The NH Senate has passed their state budget. This budget was passed down straight party lines. It is extremely disappointing to see where the priorities of our Republican Senators lie; tax cuts for businesses that will result in a large loss of revenues to the state that could have been put toward vital human services. Many Granite State children and their families continue to struggle with stagnant wages, the high cost of housing and child care, and inadequate nutrition. Putting corporations before people just doesn’t make sense.
A very important program that was not included in the budget was the reauthorization of the bipartisan New Hampshire Health Protection Program (NHHPP) formerly known as Medicaid Expansion, which currently covers more than 40,000 low-income Granite Staters. The 2014 law authorizing the NHHPP required it to be reauthorized by April 2016. The reasoning for this was to ensure that the program would work and people would take advantage of it.
The good news is that it is working and it is exceeding expectations! The New Hampshire Hospital Association has reported that emergency room visits by uninsured patients are down by over 20 percent. The hospitals have also reported significant decreases in uncompensated care. On top of that the program is bringing in millions of dollars to the state.
Beginning in 2016, the NHHPP will move those covered into the commercial insurance market, meaning they will get their coverage through private managed care companies. The funds needed to ensure a smooth transition need to be in place.
Governor Maggie Hassan had this to say about reauthorization of the program, “Reauthorizing this bipartisan program beyond the end of 2016 is critical for the health of our people and our economy, as uncertainty about the continuation of the program could lead to rising rates for all consumers. Uncertainty about the program’s future could also cause insurers to decide not to offer coverage in New Hampshire in 2017. We must work together to find a bipartisan path forward.”
If the NH Senate Republicans want to make New Hampshire a more attractive place for businesses then what could be better than having a health care program in place that will keep their workers healthy and productive? Draining needed revenues out of the state coffers to give to a majority of multi-national corporations is just wrong.
We urge you to call your state legislators and tell them, “Put Granite State children and their families first.”
GROWING UP GRANITE
From our friends at the NH Fiscal Policy Institute:
New Tax Cut Estimates Push Senate Budget Out of Balance
A new analysis from the Department of Revenue Administration (DRA) finds that the business tax cuts included in the version of the FY 2016-2017 budget that the Senate will consider today would result in a more sizable and more rapid loss of revenue than previously anticipated.
The analysis also suggests that the lion’s share of the tax reduction would accrue to a relatively small number of corporations operating in New Hampshire.
The version of the budget approved by the Senate Finance Committee last week would reduce the rate of the business profits tax (BPT) from 8.5 percent to 7.9 percent by the end of 2019 and drop the rate of the business enterprise tax (BET) from 0.75 percent to 0.675 percent over the same span. Members of the Committee assumed that these phased-in reductions would not have any impact on state revenue collections in FY 2016, but would lower such collections by $14 million in FY 2017. However, in a letter to Governor Maggie Hassan on June 2, DRA Commissioner John Beardmore notes that, given the proposed effective dates for the rate reductions, there would, in fact, be an impact in FY 2016 – a loss of $3.8 million. This effect, as Commissioner Beardmore observes, “is the result of adjustments that are likely to occur with the first two business tax estimate payments for Tax Year 2016, which are due in FY16.” In the same letter, he estimates a FY17 revenue loss of $19.4 million arising from the reductions to the BPT and BET. In other words, with these latest estimates, the Senate Finance Committee’s version of the budget, in order to maintain balance and still reduce business tax rates, must either reduce spending by an additional $9 million over the course of FY 2016-2017 or carry forward another $9 million in surplus from FY15 into the next biennium, over and above the $34 million surplus on which it already relies.
Finally, data accompanying the Commissioner’s letter indicate that there were fewer than 700 business entities with either a BPT or a BET liability in excess of $1 million in tax year 2012. These entities, in turn, represent approximately 1 percent of all businesses filing tax returns that year. DRA estimates that roughly $13.8 million of the $23.1 million tax cut the Finance Committee’s budget would produce in FY2016-2017 would accrue to these very large taxpayers. In other words, these very large businesses would receive close to three out of every five dollars flowing out of the budget in tax cuts over the next two years.