Budgets dominate post-election talk in Concord. Governor and lawmakers eye cuts and revenue ideas as state faces shortfall some peg at half billion dollars.
Election night speeches tend to accentuate the positive – often to a fault. But that wasn’t the case for one big winner Tuesday night.
"We face a significant revenue shortfall for the remainder of this year. And next year’s budget will be equally challenging."
Governor Lynch’s warnings didn’t end there.
"Meeting these challenges will not be easy; it will be hard work with hard choices. It means not doing some things that we might want to do and delaying other things until we get through this economic downturn."
In budget-speak, hard choices means flat funding, increased taxes and fees or out and out spending cuts.
"Ten percent across the board is about what you’d have to do to meet the obligations of 2009."
Steve Norton is director of the New Hampshire center for public policy studies. His believes it will take about 200 million dollars worth of cuts, new revenue or a combination of the two to bring the current spending plan into balance by July. Such adjustments would be on top of the 30 million dollars the governor and lawmakers trimmed last summer. Few expect the new cuts to come easy, but according to some in Concord, a 200 million dollar trim is doable. Democratic state senator Kathy Sgambati used to lead New Hampshire’s largest and most costly state agency, department of health and human services.
“Where we are with the revenues falling would be challenging, but I think we could get through that with some decent scrutiny of all the line items.”
And as for after the turn of the fiscal year, well, that could be a different story.
“ Beyond there, it’s sort of looking for a miracle.”
Sgambati didn’t put a number to the shortfall budget writers will face in their coming spending plan. But others have. Estimates range from about 2 to 6 hundred million dollars.…Charlie Arlinghaus directs the Josiah Bartlett Center for Public Policy Studies.
“This is going to be the largest budget problem we’ve had in recent history, and New Hampshire doesn’t deal with budget problems very well. It’s going to be very painful politically. It’s going to lead to infighting in both parties, and it’s going to lead to dissention between the governor and the legislature.”
Arlinghaus prediction may prove accurate. But at this point the fighting, at least that done in public, is partisan .
“Well, the people that wronged the ship have to worry about righting the ship.”
Ted Gatsas is state senate’s republican leader. He says overspending by the Governor and Democratic leaders is the chief culprit.
“What are we going to do with education funding, with an additional 100 million dollars in spending, we’ve got to re-look at that. That certainly can’t come forward unless somebody has a magical mystery of where 100 hundred million dollars from the sky? They’ve got to sit down and make cuts, make serious serious cuts.”
-But what would you suggest as a helpful member of the minority?
“How about if we get rid of the nursery we have 3.2 million; tobey school and additional 3.2 million. That’s 6 pretty quick.”
Expect the laundry list of potential cuts to grow in the coming days. Lawmakers in both parties confirm that state employee pay cuts and even pink slips, which the Governor has termed a last resort, could be on the horizon.
“The issue is going to be on personnel, and I think there’s no question that at some point agencies are not going to be able to do certain things.”
Again democratic state senator Kathy Sgambati.
“It is important to me we make they and say what we are not going to do rather than rendering every program ineffective by continuing to cut at the margins so they cannot function.”
But in addition to cuts, new revenue will certainly be on the table. The Governor and leaders in both parties have ruled out sales and income taxes; and higher business taxes – never an easy sell -- would be tougher still in a down economy. Expanded Gambling is sure to get a look, particularly in the state senate. But it’s never won much support in the house. Some are also floating the return of an estate tax. More novel is the idea of so-called sell/lease deals, where the state would sell an asset for cash, and then immediately lease it back. Some or none of these may come to pass, but if governor Lynch’s words on election night are anything to go by, the public should expect some big changes.
“We must be willing to think differently and creatively about how we do business as a state, and change practices and programs that are out dated.”
The Governor is expected to present lawmakers with executive order to address the current budget gap later this month. Early hearings on the next two year budget begin on the 20th.
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