GOP Leaders Offer Budget Fig Leaf But Hassan Balks

After meeting with Gov. Maggie Hassan, D-Exeter, Republican House and Senate leaders have offered a fiscal 2016-2017 budget proposal that would fully fund millions in pay raises for New Hampshire state employees in an effort to end the state’s budget stalemate, something they had previously refused to do, according to statements from the leadership.

However, in a counter letter, Hassan said while she appreciated the effort, it wasn’t enough.

Senate President Chuck Morse, R-Salem, and House Speaker Shawn Jasper, R-Hudson, said leaders were making the commitment as a “compromise proposal” with the hope that Hassan will push Democrats to support a budget override vote scheduled for Sept. 16.

“We continue to be concerned by Governor Hassan’s decision to veto the responsible, balanced legislative budget for the state of New Hampshire,” Morse said, “however, we feel it is imperative to move forward and enact a FY 16-17 budget as soon as possible. Today, Senate and House Leadership made a strong offer to compromise by agreeing to fully fund the State Employee Contract.”

In a letter to Hassan, also signed by House Majority Leader Jack Flanagan, R-Brookline, and Senate Majority Leader Jeb Bradley, R-Wolfeboro, the leaders also requested “additional legislative oversight and transparency” and “an opportunity to vote on cost items in any subsequent contract.” The leaders also commended state employees as “hardworking” and agreed with the governor that they should be valued.

The state employee contact, which was approved by more than 95 percent of the members of SEA SEIU 1984 in March, includes three raises compounded that are equal to 6.12 percent during the next two years. The contract also included increase earing aid and dental coverage and purports to save the state about $10 million in healthcare costs due to other changes.

The compromise put forward by Republicans also preserved about $31 million in proposed business profits and business enterprise tax cuts that Republicans approved but Hassan and Democrats have attacked during the impasse.

Jasper stated that acceptance of the counter off would help cities and towns combat the opiate epidemic since the legislative budget includes a 75 percent funding increase for substance abuse treatment and prevention that is badly needed at a time where it is level-funded during the impasse.

“We sincerely hope the governor will accept the proposal and end the budget impasse,” Morse added.

Hassan, however, pointed to the business tax cuts and a possible $90 million hole in future revenue as a reason not to accept the counter offer.

“While I appreciate your offer to fund the state employee’s contact, and believe that is an important first step … it does not address my principal concerns with the budget,” she said. “I do not believe it is responsible for us to create problems for future Legislatures to solve.”

Hassan said the fiscal 2015 budget ended as balanced and revenues were on track to reach $41.3 million. After additional expenditures were added in, about $25 million in additional revenue will carry over into FY16. She added that cuts in the executive branch, hiring freezes, purchasing changes, and other items will also help.

The tax cuts that she vetoed, Hassan added, would go into effect in 2017 through 2020. She also noted that she had already proposed two compromises to the business tax cut issue.

“It is imperative that we get back to the table now to pass a compromise budget as soon as possible,” she stated at the end of her letter.

Updates

New Hampshire Republican State Committee Chairman Jennifer Horn today released the following statement regarding Hassan’s rejection of the Legislature’s compromise budget proposal:

“Governor Hassan’s politically-motivated rejection of the Legislature’s budget compromise is disgraceful and further prolongs the crisis caused by her veto of the state budget. Governor Hassan’s reckless actions and rigid partisanship have threatened critical state services and blocked necessary funding increases for substance abuse prevention, education and infrastructure. Instead of political posturing for her United States Senate bid, Governor Hassan should focus on working across the aisle and ending months of fiscal uncertainty caused by her irresponsible budget veto.”

SEA SEUI 1894 also offered this response:

Yesterday, GOP legislative leaders presented a counter proposal related to the state budget that included full funding for the state employees’ 2015-2017 contract. We appreciate the recognition from the legislative leaders that funding this negotiated agreement for the people who deliver essential services for the public every day is a critical piece toward passing a good budget.

The commitment of our state workers was evidenced just yesterday with the rapid response to the sinkhole on I93. Within moments, crews were on the scene assessing and ultimately repairing the 20 foot deep hole in the highway. While this story received widespread attention, there are many other events that go unnoticed every day that are addressed by state employees to insure the safety, health, and prosperity of our state.

The new contract, which includes a 4% wage increase over two years, was negotiated/bargained in good faith by both parties the union and the state.. We are thankful that our elected officials on both sides of the aisle now agree that this contract should be funded.

While there are still outstanding issues that need to be addressed in order to ensure a balanced budget meets the needs of our state, it is an encouraging step that we have proposals from both sides being exchanged and we are beginning to see common ground. We hope that further progress can be made to reach a bi-partisan budget that we can all be proud of.