Three years ago, New Hampshire lawmakers cited compassion and commitment when they set aside $100 million to compensate hundreds of people sexually and physically abused by state workers at the former Youth Development Center. They added $60 million to a special fund for victims the next year and pledged to keep doing so until 2032.
“We are committed to doing the right thing here,” Attorney General John Formella said at the time.
It was also pragmatic. Settling claims of abuse would be cheaper, they said, than taking a risk of defending each claim before a jury during trial.
But today, the future is uncertain for the settlement fund — and the more than 750 victims who have submitted claims so far. The fund is set to run out of money, possibly within weeks, and Formella has recently expressed deep skepticism about spending more, at least for now.
The first test is expected to come Friday, when the fund’s administrator, John Broderick, asks lawmakers for $15 million now to cover claims through the end of June. Broderick, former chief justice of the state Supreme Court, has also asked lawmakers for $150 million in the next two-year state budget.
The latter amount reflects the $75 million lawmakers have contemplated spending annually on payments through 2032. But it’s unclear whether state budget writers will agree to allocate that money as they draft the next state spending plan.
“Should government leadership determine not to provide further funding or sufficient funding, the administrator sees this as running counter to the reasonable expectations of claimants and their counsel,” Broderick wrote in a letter Thursday to lawmakers.
He has asked for an answer immediately, saying the shortfall could impact claims as early as April.
Formella, whose office oversees the fund, declined to answer questions but shared a March 7 letter he sent to Broderick detailing concerns.
In the letter, Formella told Broderick he would not support his $15 million request to cover claims through June. He said Broderick was to blame for any shortfall by mismanaging the payouts, suggesting he should have stretched them out differently by paying victims and attorneys in increments.
“To be clear, the reasons we will not be joining in a request for additional funds this fiscal year is not because we have reached any conclusion as to whether a shortfall is likely to occur,” Formella wrote. He continued: “Any shortfall you anticipate this fiscal year could be easily avoided by simply issuing future awards in prudent installments.”
That surprised Broderick. In a letter three days later, he told Formella he’d asked him twice for a clear directive on whether attorney fees should be paid out up front, as Broderick interpreted the requirements, or over time: “I have never received a directive from you,” Broderick wrote. “Had I, I would certainly have complied. Even now, if you direct me to do that, I will.”
He noted some law firms have volunteered to take their payments over time or reduce their fees. The law allows them to receive up to 33 percent of the payment.
Broderick also addressed Formella’s complaint about structuring settlements in ways that give some victims large initial awards. Broderick said he uses that option when a victim has paid their attorney with a high-interest loan and needs the settlement to pay off that debt. He said in 80% of cases, he pays out awards over several years to avoid draining the fund.
More from NHPR's Document team: Almost 1,300 people say New Hampshire failed to act to protect them from child abuse at youth facilities. Here’s what the allegations reveal.
Jen Foley, a lawyer who advises Broderick and the settlement fund, said Broderick has followed the law enacted by lawmakers and stays within the discretion he’s allowed.
“He is neutral and independent, and exercises careful judgment when evaluating factors within his discretion,” Foley said. “This includes all aspects of final decisions when evaluating claims for eligibility, awarding claims that are verified, and determining payment terms and legal fees.”
Broderick will also need the support of Rep. Ken Weyler, a Kingston Republican who leads the two legislative committees that will decide Broderick’s requests, including the House Finance Committee.
Last month, Wyler was forced to apologize for mocking people abused at the detention center, saying the state should not reward people “who haven’t obeyed the rules” and had led a “misspent life.” He questioned the amount of the payouts, which can reach $2.5 million each under caps established by the Legislature.
In an interview Friday, Weyler said he’s inclined to support Broderick’s $15 million request when it comes before the Joint Legislative Fiscal Committee this week. Asked whether he will urge lawmakers to include Broderick’s $150 million request in the next two-year state budget, Weyler said: “I think that the House supports what we agreed to.”
The state had resolved 238 claims of abuse for $112 million by the end of 2024, according to the most recent report. Individuals can file claims until June 30.
Gov. Kelly Ayotte said she did not include money for the settlement in her proposed budget, which she presented to lawmakers last month, because the law requires the person running the fund to seek money from the Legislature. “Obviously we need to be in a situation where, of course, those individuals who are harmed should receive fair compensation,” she said.
Attorney Chuck Douglas, whose firm has seen nearly three dozen clients through the settlement process, said the state needs to keep its word to victims.
“The state made a promise that if you would come into the fund and file the massively long application, that this would be victim-centered, trauma-informed, and would be a fair and efficient resolution,” Douglas said. “That's what the statute said that created the fund. That's what Attorney General Formella said, and that's what everyone understood. So to pull the plug and not fund it frankly puts the state in a horrible moral position.”
Attorney David Vicinanzo and his partners represent nearly 1,000 victims, many of whom have sued the state. He began encouraging clients to pursue a settlement instead of suing the state last year, after the state expanded the type of abuse it would cover and increased the payment caps. He said that at Broderick’s request, they have agreed to spread their attorney fees over multiple payments to ease the burden on the state.
Vicinanzo said he remains optimistic.
“We have confidence that the state Legislature will live up to its promise to fully fund the ‘victim-centered and trauma-informed’ process it spent three years creating with the Attorney General’s Office,” he said. “Breaking those promises would be disreputable, a betrayal, another trauma for the thousands of kids abused by the state over a 50 year period.”
