New Hampshire voters’ trust in government and media has collapsed as a result of the COVID-19 pandemic, a St. Anselm College Survey Center poll conducted for the Josiah Bartlett Center for Public Policy has found. In addition, President Joe Biden’s honeymoon with New Hampshire voters is over, as majorities now view him unfavorably and think the country is on the wrong track. 

Among registered New Hampshire voters, 61% said the COVID-19 pandemic has made them less trustful of the government, and 60% said it has made them less trustful of the media. In both questions, 34% said their level of trust was unchanged. 

Business, however, saw those ratios reversed. Only 22% said the pandemic has made them less trustful of business, with 69% saying their level of trust is unchanged. 

“The huge collapse in trust of government and media, but not business, ought to be a five-alarm warning to government officials and journalists,” said Josiah Bartlett Center president Andrew Cline. “Trust in institutions was already low before the pandemic. It would be a mistake to maintain business as usual and see how low it can go. A serious effort to regain public trust is needed.”

Republicans and undeclared voters posted the largest drops in trust of both government and media. 

Eighty-seven percent of Republicans and 65% of undeclared voters say the pandemic made them less trustful of government. 

Ninety-two percent of Republicans and 63% of undeclared voters said the pandemic made them less trustful of media.

Democrats registered the smallest drops, with most saying the pandemic made no change in their trust of government (59%) or media (62%). 

These trust declines accompanied a significant drop in President Joe Biden’s favorability rating in the Granite State. 

Among New Hampshire voters, 52% now say they have an unfavorable opinion of President Biden, with 47% saying they have a favorable opinion. 

That’s an almost exact reversal from the February St. Anselm College poll, which found that 53% had a favorable opinion of President Biden and 46% had an unfavorable opinion. 

Biden won New Hampshire 53%-45.5% last November. 

A solid majority of New Hampshire voters (59%) now says the country is on the wrong track, with only 31% saying it’s on the right track. 

That’s up from 55% who said the country was on the wrong track in the February St. Anselm College poll. 

Gov Chris Sununu fared better, with 64% saying they had a favorable opinion of him, and 34% saying they had an unfavorable opinion. That’s down four percentage points, from 68%, in the February St. Anselm College poll. 

These results are from a Saint Anselm College Survey Center online poll conducted on behalf of the Josiah Bartlett Center for Public Policy based on online surveys of 897 New Hampshire registered voters. Surveys were collected between May 26th and 28th, 2021, from cell phone users randomly drawn from a sample of registered voters reflecting the demographic and partisan characteristics of the voting population. The survey has an overall margin of sampling error of +/- 3.3% with a confidence interval of 95%. The data are weighted for age, gender, geography, and education based on a voter demographic model derived from historical voting patterns, but are not weighted by party registration or party identification. 

The political party registration of poll respondents was 30% Democratic, 28% Republican, and 42% undeclared. 

The Josiah Bartlett Center released a previous batch of results from this poll last week. The book of tables for the poll includes both sets of questions and can be read here: SACSurveyBook JBC May 2021. 

The 2022-23 state budget approved by the Senate Finance Committee makes some significant changes from the House version. It lowers overall taxes and spending while preserving several of the House’s policy initiatives, moving some out of the budget, and adding a few new ones. The Senate’s overall two-year state spending package would spend $150 million less in General and Education Funds than the House version, reduce taxes slightly more, and rely on higher revenue projections.

With business tax revenues booming, this has allowed the Senate Ways and Means Committee to count on General and Education Trust Fund revenues of $2.89 billion for the current fiscal year, which runs through June 30. That is $160 million higher than House estimates and nearly $200 million more than Gov. Chris Sununu’s estimate from February. This higher baseline carries over into higher estimates for FY 2022 and 2023 revenues, even though the governor, House, and Senate project revenues to grow at similar modest rates over the next two years. In total, the higher revenues generated in March, April, and May of this year give the Senate more than half a billion in General and Education Trust Fund revenue that their House counterparts did not have earlier this spring. (The above graphic represents the different budget revenue projections.)

