It suppresses competition, keeping prices high. The budget inexplicably brings this cost-raising, bureaucratic nightmare back to life.
To their credit, House budget writers resisted the temptation to fully fund every wish of their party's varied constituent groups, which are legion. They spend less on the University System of New Hampshire, for example, than Gov. Hassan proposed, and less on some social services. But they still spend more than the state has or is likely to have in the next two years. This budget is a return to the bad old days of pushing spending up beyond our ability to pay for it, with the design of justifying future tax hikes when revenues inevitably fall short of the politicians' "priorities."