State agencies seek 19 percent increase

FOR THE MONITOR

New Hampshire’s next state budget is already under construction. The process of building doesn’t start when the new governor takes the oath in January. It doesn’t start when we elect the governor in November. The New Hampshire budget process starts in October, with the Dance of the Wishing Commissioners.

The heads of each of New Hampshire’s subunits of governments, from the massive Department of Health and Human Services to the tiny Boxing and Wrestling Commission, have to submit their budget requests by Oct. 1, including a “maintenance budget” to fund current programs as well as recommendations for spending cuts or increases.

This year’s agency budget submissions add up to a 19 percent increase in total state spending over the next two years.

You can review each agency’s budget request at the Department of Administrative Services web page, or download the entire agency budget book. Trust me, if you’re only going to read one 5,000-page document about New Hampshire’s budget, this is the one.

The current budget, included money we actually spent in Fiscal Year 2012 and funds authorized for FY ’13, totals just over $10 billion. The agency requests for FY ’14 and FY ’15 came in at just under $12 billion. The 19 percent overall increase requested isn’t spread evenly across all state agencies. Some commissioners are asking for the moon. Others are downright frugal.

Let’s look at some of the outliers. The Public Utilities Commission is seeking the largest percentage increase in its budget, from just under $41 million to over $100 million, a 146 percent increase. But that request turns out to be mostly wishful thinking. Just about all of the requested increase can be traced to huge spikes in anticipated revenue from the Regional Greenhouse Gas Initiative and the Renewable Portfolio Standards program.

Fortunately, New Hampshire taxpayers or ratepayers won’t be on the hook should the PUC’s rosy forecasts fail to pan out. Unlike overly optimistic revenue forecasts, if

RGGI and RPS revenues don’t come in, the PUC won’t spend the money.

The university system is seeking an 89 percent increase from the current budget, hoping to get back to the $100 million per year that it got from the General Fund in previous budgets.

The Highway Safety Agency is looking for an 85 percent increase, anticipating a slew of federal grants to pay for it.

29 percent increase

The largest request for additional funding comes from the state’s largest agency. The Department of Health and Human Services wants $1 billion more over the next two years, hoping to increase its budget from $3.7 billion to $4.8 billion. That would be a 29 percent bump in the Health and Human Services budget and accounts for more than half of the requested budget additions.

But not all agencies are looking for a lot more money. Safety, Transportation, and Fish and Game are seeking budget increases of under 5 percent over two years. Education is seeking a 7 percent increase, and Secretary of State Bill Gardner is looking for just 3.7 percent more than the current budget.

The Pease Development Authority operates independently of the rest of the state’s budget, except for its Ports and Harbors Division. It will spend $1.3 million for port dredging in FY ’13, but the Army Corps of Engineers has agreed to take over commercial dredging operation after that. The overall ports budget request drops by more than half.

34 percent drop

The New Hampshire Retirement System will no longer provide subsidies for local pension contributions, resulting in a 34 percent drop in its budget request.

These requests are just the first step in a budget process that will stretch until shortly before the new fiscal year starts July 1, 2013. Think of this as a wish list from state agencies for everything they would like for Christmas.

It was never going to be realistic preview of New Hampshire’s budget priorities.

By Nov. 15, each department much submit a 90 percent budget, which should tell us which programs are considered most essential.

By then, we’ll have elected a new governor, who can use the 90 percent budgets to see which commissioners are serious about controlling spending in their departments, and which are threatening to leave the widows and children out in the cold if they don’t get every dollar they’ve requested.

Grant Bosse is vice president for media for the Josiah Bartlett Center for Public Policy, a free-market think tank based in Concord.