Businesses seem pleased with 2014 Legislature

‘I wish all of the sessions could be like this,’ says one lobbyist

June 13, 2014

Bob Sanders,

This was the year when the New Hampshire Legislature actually did something – a lot of things, actually – and it wasn’t harm, as far as the business community is concerned.

Lawmakers tackled some major problems, as well as a few minor ones, with less of the ideological rancor of years past, and there wasn’t much for business organizations and lobbyists to complain about.

“It was a fairly quiet session,” said David Juvet, senior vice president of the Business and Industry of New Hampshire. “There were a few accomplishments. No unusual harm or damages. I wish all of the sessions could be like this.”

The few accomplishments? There’s a Medicaid Enhancement Tax whose revenues actually go to health care while settling a lawsuit that would have left a huge hole in the state budget. There’s a road toll (or gas tax, those who breathe outside the State House) that actually is used to build and repair roads – especially Interstate 93 – in a realistic 10-year plan. And a Site Evaluation Committee that actually has a staff and a process to evaluate new energy projects.

And don’t forget – because it happened so early in the session — the Legislature expanded Medicaid, injecting hundreds of millions of federal dollars into the health care system to pulse – pardon the metaphor – though the veins of the state economy.

Among the host of minor accomplishments for business: cracking down on patent trolls, fixing a noncompete employment agreement law and passing an acceptable pay equity act while killing a minimum wage hike.

There were complaints, of course, and a few disappointments, but overall “we were fairly pleased,” said Chris Williams, president of the Greater Nashua Chamber of Commerce. “It was friendly toward business compared to other years. I give it an A minus.”

Health care

For hospitals, which have been staggering over the last couple of years under federal and state cutbacks, the resolution of the Medicaid Enhancement Tax settlement was a huge relief. At least for 25 of them. (St. Joseph Hospital of Nashua has opted for pursuing its lawsuit against the state over the MET.)

Hospitals have always paid the MET, of course, but got Disproportionate Share Hospital (DSH) payments back to pay for uncompensated care. The state used to get a cut too – under a complicated arrangement known as "Mediscam" – but when it could no longer do that, it started using the MET tax to fill its own plate, with nothing left over for the hospital DSH.

“When we didn’t receive those DSH payments for two years, that was a disaster,” said Leslie Melby, vice president of state government relations for the New Hampshire Hospital Association. “That was catastrophic. There were more than a thousand layoffs.”

Under the compromise, the hospitals may still end up with a net MET payment, at least at first, since the tax is gradually reduced. In 2016, said Melby, the hospitals project that they will pay $220.5 million and get back somewhere between $175 million and $224 million in DSH payments.

And, according to the agreement, that surplus is supposed to go toward medical costs.

DSH payments will go down along with the tax, but so should uncompensated care now that more patients will be insured, thanks to the Affordable Care Act and the expansion of Medicaid.

“When you have a predictable source of revenue going forward, the hospitals will be able to meet the needs of the community in a more reliable way,” Melby said.

Not everybody was happy about the Medicaid expansion, which might save the state money in the short run, but will result in larger bills in the future, say opponents. But most business groups supported it.

There was other health care legislation as well. Two bills were passed in reaction to the situation at Exeter Hospital where a drug addict who was a lab technician infected dozens of patients with hepatitis B, but the laws weren’t the overreaction that they could have been. House Bill 597 would require that hospitals come up with a drug-testing policy, but would not – as it did in original form – require mandatory testing.

“It includes drug testing when there is a reasonable suspicion,” said Melby.

Blanket testing requirements would be a waste of time, he said. “Different tests tell you different things depending on what you are looking for.”

Network adequacy under the ACA was addressed, though it should be less of an issue next year, when five insurers will be on New Hampshire’s exchange, as opposed to last year when the sole insurer – Anthem – left holes in its coverage area.

While bills mandating that insurers negotiate with hospitals failed, the Insurance Department now has to hold hearings on coverage plans before approving them.

Under Senate Bill 229, privacy restrictions also were loosened up a bit, allowing more professions – such as licensed nurse practitioners and manage care providers – to see private medical information for such things as care coordination.

“That could mean money savings,” said Janet Monahan, a lobbyist with the New Hampshire Medical Society.

Construction and real estate

For years, the state of New Hampshire’s highway fund seemed to be only of interest to contractors, but as the state continued to get bad marks for its deteriorating infrastructure, upgrading it has become more of concern to the entire business community.

