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N.H. House votes against distributing flood settlement money among 14 towns

The House voted overwhelmingly yesterday not to share a $1.1 million settlement with the 14 New Hampshire communities that say they are owed money under a decades-old Merrimack River flood control compact.

According to the terms of the 1953 compact, towns along the river that gave up land for flood control are compensated annually for the lost tax revenue by the state of New Hampshire and its downstream neighbor, Massachusetts. The Bay State is required to reimburse New Hampshire 70 percent of the Merrimack compact payment.

But the funding dried up, and for the past several years, Massachusetts failed to pay its part. In turn, New Hampshire shouldered in full the payments to affected communities. But as budgets tightened, in fiscal years 2012 and 2013 the state covered only its 30 percent share of the compact payment. That meant the towns missed out on $496,777 each year Massachusetts’s portion went unpaid.

In January, the two states reached a resolution over some of the money owed. Massachusetts agreed to pay New Hampshire roughly $1.11 million under a settlement deal that absolves the Bay State’s outstanding debt through fiscal year 2012. Towns should see some of that money to make up for previous years’ losses, said Jim O’Brien, chairman of the Hopkinton Board of Selectmen.

A bill introduced and passed by the state Senate would have appropriated almost all of the settlement money to the 14 communities affected by the Merrimack compact, including Hopkinton, Henniker, Webster, Weare and Dunbarton. The remaining settlement money would be deposited in the state’s general fund.

But yesterday, the House rejected that legislation by a vote of 284-62.

During consideration of the bill, Rep. Mario Ratzki, an East Andover Democrat, said the state promised to protect the towns when the land was taken from them.

“They are counting on the state of New Hampshire to make them whole,” he said. “That promise has been kept almost 60 years, except 2012 and 2013.”

The state doesn’t have the money, said state Rep. Peter Leishman, a Peterborough Democrat on the House Finance Committee. Last week, that committee recommended on a vote of 18-2 that the full House not pass the bill. “If we make the communities whole, we would need to find almost $1 million to go back and pay,” Leishman said.

That money would mean a lot more to the communities than it would to the state, said Rep. Leigh Webb, a Democrat from Franklin, one of the towns affected by the compact.

Hopkinton, which gave up the most land under the Merrimack compact, could stand to gain about $280,000 if the bill passed, O’Brien said. The town is now home to an Army Corp. of Engineers dam along the Contoocook River that takes up roughly 4,000 acres with an assessed value of $10 million, O’Brien said.

The towns see the compact money they haven’t yet received as a deficit that they still want to collect, he said, and it’s disappointing that the bill allowing that didn’t pass.

But, it may not be the end. The Senate could still attach the defeated bill’s language to separate legislation. “I wouldn’t be surprised,” O’Brien said. The bill’s sponsor, Bedford Republican Sen. Andy Sanborn, didn’t return a call for comment.

The 14 communities affected by the compact will be paid in full for fiscal years 2014 and 2015. New Hampshire has pledged to pay both state’s shares in those years, and that sum amounts to just less than $700,000 per year, said John Beardmore, commissioner of the state’s Department of Revenue Administration.

(Allie Morris can be reached at 369-3307 or at amorris@cmonitor.com.)

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