Roughly half of the readers of this column will see it on Monday before the election not knowing who will be our next governor. The other half will read it later in the week knowing who has been elected to office including the New Hampshire governorship.
The new governor, with abounding enthusiasm while exhausted from the months long race, will immediately face deadlines requiring study, decisions and communication. No assignment will be more central to the governor-elect getting started than his or her effort on the new budget.
State agencies have been at work for months preparing documents with their budget requests and Governor Lynch’s staff has been bringing the overall package together. But the budget for the two years beginning next July 1 will be the new governor’s budget … not Governor Lynch’s budget.
Each of the candidates has expressed a willingness to consider restoring funding for hospitals, the university system, some health and human services programs and others. Adding up these expenditures they total tens of millions of dollars. So, to say it mildly, given the state of the economy and state revenues, the new governor may need to adjust some spending she or he may want to meet today’s economic realities.
October is a small month for revenue. But the fact that the revenue exceeded the budget plan, $9 million over the $108 million goal, is very good news for the new governor. And the fact that for the first four months of the fiscal year we are narrowly ahead of projections is also positive.
Those revenues, the new governor will learn and come to appreciate, are paying for an appropriations side of the budget that is lower than the prior biennial budget by more than 10 percent. That means spending has been lowered to meet reasonable revenue expectations but with little margin for error.
For the new governor to restore spending to any major category, such as $50 million to the university system, he or she will have to reduce spending in other places, raise additional revenues or take very optimistic revenue projections on the income side of the budget.
From the moment the governor-elect is known, the clock will be ticking. The new governor will be sworn in on Jan. 3 and will be expected in his or her inaugural address to lay out some policies, including budgetary, they hope to achieve in the next two years. Then, on or before, Feb. 15, the new governor is required to present his or her budget plan to the legislature.
While the campaign has been long and incredibly intense, the new governor will face a short time frame in which to craft the new budget that will determine the funding priories and tax policies that will be hallmarks of their administration.
The new governor will be interested where New Hampshire stands in the amount of taxes paid as a percentage of residents’ income. The Tax Foundation released its annual report a few days ago reporting that in 2010, Americans paid 9.9 percent of their income for state and local taxes, up from 9.3 percent in 2000.
Of the 10 states with the highest tax burden, four of them were New Hampshire’s sister New England states. Connecticut collected the highest level in New England, 12.3 percent, and the others in the top 10 were Rhode Island (10.9 percent), Massachusetts (10.4 percent) and Maine (10.3 percent).
At the other end of the scale, New Hampshire at 8.1 percent has the seventh lowest tax burden for state and local taxes.
A recent Wall Street Journal article on the Tax Foundation report said about New Hampshire, "’one of the nation’s most simple and inexpensive’ personal income tax systems in the country. The state had a flat income tax of 5 percent, and even that was just on dividend and interest income, giving many citizens little or no income tax liability … was also one of just five states without a sales tax. It is therefore heavily reliant on property taxes, which were 5.68 percent of income in 2010, the highest rate in the country."
Many times as a community or in small groups, the Newport area community has come together because of the life of Jesse Scott. It was true again on Saturday as the Newport Opera House was the setting for a celebration of the long life of Jesse. He had died the prior Sunday at 105.
It was truly a celebration marked with humor and recollections from family, professional colleagues and friends. And there was a thread of a long life lived in a small New Hampshire town, of service as a conservation officer and legislator, but mostly about friendship and connections with a wide array of friends and acquaintances.
Those who have gathered with Jesse over the years will not forget the special gift his was to their lives as well as our community and state.
It sure seems early in the season, but Judy and I very much enjoyed the Friday evening kick-off of Christmas at the Fells. With a celebratory spirit surrounding the Hay home at The Fells, one tours through each room to see beautiful "winter wonderland" decorations in a traditional style. It was great fun and a reminder Christmas is not far off. Christmas at The Fells continues this weekend.