New Hampshire has long relied on sales of hard alcohol at state owned stores for revenue. While other states impose hefty taxes on vodka, scotch, and rum, New Hampshire keeps prices down by simply pocketing the profit on each bottle, and barring the sale of anything harder than Pinot Noir in grocery stores.
But in an effort to boost state revenues, Liquor Commissioner Mark Bodi is floating the idea of putting Jack Daniels next to Bud Light and the Yellowtail Chardonney at your local supermarmket. Josh Rogers reports for New Hampshire Public Radio:
About 5 minutes into his testimony to state budget writers Monday, Commissioner Mark Bodi made a glancing mention to what could prove the most conspicuous shift in state alcohol marketing policy since grocers were given permission to sell wine 30 years ago.
“The commission is currently reviewing how we might expand the sales of spirits specifically through greater agency store operations. However that review continues and I’m not in position today to offer any short estimates as to what the likely revenue from any expansion of agency stores would create.”
Outside the hearing room, Commissioner Bodi continued to play things pretty close to the vest. When asked for a ballpark notion of what state might gain by putting hard liquor in grocery stores, he said millions and left it at that. Bodi did say however, that new agency stores would be tailored to meet the needs of consumers and retailers alike.
“In areas where there are strong demands, grocery stores would have a significant number of spirit offerings. In areas where there is lower demand, you would have an opportunity for a small mom-and-pop store to add a few skews of vodka and bourbon as a convenience item.”
Tom Fahey reports in the Union Leader that Governor John Lynch is giving the idea of raising New Hampshire's gas tax a lukewarm reception:
Lawmakers from both parties say the state needs to increase its gasoline tax to keep highways maintained, but Gov. John Lynch is not convinced of that yet.
Lynch said this week he hasn't changed his stance against a gas tax hike, but he left room to be persuaded it is the right move.
He said the state needed to figure out how much highway work needed to be done and how much it would cost before talking about raising revenue. He noted a federal economic stimulus package was expected to send money for highway and bridge construction to all states.
"That may be part of the overall financing package going forward," Lynch said.
His popularity ratings would make John Lynch blush. His winning streak beats Ray Burton's. He was unopposed while unanimously winning a 17th term. He's Bill Gardner, and he will be New Hampshire's Secretary of State for another two years.
The House and Senate meet in Joint Convention at the beginning of each two-year session to elect two Constitutional Officers, Secretary of State and State Treasurer. State Senators Jack Barnes (R-Raymond) and Lou D'Allesandro (D-Manchester) nominated Gardner to the post. D'Allesandro said that New Hampshire's elections are the best in the world, thanks to the work of Gardner and his staff.
Gardner was elected to the New Hampshire House in 1972, as a Democrat from Manchester. After two terms, he was elected Secretary of State by the House and Senate in 1976. As Secretary, Gardner probably oversees more elections every other year than anyone else on the planet. With 400 House Members, 24 State Senators, five Executive Councilors, a Governor, and ten full sets of County Officers, Gardner was responsible for over 1,500 candidates in the September Primary and November General election.
Gardner is also required by law to serve as defender of New Hampshire's First in the Nation Primary. The Legislature has given the Secretary of State broad power to set the date of the Primary, largely based on its confidence in Gardner. He is confident that New Hampshire will keep its First in the Nation status in 2012.
Barring a serious primary challenge to President-Elect Obama, the Democratic Party isn't likely to make waves with the nominating calendar. And the Republican National Committee amended its rules at the summer convention, cementing New Hampshire and South Carolina as the only Primaries that can be held before February 1st, 2012. Iowa, and perhaps Nevada, will hold an earlier caucus, but Gardner must only guard against elections similar to New Hampshire's, primaries that assign delegates to the national conventions.
Gardner's last act before signing nearly 500 election certificates is to administer the dozens of recounts requested each election year. This year, none of the recounts changed the results reported on election night. Years before the nation ever heard of hanging chads, Gardner moved New Hampshire away from punch card ballots. All cities and towns either count their ballots by hand, or use "Optiscan" ballots, which still require every voters to put ink on paper, and more importantly, leave a solid and traceable paper trail. Gardner says that the recounts showed a few problems at the ballot box this year, including one set of ballots that appears to have been entered into the machine twice, but that none of these errors affected the outcome of any election.
The state senate elected state Sen. Sylvia Larsen (D-Concord) for another term as senate president...
