NH State Budget Deal Struck

New Hampshire House and Senate members have sealed the deal on a new state budget, a $10.7 billion two-year package that begins in 11 days. It does not include Medicaid expansion, but it does spell out steps to achieve it later this year, legislative leaders said.

Lawmakers also struck a compromise on the capital budget, which spells out millions of dollars in infrastructure improvements across New Hampshire, including $38 million for a new women's prison. Like the state budget, the Legislature will vote on it Wednesday.

The new fiscal year, FY 2014, begins July 1. New Hampshire operates on a two-year budget cycle.

Gov. Maggie Hassan praised the budget pact as a bipartisan compromise. She said she remains convinced that, after a study of Medicaid expansion is concluded within four months, that the state will embrace it and expand coverage for thousands of Granite Staters in need. An excerpt from her statement Thursday:

"This bipartisan, fiscally responsible balanced budget agreement represents true and meaningful progress on the priorities that matter to the people of New Hampshire and that are critical for creating good jobs and building a more innovative economic future.

By restoring investments in priorities such as higher education, mental health, economic development, public safety and more, this bipartisan agreement will keep our state moving forward by encouraging innovation and maintaining the health and well-being of our families and communities. ...

While I believe we could move forward now with accepting the $2.5 billion in federal funds for Medicaid expansion, I respect the Senate’s desire to study a New Hampshire-specific model and appreciate its willingness to do so in a timely way. ... I am confident that once members of the Legislature see the results of the study, they will want to move forward as quickly as possible through a special session. Because, as both Democratic and Republican Governors across the country have found, Medicaid expansion is absolutely critical to the health and financial well-being of our citizens, and every day that New Hampshire delays after January 1^st will cost us $1 million a day in federal funds.”

Senate President Peter Bragdon (R-Milford) statement on the budget deal:

"I am grateful the House agreed with the Senate on a number of important priorities. The budget agreement reached early this morning is reasonable and responsible. Most of all, it strikes the right balance between what our citizens need and what the state can truly afford. The new budget supports higher education, provides for our most vulnerable citizens and promotes economic development.  All this was accomplished by not raising taxes or fees and by using responsible revenue estimates to live within our means.

Budget negotiations are never easy or simple. Regardless, we still have the responsibility to get things done on time and in a civil way, because that’s what the citizens of New Hampshire expect of us.  I applaud the House and Senate members who participated in the negotiations and recognize all of the extra time and effort they put forth in reaching a new spending plan for the next two years."

House Speaker Terie Norelli (D-Portsmouth) said the budget accord would begin to meet many New Hampshire priorities. She also expressed hope that the study contained in the House-Senate agreement would lead the state to a timely expansion of Medicaid.

"The budget agreement reached early this morning goes a long way toward restoring the investments in our citizens, communities and state.  With restoration of funding for higher education, our mental health system, domestic violence programs, uncompensated care and fully funding great programs like CHINS and LCHIP there is a great deal for us to be proud of in this budget.

We fought to reduce the the Back of the Budget cuts to state employees and to provide the Governor and department heads with management discretion to make intelligent cuts.  We were able to get the cut reduced significantly along with including the approval of the new state employee contract which provides for the first pay raises in five years and significant savings in health care costs.

After numerous proposals and counter-proposals, we were able to agree on terms for a commission to develop a New Hampshire model for Medicaid Expansion.  We continue to believe that expansion is without a doubt in the best interests of the state.  It will provide needed health care to tens of thousands of hardworking Granite Staters, improving their lives and strengthening their communities.  It will also bring a tremendous financial boost to our state including hundreds of jobs."

Senate Minority Leader Sylvia Larsen (D-Concord) had this to say:

"Senate Democrats have worked to protect many of the good initiatives of this budget — restoring education funding, Children in Need of Services, and mental health services, and creating a clear path toward accepting $2.5 billion in federal funds to extend Medicaid coverage to 58,000 people in our state. 

There are also some things that Senate Democrats could not reverse that we will continue to work on next session.  At the end of the day, this is a compromise, and the very fact that we can reach one is a good thing. It shows that together with the leadership of Governor Hassan, in New Hampshire we can still work together, find common ground, and make progress on important issues."

