Uncertainty Deepens As Budget Veto Impasse Drags On

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Garry Rayno is InDepthNH.org's State House Bureau Chief. He is pictured in the press room at the State House in Concord.


CONCORD – As the days go by without a state operating budget, the impasse between Gov. Chris Sununu and Democratic legislative leaders increases the uncertainty for local government officials and state agencies.

While state agencies need to spend more money than allowed under the three-month continuing resolution lawmakers passed and signed, local officials face difficult questions as they begin constructing budgets voters or councils will decide next year.

State Agencies

The $13.3 billion, two-year operating budget contained additional money for expanded and some new programs and also aligned state agency spending with caseloads and last fiscal year’s spending.

Now almost two months through the continuing resolution, agencies are feeling the pinch and the agendas of the Legislative Fiscal Committee and the Governor and Executive Council meetings this week reflect those concerns.

And some of the requests by state agencies are big ticket items. The total request to the Fiscal Committee to overspend the money allotted for first quarter spending exceeds $85 million.

One problem affecting all agencies is an extra pay period within the three-month continuation resolution. Normally that would not be a problem but is because there was one less pay period during the first quarter of the 2019 fiscal year.

The extra pay period not only includes wages but also benefit costs so the figure is substantial.

Plus, the new collective bargaining agreement includes raises that went into effect halfway through last fiscal year, step increases, new hires etc. and the price tag for the additional payroll costs is about $25 million.

The bulk of the remaining requests are for the Department of Health and Human Services.

$35 million request

One large request concerns a $35 million federal grant to help the state’s response to the opioid crisis.

The committee approved spending some of the money during its July meeting and is being asked by the department to spend more to continue programs through September.

Similarly, the committee approved spending some of the $1.8 million Health and Human Services wants to draw down federal money for the Temporary Aid to Needy Families (TANF) or welfare program. Now the agency returns seeking the rest of the federal money to match state spending through the end of September.

Medicaid money

The agency is also requesting the rest of $7.2 million in federal Medicaid money to cover increased caseloads in a number of health-care programs. The committee approved spending some of the money in July.

State social service officials say they need an additional $8 million above their appropriation to continue providing developmentally disabled services to new clients who were removed from the wait list last fiscal year.

The committee had approved money so existing clients would continue to receive their services but those turning 21 years old who go from school district responsibility to the state would not. 

The additional money would allow those coming off the wait list this fiscal year to receive services under the program.

The department also wants the committee to approve an additional $2 million beyond what is authorized under the continuing resolution for the Choice for Independence program allowing seniors to remain in their homes and receive services rather than be in a nursing home.

The money is needed to provide services to the growing number of people choosing the at-home program. Enrollment went from 2,465 in fiscal 2018 to 3,567 in fiscal 2019, health officials said.

Other agencies seek funds to continue positions. The Department of Transportation seeks to spend an additional $900,000 for summer maintenance work including for overtime, services and materials.

Many of the requests will be before both the Fiscal Committee and the Executive Council which meet at 10 a.m. Wednesday, the council in the Boys and Girls Club in Manchester and the committee in the Legislative Office Building.

Schools and Municipalities 

The budget Sununu vetoed contained about $180 million in new money for schools, and cities and towns.

About $140 million was earmarked for schools by returning stabilization grants to their original level and ending the annual 4 percent decreases enacted several years ago. There also was new money targeted to help property poor school districts in crisis or on the edge.

The $40 million in municipal revenue sharing money had no strings attached as its champion Senate Finance Committee Chair Lou D’Allesandro. D-Manchester, repeatedly noted, meaning it could be used for property tax relief by struggling communities.

But the veto’s effect goes beyond the missing money.

Without the change in law included in the trailer bill or House Bill 2, another 4 percent reduction in stabilization aid to school districts will take effect this fiscal year on top of the 4 percent included in this year’s school budgets.

School districts’ predicament

Many school districts operate under SB 2, which require school districts to adopt a budget by the first of the year in order to hold the required budget hearings etc. And if the district has a budget committee, then the work has to be completed earlier.

Towns are in a similar predicament.

Should they include the revenue sharing money when they begin building their budget for next year?

Although the clean water money for the state’s share of water and sewer projects was fully funded in the vetoed budget, there likely will not be enough if the impasse drags on.

If that happens, then the money will be pro-rated which means cities and towns would receive a percentage of the state’s share, but not the full amount.

The House and Senate Finance Ad Hoc Committee on the Budget holds it third and final hearing Thursday at 10 a.m. in Rooms 210-211 of the LOB.

The hearing’s topic is education and activists who pushed to increase education funding this session are working to turn out a large crowd of educators, parents, officials and students to tell how the veto affects them.


The governor and Democratic leaders are scheduled to meet this week again to see if they can reach a compromise that would pass the House and Senate.

While progress has been made, both sides are dug in on a couple of key issues: business tax rates and education funding levels.

While the governor and Democratic leaders try to find a path to a new two-year budget, the political parties are turning up the heat making compromise more difficult.

Speculation around the State House is there may not be a compromise within the three months covered by the continuing resolution, and another three-month resolution may be needed.

The intrigue is bound to build as lawmakers return to Concord to act on the remaining bills of the 53 Sununu vetoed.

The House returns Sept. 18 and 19 and the Senate Sept. 19.

The longer the state operates without a budget and on a continuing resolution, more and more people will see and feel the effects with the political season leading to the 2020 election almost here.

Garry Rayno may be reached at garry.rayno@yahoo.com

Distant Dome by veteran journalist Garry Rayno explores a broader perspective on the State House and state happenings for InDepthNH.org. Over his three-decade career, Rayno covered the NH State House for the New Hampshire Union Leader and Foster’s Daily Democrat. During his career, his coverage spanned the news spectrum, from local planning, school and select boards, to national issues such as electric industry deregulation and Presidential primaries. Rayno lives with his wife Carolyn in New London. InDepthNH.org is New Hampshire’s only nonprofit, online news outlet dedicated to holding government accountable and giving voice to marginalized people, places and ideas. 

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