Charlie Arlinghous is the head of the Josiah Bartlett Center for Public Policy and is one of the most respected authorities on NH’s budgets and the process by which it is assembled ("crafted"? No, we shall not sully that word here). Over at NH Watchdog, he has let loose:
In most states, the budget process is dysfunctional. In New Hampshire it has turned into a farce. The state budget process has officially begun with two days of hearings over department submissions that increase spending 32% when every reality-based human knows the budget will have to be cut not increased.
Officially, the budget process began on October 1. At that time, each department head is required by law to submit a so-called maintenance budget – its estimate of what it would spend if it didn’t change anything it did or the way it did it. This submission, while required by law, has never born any relation to the reality of crafting a budget…
…Interestingly, the budget submitted for the governor’s office itself was a decrease of 9%. He’s right but everyone who works for him is living in the clouds. Their combined submissions were a 31% increase in the first year and an additional 4% in the second. In total, they ask for $3.9 billion, an increase of more than a billion over the baseline of the current spending level.
And here is the money paragraph:
One department asked that they be exempted from the governor’s 5% cut. Presumably every department wishes to be exempted. It is up to the legislature to make clear from the very beginning that every single department and agency will see a reduction. The only way to achieve cuts and to have managers focus on them is if they all know that everyone is in it together and no area can be exempted.
He also calls out two really serious problems that the Republicans will have to account for and provide solutions:
Next, set a baseline. Some fixed costs will skyrocket. The mandatory retirement system contribution will nearly double from $97 million to $174 million. Debt service will skyrocket because we borrowed to pay much of last year’s payment. That means each agency will probably need to decline by slightly more than 10%. If everyone understands that at the start, the process will end better.
Look what happened to GM – union benefits, especially for retirees, would have put them out of business if it weren’t for massive amounts of taxpayers monies plowed into it as a payback to those same unions. The State equivalent of that, the Retirement Monster which NH politicians on both sides of the aisle created, is staring at us with an billion dollar gleam in its eye. Democrats the last 4 years have done nothing to address it. The Debt Devil, however, can pretty much be laid entirely at the feet of Lynch and his cohorts – time to pay the piper for borrowing beyond our means.
I have said that Issues #1 through #4 for the new majority has to be a focused concentration on fiscal issues. And for all the yelling now being heard by the New Minority of "can’t cut that social program", ALL social issues and programs have a fiscal cost. However, they should be viewed, at least in the beginning, strictly from a fiscal standpoint.
