January 13, 2014 

     Welcome to 2014, and along with that we want to welcome you to our 2014 installment of "The Advocate!"  For those who have been members of our Chamber for a while, you already know what this eblast is all about. For those who have joined our Chamber in the past eight months, this is a weekly eblast we send out to provide you a comprehensive update of what is happening in our State Legislature up in Concord, and how it impacts your ability to do business in New Hampshire.  We send this out in January through June, which is when our Legislature is actually in session.  We typically send this out on Friday afternoons, but chose today for this first update so that we could properly introduce it to you and so that we could provide you a recap of a special political event our Chamber held this past Friday.  


     We hope you'll each enjoy receiving these weekly updates!  Your feedback and questions relating to these updates are always welcome, and you can share those comments and questions by emailing our Chamber president at cwilliams@nashuachamber.com.  

    This update is brought to you in partnership with Devine, Millimet & Branch.

Your Help Is Needed! 

We're interested in what you think about a potential gas tax increase.  Our Chamber is considering whether or not to take a formal and public position on this issue, and we need your input as part of our due diligence.  Please click on the following link, and complete this easy survey.  It's only six questions, and won't take much time at all!


Survey:  https://www.surveymonkey.com/s/NashuaChamberGasTaxSurvey 


Recap of our 2014 Chamber Legislative Symposium

This past Friday, the Chamber presented its 2014 legislative symposium.  This annual event is an opportunity for local House and Senate members to hear from key players on some of the most pressing issues of the upcoming year, before the legislative session gets too far underway.  The event is special to our regional legislators because it allows them an opportunity outside "the Concord bubble" to receive a neutral overview of these issues, which in turn allows them to make more educated votes as these issues come before them for votes later in the session.  For this year's Symposium, we covered three topics which undoubtedly will be the ones you will be hearing much more about over the next six months:  Medicaid expansion, an increase in the Gas Tax, and the potential divestiture of PSNH generation assets. 


View the presentation slides here, or read on for more information. 


Medicaid Expansion

We were happy to welcome as our three presenters on the topic of Medicaid expansion Mr. Steve Norton of the NH Center for Public Policy Studies, Mr. Charlie Arlinghaus of the Josiah Bartlett Center, and Mr. Tom Wilhelmsen, the CEO of Southern NH Health Systems.  


Steve noted that the House and Senate had come very close to an agreement on Medicaid expansion this past fall during a special legislative session.  Majorities in both the House and Senate have come out in support of the concept of using Medicaid to fund healthcare coverage for people with incomes up to 138% of federal poverty limits.  The House and Senate majorities also agreed on the concept of using the Medicaid money to provide funding for the purchase of private healthcare insurance for these individuals.  The expansion issue ran upon the rocks, however, over the timing of when such expansion efforts would actually occur.  The Senate majority was pushing for a one-year deadline within which the federal Centers for Medicaid Services would have to issue its approval of the New Hampshire proposal, or else the expansion law would expire.  The House majority sought a longer timeframe for this approval and implementation.


Charlie Arlinghaus, who as a member of the Medicaid Expansion Commission voted last year against expansion, said that, in the states where expansion has taken place, the data does not show any significant impact on the numbers of people who are insured.  Charlie acknowledged that he was shocked that an agreement was not reached last November, since the House and Senate proposals were so similar.  He thinks that a compromise is possible this year.  


A local flavor to the issue was presented by Tom Wilhelmsen, who said that "we are at a critical crossroads in healthcare delivery in New Hampshire."  To put things into perspective, Southern New Hampshire has paid $25 million in the Medicaid Enhancement Tax since 2012, but has only received back $3.1 million in disproportionate share payments from the State (before the MET tax was revamped a couple of years ago, hospital MET payments and the DSH payments essentially offset each other).  As a result, Tom said it is essential that Medicaid expansion take place.  As he put it, "we have to expand coverage or suffer the consequences."  