“Businesses need to transport goods and services and it’s important to the tourist industry,” summed up the BIA’s Juvet.

Backers were satisfied that SB 372 would use all of the $33 million in annual increased funding for roads and bridge construction, and not be diverted for other uses.

“We lobbied fairly aggressively for it,” said Will Stewart, newly named president of the Greater Manchester Chamber of Commerce.

Not all businesses were happy with the gas tax. The trucking industry opposed it, and convenience store owners have always been against state tax increases that could hurt cross-border sales.

But, said Gary Abbott, executive vice president of Associated General Contractors of New Hampshire, “we still will have the lowest gas tax in New England.”

Abbott is also happy with the 10-year plan, which he called a “very realistic, bought-and-paid-for plan compared to other years. It’s a great tool for contractors and for planning purposes.”

Commercial contractors, however, were disappointed that a bill inventorying the need for school buildings morphed into one that pertains only to school security. The state’s school building moratorium was lifted last session, but most of the money has gone to pay off old debt. Now that there might be money available, it would be nice that it could be quickly put to use, Abbott said.

Homebuilders were happy to beat back another attempt to water down the law mandating that communities plan for affordable housing, and there were a few minor improvements as well.

SB 393 makes it easier to develop the state’s surplus lands, as well enabling the New Hampshire Housing Finance Authority’s low-income homeowner program to be used for rehabilitation.

Energy

There were a slew of energy-related bills this session, but the most important one flew mostly under the media’s radar screen.

“This is the big one,” said Michael Licata, the BIA’s vice president of public policy.

“It’s the most significant energy bill of the year,” said Jim Monahan, who represents the New England Power Generators Association, though Public Service of New Hampshire lobbyist Donna Gamache said it may mean more to lobbyists then others.

“It matters to people who want to site projects and who want to oppose projects, but nobody else really cares,” she joked.

The state’s economy needs energy to grow and prosper, and a lot of the energy it relies on won’t do, either because of new environmental restrictions driving up costs, increasing regulatory insistence on renewable energy and reliability and efficiency concerns. Thus the proliferation of new energy projects, growing local environmental concerns surrounding them, and the importance of the Site Evaluation Committee in sorting this out.

But the SEC had a huge board, no staff and little legislative guidance on how it is supposed to proceed. SB 245 tries to fix this.

The bill cuts the size of the board from 15 to nine members – including, for the first time, two board members appointed by the governor to represent the public – and grabbed $500,000 from the state’s renewable energy fund to staff it. The bill also sets criteria requiring that a project has to at least weigh risks with the public interest in mind. Developers also have to present other alternatives and explain why it chosen the one before the SEC.

“When it was first introduced, it was anti-development,” said Licata, “but after it was amended, it was pretty well balanced.”

Environmentalist weren’t happy about the raid on the state’s pool of money that is supposed to help develop renewable energy, not evaluate it, but they did appreciate the staffing and added transparency.

However, the bill did not address the “biggest elephant in the room”: how the SEC will be funded in the future, said Catherine Corkery, director of the New Hampshire chapter of the Sierra Club.

“No one had the stomach to talk about an application fee,” she said. “But come on. Something like Northern Pass is not going to have a filing fee? Are you kidding me?”

Other energy bills that related to business interests:

• Lawmakers again tried to provide some kind of protection for consumers who buy prepaid fuel contracts. But they again rejected escrow accounts, although under HB 1282 solicitations can only offered from the beginning of May to end of October.

• HB 532 allows municipalities to create districts that can borrow or channel energy-efficient loans to businesses in exchange for a lien on the property. The state already has a Property Assessed Clean Energy plan for homeowners, but objections at the federal level prevented it from being implemented. This PACE program targets businesses, and its $60,000 cap was raised to 35 percent of equity, or $1 million, whichever is greater

• HB 1602, which empowers the state Public Utilities Commission to order PSNH to divest its coal-burning plant in Bow. It also instructs the SEC to come up with rules for wind plants – a bill that was scaled back to make it more acceptable to the wind industry.

Last but not least, there’s SB 268, which would allow a small portion ($1 million out of $25 million) in funds from the Regional Greenhouse Gas Initiative to be spent on a comprehensive fuel-neutral program currently run for small businesses by the Retail Association of New Hampshire as well as another for large businesses run by TRC, a Portsmouth engineering firm.

