Republicans House Speaker Sherman Packard of Londonderry and Sen. James Gray of Rochester are pictured in the State House on Thursday, the last day for conference committees to finish their work. PAULA TRACY photo
By PAULA TRACY, InDepthNH.org
CONCORD – Annual required auto inspections for New Hampshire vehicles could end in 2026, first responders in the Group II retirement plan could retire after 22 years of service rather than 23, and the “Momnibus” maternal mental health aid package is back in the budget as is funding for the developmentally disabled wait list, in last-minute negotiations between the House and Senate on a proposed new $15.7 billion state budget Thursday.
Still not enough for Republican Gov. Kelly Ayotte, who said she would veto the budget if it came to her today in an interview with WMUR’s Adam Sexton.
Ayotte said she couldn’t sign off on what she called an “11th-hour backroom deal.” She said it failed to deliver on promises to first responders, cuts funding to Manchester schools and fails to deliver for the state’s most vulnerable people.
The proposed budget compromise still has to be voted on by the Senate and House before it heads to her desk.
Republicans said the budget also protects Medicaid and Medicare rates, funds Community Mental Health programs at $37.8 million, offers Developmental Disability Services at $31.3 million, ensuring no waitlist for their residential services for adults with an acquired brain disorder at $10 million, protects 30 percent of revenue sharing for cities and towns under the Rooms and Meals Tax.
It also funds but reduces budgets for the Department of Corrections where there may be layoffs, the Office of Child Advocate, the Housing Appeals Board, the Human Rights Commission, the Board of Tax and Land Appeals, the Commission on Aging, and the NH Council on the Arts.
It also provides $120 million for Group II Tier B retirement, tightens bell-to-bell cell phone restrictions in New Hampshire schools, funds the 9-8-8 Suicide Hotline and the Northern Border Alliance with Canada.
It restores 75 positions in the Department of Corrections from the House passed version, but there are cuts for therapists and counselors for inmates.
It restores the balance to the $250 million Rainy Day Fund, funds $11.5 million for the Southern New Hampshire Regional Water Project (in addition to $5 million in the Capital Budget) and directs $55 million in PFAS lawsuit settlement payments to public water systems in 75 New Hampshire communities covering 400,000 Granite Staters.
There is also $10 million in it for local wastewater projects.
Democrats said the deal is hardest on the backs of the working poor by requiring a Medicaid premium while at the same time giving wealthy people a $5,600 voucher to send their kids to any school other than the public one in their community, among other concerns.
Next Thursday, all 400 House and 24 Senators return to Concord to the State Capitol to vote on the final product. It will still need to go to Gov. Kelly Ayotte who may veto it, if passed by the legislative chambers.
She has an up or down vote and has no line item veto.
Ayotte, a Republican, ran on restoring funds for the first responders across the state who formed the Group II retirement plan. It is among a number of items she wanted and so far has received like bail reform and expanding Education Freedom Accounts.
There are about 1,500 Group II members whose benefits changed in 2011 and Ayotte has maintained they were promised a fix.
Ayotte also released a statement that there is inadequate support for Manchester’s schools in the proposed budget.
She has also called for a “bell to bell” cell phone ban in schools which is now part of the budget but whose committee of conference refused to concur, Thursday just before the deadline.
That means if the budget is dead so is the cell phone ban.
“MAKING SAUSAGES”
Otto Von Bismarck once was quoted as having said “laws are like sausages. It’s better not to see them being made,” which two legislators Rep. Dan McGuire, R-Epsom, and Sen. Regina Birdsell, R-Hampstead, referred to as part of their assessment of the political process they just went through since January.
The process was long and culminated intensely this week with occasional clashes mostly between House and Senate Republicans.
House Rep. Mary Jane Wallner, D-Concord, asked to be excused from the vote because she could not support it.
The law requires a unanimous vote.
“The budget agreements contain many policies I cannot support,” Wallner said, listing charging health care premiums and copays for the state’s poorest citizens while expanding the Education Freedom Accounts to provide $5,600 vouchers for even the most wealthy to send their kids to non-public schools or home school.
Wallner also listed her objection to the reduction in the staffing for the Office of the Child Advocate and inadequate funds for the state’s largest and most diverse school system in Manchester, and she lamated the Group II package.
“I do ask to be removed,” she said.
Wallner was replaced by Republican Jess Edwards, Jr., R-Auburn.
Wallner, currently the House’s longest serving member, issued this statement:
“The budget agreement reached by Republicans was made behind closed doors and contains many policies that I cannot support. The GOP budget enacts new health care premiums and copays on our most vulnerable citizens while expanding school vouchers to higher-income families. It significantly reduces the staffing and authority of the Child Advocate’s office and removes protections for New Hampshire children. It inadequately funds our state’s largest and most diverse school district and fails to adequately restore retirement benefits for our first responders. Simply put, this budget fails New Hampshire.”
SWEETENED SAUSAGE
But just before lunch the committee announced an agreement to help sweeten the deal.
Rep. Joe Sweeney, R-Salem, offered amendments after getting information on the current state of the state, with $320 million in cash on hand, and a nod from Michael Kane, Legislative Budget Assistant, that the two chambers have produced a balanced budget for fiscal years 2026 and 2027.
Sweeney said with a little room to spare there should be restoration of funding for the developmentally disabled wait list in 2027, returning roughly $18 million which was taken out Wednesday and replaced Thursday and restoration of the so-called “Momnibus” proposal for maternal mental health outreach about $175,000. There are also back of the budget cuts for HHS in this budget, which were not in the governor’s which could still impact programs that have yet to be announced.
