Congress inaction causes NH budget uncertainty
CONCORD, N.H. (AP) — Congressional inaction on dealing with looming spending cuts is creating a difficult and uncertain environment for New Hampshire’s legislative budget writers.
Members of the House and Senate budget and tax writing committees got an update Monday on the potential ramifications on New Hampshire from actions by Congress to deal with the so-called fiscal cliff.
House Finance Chairwoman Mary Jane Wallner said lawmakers will have to be flexible and able to make changes when new information is received.
‘‘We’re up in the air with a lot of this,’’ said Wallner, D-Concord.
Gov. Maggie Hassan presents her budget recommendations to lawmakers in mid-February. The House is scheduled to vote on its version of the two-year spending plan on April 4 followed by the Senate in early June.
‘‘Budgets often are like this. Information keeps coming up to the last minute,’’ Wallner said.
Jeff Hurley of the National Conference of State Legislatures told the committees that non-defense spending cuts affecting New Hampshire individuals, businesses and governments could be $32 million this fiscal year. Congress just acted on taxes but postponed to March 1 the deadline for an automatic series of spending cuts to take effect — called sequestration.
Hurley said there is no guarantee Congress will vote on a different set of spending cuts before the deadline. Federal lawmakers are more likely to postpone the deadline again, he said.
‘‘Congress loves to play the game of kick the can down the road,’’ Hurley said.
Hurley said NCSL is trying to get federal lawmakers to consider the impact cuts would have on states. He said most entitlement programs are exempted from the automatic cuts. The most likely target that isn’t exempt is education aid to states, he said.
‘‘The state and local impact is always overlooked,’’ he said.
Federal budget decisions will affect spending in New Hampshire’s current budget as well as the new budget that must be enacted by July 1.
Jeff Pattison, director of the Legislative Budget Assistant’s office, gave lawmakers a snapshot of the state’s fiscal situation for this year which projects a possible $25 million deficit. But Pattison cautioned that the picture is incomplete, not just due to pending decisions by Congress, but also because some savings lawmakers counted on may not be realized.
As an example, he pointed to a delay in implementing managed care for Medicaid clients. That was supposed to save the state $16 million but has not been implemented. Each month it is delayed cuts the anticipated savings by $1.5 million and increases the possible deficit, he said.