The New State Budget: Where Things Landed
On Wednesday, a compromise state budget was passed overwhelmingly in the New Hampshire House and Senate. This brought an end to a process that, at times, felt more like…well… passing a kidney stone. Here’s what it means for the state, for you, and for Portsmouth.
No shutdown of state government services. In the absence of a new budget, the state was operating on a 3-month “continuing resolution” that extended the old budget until October 1. Without an agreement, non-essential state services would have shut down on that date. The new budget takes effect on October 1 and ensures the uninterrupted delivery of services.
Local tax bills will go out on time. With the budget in a state of flux, the amount of funding cities and towns would have received from the state was uncertain. In the absence of an approved budget, communities wouldn’t have known exactly how much money to expect from the state for education, revenue sharing, and other line items where money is received from the state. This would have forced many communities—including Portsmouth—to send out HIGHER property tax bills based on the assumptions of the old budget. Along with the looming expiration of the continuing resolution, this scenario provided incentive for both side to cut a deal.
Scheduled business tax cuts will take place but with some new conditions. Rates will be lowered in 2021 if actual revenues for the previous year exceed projected revenues by 6% or more. But rates will go up if actual revenues fail to come within 6% of projections. (This was a critical item for the governor.)
Budget Highlights
So what’s in the new $12.9 billion state budget?
Adequacy funding for public education increases by $138m with full restoration of stabilization payments.
Full day kindergarten, special education, school transportation, and building aid are all fully funded.
Communities will be allowed to keep excess SWEPT funds.
Increases are included for both the State University System and the State Community College System funding (along with tuition freezes that will make college more affordable)
Family planning services provided by Planned Parenthood and other community health providers are fully funded. These services include birth control, STD testing, and cancer screenings—but not abortion. (See my earlier post on this issue).
Medicaid recipients will now be eligible to receive dental benefits.
A much-needed 3.1% increase in Medicaid provider reimbursement rates was included to make it easier for health care providers to attract and retain skilled workers.
Mental health services that are key parts of the 10 year mental health plan, including Mobile Crisis Units, Step Up programs, and services for children are now funded.
Funding is included for construction of a secure psychiatric unit to be housed outside the state prison. This will end incarceration of mentally ill.
Suicide prevention programs, including teacher training to help recognize at-risk students, are funded.
DCYF child protection staff and programs are also fully funded.
$40 million is also included for revenue sharing that will be returned to New Hampshire cities and towns. These funds can be applied to reduce property taxes or to address any other local priorities.
Unfortunately, while compromise was possible on some issues, it didn’t happen on an issue critical to many New Hampshire families. Paid family leave was vetoed by the governor and a start-up appropriation for the program was removed from the budget.
What Else is In There?
Tacked onto the budget were several important policy changes:
The state’s minimum age for smoking and vaping has been raised to 19.
A controversial new state housing appeals board has been added. It will allow individuals or developers to appeal decisions by local boards or committees.
So How Did Portsmouth Make Out?
Unlike property-poor communities such as Berlin (e.g. cities and towns with less-valuable properties taxed at much higher rates), Portsmouth will not be seeing a major increase in state education funding. If fact, under the new budget while Portsmouth will receive $410,724 in new revenue sharing funds, the city will receive $335,320 less in education funding in 2020. When combined, this means Portsmouth will see a small net gain of $75,404.
Bigger news for Portsmouth was the inclusion of full funding for rebuilding the state fish pier, which partially collapsed earlier in the year.