State Sen. Peter Bragdon (R-Milford) was also elected to be the Senate Republican leader. A week after the election the state senate Republican caucus nominated Bragdon to lead the caucus. Bragdon's nomination was a surprise as many observers expected state Sen. Ted Gatsas (R-Manchester) to continue serving in that role.
The senate also voted today to reappoint Tammy Wright as Senate Clerk, Robert Buchholz as Assistant Senate Clerk and Carleton "Kit" Marshall as Sergeant-at-Arms.
Okay, it's not much of a race. Terri Norelli will soon be re-elected Speaker of the House.
The Republican Caucus has nominated Minority Leader Sherm Packard.
Representative Robert Rowe (R-Amherst) is also seeking the gavel, and is making a unique case from the floor. He wants more partisanship in order to get less partisanship.
By separating the Speaker's Office from the Democratic and Republican Caucuses, Rowe says the Speaker can meet the needs of all 400 Members, and the two party caucuses can make their cases in a less confrontational fashion. Rowe would change House rules so that rather than appointing the Majority and Minority Leaders, each would be elected by their caucuses.
Currently, the Speaker selects the Majority Leader and respects the nomination of the opposing party for Minority Leader. Rowe also promises a more open process, saying that too often last term, House leadership shut off debate in Committee and stacked debate on the House floor.
UPDATE- I just spoke with Representative Rowe as the balloting is concluding. He says he had received pledges of support from several Democrats, and that if Sherm Packard hadn't placed his name in nomination, it would have been a very close race.
"I've been a moderate, consensus-builder, and I'm running because this House has changed. Hostility. Get even. I was listening to the nominating speeches, and thought I must have served in a different Legislature for the past two years," Rowe said.
Even before taking office, Barack Obama's choices give us a great example of a change we can make in New Hampshire just by following his example. But it's not a choice he made as President-elect; it's a choice he's making as a father.
Shortly after the election, Barack and Michelle Obama visited the White House. Like any good parents, decisions about their children were high on the agenda. The Obamas had to consider dozens of options to find the right choice for a school for their children. They settled on a well-known school in the District of Columbia, but only after considering quite a few options and deciding what was the right fit for their children's educational needs.
Figuring out what is best for your children is an important priority in anyone's life, but it's different for the Obamas. The Obamas are rich, and the education system most people of more modest means operate in doesn't offer the same choices the Obamas faced.
For most families in the country and in New Hampshire, the education decision is premade for them. If you live at 1600 Pennsylvania Ave., then you go to this school. No school visits, no work to find the right fit for your kids. There's one school based on your zip code.
In many cases, particularly in New Hampshire, that one geographically assigned school is a pretty good choice for most kids. But it isn't and can't be a good choice for all kids. Kids are different. Their needs are different. Their learning styles are different. Their educational achievement is different. What their parents want for them is different.
I think most of us would agree that the Obamas' experience was better. They had many choices for their kids. They could consider a variety of options and decide which school was best for their particular circumstances and their children. They did the same thing back in Chicago. They considered their options and chose a local school, but a privately run one. No one begrudges them the choice they made. Most of us admire the care they took to do what was best for their children.
They have a high family income, so they have choices. People with a low family income may have just as many educational considerations, but they have essentially no choices.
None of us would argue that the Obamas should send their kids to a school picked solely on the basis of their geography. Even if he weren't President, if they were just two professionals with kids living in that neighborhood, we would agree that the children's education would be better by considering a number of options.
That same dynamic is true of a family living in Merrimack or Dover. Assigning each child a school on the basis of which street he happens to live on is convenient, but it isn't the same as making a good choice based on the child and his needs.
There are many ways to change the system to allow more options for parents without throwing out the current system we have. In most cases, for most kids, the local neighborhood school will probably be a good choice. Wealthier parents who decide their children need something else or find a different school with a better fit can choose that option. We need to find a way to create more options for children of more limited means.
A few years ago, the Legislature considered and almost adopted a 21st century scholarship bill to increase educational choices for lower-income families. The bill would have created a fund and given scholarships to children of modest means to use at any approved school in the state. Those children and their parents would have more options, just as the Obamas do.
It doesn't have to work precisely that way. The important thing is to address the economic obstacle that creates a very different set of decisions for richer kids and poorer kids. Today, rich kids have choices; poor kids don't. Most kids, rich or poor, go to the assigned school. But in an ideal system, every parent would go through what the Obamas went through. We would consider many different options for each child and choose a school on the basis of the child, not on the basis of geography or administrative convenience. There's no reason not to make that change today in New Hampshire.
Charles M. Arlinghaus is president of the Josiah Bartlett Center for Public Policy, a free-market think tank in Concord.
