State financial experts say New Hampshire is starting the year off in better fiscal health than expected. That’s good news for lawmakers charged with crafting the next two-year state budget.
When budget writers wrote up the current state spending plan, they projected the state would start 2017 with a $33 million surplus. But according to this month’s estimates, the actual surplus is nearly 3 times that amount.
And the state’s so-called “Rainy Day Fund” has $130 million more than expected in January.
But Michael Kane, who heads the legislature's budget office, told lawmakers Monday these numbers could easily change before June.
“It’s too early to predict if the state is going to end Fiscal Year 2017 with a deficit or a surplus – a large share of that is because of your revenues, it’s so early in the year,” Kane said.
The states highest source of revenue is business taxes. Last year the state brought in 15 percent more money from business taxes than the previous year. But the reason why is hard to pinpoint, says State Revenue Commissioner John Beardmore.
“You can see from '13 to '14 to '15 we were pretty flat and '16 really popped – why is that? I think the Ways and Means Committee will chew on that question quite a bit over the next several months. That’s a difficult question to answer unequivocally,” Beardmore told lawmakers.
Republican lawmakers have attributed this increase to a recent cut in business tax rates – a trend Gov. Chris Sununu says he wants to continue.
Sununu is scheduled to release his version of the state’s new budget in early February, which leaves lawmakers about four months to get to a final version.