Business groups keep an eye on Thursday’s NH House budget vote

It won’t all be about the state budget when the NH House meets on Thursday. Lawmakers will also be considering a marijuana legalization bill, a bill related to employees’ unused vacation time as well as a renewable energy bill – all which have already passed the House, but now must face another vote after the House Finance Committee weighed in.

Still, the budget is the biggie. Unlike last session, the trailer bill is not loaded with non-budgetary items, like added restrictions on abortions and so-called “divisive concepts.” There will be major policy debates on whether to increase funding to private schools via Education Freedom Accounts, but they at least are somewhat related to government spending.

One “big disappointment,” in the words of Bruce Berke – state director of the National Federation of Independent Business – is that there is unlikely to be a further cut in the business enterprise tax. If you remember, Republican lawmakers achieved their long-standing goal of cutting the business profits tax –paid mostly by large companies, many based out of state – to 7.5 percent in the last session. However, the proposal to cut the BET rate to 0.5 percent, which would mainly help out smaller businesses, was dropped and the rate remained at 0.55 percent.

This year, a bill to cut the BET was retained, along with bills eliminating the communications tax and accelerating cuts in the interest and Dividends tax.

Nevertheless, The Business & Industry Association of New Hampshire called the budget a good “first step” and urged passage. It I particularly happy that the House expanded Medicaid for two years, though they prefer the Senate position in Senate Bill 263, that would make it permanent, as much as anything can be permanent in a body that changes every two years. The Senate voted unanimously to pass its bill and the House held hearings on it Tuesday, where David Juvet submitted testimony on behalf of the BIA.

He said that if the expansion – known as the Granite Advantage Health Care Program – “is allowed to sunset at the end of this calendar year over 90,000 individuals will lose health insurance coverage,” he testified. That will mean hospitals would have to pick up the costs. “The costs associated with uncompensated care are shifted to other payers. In New Hampshire, that is primarily employers in the form of higher health insurance benefit costs.” “Beyond that,” he added, “if the Granite State Health Care Program ends in December, New Hampshire’s economy will feel the immediate loss of $1 billion every biennium moving forward as federal support for the program is taken away. It is hard to capture just how significant a negative impact this will have on our economy.”

If the budget is passed on Thursday – and that’s a big if – then both a divided House and a united Senate will try to come to a compromise in June.

The BIA and other business groups are pleased that the House has put some money into affordable housing, though it cut the governor’s $30 million InvestNH program to $15 million in its budget proposal and another $10 million from the $25 million aimed at the Affordable Housing Fund.

Still, that’s a good sign because “the House is usually where Housing bills go to die,” Juvet told NH Business Review.

The House budget actually ups the governor’s requests to increase Medicaid reimbursement rates and funding for the state university systems, two other BIA priorities.

Other bills

After the budget debate, the House will take up some other key legislation, including House Bill 74, which would require companies with over 15 employees who offer vacation time to grant it, even if they lay off the employees or sell their company. The bill squeaked by the House, 187-174, in February, but it was then refereed to the Finance Committee. Supporters said it protects employees who were terminated from a company through no fault of their own. Opponents said that this rarely happens, and opposed any additional state interference in business practices.

Similarly, HB 234 passed by 10 votes after an attempt to kill it failed by a single vote. The bill would end the practice of s0-called “sweeping” of renewable energy certificates. That means that if the consumer doesn’t use those credits by selling them, the utilities get to keep them, enabling them to meet their renewable energy goals. Proponents say this amounts to an “unconstitutional taking” and hurts the renewable energy market. Opponents said this allows utilities to save some money (about $3 million a year) that can be used to cut people’s electric bills slightly. Proponents said ending REC sweeping could actually save consumers more by lowering the peak demand.

The last bill on the agenda on Thursday is HB 639, known as “cannabis light,” since it would legalize marijuana and could be sold by private entities, though regulated and taxed by the state. The big debate here isn’t so much about legalizing it, but how much to tax it. The bill calls for a 12.5 percent tax. Opponents said it should be 15 percent. Whatever the House decides, the key test will be in the Senate, where previous marijuana bills have gone up in smoke.