Despite several differences, House and Senate budget writers arrived at similar bottom-line spending numbers. The House version of House Bill 1 would spend $13.6 billion in total funds, with $3.46 billion of that in General and Education Trust Funds. The Senate Finance package would spend $13.5 billion total, $3.32 billion from the General and Education Trust Funds.

For more, read our policy brief (pdf): Budget Visions 2022-23- Senate

If the Senate Finance Committee’s proposed budget becomes law, New Hampshire will at last become the only Northeastern state with no personal income tax.

New Hampshire markets itself as having no sales or income tax. But that’s not precisely true. Though the state does not tax individual earned income, it does tax personal income derived from interest and dividends. That is a personal income tax. 

The budget proposed by the Senate Finance Committee would phase out the state’s interest and dividends tax over five years. (The House-passed budget and the governor’s proposed budget also would phase out the tax.)

That tax brought in $105.8 million in Fiscal Year 2018, $114.7 million in Fiscal Year 2019, and $125.7 million in Fiscal Year 2020.

That might sound like a lot of money, but for context state business taxes alone have brought in $174.5 million in additional, unplanned revenue so far this fiscal year. The state is more than $200 million in the black this year, and that’s despite a $65 million pandemic-related drop in rooms and meal tax revenue below what was budgeted. 

In eliminating the interest and dividends tax, New Hampshire would follow Tennessee, which eliminated its Hall tax (on interest and dividend income) on Dec. 31, 2020. That tax was phased out over several years, beginning in 2016.

Being situated in Northern New England, New Hampshire has numerous geographical disadvantages that make it challenging to recruit businesses, entrepreneurs, retirees, and young people. It can’t change its weather or 18-mile coastline. But it can change its economic climate.

With an eye on economic and population growth, many other states are pursuing aggressive growth strategies that involve lowering tax rates and regulatory burdens. New Hampshire’s astounding economic growth over the last several decades can largely be attributed to its singular focus on growth-based economic policies. But as Massachusetts and other states have copied states like New Hampshire, Texas, Florida, and Tennessee, it’s become more difficult for New Hampshire to stand out — and to recruit entrepreneurs, businesses, and employees. 

If it eliminated the interest and dividends tax, New Hampshire would join Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming to become the ninth state to levy no tax at all on personal income. 

New Hampshire not only would be the only Northeastern state with no income tax, it would be the only one North and East of Tennessee. On top of New Hampshire’s already relatively competitive economic policies, that would help keep the New Hampshire Advantage alive.

Becoming truly income-tax-free would improve New Hampshire’s competitive position, not just in New England, but internationally. It would help preserve the New Hampshire Advantage in an increasingly competitive era in which states are working non-stop to attract an increasingly mobile workforce and entrepreneurial base.

More than two-thirds of New Hampshire voters support right-to-work, the Josiah Bartlett Center for Public Policy’s first public opinion poll shows. The poll also found support for Education Freedom Accounts, voter ID laws, and relaxing local housing regulations.

Asked if they would “be in favor of changing the law so that employees who don’t want to join a union could choose not to pay union fees,” 68% of New Hampshire voters said yes, and 22% said no. Ten percent said they were unsure.

“Most Granite Staters just think it’s wrong to make people pay fees to a union they don’t want to join,” Josiah Bartlett Center President Andrew Cline said.

Even Democrats broke in favor of right-to-work, the poll showed. Democrats said they would support a right-to-work law by a 44%-41% margin, just outside the poll’s margin of error. Republicans were in favor by an 88%-6% margin, and undeclared voters were in favor by a 73%-18% margin.

Every demographic group supported the passage of a right-to-work law except those who described themselves as “very liberal.” They opposed it by a margin of 29%-54%, with 17% undecided.

Twenty-seven states have right-to-work laws, which forbid employers from making non-union employees pay so-called “fair share” fees to labor unions. Employers and unions often negotiate contracts that require these fees, on the theory that non-members benefit from union collective bargaining efforts.

