The state budget: fair and balanced



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Scarce resources make for difficult budgets – and a lot of carping from the sidelines. As any parent cutting a family budget or any CFO making painful financial changes in order to ensure a company’s survival — can tell you, no matter how you go about it, there are plenty of people ready to tell you what you did wrong. And the same has proved true as the governor and Legislature worked together this spring to close a $300 million budget shortfall caused by plummeting state revenues. Some of the steps that we needed to take to close the gap are ones we began last year, when it first became clear that the national recession would have an even bigger impact on state revenues than most economists had predicted.New spending authorized in the previous budget was eliminated. State agencies were instructed to freeze spending in multiple areas and to cut it in others. State workers were laid off. For the first time since the state began subsidizing child care so that low-income parents could work, there is a waiting list for over 2,000 New Hampshire families. The courts will stop holding jury trials for a four-month period, a devastating impact to our justice system. In all, our cuts equaled about $150 million.Many constituents have asked me why we didn’t cut even more — after all, some of them say, that’s what families do when money is tight. My answer is that families do indeed cut expenses to close budget holes, but they don’t let their children starve. They don’t sell the car if it’s the only way to get to work and earn money.Likewise, there are some things in the state budget that we cannot eliminate. Some involve federal requirements. Others would put people’s lives and safety at risk. Still others – like further cuts to child-care subsidies for low-income working parents – force people out of the workforce and onto welfare at greater cost.Aid to cities, towns and school districts makes up 45 percent of the budget. We cut some funding to cities and towns last year, but decided not to make further cuts now because doing so would have shifted costs to local property taxpayers. Similarly, we worked to keep a very basic state safety net in place in order to prevent shifting these burdens to cities and towns.Finally, we wanted to avoid anything that would stall economic growth, rejecting calls for new taxes on businesses.But as reporters and editorial writers have noted, everything else was fair game.We also tried to think creatively, and I think we found some innovative ways of closing the shortfall while still honoring our commitments to invest in the future.We’re going to maintain our commitment to helping businesses and homeowners improve their energy efficiency, but we figured out a way to draw on federal stimulus funds to do this so we can use current cash in the Regional Greenhouse Gas Initiative account to reimburse the state for what it expended in setting up the program.We will draw down uncommitted funds from the Land and Community Heritage Investment Program, but in the interim we will aim to provide an equal value of state-owned land for conservation purposes to communities seeking to preserve open space.We worked with public employees to create a retirement health benefit that doesn’t cost the state or municipalities anything, but allows employees to pay tax-free into a health fund they can later draw down in retirement.We know that everyone won’t agree with the decisions we made – and in some cases, it’s clear that political opponents will try to take advantage of the discontent. I remain convinced, though, that our insistence on balancing the budget while continuing to invest in education, protect essential services, keep business taxes low and avoid further downshifting to local property taxpayers, ensures all of our citizens a better future.Sen. Maggie Hassan, D-Exeter, is chair of the Senate Commerce, Labor and Consumer Protection Committee.

 

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