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Sen. Reynolds holds public forum on state budget

N.H. State Senator Deborah Reynolds answers questions about a projected $500 million shortfall in state revenues over the next biennial budget cycle at a public forum on the 2010-2011 budget at Glencliff Nursing Home on Monday Night. Marcia Morris. (click for larger version)
May 21, 2009
REGIONAL—Where will the money come from?

That was the question on the minds of state legislators and members of the public gathered Monday night at the Glencliff Nursing Home to consider the state's current budget crisis.

The public forum, sponsored by Senator Deborah Reynolds, brought together many from the local congressional delegation and others for a frank and detailed discussion of the ramifications of the global economic downturn on the state's fiscal circumstances.

"I think it is important to try to bring information out to the people that we all represent, rather than asking them to travel to Concord," explained Senator Reynolds. "My fear is that members of the public do not realize just how dire the situation truly is."

"We are experiencing the most significant recession since the 1930s," said Sen. Reynolds. "While New Hampshire is faring better than many other states we are facing severe economic challenges." She said that federal stimulus money is expected to help for specific one-time project expenses during 2010 and 2011, but even with these funds the state is expected to experience a $250 million to $300 million revenue shortfall just in the upcoming year.

Reynolds said that New Hampshire has seen dramatic decreases in revenues over the course of the last 8 months, with a $50 million drop just in the month of April alone. Revenues from sources like the rooms and meals tax and from real estate transfer fees have taken a big hit, and until the economy begins to recover, the picture remains bleak.

On the spending side of the equation, as the economy worsens demands on the Health and Human Services budget continue to grow. "Members of the Senate are working hard right now to make decisions about how to protect our most vulnerable and needy citizens while promoting job growth. It is a very daunting task. We need to keep roofs over people's heads, food on the table, protect people from abuse and provide basic core requirements like education and transportation. It is a very challenging problem."

Attendees discussed the pros and cons of a number of contending approaches such as the cigarette tax, gambling, and spending cuts in many areas including furloughs for state employees, cuts in kindergarten adequacy and charter schools. But the consensus was clear that given the magnitude of the problem, there are no good options and the solution will need to be some package of spending cuts and revenue increases of significant proportions.

A number of state legislators said that they are hearing a much greater readiness on the part of constituents to consider the introduction of a broad based tax to solve the looming problem. But Senator Reynolds reminded everyone that Governor John Lynch has said clearly that he would veto a sales or income tax. She said she felt that to even consider such a change in New Hampshire would necessitate a constitutional amendment tying it to a reduction of the property tax.

Executive Councilor Ray Burton praised Reynolds for holding the forum and appealed to all the legislators to keep an open mind about new sources of cash for the state budget. "It is evident that new cash has got to be found from somewhere," said Councilor Burton. "The senators may just have to hold their noses and vote for increased fees, gaming and other things. If we don't find some revenues from somewhere we will have to reduce services, experience layoffs or see steep increases in the property tax. Institutions like Glencliff will be an easy target in the next round of cuts."

Burton raised the specter of court intervention if the general court cannot find a way to get the job done. He reminded the legislators that state hospitals were taken over by the courts during the tenure of Governor Meldrim Thompson. "I beg and plead with you all to be open minded and willing to change your minds about some things as we go forward," said Councilor Burton. "That is what it will take to get this done by July 1."

Martin Lord Osman
Varney Smith
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