The New Hampshire House and Senate are organizing themselves today, as required by the State Constitution. The House just completed its roll call of the 400 Members-Elect, and will administer the Oath of Office en masse. 390 Members-Elect answered the call.
Anyone missing the Roll Call will be sworn in before the next session they attend.
The Governor will now be summoned to the House Chamber to give the Oath. The newly-inaugurated Members will then elect their officers, including Speaker of the House, as well as the House Clerk and House Sargent at Arms. The Senate will do the same for their Members and Officers.
Once both chambers are set up, they will meet in Joint Session to choose two additional Constitutional officers, the Secretary of State and State Treasurer.
Kevin Landrigan blankets the state budget this morning, with a pair of pieces.
First, he reports on the growing shortfall in the state Highway Fund, along with the hopes for free money to start flowing from the Obama Administration:
A federal stimulus package from President-elect Barack Obama would help pay for much-delayed projects, but does little to deal with a projected, $153 million deficit facing the Department of Transportation, Commissioner George Campbell said Monday.
"A lot of people think if we get a 100 percent fully funded stimulus package that it's going to solve all our problems, but it's not,'' Campbell told a legislative commission that will soon prepare a final report on the state highway fund.
Then, Landrigan turns his attention to health care, as State Health and Human Services Commissioner Nick Toumpas says that rising health care costs will keep going up:
"A business as usual approach will not be available. We need to fundamentally examine what we do and how we do it," Toumpas said.
Spending to maintain current services from all sources (including federal grants and local property taxes) would go up 16.5 percent over the same period. The total health and human services budget would increase from $3.3 billion in the current two years to $4.4 billion in the next two. For the past several months, Toumpas has engaged in an agency-wide dialogue with stakeholders to figure out how to more efficiently deliver services.
"Our ability to tweak rates and cut on the margins is just not going to fly moving forward," Toumpas said.
Both Campbell and Toumpas are telling legislators that the structural problems in their departments goes far beyond the current economic slowdown. State budget writers have been placing far too much blame on national economic conditions, and not enough on their own choices. They will have to make far different choices this year in order to close that gap.
Despite an historically large budget deficit, New Hampshire Department heads have asked the Governor for huge increases across state government. While these wish lists don't have much to do with the budget actually proposed by the Governor or adopted by the Legislature, the University System is seeking a 9% increase next year, drawing criticism from the editorial page of the Union Leader:
Yet USNH officials displayed a tin ear by merely giving lip service to the slowing economy while asking last month for such a big increase in state aid and reiterating the plan to raise tuition by 5 percent.
USNH also boasts that its cost of attendance (tuition, fees, room and board) rose less than 6 percent a year this decade. But that is well above the rate of inflation. Each year USNH schools get a little less affordable for the average New Hampshire family.
Pat Buchanan has a knack for being as wrong on trade issues as it's possible to be. In this morning's Op-Ed, Buchanan argues that "What's good for GM is good for the GOP."
And to let the auto industry die is to write America out of much of the economic future of the planet.
In a good year, like 2005, Americans buy more than 17 million new cars, and West Europeans as many. Tens of millions in Eastern Europe, Russia, China, India and Southeast Asia are now moving into the middle class each year. These folks will all need or want one or two family cars. If we let the U.S. auto industry die, that immense and burgeoning market will be lost forever to America, and ceded to Asia.
"Who cares?" comes the free-traders' reply. Japanese and Koreans are setting up factories here. They can pick up the slack.
But that means Americans will work for and depend on foreign companies for a necessity of our national life as vital as the imported oil and gas on which our cars and trucks operate. All the profits of the mighty automobile industry in America will be sent abroad.
I'll leave the politics to others for now, though trying to outbid Democrats for the love of union workers seems like a losing strategy. The protectionist policy behind Buchanan's argument is what's really at fault. Buchanan would pump billions in taxpayer dollars in failing companies, bailing them out for the decades of bad decisions that have led to their decline. American consumers have turned away from "American" cars because they are more expensive, and less reliable, than comparable "foreign" cars. I use quotes because I have a hard times telling the difference between a Ford assembled in Mexico and a Honda made in the U.S.A. Which is more American?
If taxpayers refuse to bail out the Big Three, the U.S. auto industry won't die. It will change significantly. Ford or GM might even be bought up by a foreign company, just as Daimler did to Chrysler earlier this decade. But that new owner won't start shipping immense profits overseas. It will take on the problems of the company it buys. Some labor agreements might get restructured, bringing pay and pensions back to competitive levels. Some of that pension obligation might even get shifted to taxpayers, but that's a problem with our pension system, not the auto industry. None of these details represents a decent reason to protect poorly run companies from feeling the consequences of their bad decisions.