VOTER ID

New Hampshire voters are even more strongly in favor of requiring a photo ID to vote. Asked whether voters should “be required to show a photo ID before being allowed to cast a ballot in a New Hampshire election,” 76% said yes, and 19% said no, with 4% saying they were unsure.

By party registration, every group supported voter ID laws, with 98% of Republicans, 50% of Democrats, and 80% of undeclared voters in support. Again, only self-described “very liberal” voters were against, with 33% in favor, 61% opposed.

EDUCATION FREEDOM ACCOUNTS

A plurality of voters is favors Education Freedom Accounts, the poll shows. Asked if they would support letting families access a state-approved Education Freedom Account to pay for educational expenses outside of their assigned public school, 42% were in favor; 37% were opposed. Support was strongest among Republicans (55% in favor, 27% against), followed by undeclared voters (42% in favor, 36% against), then Democrats (28% in favor, 49% against). 

Importantly, these results closely track a poll conducted by the University of New Hampshire Survey Center in 2018. In both polls, the accounts were described in detail. That UNH poll found 40% in favor, 33% opposed, and 18% saying they didn’t know enough about the issue. 

The UNH Survey Center’s poll in March asked a very different question that did not accurately describe the accounts. Unsurprisingly, it got a different result, finding that 35% said they supported and 45% said they opposed. 

The consistency in the results for the two questions that accurately described the accounts shows that more Granite Staters support than oppose Education Freedom Accounts when they have an accurate description of the program. 

BUSINESS TAXES

Another question legislators are considering is what to do with business tax rates. We asked voters what they thought the state should do with business tax rates given the state’s large revenue surplus, which was created primarily by business taxes. The poll found that 58% of voters said business tax rates should stay the same, 34% thought rates should be cut, and only 8% thought tax rates should be raised. 

That is a very clear finding that Granite State voters do not think the state should raise business taxes. 

LOCAL HOUSING REGULATIONS

On the state’s record-setting home and rental prices, the poll found that a majority of voters (51%-29%) support relaxing some local regulations so developers can build more rental housing, and a plurality of voters (45%-34%) support relaxing some local regulations so developers can build more homes.

Democrats were the most supportive of relaxing some local regulations to build more housing. A majority of Democrats supported relaxing local regulations to build more rental housing (60%) and more single-family homes (52%). 

ABOUT THE POLL

The results are from a Saint Anselm College Survey Center online poll conducted on behalf of the Josiah Bartlett Center for Public Policy based on online surveys of 897 New Hampshire registered voters. Surveys were collected between May 26th and 28th, 2021, from cell phone users randomly drawn from a sample of registered voters reflecting the demographic and partisan characteristics of the voting population.

The survey has an overall margin of sampling error of +/- 3.3% with a confidence interval of 95%. The data are weighted for age, gender, geography, and education based on a voter demographic model derived from historical voting patterns, but are not weighted by party registration or party identification.

The full tables for these poll questions can be read here: Tables and Demos.

 

Siding with Massachusetts in a lawsuit brought by New Hampshire, the Biden administration on Wednesday told the U.S. Supreme Court that states could justify taxing non-resident telecommuters. 

New Hampshire sued Massachusetts in October over the Bay State’s effort to collect income taxes from Granite Staters who used to cross the border for work but had to switch to telecommuting during the pandemic.

The bulk of the Biden administration’s legal brief on behalf of Massachusetts addressed technical legal questions, primarily whether New Hampshire is the right party to bring the suit and whether it’s proper for the Supreme Court to take it. Media reporting of the administration’s brief focused on these issues.

But further down in the 18-page document, Acting Solicitor General Elizabeth Prelogar argued that a state could legally and constitutionally tax telecommuters who never physically entered the state’s borders. 

“New Hampshire correctly observes (Br. in Support 25-30; Reply Br. 10-13) that a New Hampshire resident who works from home will rely on New Hampshire services like police and fire protection,” Prelogar wrote. “Yet that resident’s work also may continue to depend on and benefit from services provided by Massachusetts. For example, Massachusetts and its municipalities might provide similar protections to the infrastructure and staff critical to the work of the New Hampshire resident who is temporarily working from home—such as computer servers that enable and store the employee’s work product, courts that enforce contracts, and financial institutions and transactions necessary to the work.