Also if passed into law, Group II retirement first responders can retire a full year earlier than the previous plan of 23 years, but it still could be a sticking point as the proposal falls far short than the roughly $27 million a year Ayotte wanted for the next 10 years and was supported by the House. The Senate started amending it first to delay implementation six months and now to $15 million a year.
That Group II aspect of the budget package has the potential to trigger a veto by the governor or a means to strike it down by the House.
Republicans control the House by about 40 votes and hold the 16-8 Senate majority.
Ayotte will sign, veto or allow it into law if it reaches her desk.
If not, the state could run on a continuing resolution if passed. It would allow the budget status quo beginning July 1 until a budget resolution is reached but legislators are hoping to avoid that this summer.
OTHER COMMITTEES OF CONFERENCE
There were about two dozen committees of conference beside the budget and all needed to come in with an agreement or not by the 4 p.m. Thursday deadline.
Committees of conference are to reconcile differences between chambers on various bills they still want to work toward agreement on.
A full list of the committees and their results are here https://gc.nh.gov/committee_of_conference/
But House Bill 2, the trailer bill was another avenue to passage for some bills which were controversial.
MOTOR VEHICLE INSPECTIONS
The motor vehicle inspection bill, House Bill 649, which was favored by House Majority Leader State Rep. Jason Osborne, R-Auburn, and a House priority, initially was to have vehicle inspections required every other year, new cars would not need to be inspected in the first three years and it would eliminate the onboard diagnostic and prevent a check engine light from failing a vehicle inspection.
The bill just eliminates the vehicle inspections in 2026 and allows the state Department of Environmental Services to work with federal officials on the matter related to emissions.
GROUP II
The package also now agrees to shifting from 23 years of service to 22 years for the Group II retirement but it still would only spend $30 each biennium rather than the governor’s proposal of about $67 million.
Ayotte could argue that she found a revenue source to afford to pay for most of Group II with support for the increase of more video lottery gaming terminal revenue and that the budget as it now stands ignores that point.
FREEDOM CAUCUS GOT ALL THEY WANTED
Committee of Commerce member Rep. Jose Cambrils, R-Loudon, called it a “hard fought budget” and at the end of the day he said he thought a lot people will be satisfied, noting it kept the rainy day fund almost level, which helps the state’s credit rating which is quite good.
“A shout out to my Freedom Caucus friends that what they were requesting was achieved. I hope they will join us in passing this very good budget,” he said.
State Rep. Dan McGuire, R-Epsom, said he certainly did not get everything he wanted but “I think it is a good compromise.”
CHALLENGES AHEAD
Sen. James Gray, R-Rochester, who chaired the Senate Finance Committee said the Senate concurred with the House amendments.
But he warned there are financial challenges for the state in the next few years and indicated the funding for the victims of the Youth Development Center looms.
“We will need to take some steps,” he said, and there will be difficult financial decisions he predicted.
Already the state has spent over $160 million in settlements for victims of the state who were in custody as children at the Youth Development Center, now called the Sununu Youth Services Center, and there are estimates the state’s future liability is more than $1 billion.
The budget plan calls for $80 million to be collected in 2027 when the state sells the Sununu Youth Services Center when that population moves to Hampstead Hospital ground, but it may not materialize in time due to many potential delays and valuation issues on the property.
Senate President Sharon Carson, R-Londonderry, thanked her colleagues for their hard work finalizing a budget that both sides could agree to within state means.
“I always said this was going to be a very difficult budget,” she said.
Carson said she promised a thoughtful approach “and I think we did that.”
She said it was an exercise in compromise and the Senate showed it is capable of doing that.
Sen. Regina Birdsell, R-Hampstead, said it was her first time in a budget committee of conference and called it educational and “an interesting display of how the sausage is made.”
State Sen. Tim Lang, R-Sanbornton, who also had his first experience crafting a state budget said, “The breadth and depth of looking at an entire state budget is a daunting task. I was also surprised at the hard ‘NO’s’ on certain policy/spending items from each body and I was also surprised where we could find compromise on policy/spending items.”
ARTS COUNCIL
“As for the Arts Council, I am glad House accepted our proposal, and I already have two corporate sponsors ready to donate to the program,” he said following the vote.
The budget proposal would allow for $150,000 a year to fund the Arts and Lang offered an amendment that creates the Senate’s version of a tax credit program for the NH Patron of the Arts.
He declined to say who or how much those potential patrons would pledge.
There was discussion Wednesday when Carson said she recieved word of a possible $1 million national match for the Arts, but that aspect was not passed as part of the House side of the committee of conference and is not part of the budget.
PACKARD’S PRAISE FOR RECORD EDUCATION SPENDING
House Speaker Sherman Packard, R-Londonderry, issued a statement applauding the newly proposed budget compromise, emphasizing its focus on New Hampshire’s top priorities, including more than $2.1 billion in record state funding for public education.
“This budget is a win for New Hampshire families – our priority. We’re making historic investments in our public schools and protecting essential services that serve the citizens of our state,” said Speaker Packard. “The Group II retirement proposal is better than what these folks have today, and it is what’s currently possible with funding limitations, while balancing the needs of everything else that gets state funding.”
He continued: “I am proud of the hard work of our House Finance Committee and our Senate counterparts for working out compromises and getting the job done. I look forward to meaningful dialogue in the coming days to ensure we live up to our duty of passing a solid budget that works for all Granite Staters.”
MORE INFORMATION
To access the budget in HB 1 and the trailer in HB 2 go to the “view report” tab under both committees of conference to read the final version, here https://gc.nh.gov/committee_of_conference/ The link also includes other committees of conference and their final agreement or opposition.
All lawmakers are expected back in Concord at 10 a.m. Thursday, June 26 to vote on this budget proposal.