By GARRY RAYNO, InDepthNH.org

CONCORD — Taxes are always a hot topic, but the sparring over an essential aspect of government has started early this term.

Since lawmakers went home in June after passing a constrained two-year budget that already projects to be about $100 million short of revenue, two court decisions were released that would have the state pay more of the cost of public education. 

The state Supreme Court in a split decision upheld the ConVal ruling that the state is not meeting its constitutional obligation to pay for an adequate education for its children and the Rockingham County Superior Court decision in the Rand case that says the state fails to pay the full cost of an adequate education and unconstitutionally uses local property to make up the difference and fails to meet other costs such as special education.

New Hampshire pays about 20 percent of the cost of public education for kindergarten to 12th grade, the lowest amount in the country where the average is 47 percent.

This past session the legislature did little to address the education funding issues raised in both lawsuits, but Rep. Thomas Oppel, D-Canaan, asked the House Rules Committee this week to waiver a rule that forbids a bill killed in the first year of a two-year session to be brought back again in the second year.

The bill Oppel sought to bring back was House Bill 503, which would do away with the rate reductions to the state’s two business taxes, to the rooms and meals tax and would reestablish the interests and dividends tax.

Speaking to the committee this week, Oppel said the bill would give lawmakers more options when they debate what to do to address the court rulings and improve the education funding system.

However, no member of the Rules Committee, including the four Democrats on the eight-member committee, would make a motion to approve Oppel’s request.

Rep. Lucy Weber, D-Walpole, said agreeing to waive the rule would set a bad precedent, which Republican House Speaker Sherman Packard, R-Londonderry, agreed with. 

“I thought we needed to at least start the conversation,” Oppel said after the meeting.

The vast majority of Democrats voted against HB 503 when it came to floor last spring and was killed on a 345-27 vote, although the cuts in business tax rates over the last decade have cost the state between $795 million to $1.2 billion in lost revenue, according to a study done by the NH Fiscal Policy Institute.

Oppel, who represents three towns in the Mascoma Valley Regional School District, which was a plaintiff in the ConVal suit, said his goal was to bring some property tax relief to his constituents.

“Property taxpayers in my district and across the state are struggling with the increasing burden imposed on them by tax cuts, which benefit only the wealthy and well connected,” he said. ‘Much of this is due to the state’s inadequate funding of public schools.”

While the Democratic leadership was silent about Oppel’s attempt to revisit HB 503, Republicans were not including Gov. Kelly Ayotte, who released a statement saying, “We’re not going to MASS up our great state with higher taxes. Today, tomorrow, and every day, no income tax, no sales tax — ever.”

And the House Majority Office released a statement claiming Democrats were targeting individuals, businesses and restaurants “in a shameless attempt to put more money in the state’s coffers,” said Deputy House Majority Leader Joe Sweeney, R-Salem. “Republicans continue to stand strong in defense of the New Hampshire Advantage. No Income Tax. Not Now. Not Ever.”

This week, Sweeney in an email sent to raise money for the Committee to Elect House Republicans, both of whom were recently fined for violating the state campaign reporting laws, targeted attorney Andru Volinsky, who was the lead attorney in the Claremont education funding case and involved in the Rand case as well.

The email calls Volinsky a relentless tax advocate, and accuses him of “leading the charge with his bombshell proposal for a 3 percent flat income tax on every paycheck—hitting families, small businesses, and retirees alike. He dresses it up as a ‘fix’ for our schools, but let’s be clear: this is a Trojan horse to fund endless liberal priorities, from bloated bureaucracies to out-of-state agendas.”

Volinsky said, ‘I am straight forward, I write about an income tax and I post about it.”

“We know the game,” he said, the Republicans are going to say all Democrats are income taxers.

“Either we stand up and explain what we are trying to do, or we cower in the corner,” Volinsky said. “We need to say this stuff, (Democrats) can’t hold press conferences saying we need to deal with property taxes and then be AWOL when people put forward plans.”
There are a number of bills introduced this session to address the two court rulings, but most would use a statewide property tax as a solution.

House Republicans have already resurrected a bill that would cap school budgets at the rate of inflation adjusted up or down and tied to a school district’s average school attendance.

Two years ago, the legislature approved spending caps for school districts for the first time and a couple dozen districts had budget caps on school warrants last spring.

All but one were resoundingly defeated.

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