November 30, 2008
Union Leader
State House Dome: Concord talk turns to taxes, lots of them
WHILE ALL the talk in Concord is about budget cuts, no one’s talking about taxes. That will change — soon.
When the Legislature starts work in January, it will tackle bills to add or increase all sorts of taxes. Lawmakers have filed a dozen tax bills so far on gasoline, tobacco, bottles, beer, income (three of those), even fireworks.
One resurrects the Legacy and Succession tax (better known as the death tax) that produced $25 million a year before it was repealed in 2002.
Safety Commissioner John Barthelmes told lawmakers he’d like several bills to bump up a couple of fees his agency collects.
Want to register your boat? Get ready to dig deeper to help the navigation safety fund that covers enforcement of boating speed limits.
Barthelmes would help the state academy for firefighters with a higher fee on companies and lawyers who want access to motor vehicle records.
Four gambling bills are also in the hopper, two of them authorizing a North Country casino. Historically, the House has rebuffed any expansion of legal gambling. But this economic downturn is itself historic.
Estimates are that the state might have to find itself as much as $400 million more in the next two years than it spent in the current two-year budget.
Part of that gap is due to the rotten economy, which crimps tax collections. The state is also locked by law into some kinds of expensive spending. It covers 35 percent of pension contributions for teachers, firefighters and police. That came to $24 million in 2007. With all the retirement reform talks next year, expect that expense to come under the microscope.
Medicaid costs are locked in by law, but there is some light in that tunnel. Governors across the country are pushing for a federal stimulus plan that puts extra money into Medicaid and eases budget pressures. Federal regulators just loosened up Medicaid rules, making it easier for states to adjust co-payments for Medicaid services.
Gov. John Lynch’s team is looking for money under every rock. At budget briefings last week Administrative Services Commissioner Linda Hodgdon was interested in the estimated $18 million that the Public Utilities Commission will get from the regional auction of greenhouse gas emission allowances. The money is supposed to fund grants for energy efficiency projects.
“Are you required to hand out the grants?” Hodgdon asked. PUC chairman Tom Getz replied that he thinks so, but it’s not definitive in the statute. The latest $60 million in savings Lynch made in this year’s budget were largely accounting moves, with a few exceptions like the end of cancer screening programs and cuts in payments to nursing homes and hospitals.
Health and Human Services Commissioner Nick Toumpas said the easy part is over. Unless extra federal aid arrives, cuts will go deeper for the rest of 2009, and into the 2010-11 budget.
“In the next round, virtually all the population will feel the effects,” he said on The Exchange show Monday on New Hampshire Public Radio.
HHS isn’t alone in its financial pain. The Judicial Council met its orders to cut 3 percent from next year’s budget, but warned things are getting tight.
Legal Assistance has cut 10 percent of its staff, including three lawyers. Public defenders are under increasing strain as the bad economy pushes up demand for attorneys among indigent defendants, executive director Nina Gardner said.
At the Postsecondary Education Commission, executive director Kathryn Dodge’s admittedly–bold request” asked for an extra $2 million to $3 million to boost either tuition grants or the number of students receiving them. Right now, grants only go to students in families of four that earn under $20,000 a year. The average grant among 4,500 students was $700 this year, Dodge said.