Should N.H. pay people to move here?

New Hampshire attracts residents with its high quality of life and exceptional level of economic opportunity. Though located in remote northern New England, the state has posted population and economic growth rates superior to its Canada-bordering neighbors, both of whom are in serious danger of slipping into population decline this decade.

The biggest constraint on New Hampshire’s population growth is not a natural deficit in the state’s attractiveness, but a government-imposed housing shortage. 

So it’s interesting that legislators are considering a bill to spend $750,000 worth of taxpayer money to pay people to live here. 

House Bill 1524 would create a state National Service Alumni Attraction and Retention Fund. 

The money would finance “grants to New Hampshire-based employers and institutions of higher education for the purpose of providing financial assistance, workforce development, and education to AmeriCorps alumni and returned Peace Corps volunteers” interested in pursuing post-graduate education or work in the state.

The plan differs from an existing program in Vermont in scope, but not concept.

Vermont in 2018 created a remote worker relocation program that offered $10,000 to anyone who would commit to moving to Vermont and working remotely. It was followed by another program to pay people $7,500 to live and work in economically distressed parts of the state. 

Vermont’s treasurer reviewed the remote worker program in 2019 and concluded that it was impossible to determine whether people moved for the money or claimed the money for moves they’d previously planned. 

When a consultant used questionable multipliers to conclude last year that the programs paid for themselves, the treasurer publicly criticized the findings. 

In any case, the programs enrolled just 307 people, which comes to 0.047% of Vermont’s population of 645,570. From 2018-2019, a total of 14,915 people moved to Vermont voluntarily (who knows why?), and another 16.337 moved out. 

Maine is getting into the cash bait game too. The Senate just passed a bill intended to keep Mainers from leaving the state by forgiving up to $40,000 in student loan debt for first-time home buyers. The taxpayer cost would be $10 million. 

Now some New Hampshire legislators want to use taxpayer money to recruit national service volunteers to live or study in the state.

It’s not clear why these particular individuals would be more worthy of taxpayer-funded recruitment than, say, angel investors, construction workers, clergy, nurses or any other non-profit volunteers. But it’s certain that a program created to lure one group favored by politicians will be expanded to include other groups favored by other politicians.

And that gets to the heart of the problem. Any such program would open the state coffers for giveaways to whichever groups can gain the attention and admiration of politicians. A new program to bestow state favors on politically popular groups would create additional perverse incentives for politicians.

Politicians would have a strong incentive to add politically popular subgroups to the list of people eligible for taxpayer subsidies. Individuals, no matter how worthy, who can’t gain the favor of legislators would wind up subsidizing the groups who have. 

Taxpayer money is a finite resource to be used with restraint and discretion for public purposes only. The gifting of tax money to people who have performed a service favored by politicians runs against the spirit, if not the letter, of the state constitution. 

Part I, Article 31 states that the Legislature shall assemble for two reasons only, to redress public grievances and to make “such laws as the public good may require.” New Hampshire would have to be in a dire state of cultural decay for the public good to require taxpayer-funded recruitment of national service volunteers.

Part I, Article 36, limits the granting of public pensions under the principle that “economy” is “a most essential virtue in all states” and therefore “no pension shall be granted, but in consideration of actual services; and such pensions ought to be granted with great caution, by the Legislature, and never for more than one year at a time.”

The grants to be funded in HB 1524 aren’t pensions precisely, but they are similar. They are taxpayer grants to individuals in recognition for services rendered to the public. However, the public is not necessarily the taxpayers of New Hampshire, but rather the people of any place where the volunteers served. 

That makes the National Service Alumni Attraction and Retention Fund a payment by New Hampshire taxpayers for services rendered to any people on Earth. Why it’s in New Hampshire taxpayers’ vital interests to make cash payments to people for services rendered anywhere is a mystery. 

Finally, as the fund is designed to recruit these specific volunteers to New Hampshire, it is about more than just rewarding this service. Its goal is to improve the state by paying those volunteers to live here temporarily. 

The use of taxpayer money to create a custom-designed state population is questionable enough. But to recruit people with no specific economic assets for a year or two of work or study is of no discernible long-term value to the state. 

Good public policy in a republic avoids creating favored classes of citizens by bestowing tax money on politically preferred groups.