Counties brace for millions in cuts in state funding
County officials are worried about a potential $8 million cut in funding in the House’s proposed two-year state budget.
The cut comes from the House budget proposal increasing the level counties would have to spend on long-term care before using general funds to soften the expense. But the cap increase isn’t the only change in the budget making county officials wary.
The proposal approved by the House also counts as general fund revenue a portion of money raised in a per-bed nursing home tax and federal matching dollars, when the money has historically gone back to nursing homes to compensate for Medicaid reimbursement shortfalls.
Future costs and the impact of the state budget are difficult to forecast, said Betsy Miller, executive director of the New Hampshire Association of Counties. Her group provided estimates showing the House budget could cost counties between $1.7 million and $3 million in the first year and between $4.8 million and $8 million the second, in addition to 2013 spending levels.
Together, the two parts of the budget proposal translate into a possible $972,000 increased liability for Merrimack County in the next fiscal year and an additional $625,000 the year after, according to the association.
In the first year of the House’s budget, the cap on county long-term care spending increases $3 million, to $110 million; in the second year, it increases to $115 million. Historically, the cap increased $1 million or $2 million each year.
In her budget presented to the House in February, Gov. Maggie Hassan proposed pushing the cap higher, to $112 million in the first year and $117 million the second.
“The expectation was we would see what we consider a reasonable increase based on some sort of inflation rate, which is how it happened over the past 10 years. If it had been $1 (million) or $2 million we wouldn’t have been surprised,” Miller said. “It’s really the second year, that was a shocker. We didn’t think there was any rational basis for that.”
Pamela Walsh, Hassan’s chief of staff, said the figures came from the original 2007 law dividing up funding responsibilities between the state and the counties and establishing the cap on county liabilities.
“The budget we presented is about focusing on rebuilding and reinvesting in certain areas of the state, including education, long-term care, school building aid. We had to make a lot of tough choices, and one of the choices we made was abiding by the law on the split of expenses between the state and the counties,” she said.
Rep. Neal Kurk of Weare attempted to amend the budget on the House floor Wednesday, suggesting the caps be set at $109 million each of the coming two years. That amendment was defeated, 195-171.
Speaking Tuesday, Kurk said, “anyone who votes against this is voting to raise local property taxes. It all comes out of our same checkbook.”
Seven of the 10 counties, including Merrimack County, have already passed their budgets for the 2013 fiscal year (the county’s fiscal year began Jan. 1; the state’s begins July 1), and could have to convene their delegations for permission to raise more in taxes than previously expected.
Miller said the association is holding a meeting today and will bring its concerns to the Senate, which begins considering the budget next week.
(Sarah Palermo can be reached at 369-3322 or
firstname.lastname@example.org or on Twitter @SPalermoNews.)