Gov.-elect Hassan: I’ll give state agencies ‘conservative’ budget targets

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Gov.-elect Maggie Hassan yesterday said she’ll set “conservative targets” for agencies seeking more money in the next state budget, as she looks to roll back cuts made by the GOP-dominated Legislature last year.

“As many of you are aware, there were decisions in the previous budget that I believed were the wrong choices for New Hampshire’s future. As part of our upcoming budget, I intend to work to reverse some of those choices,” Hassan said. “But it is important for all of us to understand that we will not be able to reverse course all at once.”

Her comments came at the start of three days of public hearings this week on budget requests made by state agencies for the coming biennium, fiscal years 2014 and 2015, which begins July 1.

Hassan, an Exeter Democrat and former Senate majority leader, will submit her own state budget to the Legislature by Feb. 15.

The budget requests submitted by agency heads total nearly $12 billion in spending over two years across all state funds, a 19 percent increase from the current biennium. The largest state agency, the Department of Health and Human Services, requested $4.9 billion over two years, a 29.2 percent increase.

That’s not likely to happen.

“Those requests total far more than our taxpayers and our economy can afford,” Hassan said.

Instead, she said, she plans to send agencies “conservative targets, reflecting the fact that there are still many unknowns in the national economy including the possibility of the so-called fiscal cliff,” for their budgets. She didn’t specify what those targets would be.

And as pledged during the fall campaign, Hassan yesterday said she would create a panel of experts and legislators to create consensus revenue estimates, “that will ensure that we can work from a common set of facts as we develop the budget.”

As required under state law, agencies also submitted budgets that would maintain existing state services. Those “maintenance budgets” total $10.9 billion across all state funds, an 8.1 percent increase in spending over the current biennium.

Commissioners and other agency heads also submitted budgets that reduce spending by 10 percent. Sen. Chuck Morse, a Salem Republican and chairman of the Senate Finance Committee, said those budgets could offer clues for ways to make cuts as the budget process moves on.

“These alternative budgets will give Gov.-elect Hassan, and those of us in the Legislature, an idea of where those who know their departments best believe we can find savings in a difficult budget process,” Morse said in a statement.

Democrats are set to control the House in the coming legislative session, while Republicans will have a slim majority in the Senate. That’s a big change from the last two years, when Republicans held veto-proof majorities in both chambers.

The two-year budget they passed in 2011, among other things, reduced the cigarette tax by 10 cents a pack, eliminated a $30 auto-registration surcharge, slashed reimbursements to hospitals for uncompensated care and cut the University System of New Hampshire’s $100 million appropriation by 48 percent.

Hassan has said she wants to restore funding to the university system and reverse the cigarette tax cut but has offered few other specifics on the budget since her Nov. 6 election. She has indicated that revenue from a casino might be included in her budget but has ruled out any sales or income tax.

She won’t take office until January. But Gov. John Lynch, a fellow Democrat, said yesterday that he hopes for a smooth transition.

And, he said, Hassan doesn’t have an easy task ahead of her.

“Building the next budget is going to be a challenge, and I think we all recognize that,” Lynch said. “A challenge because we still face uncertain economic times, the economy remains volatile, and there’s not a lot of evidence that that volatility is going to diminish significantly. And we have the uncertainty of a number of other financial sources. . . . But I know that Gov.-elect Maggie Hassan is up to the challenge, along with her team.”

Hearings on budget submissions will continue today, from 8:30 a.m. to 4:15 p.m., and Friday morning at the Legislative Office Building in Concord.

(Ben Leubsdorf can be reached at 369-3307 or bleubsdorf@cmonitor.com or on Twitter @BenLeubsdorf.)