Your Turn, NH - Sens. Jeanie Forrester and Nancy Stiles: A raid is about to happenSens. Jeanie Forrester and Nancy Stiles
January 01. 2015 5:26PM
WE ARE six months to the end of the fiscal year and all eyes are watching the budget. Overall revenues are running ahead of projections, which means the Senate Ways & Means Committee did an excellent job estimating revenues when we built the budget last session. However, with the governor’s recent executive orders for agencies to reduce spending, it appears that overspending has occurred — some budget experts estimate as much as a $100 million deficit. We’ve been asking the governor to provide department-by-department reports on General Fund spending since July. Unfortunately, the governor refuses to share it with the public. So we really don’t know the extent of New Hampshire’s current budget problem.
Various constituencies are nervously watching to see how the deficit will be addressed, and many fear that “dedicated funds” may be a target. We have approximately 320 of these dedicated accounts that fund specific programs.
There has been some controversy in recent years about the “raiding” of dedicated funds to assist in balancing the state budget — accomplished by transferring those funds or fund surpluses to the General Fund for general state expenses.
It is not hard to find examples of this practice. In recent years, the consistent raid of the Land and Community Heritage Investment Program’s (LCHIP) dedicated fund caught the attention of Granite Staters. LCHIP is an independent state authority that makes matching grants to communities and nonprofits to protect New Hampshire’s natural, cultural and historic resources. Funding for these projects is made possible by small fees charged on four types of documents that are recorded at county registries across the state. The public was told that the money would be used to conserve our state’s most at-risk natural and historic resources. But the unfortunate truth is that since the establishment of that fund, more money has been used to balance the budget then went to LCHIP projects.
In the last session, the Republican Senate made a commitment to stop this practice, most notably with LCHIP. We held to the principal that a dedicated fund means just that: funds raised for a specific purpose should be spent on that purpose. In her budget, the governor provided some partial funding of the program, but the Senate fully restored the $8.5 million that were raised through real estate transaction fees. We also went a step further and protected LCHIP from being raided to fund other parts of state government. We did this by stopping the governor’s attempt to have the flexibility to raid these funds to cover over-spending in other departments.
LCHIP is not the only casualty of raids to dedicated funds. Today we are seeing another important dedicated fund about to fall victim to a budgetary raid. Politicians and bureaucrats have turned their sights on more than $9 million, raised from New Hampshire ratepayers, which is dedicated to increase renewable energy generation in our state. If the impending raid of $9 million does occur, almost half of all funds raised for renewable energy projects will instead have gone to balance the state’s General Fund; this surely was not the intended use of the proceeds when the program was established by a near-unanimous vote of the State Senate.
Municipalities, businesses and homeowners are all looking to bring energy projects forward to increase sustainability, save money and decrease dependency on imported fossil fuels. Once completed, RPS-funded energy efficiency and energy conservation projects guarantee lower energy costs for towns as well as higher profit margins and increased competitiveness for New Hampshire businesses.
By continuing to look to the renewable energy funds as a source of general revenue, lawmakers dodge the transparent manner in which the state generates revenue needed to finance public services. Worse, when a decision to raid these funds is made behind closed doors, politicians and bureaucrats are undermining the very investments they pledge to support — further weakening the state’s energy future, and casting doubt in the minds of businesses and voters on the state’s commitment to renewable energy.
Fortunately, we still have time to reverse the trend of raids on dedicated funds. Contact the governor, your legislators and leaders at the Public Utilities Commission about the Renewable Energy Fund. Remind them that dedicated means dedicated.
The Senate will continue to protect the integrity of dedicated funds such as LCHIP and the Renewable Energy Fund as we begin to craft New Hampshire’s next two-year budget.
Sen. Jeanie Forrester of Meredith represents Senate District 2; Sen. Nancy Stiles of Hampton represents Senate District 24.