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Amendment to give NH taxpayers standing to sue state government gains bipartisan support

State House Bureau

March 05. 2018 2:58PM

CONCORD - Republicans and Democrats in the House have found common ground on a proposed constitutional amendment to give taxpayers legal standing in lawsuits against the state.

Constitutional Amendment Resolution 15, on the House calendar for a vote today (Tuesday), provides that “taxpayers have standing to bring actions against the government.”

Rep. Paul Berch, D-Westmoreland, is scheduled to argue on the House floor in support of the resolution, which was endorsed in an 18-0 vote of the House Judiciary Committee.

“This constitutional amendment restores to the taxpayers of our state the legal ability to bring certain lawsuits relating to the spending of public funds by the state or the political subdivision in which the taxpayer resides,” according to Berch. “In doing so, our taxpayers will have broader access to our courts and greater ability to ensure governmental accountability.”

“Until recently, the state Supreme Court recognized taxpayer standing. This amendment will assure that this important taxpayer right will continue to be recognized and enforced.”

The amendment will need a three-fifths majority vote in the House of Representatives and the state Senate. Then voters must endorse the proposition by a two-thirds majority in a statewide election.

Two recent state Supreme Court decisions triggered the amendment, according to state Rep. Bob Backus, D-Manchester, a co-sponsor of the bill.

“One annoys Republicans and one Democrats,” said Backus of the Supreme Court rulings.

The one annoying Democrats stems from a 2012 ruling in a case involving public education advocate and former state Board of Education member Bill Duncan.

Duncan sued the state over implementation of an education tax credit program, which enables businesses to take deductions on their state business taxes for donations to a scholarship fund that enables qualified students to attend private schools.

The Supreme Court never ruled on the merits of the case after it concluded that Duncan did not have standing because he was not personally affected.

In the same ruling, the court struck down a 2012 state law allowing taxpayers to establish standing without showing that their personal rights have been impaired or prejudiced, declaring it unconstitutional.

Based on that Supreme Court ruling, Hillsborough County Superior Court North Judge Larry Smukler in 2016 dismissed a lawsuit brought against Manchester over a vote by the Board of Mayor and Aldermen to ratify a new three-year labor contract with city teachers.

The lawsuit claimed that certain aldermen, due to their family relationships with school district employees, were barred by the city charter from voting on the contract, but did so anyway.

Smukler ruled that the plaintiff, Manchester resident and former state representative Matthew Swank, lacked standing to bring forward a lawsuit over the contract.

“Those are two very salient examples of what we're talking about and why I'm very excited about the unanimous committee vote,” said Backus. “This could have a very strong bipartisan vote going forward, which is essential for a constitutional amendment.”

Supreme Court counsel Howard Zibel testified on an informational basis during the public hearing on the amendment, but the court did not take a formal position in opposition.

“Two years ago a bill like this was brought forward and it did not get unanimous support, so I think these cases have had quite an influence,” said Backus.

In the “Duncan” decision, the court noted that its ruling does not mean a taxpayer can never have standing to challenge governmental actions.

“When a taxpayer has a sufficiently personal and concrete interest to confer standing, the taxpayer may seek judicial relief,” the justices ruled.

“But a generalized interest in efficient and lawful government … and (legislative action), which purports to confer standing, are not sufficient to meet the constitutional requirements necessary for standing to exist.”

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