Last week, we predicted that the committee of conference on the State budget would be smooth and uneventful, and that is just how things played out. However, after the budget conferees had completed all of their substantive decisions on the budget late Wednesday night, the temperature increased exponentially when the Governor announced that she will veto the budget "if it comes to her desk as it is" (and since the House and Senate rules make it essentially impossible to make any changes in the budget once it has come out of the committee of conference, and since there are solid Republican majorities in each body, it is a virtual certainty that this budget will indeed arrive on the Governor's desk next week "as it is").
To recap, the budget committee of conference started off last Friday afternoon with an agreement by House and Senate conferees regarding the amount of revenue that would be available for the upcoming biennium. That was a key indicator that there would be smooth sailing between the Republican majority conferees on the House and Senate sides, because it meant that the discussions in the committee would be directed primarily at spending priorities rather than how much money reasonably could be spent.
Although not surprisingly it was the majority party that got its way on every vote taken by the committee, and although there were obviously many disagreements between the Republican and the Democratic conferees along the way, the tone of the committee was invariably civil and cordial. Also, while in some years budget committees of conference have proceeded in fits and starts, this one moved along with great efficiency. This was obviously because the lines of communication were strong between the two bodies, and the novel decision by Speaker Jasper to personally take part in the committee of conference proved to be a good one. Kudos to Speaker Jasper, Senate President Morse, Senate Finance Chair Jeanie Forrester, House Finance (and Committee of Conference) Chair Neal Kurk, and all the members of the committee, Democrat and Republican, who participated in the hard work of this committee and showed that legislators can disagree on fundamental issues while accomplishing their work in a respectful and professional way.
The main debates of the week centered around three questions: whether the New Hampshire Health Protection Program (Medicaid expansion) should be reauthorized at this point in time; whether the cuts to the BET and the BPT should be eliminated; and whether the budget should include a pay raise for State employees. The Democratic conferees argued for an affirmative answer to all those questions, but the Republican members had the votes and the conference committee decisions went the other way. These are the issues that probably will be at the center of the debate over the coming months.
The business tax cuts have been supported by the Chamber all the way back to the time that they were introduced as SB 1 and SB 2 in January. The Governor has stated her concern that these cuts will cost the State revenue that the State cannot afford to lose, but as Senate President Morse said in his closing remarks yesterday these tax cuts send an important message to business that we "want you to grow, add jobs, and pay your employees even more." He noted the recent Pew Center study that says that New Hampshire is the 10th worst state with respect to job creation since the recession, and he stressed the need to make sure that New Hampshire takes affirmative steps to address that problem.