"The good, the bad and the ugly" were the first words Senator Sylvia Larson (Concord) used in her criticism last Wednesday of the budget proposed by the Senate Finance Committee.
Senator Larson was doing her job as the Minority Leader of the Senate. She was laying out the points of contention she and her Democrat Senate colleagues found in the budget for the two years beginning on July 1. Those of us who sit on the Finance Committee know this budget is the result of dozens of tough decisions.
The new budget is the first one, I believe, since World War II that will have the state spending less money over the next two years than we are spending in the current biennium. It spends 11 percent less. That reduction means that about 1,000 positions will be eliminated. Many of them have been unfilled for years so we are doing away with only funding for vacant positions. In other situations, there will be layoffs.
The Senate added back into the budget some programs severely cut or eliminated in the House version. That is good for those who depend upon some mental health and developmentally disabilities services, but the Senate did not have the money to reinstate other programs.
Most severe were the cuts to the state’s larger hospitals and the $55 million reduction in the state contribution to support the University System of New Hampshire. Hospitals have received millions of dollars each year for the past two decades to assist them with the costs of serving those with no insurance or where the payments from Medicaid are so low that hospitals incur losses for providing the care. The University System has been receiving close to $100 million each year so a reduction of $55 million is very significant.
The impact of these state payments means that jobs and services may be eliminated, and hospitals may need to increase costs charged to private insurers, creating increases in premiums paid by businesses and individuals. The University System can reduce staff and save money in other ways but tuition hikes are likely making it more difficult for families to send their children to the University of New Hampshire, Plymouth State University and Keene State College. Granite State College students could see the cost of each credit hour go up.
Why so many cuts, many of them deep ones? There are two answers: first, revenues are off for the current fiscal year plan by $47 million. And revenue has been below our annual income plans throughout the recession leaving less money to spend.
Secondly, there is a strong commitment by the House and the Senate to live within our means. There will be no fee or tax increases, no new taxes or fees and no bonding of operating expenses. That is a major change from the last few years and means we have limited our flexibility in setting the amount of money we can spend.
The budget we pass must be balanced. At the end of the biennium there may be a surplus or a deficit. But when we start each new biennium the proposed budget has to be balanced.
If only Washington had some of the same discipline, we would not have the annual budget deficits, high debt levels and what seems like no hope of turning things around. New Hampshire’s rules on the budget are tough to meet but I believe the Senate has done it.
After Senator Larson finished her address, the Senate clerk called the roll and the vote on approval of the new budget was 19 in favor and five opposed. It was right down party lines.
We now have a Senate proposal for a $ 10.3 billion budget that is balanced. There are some good and bad and maybe even ugly parts, but the Senate has done a good job in preparing its budget.
Next steps? This Wednesday the House will likely vote to "non concur" with the Senate’s proposed budget and "request a committee of conference." Committees of conference members will be appointed by the Senate President and the Speaker of the House. Given that the budget bills, HB 1 and 2, are House bills, the House will set the time for the committees of conference to meet and the chair of the House Finance Committee will chair the committees of conference.
The conference committees must complete their work by 12:00 p.m. on June 16.
A final vote on the budget as adjusted by the committees of conference is scheduled for June 23rd. That will leave time for the budget bills to get to the Governor’s desk so he can sign them before July 1.
I made it to the opening day of the Newport Farmers Market on Friday afternoon and left happy with my "double garlic" marinade, English muffins, goats’ milk cheese and New Hampshire made wine. It seemed like I hadn’t miss a beat from my last market visit last year.
I missed the kick off in Claremont of their market on Thursday because the Senate met that day. The president of the Claremont Farmers Market is Charlene Lovett, also a state representative. She reports that "customers and vendors had to brave strong winds, rain and cold, but people were excited that the 2011 season was finally here."
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