Bailing out the Big Three is subsidizing failure. And you only subsidize something when you want more of it.
Tough economic times and rampant government spending are boosting the efforts of taxpayer groups in New Hampshire. But instead of the State House, these groups are concentrating on City and Town Halls across the Granite State. Chris Dornin profiles the trend in the New Hampshire Sunday News:
Republican Mayor Frank Guinta of Manchester tried and failed to get the Democrat-controlled board of aldermen to put a cap before voters this fall.
"There were enough petition signatures, but they voted to do it next November," Guinta said. "A cap would force the city to choose priorities and find cost efficiencies. In a recession, you can't spend what you don't have. A vote of 10 out of the 14 aldermen could still override the cap in case of emergencies."
Naile said officials in Concord and Manchester will come to regret blocking a vote in 2008.
Concord officials filed suit recently to keep the matter from ever coming to a vote. He thinks they will lose.
"They're rightly scared of this," Naile said. "They made a mistake. When it finally goes to vote next November, the economy will be even worse. We'll be whipping up our troops over it."
Mike Biundo chairs the New Hampshire Advantage Coalition and said the taxpayer rights movement is huge and growing.
"In addition to Concord and Manchester, we've been in touch with folks in Londonderry and Merrimack about caps," he said. "Some folks in Andover are interested. The one in Somersworth (this month) only failed by 8 percent. The recession is fueling it. People are looking for tax relief."
The Legislature holds its Organization Day on Wednesday, and doesn't start legislating until January, but incoming lawmakers have already filed a bevy of levies on New Hampshire's taxpayers. Tom Fahey rounds up the proposed taxes and fees in this week's Under the State House Dome:
Lawmakers have filed a dozen tax bills so far on gasoline, tobacco, bottles, beer, income (three of those), even fireworks.
One resurrects the Legacy and Succession tax (better known as the death tax) that produced $25 million a year before it was repealed in 2002.
Safety Commissioner John Barthelmes told lawmakers he'd like several bills to bump up a couple of fees his agency collects.
Want to register your boat? Get ready to dig deeper to help the navigation safety fund that covers enforcement of boating speed limits.
While the state still struggles to fix a $250 million budget deficit in the last year of this budget, a much bigger problem looms just after the new year. The next budget will start with the largest budget hole in recent history. Politicians of all stripes will need to put principle over politics and avoid the sniping that too often replaces debate in modern times.
Legislators dealing with the current two-year budget had to resolve a $71 million revenue shortfall in the first year and an additional $250 million problem in the second year. A series of spending cuts, small tax increases and borrowing has trimmed the second-year deficit to $75 million. However, some of these proposals have put problems off until next year's budget.
As the governor prepares a budget proposal due in February, estimates of the gap between current programs and likely tax revenues range between $250 million and $800 million. Although much depends on whether the economy recovers quickly, a good median estimate is that we face a $500 million problem. By almost any measure, this will be the most difficult budget in many years.
Many politicians and outside observers will be tempted to pick apart the details of any proposal to score points against their political opponents. Instead of squabbling over details, politicians should agree on broad goals to limit the games that can be played over small points selected out of context.
Broadly speaking, I think the vast majority of elected officials can agree on the end goal. At the end of the budget cycle, regular expenditures and regular revenues should be in balance. That may sound like a fairly simple goal to the average citizen who has no choice but to balance his or her own budget. However, New Hampshire's budget is not balanced that way and is not currently required to be balanced that way.
The last couple budgets, for example, have spent more than they hoped to raise. The current budget got in trouble because revenues fell quite a bit short of the estimates used to balance spending. However, even if revenues had come in as budgeted rather than $300 million short, the state's general fund had planned to spend $108 million more than it hoped to raise.
The extra spending was balanced with one-time revenue sources, notably surplus money from the previous budget. Generally, regular recurring programs should be paid for with regular recurring tax revenues, not one-time windfalls, just as you wouldn't pay for a mortgage payment with an unexpected lottery windfall.
Getting back to a truly balanced budget will take both years of the next two-year state budget. In the current economic climate, it is reasonable to expect the first year to be a transition period. Many unusual and one-time sources are being used to balance the current budget, and it will take some time to readjust.