“And the employer located in Massachusetts, where the employee worked before (and may well return after) the pandemic, will continue to benefit from the services Massachusetts affords in the interim, thus helping to sustain the employee’s continued employment during that temporary period. A telecommuting employee’s physical location thus need not map precisely onto the location of the governmental services needed to support that employee’s work.”

Under Prelogar’s theory, a state would be justified in taxing the incomes of all people who work for a local company, regardless of where on the planet they live, because that state’s services benefit the employer, thus “helping to sustain the employee’s continued employment…”

The Biden administration’s interest in New Hampshire’s lawsuit clearly goes far beyond mere legal technicalities. The administration has sided with Massachusetts on the merits and has signaled that the U.S. government sees nothing wrong, either morally or constitutionally, with a state’s cross-border taxation of non-resident telecommuters. 

The dire state of New Hampshire’s housing shortage is illustrated in the New Hampshire Housing Finance Authority’s just-released spring Housing Market Snapshot. 

The median home price in New Hampshire hit $362,000 in April, up 16% from last April’s median price of $313,000. 

Last April’s housing snapshot showed that in March of 2019, the median was just $275,000. In just two years, the state’s median home price has jumped by $87,000.

Migration caused by the COVID-19 pandemic is not the primary cause of this increase. The report shows a roughly 5% increase in home buyers from Massachusetts and a much smaller bump in buyers from other states in 2020. 

The real culprit is supply. 

The number of new building permits issued in New Hampshire collapsed in the five years from 2004 to 2009 and has not recovered. In 2004, more than 500 permits for single-family homes and more than 200 permits for multi-family housing were issued in the state. By 2009, barely more than 100 single-family home permits were issued, and multi-family permits were in the low double digits.

Since 2009, the number of issued permits has climbed slowly but has not come close to its early 2000s levels. A little more than half as many permits are being issued annually than in the early years of this century. 

One way to think about the numbers is that builders were constructing hundreds more homes each year in New Hampshire when the hit TV show “Friends” ended its run than when “The Big Bang Theory” ended its run. 

Fewer homes being built means fewer homes on the market. There were more than 8,000 homes for sale in the state in May of 2018. This May, there were 4,613. 

Last spring, there was a 1.6 month supply of homes on the market, including a 1.1 month supply of homes priced less than $300,000. 

This spring, the overall supply has fallen to 0.6 months and the supply of homes priced less than $300,000 is down to 0.4 months. 

The only way out of this housing shortage is to build more homes. 

In April of 2020, when barber shops and hair salons were closed and people resorted to cutting each other’s hair, we pointed out that this was technically a criminal offense in New Hampshire. 

Barber and cosmetologist licensing is governed by state law, and those laws are written not only to protect public health, but also to protect barbers and cosmetologists from competition.

RSA 313-A:9, part of the chapter governing barber and cosmetologist licensing, states: 

“It shall be a class A misdemeanor for any natural person, and a felony for any other person, to engage in any practice regulated by this chapter without the appropriate license.”

To translate that into plain English: Any person who cuts hair without a license commits a misdemeanor, and any company that has its employees do so commits a felony.

That language is clear and unambiguous. It is a crime to cut hair — even a family member’s or your own — without a license. 

(It’s also illegal to give manicures and pedicures or apply makeup without a license, as those activities are defined in the statute as falling under the definition of cosmetology, the practice of which requires a state license.)

Yet when we pointed out the plain fact that the law criminalizes regular practices that people do for each other every day, some state representatives and journalists said we were wrong. We were accused of stoking fears, and of misrepresenting the law. 

A year later, the Legislature has acknowledged that the law does, in fact, make it a crime to cut hair without a license. 

And it has passed a bill to change that.

House Bill 606, introduced by Rep. Carol McGuire, R-Epsom, simply inserts “for remuneration” into RSA 313-A:9 so that it reads: 

“It shall be a class A misdemeanor for any natural person, and a felony for any other person, to engage for remuneration in any practice regulated by this chapter without the appropriate license.”

