New Hampshire revenues are $100 million ahead of projections according to the New Hampshire Department of Administrative Services. This is good news for our state, but I’d like to dig a little deeper into what this means, and how important it is to produce accurate and reliable projections.
The House and Senate make budget and spending decisions based upon what they believe are well vetted revenue projections, but these become politically driven. When the majority party produces unrealistically low revenue numbers the budget becomes balanced at that low number.
According to State Senator Dan Feltes of Concord, if the NH Senate numbers were used and followed, we could have had more funds available to combat the heroin and opioid crisis, send more education aid back to our communities, increase aid to help strengthen our roads and fix our red-listed bridges, and potentially lower tuitions costs for New Hampshire students at our university and community colleges systems, which are among highest in the nation.
We could have done all of this, without raising taxes, and still had a strong surplus to put away in the Rainy Day fund according to Senator Feltes.
No economist, liberal or conservative, has said that the business tax cuts, in effect for such a short time, have led to these revenues. It’s simply not credible to now declare that the revenues are a direct result of the business tax cuts, he says.
Reform is needed, and politics should be removed from the revenue projection process as much as possible. It is time for more independent, unbiased approach to revenue forecasting in our budget process.
Senator Feltes recommends that we put in place a revenue estimator position within the non-partisan Legislative Budget Assistant’s office. This position would not have direct communication with legislators, except at publicly-notices hearings. They would be free of political influence to offer the most accurate revenue projections for Legislature to consider.
Starving the government through politically motivated budget decisions is not a sound way to operate.