By GARRY RAYNO, Distant Dome
King Ridge Ski Area, where I learned to ski many years ago, was called an upside down ski area.
Instead of driving to the base of the mountain to start your day, at King Ridge you had to drive to the top of the hill to park and begin skiing down the trails before taking a lift to the top where the lodge and all the other amenities were.
The disappointing aspect of an upside down ski area was that your last skiing of the day was a lift ride to the top of the hill, not a fast run down a trail.
While the ski area is long gone, replaced by large houses with views over the Kearsarge Valley, it is representative of what state government is like in New Hampshire.
Instead of starting at the bottom, the state starts at the top where those with the most are taken care of nicely, while those at the bottom face barriers to the help they need.
Perhaps the most telling of the upside down state is the special laws written for some of the largest wealth managers in the state that hold billions of dollars from people like Bill Gates and Jeff Bezos whose wealth is not taxed no matter how much it earns as long as they leave in the trust.
The new laws were sold by telling lawmakers “Make New Hampshire a destination for all that money,” although there is no way for the state to benefit — taxwise — from having all that money within its borders.
And just this year, the one levy that did tax wealth, the interest and dividends tax, was repealed although it produced $184 million last fiscal year. GOP lawmakers did not want the state to have any tax on income.
The generosity does not stop there, it extends to large multinational conglomerates which have seen their state tax liability lowered by about $1 billion over the last decade.
All that lost money would have softened the path for the budget process this session, and going forward when the federal government begins trimming its share of costs for Medicaid and other social programs.
Public education funding is a perfect example of being upside down.
Public education has long been known as the great equalizer, meaning if a child is intelligent or has talent, he or she has the same opportunity to succeed in public schools as children of CEOS and corporate attorneys or technical engineers.
However, the funding system is heavily weighted toward property taxes as the primary source of money — 80 percent — and most of it is local property taxes with widely varying rates.
The result is schools that operate in property poorer communities have difficulty convincing property taxpayers to keep paying escalating bills. Their tax rates are much higher than those in property wealthier communities where the rates are low but raise more money than they need for their schools without putting a heavy burden on homeowners.
The property tax is the most regressive tax because it has nothing to do with the owner’s ability to pay. So if the cabin on the lake has been in your family for generations, but the latest reevaluation puts your tax bill over the $15,000 range, you may have no choice but to sell that long-cherished cabin.
While property taxes are the hardest on the middle class and the poor, the wealthy have no problem paying property taxes which are usually much less than they would have to pay under an income tax.
Their money goes to electing state lawmakers to keep the education funding system largely in place, as the supreme court recently did with its decision on the Statewide Education Property Tax.
The court ruled property wealthier communities may retain the excess SWEPT money they raise for themselves which once went to the state to help the property poor communities but has been retained by the wealthier communities to lower their already low property taxes since 2011.
The most recent budget includes a perfect example of the upside down approach.
The Education Freedom Account program was initially sold as a way for lower income parents to find alternative education for their children if they did not do well in the public school environment, but quickly became a subsidy program for parents with children in religious and private schools and homeschooled which accounts for about 80 percent of the money that topped $30 million in the recently completed school year.
GOP lawmakers pushed through “universal vouchers” this session which means there is no income cap on parents as there was for the program’s first four years so now the applications have nearly doubled and the program will once again overspend its budget for the next two years paying a subsidy to wealthy parents with kids in non-public schools.
Unfortunately, lower income parents have difficulty finding an affordable alternative for their child and the average $5,200 grant is not enough to make it affordable.
While the lawmakers were to find the $80 to $100 million it will need over the biennium for the program, parents — often a single parent — will have to pay a premium for their child’s health insurance under the Medicaid program, and others will have to pay higher co-pays for drugs and procedures for their own health insurance.
With cuts looming at the federal level, the state is likely to need additional money to pay for its share under overhaul of Medicaid, while well-to-do parents get to go on a skiing vacation or a trip to Europe as an alternative to public education.
Although under two court orders to increase state aid to public education to meet its constitutional obligation, lawmakers did not make any significant change in funding.
The state university system took a significant haircut in the budget passed this year that will lead to higher tuition for in-state students in a system that is one of the most expensive in the country and has saddled many New Hampshire college graduates with some of the highest student debt in the nation.
The community college system also was given less money than the previous biennium, and also expects tuition increases next year.
But if you come from a wealthy enough family, the cost of higher education is not an issue and you have more options than students on the lower end of the economic spectrum.
The new budget makes millions of dollars of back-of-the-budget cuts to the state Department of Health and Human Services and many worry that some needed programs will end or help will be prorated for those most in need.
Somehow New Hampshire’s upside down government or legislature has decided that the wealthy need the advantages and the poor can do with a little less.
That is not the way government usually works, but New Hampshire has a long history of building inequity into the system.
Protecting the most vulnerable in New Hampshire, means not giving the well-to-do what they believe they need like lower taxes and fewer fees.
This upside down government is why New Hampshire will quickly grow older and wealthier, but young people will move to states that are not upside down and instead invest in the young and protect the vulnerable.
What business will want to move to New Hampshire or expand here under that scenario?
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.