Popular budget programs face cuts

Jun 8, 2010 — The Telegraph (Nashua, N.H.)

Kevin Landrigan

Jun. 8, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- CONCORD -- Popular programs for land preservation, renewable energy, community colleges, the teaching of high-cost special needs students and care for catastrophically ill patients in hospitals face cuts among the Democratic legislative leaders' final moves to pare the $300 million budget deficit.

The proposals would bump up to $60 million from what the state expects to receive by selling off or leasing valuable state assets such as a state liquor warehouse and highway rest areas.

House and Senate budget writers endorsed an earlier estimate of $50 million with neither one identifying which properties would be sold off or leased.

The final deficit compromise would increase taxes for insurance companies, canceling a final tax cut already in state law to lower the tax on premiums this fall down to 1 percent from 1.25 percent currently.

"I think we've got the outline of a deal that pretty well gets the job done or as much as we're going to be able to do," said Sen. Lou D'Allesandro, D-Manchester, who chairs the Senate Finance Committee.

House and Senate Democratic leaders, along with Gov. John Lynch, negotiated the details in small groups behind closed doors several days last week and through the weekend.

They endorsed making 17 changes that create another $40 million in budget savings or increased revenue.

If adopted, they would leave the state at the end of the two-year budget cycle with a surplus of $11.9 million, according to an analysis of legislative budget experts.

That solves Lynch's desire to bring the curtain down on the 2010 session and kick off his campaign for a historic fourth straight term in office with a plan to balance the beleaguered state budget.

House and Senate Republican leaders said they will pursue a separate bill at Wednesday's special session to repeal the unpopular dividends tax on profits from owners or investors in limited liabilities companies "Let's have a simple, one-purpose bill and keep the promise we've been making for months that this tax should be dead and gone," said House Deputy Minority Leader David Hess of Hooksett.

Proposals to erase the deficit have included the LLC tax repeal, but Hess said that's not a sure thing since House and Senate leader talks on a compromise abruptly broke off two weeks ago.

A key breakthrough to end the deficit controversy for House and Senate Democratic leaders came when D'Allesandro agreed to decouple the deficit from his demand that the bill include legalizing betting at slot machines or casino-style game tables.

D'Allesandro will ask the Legislature to pass on Wednesday a separate bill that would authorize up to 10,000 slot machines at four competitively chosen locations.

Unlike previous versions, this one does not assume immediate millions into state coffers, but what profits do come would be sent to the Rainy Day Fund.

This account for fiscal emergencies will be drained to resolve the latest budget deficit dilemma.

Many of these eleventh hour changes were not in either the budget deficit proposals that cleared the House of Representatives or the state Senate over the past two months.

For example, the system of seven community colleges across the state went through the budget deficit talk unscathed without any proposed changes.

All that changes with this new 68-page comprehensive amendment to the budget deficit debate that compels system administrators to cut administrative costs by nearly $900,000.

Community outrage over proposed cuts to the Land Conservation and Heritage Investment Program in March was so severe House budget writers were forced to rip out one proposal they had unanimously endorsed and start over on another.

But these final changes include a $1.5 million cut to LCHIP.

Likewise, neither budget bill cut grants under the Regional Greenhouse Gas Initiatives but these late-breaking additions include a $3.1 million cut for RGGI.

Hospitals that treat the most catastrophically ill students would be cut $1.7 million, and the state aid that contributes to high-cost special need students would be cut $4 million.

Spending on the judicial branch would be $1 million lower next year. Lynch wanted a $4 million cut and the Senate last month had gone along with making judicial administrators give back $2 million.

Newstex ID: KRTB-0136-45872617