Both organizations would have to bid on the program to continue running it next year, and it would be run and bid out by the PUC’s Electric Division not the Sustainable Energy Division that awarded the original bids. Still, both TRC and the retailers said they are happy that the programs will continue in some form.

There were few disappointments this year. The narrow defeat of casino gambling was a disappointment to many business groups, including the Nashua chamber, but it was a win for others, like the Lodging and Restaurant Association.

But both groups, as well as several others, also were disappointed with the final outcome of SB 321, a bill that originally would have allowed the names of specific businesses, such as a Dunkin’ Donuts, on signs near highway exits, instead of the more generic food or fuel. In the end, the bill does allow for signs to list specific attractions, such as Verizon Wireless Arena in Manchester or the McAuliffe-Shepherd Discovery Center in Concord.

But “disappointment” was not a word uttered often by New Hampshire business groups in 2014.

Key business-related bills passed in 2014 legislative session

Bill#	Title	Notes
DEVELOPMENT AND CONSTRUCTION
SB367	requiring adjustment of the road toll (Gas Tax)*	Increases gas tax 4.2 cents, all going to road repairs and improvements.
HB2014	relative to the state 10-year transportation improvement program.	Funds I-93 and other projects that can be realistically funded by gas tax
SB223	authorizing municipalities to enter into contracts for the private funding and repayment of construction of sewer systems.*	Allows a business to pay for a sewer line, and then get paid back through the municipality if others use the line.
HB1416	establishing an economic development plan	Directs the DRED to come up an economic development operating plan
SB241	establishing the division of economic development fund.	Provides mechanism for businesses to contribute to the above planning
ENERGY
HB1282	relative to prepaid contracts for home heating fuel.	Registers home heating companies and prohibits them from soliciting pre paid contracts before May or after October.
HB532	relative to energy efficiency and clean energy districts	Expands energy saving loans up to $1 million to businesses. Private financing will be channeled through municipally created districts, secured by liens in the property.
SB268	relative to funding for certain energy efficiency programs	Allows RGGI to fund to continue to fund two fuel neutral energy efficiency grant programs to businesses.
SB324	relative to the assessment of public utilities and other entities to fund the PUC	Reduces fees to phone companies, increase it for electric utilities, and starts assessing energy suppliers and aggregators as well
SB245	relative to the siting of energy facilities.	Reduces Siting Evaluation Committee to nine, includes public members, gives it staff, requires pre-application hearings, and a ruling that project is in public interest
HB1602	relative to the divestiture of PSNH assets.	Empowers PUC to order PSNH divest bow power plant and other generating assets. Gives guidance for new rules on siting windmills acceptable to developers
HEALTH CARE
SB413	relative to access to health insurance coverage. (Medicaid expansion) *	Expands Medicaid by using federal funds to buy health care coverage under the ACA exchange or to provide coverage though the state’s Medicaid managed care program.
SB369	relative to the Medicaid enhancement tax	Gradually reduces the MET with reimbursements to hospitals based on uncompensated care costs. Money raised would to Medicaid only.
HB658	relative to registration for medical technicians.	Registers medical technicians with access to both controlled substances and patients with access
HB597	relative to a drug-free workplace for licensed health care facilities and providers.*	Have to come up with policy, but not mandatory testing, as originally proposed.
SB229	relative to the use and disclosure of protected health information.	Allows more access to patient records –, LNP and PA, and manage care provider, care coordinator — and for more purposes, like care coordination.
SB340	requiring the insurance department to hold public information sessions	Requires state insurance department reveal ACA networks before approving them
LABOR
SB351	relative to the requirement for notice of non-compete agreements prior to the start of employment.	Allows adding noncompete clause, or keeping a prior one, when changing position in the company
HB1188	relative to paycheck equity.	prohibits employers from requiring an employee to refrain from disclosing their wages.
HB1407	relative to privacy in the workplace.	prevent employers from requiring access to both a potential or current employee’s private social media and email accounts
CORPORATE LAW
SB215	authorizing benefit corporations.	Allows companies to form corporation whose purpose includes a social benefit as well as profit
HB1439	relative to the attorney general's authority in investigating combinations and monopolies.*	Gives attorney power to investigate mergers, hire experts and charge the merging parties for the costs.
HB1631	relative to debt collection and small claims.	Ups the threshold from $7,500 to $10,000
SB303	relative to bad faith assertions of patent infringement.	Prohibits patent trolls from filing baseless lawsuits, with a private right of action for violations and enforcement by the AG’s office.