The New Hampshire Senate Finance Committee voted along party lines Tuesday to pass a state budget plan that spends about $200 million more than the House’s proposal, but about $200 million less than the budget backed by Gov. Kelly Ayotte.
The Senate’s $15.7 billion package largely reverses a range of cuts made by House budget writers, including cuts to higher education, Medicaid provider rates, and mental health services. The Senate budget also preserves government entities — including the Office of Child Advocate, the Human Rights Commission, and the enforcement arm of the New Hampshire State Liquor Commission — that would be eliminated under the House plan.
Like the House’s, the Senate's budget relies on increased revenue from video slot machines, and boosts numerous state fees. It also calls on multiple state agency heads to identify millions in unspecified savings.
Prior to the final vote on the plan Tuesday, lawmakers from both parties acknowledged this budget season posed fresh challenges. The end of federal COVID aid — which pumped more than a billion dollars into the state treasury during the last budget cycle — was a big one. So was the uncertain national economy.
But top Republicans were adamant that this spending plan — which features funding cuts for state housing initiatives and eliminates the income cap for participants in the state’s voucher-like school choice program — sets the state on a proper course.
“I see us launching off this budget into the next biennium more prosperous than we are today,” said Sen. President Sharon Carson of Londonderry.
But Democrats on the committee said they were worried this budget would do the opposite, particularly as Congress considers new federal cuts to Medicaid spending. They also pointed to ballooning liabilities from the abuse cases at the state’s former youth detention center, and to potentially adverse rulings in two education funding lawsuits now before the state Supreme Court.
“Once we get through the budget, I can devote myself full time to worrying about the next budget,” Democratic Sen. Cindy Rosenwald of Nashua said before the final committee vote. “That’s already starting to make me worried about the threats to our prosperity, for the long term.”
Here’s a closer look at the Senate’s proposed plan.
Health and Social Services
The Senate budget earmarks $52.5 million to reverse the 3% rate cuts to Medicaid service providers backed this spring by the House. The Senate plan also adds back $37.8 million in mental health and developmental services funding.
Under the Senate budget, people insured through Medicaid would be charged premiums, at a flat rate per person. The budgets backed by Ayotte and the House also included Medicaid premiums, at variable rates pegged to income.
The Senate budget also requires the state to resubmit a federal waiver to set up work requirements for adult Medicaid recipients.
The spending plan allocates $1 million to fund the state family planning program, allowing the program to leverage federal grants.
The Senate budget restores the Office of Child Advocate, which has been eliminated by the House. The Senate proposes funding the office at $1.6 million, but would trim the office’s staff. It would also make the Child Advocate post subject to Executive Council confirmation, and add new language about oversight duties being “non-partisan.”
Department of Corrections
The Senate plan restores more than 100 jobs at the Department of Corrections cut by House budget writers. The restoration of positions follows the resignation of former Commissioner Helen Hanks last month.
During the House budget process, GOP leaders said they lost confidence in Hanks, though Senate budget writers praised her for advising them as they made funding decisions tied to corrections.
Higher Education
The Senate budget would send $85 million a year to the state University System, which includes the University of New Hampshire, Plymouth State and Keene State.
The House’s budget slashed $50 million in University System funding, a more than 30% reduction from what Ayotte proposed spending in her budget.
School Funding
The Senate budget retains the education grants for school districts at $4,351 per pupil, with additional funding for students eligible for free and reduced-price meals and special education.
The Senate budget would also allow for universal student enrollment in the state’s voucher-like Education Freedom Account program. Under current law, EFA eligibility is limited to families with incomes no higher than 350% of the federal poverty level — or about $113,000 for a family of four.
Diversity and equity initiatives
The Senate budget includes language to prohibit diversity, equity, and inclusion initiatives in all public schools and state-funded colleges and universities.
The budget backed by the House aimed to go further, by also blocking state agencies and municipalities from entering into contracts that include provisions “that classify individuals based on race, sex, ethnicity, or other group characteristics for the purpose of achieving demographic outcomes.”
That broad definition of DEI was a flashpoint in the House. Democratic lawmakers and others cautioned that it could affect people with disabilities and other shared experiences.
Public retirement benefits
Pensions for so-called “Group II” public employees — which includes police officers and firefighters — have been a fraught issue for some time. Like the budgets proposed by Ayotte and the House, the Senate budget would restore pension benefits now denied to 1,500 first responders hired since 2011. But unlike Ayotte and the House, the Senate plan would delay the pension change for six months, a move budget writers in the Senate say will save the state $7 million.
The total cost of the pension change is $27.5
million a year.
When Ayotte included the pension change in her budget, she tethered its funding to allowing video slot machines at the state’s charity casinos. The House, meanwhile, didn’t tie any Group II pension change to a specific revenue source. Senate GOP leaders raised concerns about the fiscal implication of restoring Group II benefits this year.
Finance Chairman Jim Gray proposed a five year phase-in, and the Senate vote to add the benefit with the six-month delay was opposed by Senate President Sharon Carson.