The current budget will be balanced with $40 million of "bonded" or borrowed money. It also includes a series of one-time revenues, such as a large transfer from the Pease Development Authority and the governor's recent proposal to take $15 million from other dedicated funds to bail out the state general fund. In addition, the incoming President is likely to propose a bailout package that could include $50 million to $100 million in one-time aid to the state.
The one-time revenue and borrowed money cannot be expected on a regular basis. Therefore the state must wean itself from it. Adjustments to spending this year and next must be made so that spending and revenue in the second year of the next budget balance.
Once the budget is restored to balance, our sloppy balancedbudget law should be amended. Each year the budget should be in balance, and surpluses carried forward from the previous year should not be counted toward balancing current spending and revenue. The sloppiness of the existing law makes it possible to defer some decisions and put off problems into the second of the two budget years.
The legislative session will see many arguments and debates over raising taxes, cutting spending, finding new revenue sources and changing the budget process. But both parties and most factions ought to be able to agree on the ultimate goal of getting back to balance at the end of the second year. Agreement on that goal offers some hope that the real debates will center on differences of principle and put at least some modest limits on less productive political bickering.
Charles M. Arlinghaus is president of the Josiah Bartlett Center for Public Policy, a free-market think tank in Concord.
With gas prices dropping under $2 a gallon for the first time in over three years, maybe New Hampshire drivers are willing to pay higher gas taxes. Maybe not. But some lawmakers are turning to the gas pump to try to replenish a Highway Trust Fund depleted by spending on other agencies and drivers staying home this summer.
The Concord Monitor reports on two Representatives who see higher gas taxes as the only way to pay for roads:
Rep. David Campbell, who has chaired this year's committee to study the highway fund, has said he will sponsor a gas-tax-increase bill. He said he hasn't sorted out all the details - including how big a raise he'll support - because it's not clear how much federal aid the state will receive. But, he said, he's come to believe that cutting alone won't right the road budget.
"At some point you can't cut the highway fund any more," said Campbell, who is not related to the transportation commissioner. "Are you going to cut winter salt? Are you going to cut snowplowing? Are you going to cut paving?"
Campbell, a Nashua Democrat, said he has backing from both sides of the political aisle.
"It's something that I'm hopeful the leadership of both parties, in both parties, can get behind," he said. "If they don't, I want them, whoever they are, to answer for the consequences if we don't do it. Show me where we're going to cut."
Rep. Candace Bouchard, a Concord Democrat who chairs the Public Works and Highways Committee, said she will support Campbell's bill.
"I'm pretty hopeful that people will understand the need to maintain our transportation system," Bouchard said. "I think we need to make our argument and show everyone that we've done our homework."
New Hampshire drivers currently pay 38 cents per gallon in gas taxes, 19.4 cents to New Hampshire, and 18.4 cents to Washington.
The Union Leader comes out against tapping New Hampshire's Rainy Day Fund to pay down the state's budget deficit:
The budget situation is likely to get worse next year. Tapping reserves now would leave less in savings for a real emergency. As bad as things seem now, this isn't a real emergency.
And depleting savings now would only delay the inevitable cuts. By contrast, cutting now saves more over the long term and reduces the amount that might be needed from the rainy day fund down the road.
That's why Lynch should have made the additional $75 million in cuts he has already identified as needed, but has decided to delay until next year.
Drawing down the Rainy Day Fund would not only remove the safety net against even tougher times, but would have serious implications for New Hampshire's bond rating, making it even harder to finance long-term capital projects like roads, schools, and bridges. Then again, bo
Meanwhile, Foster's Daily Democrat describes last week's proposed cuts as "reaching to meat and bone":
Friday's cuts will affect everything from school aid to overtime and carpooling.
Water and pollution grants will be deferred until next year. LCHIP will not enter into any more funding commitments this year, and the program will repay the state for the $3 million in its budget last year.
The current University System of New Hampshire budget will be slashed by $4.5 million, and the community colleges will lose $1.7 million. The university system and community colleges have agreed to not raise tuitions to cover the losses.
The agency with the largest budget — historically more than half of all state funding — is the Department of Health and Human Services. It is HHS that is the most people-related department in the state, administering to often the most needy and most vulnerable members of our society — people to whom we have a moral and financial obligation.
Many of the Governor's cuts are superficial, such as directing state agencies to reduce overtime and travel where possible. Others simply defer spending into the 2009 budget, adding millions to next year's mounting deficit. None of the cuts proposed last week eliminate state jobs or bring agency spending back near where it was before last year's record increases. The tough spending cuts are coming, but they haven't happened yet.