Gas Tax

From the frying pan and into the fire, the Symposium next proceeded onto another one of the significant crises facing the state:  the status of the state's road and bridge infrastructure. NH DOT Commissioner Chris Clement told the audience that his department is facing tremendous revenue challenges.  In one of the colorful images which Commissioner Clement likes to use, he said that the total road mileage in New Hampshire, if stretched end to end, would reach from Concord to Anchorage, Alaska.  Within that total stretch, the New Hampshire roadways that are currently classified as being in "poor condition" would stretch all the way from Concord to Fargo, North Dakota.  New Hampshire roads representing the mileage from Fargo to the Yukon would be considered in "fair condition," and the final stretch from Yukon to Anchorage would be the only part of the trip that would constitute roads that currently are in "good condition."


Nashua's own Representative David Campbell, the Chair of the House Public Works Committee, summarized the existing situation as "catastrophic."  The gas tax has not been increased since 1992.  During that same period, however, inflation has been extreme.  For instance, it takes 64% more funds to pay for the paving of one mile of road than was the case in 1992.  The cost of asphalt has increased by over 400%.  Representative Campbell said that, however the money is raised, it must be done, because the state of our roads and bridges is a critical factor with respect to New Hampshire's economy, jobs and tourism.


Charlie Arlinghaus also spoke during this part of the afternoon's agenda.  Interestingly, as the head of the premier conservative think-tank in the state, Charlie said that he was taking no position this year for, or against, the gas tax.  His conclusion:  the State needs more revenue to undertake necessary repairs and construction related to our highway and bridge infrastructure.  However the State raises the money, Charlie said, it must do so without resorting to the financial gimmicks and one-time tools it has typically resorted to in past years.


Among the other issues which came up during the course of the discussions:


  • A tax on "vehicle miles traveled" rather than on the purchase of gasoline might be necessary in the future in order to ensure that alternative fuel vehicles pay their share for the use of the roads.  
  • A significant portion of highway fund money goes to pay for state troopers rather than for road maintenance and construction (a use of highway fund money which is permitted under the State Constitution).  Although at first blush it might look like it makes sense to dedicate 100% of highway funds to roads and bridges rather than diverting some of it to state police, that only begs the question of how the State would make up for that lost revenue currently supporting state police & safety operations.   
  • Could sections of I-93 be turned into toll roads?  While that is theoretically possible, in the eyes of Commissioner Clement and Representative Campbell that would be politically untenable because of the image it would set for the state.  

PSNH Divestiture

     Also at Friday's Symposium, we were pleased to welcome new PSNH CEO Bill Quinlan, who just arrived in New Hampshire two months ago. Bill spoke to the audience about fuel diversity. Natural gas has become a significant fuel source, but there is a high cost for natural gas delivery in New England (for instance, New England natural gas delivery costs are eight times higher than in New York). This has led to huge volatility in natural gas costs, and overdependence on natural gas would be a problem. In Bill's view, the PSNH generation assets are an important backstop that other states do not have, and those assets create stability through the diversity of energy sources available to NH. In particular, Bill noted that projects like Northern Pass (which would bring 1,200 megawatts of hydropower into the New England power grid), are game-changers because they offset the generation that is being lost through the retirement of other electric generators in New England.

     An opposing view was presented by Mr. Dan Allegretti of Constellation Energy, a competitive energy supplier. Dan said that it makes sense to take advantage of the least expensive energy available, which is natural gas. He also disputed the idea that PSNH generation assets are a necessary backstop; other utilities, for instance, outsource their backstop services. He questioned whether it was better for the utility company to own plants or to use outsource contracts for those purposes.

     All in all, it was an extremely fast-paced and stimulating afternoon of discussions. Thanks to all of our speakers and to all of our dedicated Nashua-area legislators who took five(!) hours out of their Friday afternoon to talk about these critical issues.
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Greater Nashua Chamber of Commerce | (603) 881-8333 | icullinan@nashuachamber.com | http://www.nashuachamber.com
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