Peter Francese- Director of Demographic Forecast for New England Economic Partnership
Francese presented a series of statistics on long-term trends with New Hampshire's population, which will impact both tax collections and demand for services.
New Hampshire's population and household growth has slowed to about a 1/3 of the nation's growth. He says that "you can not possibly expand revenues fast enough to keep up with the exploding growth of the elderly population."
Working age population ages 30-44 is down 14%, while age 55 plus is up 30% between 2000 and 2008.
New Hampshire is now the 4th oldest state in the nation, with the 3rd most rapidly aging population. Over the past eight years, New Hampshire has gained more 65+ residents than any other New England state. He says New Hampshire tax structure provides powerful incentives to retire in the Granite State.
Francese passionately argued that current policy discriminates against young people, and that local policy makers discourage workforce housing for fear it will add to their school budgets, but that cities like Portsmouth approve age-restricted housing under the belief that older homeowners don't demand local services. He says these incentives simply drive the median age ever higher.
"Your property taxes are not your children's' fault."
He says the implications of New Hampshire tax policy is to favor elderly residents with affordable 55+ housing and increasingly generous property tax abatements. Meanwhile, the number of families with children and school enrollment are declining, but property taxes keep rising.
Francese says that other New England states have tried to lower property taxes with broad based personal taxes and casino gambling to no avail, except to increase out-migration. He argues that continuing to provide generous property tax abatements to senior, while raising property taxes on working families, will continue to drive younger workers out of state.
"The problem is not that we have a problem with our tax structure. We have a problem with our government structure."
Francese says New England's reliance on town governments to fund schools increases administrative overhead, and the similar structure leads to duplicate costs for police and fire services. He says the "only possible solution" is to consolidate town functions to the county level. When he gave similar advice in Massachusetts, he was told that "regionalization" was a four-letter word.
Francese says the best revenue source for New Hampshire state government is to bar towns from building cheap age-restricted housing, and force the smallest towns to consolidate highway, police, fire, and school departments. He says the overall savings in property taxes would fund other functions of state government.