- Associated Press - Saturday, April 11, 2015

CONCORD, N.H. (AP) - After several sharp twists and turns in the New Hampshire House of Representatives, an $11.2 billion two-year state budget is now in the hands of the Senate and the upper chamber is poised to alter the proposal substantially.

Republican Sen. Jeanie Forrester, chairwoman of the budget-writing finance committee, said the Senate has three priorities this budget season:

-Uphold previous commitments, including using dedicated money for its intended purpose and protecting the state’s most vulnerable citizens.

-Add money to the rainy day fund.

-Improve the business climate, in part by reducing business taxes.



All three run counter in some way to actions taken by the House.

The Senate has until early June to pass its version of the budget before entering negotiations with the House. The next state budget will take effect July 1, unless Democratic Gov. Maggie Hassan vetoes it. Hassan had proposed an $11.5 billion, two-year spending plan, a roughly 7 percent increase from the current $10.7 billion budget.

While the House process was chaotic, the Senate has two built-in advantages: More time and a clearer revenue picture. The Senate Finance Committee is already crunching the numbers and will have the benefit of seeing revenue numbers from March and April, two major months for business taxes. That often allows the Senate to increase revenue estimates for the next budget and be able to spend more.

Even with the benefit of better revenue numbers, the Senate still faces considerable challenges.

Two lawsuit settlements and an unexpected increase in the number of children on Medicaid mean roughly $120 million in new spending that the Senate will need to find money for, Forrester said.

Senators are also looking to lower the rate of the state’s two largest business taxes. They hope the reductions will spur business growth and eventually lead to more revenues, but it could cause an immediate drop in revenue in the next budget. Business taxes for March came in below projections, although the state is above its overall revenue plan by $33 million this fiscal year. The House plan does not include business tax reductions.

The House, dealing with tight revenues and an unwillingness to raise taxes, took about $50 million from the state’s renewable energy fund and emptied the $10 million rainy day fund. Forrester and Senate President Chuck Morse have made it clear they do not support raiding dedicated funds and want to increase the rainy day fund.

Senators will also look to undo the House’s move to eliminate or reduce funding for programs for the elderly. The House budget also does not fully fund the state’s needs for people with developmental disabilities, a choice that prompted protests.

“There is a general feeling that the developmental disabilities waitlist, Meals on Wheels, those types of programs, are important and are a priority,” Forrester said.

Other elements of the House budget will remain unchanged. Morse has said the Senate will not include money for Medicaid expansion in its budget and will debate separately whether to reauthorize the program.

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