House Republican Leader Gene Chandler (R-Bartlett) statement:

"We believe the Senate budget proposal was the best option for the state. The committee of conference process is about compromise and we’re happy our Democrat colleagues in House agreed with the majority of the Senate proposal. The Senate did a fantastic job fighting to keep our state government on a sustainable course and adopting what House Republicans fought for throughout the budget process.

We are also happy to see that this budget allows for funding to our state’s valuable charter schools while lessening the impact of downshifting to the counties and creating no new taxes or fees. This budget also continues the business tax reforms passed last year but suspended in the House version of the budget. New Hampshire’s taxpayers deserve an honest and transparent budget that promotes an efficient and accountable government that is built on realistic revenue estimates. I’m confident this budget leads us in that direction.

Medicaid expansion is a serious matter that deserves a full comprehensive study an fair up or down vote of the full legislature separate from the state budget. I'm glad we've been able to maintain the Senate's position to study before we consider implementation. Although the timeline is tight, we will know more through this study process and our legislators can make a truly informed vote on this stand alone issue. It’s only fair we give this policy the same scrutiny as any other major piece of legislation."

Rep. Neal Kurk (R-Weare), Ranking Republican on the House Finance Committee offered the following:

"The committee of conference report on HB 1 and 2 is one fiscal conservatives can support. Largely following the Senate versions of the two bills, the budget is balanced using reasonable revenue estimates without new or increased taxes or fees. Compared to the current biennial budget, it represents a 2.8% increase in general fund spending and a 6.5% increase in total spending."

_____________________

An earlier story follows...

Deal or no deal? New Hampshire legislators worked into the wee hours of Thursday to negotiate a tentative compromise on a $10.7 billion state budget for 2014-2015, but Medicaid expansion appears to remain elusive – at least when fiscal year 2014 begins in 11 days.

House Speaker Terie Norelli (D-Portsmouth) and Gov. Maggie Hassan (D-Exeter) support Medicaid expansion to capture $2.5 billion in federal funding. Under the expansion, which is part of the Affordable Care Act, the state would receive 100 percent funding for three years, then 90 percent thereafter. The state can choose to opt-out after that, supporters note.

Senate President Peter Bragdon (R-Milford) led the charge in scuttling a bill for Medicaid expansion in the Senate, questioning the federal obligations and strings attached. The Republican-led Senate, along party lines, pushed for a study of Medicaid expansion. Now, as the House and Senate leaders are moving toward a compromise, there could be a study commission on the issue, with a goal of expanding Medicaid by Jan. 1, 2014.

Norelli said Medicaid expansion would be good for thousands of Granite Staters, and good for the economy. She said earlier this week, "As we work to find the best possible outcome for the state of New Hampshire, this counter proposal continues the dialogue and addresses many of the concerns of our colleagues in the Senate. We disagree with their assessment that there hasn’t been enough study on this issue.  The House and numerous outside organizations have spent a great deal of time considering the impacts of Medicaid Expansion and the tremendous long term benefits for the state and citizens."

Readers have been vocal in support or opposition to Medicaid expansion. Steve Morgan and Rick Katzenberg, in a blog post this week on Amherst Patch, wrote that the federal government has given written assurances that New Hampshire can opt-out, should the federal government not fund expansion as promised. They also noted that Arizona Gov. Jan Brewer, no friend of "Obamacare," held fast and accepted Medicaid expansion. In New Hampshire, Morgan and Katzenberg wrote, the expansion means $422 million in this biennial budget, as well as an estimated 5,000 jobs over seven years.

Rep. Pamela Tucker (R-Greenland) has urged lawmakers to block Medicaid expansion in order to save taxpayers money, as she questioned the federal government living up to its promises. Like Bragdon, Tucker, the co-chair of the House Republican Alliance, said the federal government had failed to live up to its promise to fund special education.

The House and Senate have set today as the deadline to wrap up work on the budget – and any other pending legislation. The committee of conference reports will be voted on by the full chambers next week, according to the legislative schedule.