As we approach the final days of the holiday season, most of us are trying to focus on last-minute shopping, baking, holiday parties and arrangements to visit with relatives. But just like an ill-timed snowstorm that throws off carefully arranged travel plans, there is a December Grinch that always shows up with a gift at the wrong time. That unwelcomed gift would be the local property tax bill.
While property taxes in New Hampshire have long been a problem, the increases in recent years have made this December gift even more difficult to accept. People who see their taxes going up while services remain stagnant are left wondering, “What the heck am I paying for?”
In New Hampshire, funding for schools and local government comes primarily from two sources: state aid and the property tax. When state aid is reduced, or not maintained at a level to match living expenses, the only way for municipalities to maintain obligations is to increase the property tax.
This scenario has played out in recent years, as Republican budget writers have cut state aid to municipalities and turned back federal funds in the name of reducing the overall tax burden. While this approach gives them a good talking point come election time, in reality all it does is downshift obligations from the state to local taxpayers.
Municipal taxes are borne exclusively by property owners, whereas state taxes assess moneys from businesses and out-of-staters. This approach by Republican budget writers actually increases the tax burden on their local constituents.
A prime example of this misguided approach came in the 2011 budget, enacted into law over the objection of former Gov. John Lynch. Lawmakers that year eliminated the state’s contribution to retirement costs for municipal employees in the name of “cutting spending” at the state level.
These cuts left municipalities, forced to meet contractual obligations, with no choice but to make up the difference, up to millions of dollars annually, with higher property taxes.
Budget writers have taken this approach with increased frequency in recent years, and what’s most troubling is that the newly elected Republican majority doesn’t seem to view rising local tax rates as a problem.
In numerous public statements since winning the Nov. 8 election, Gov.-elect Chris Sununu and Republican leaders in the Legislature have indicated that their focus this term will be on enacting new restrictions on voting, abolishing the permit requirement to carry a concealed weapon and going after labor unions with “right to work” legislation.
Those were not the concerns that my colleagues, both Democrats and Republicans, heard while out on the campaign trail this fall. We will make sure our Republican colleagues understand that they are downshifting state fiscal responsibilities to local property taxpayers.
(Rep. Steve Shurtleff is the Democratic leader in the New Hampshire House of Representatives.)