HB 606 passed the House 200-166 in April. No one testified against the bill in committee. On Thursday, May 27, the bill passed the Senate on the consent calendar, which means it was considered so non-controversial that it was passed with a slate of other bills by voice vote with no debate.

If the bill becomes law, as expected, it will remove an offensive and absurd criminal penalty from the books. But the criminal penalty for performing unlicensed hair cuts for pay remains.

And it remains a criminal offense to perform other services without a license. There are criminal penalties for the unlicensed appraisal of real estate, unlicensed auctioneering, unlicensed junk or scrap metal dealing, and the unlicensed sale of lightning rods. 

(Legislators passed a bill in April to remove the entire section requiring a license to sell lighting rods. Gov. Chris Sununu signed the bill, and it takes effect next January.)

Removing the criminal penalty for doing your family’s hair and makeup is long overdue. But it’s a small step. Unnecessary criminal penalties remain woven throughout New Hampshire’s occupational licensing laws. And unnecessary occupational licensing remains rampant in general. Much more work is needed to remove needless, anti-competitive and economically harmful occupational licensing requirements. 

Join us Tuesday, June 1, at 4 p.m. for a free webinar on Education Freedom Accounts. Dr. Ben Scafidi, director of the Education Economics Center at Kennesaw State University, will explain the fiscal and economic impact of the Education Freedom Account legislation pending in the Legislature. Scafidi is the author of the Josiah Bartlett Center’s report on Education Freedom Accounts.

The webinar will be held via Zoom and is open to the public.

Register on Eventbrite at efawebinar.eventbrite.com.

You can read Dr. Scafidi’s report here.

The Manhattan Institute has published an analysis of New Hampshire’s Housing Appeals Board that praises the new body as a narrowly tailored, small-government way to address the serious problem of arbitrary and ad-hoc denials of new housing construction. The board “respects localism while attempting to address the state’s housing crunch,” writes author Brian Chen.

Chen sums up the Housing Appeals Board this way:

“Amid worsening housing shortages, states across the country are considering how to reform land-use policy. For a promising model of how to achieve strong reform with relative ease, policymakers ought to look to New Hampshire. Its new Housing Appeals Board (HAB) provides efficient administrative review of local land-use decisions while respecting local autonomy.

“HAB represents a light-touch, small-government approach to state land-use policy. The board cannot review legislative enactments such as zoning or subdivision regulations; local governments can choose to zone however they wish. However, HAB does have broad power to review the discretionary and individualized processes, allowing it to reverse arbitrary and abusive decisions. HAB provides a superior alternative to judicial review, as its structure and process allow for a quicker and cheaper resolution of conflicts than the courts.”

The board serves as an administrative review panel where citizens can appeal local planning and zoning board decisions without having to undertake the expense of going to court. Its purpose is to ensure that local boards are following state law and their own local ordinances and rules.

The board will not fix the state’s severe housing shortage. It is merely a less costly tool for holding local boards accountable should they stray from existing laws, ordinances and rules. The difference it makes will come on a case-by-case basis. Over time, it should begin to discourage boards from making decisions based on political considerations and encourage them to stick with written policies. That should reduce some of the arbitrariness and unpredictability that has made it harder and more expensive for builders to meet the huge demand for new housing in the state.

The board began accepting appeals of local planning and zoning decisions in January. You can follow its cases and keep up with its activities at its website.

Officially, New Hampshire’s minimum wage is $7.25 an hour. Finding someone who actually earns that, though, could be harder than finding a vegan in a Brazilian steakhouse on Flank Steak Friday.

“You wont’ find it,” Mike Somers, president of the New Hampshire Restaurant and Lodging Association, said. 

A person making $7.25 an hour in New Hampshire is “a bit of a unicorn,” Somers said. “Frankly, we haven’t seen it for years. I haven’t seen anybody paying less than 9.50 or 10 bucks an hour in years.”

New Hampshire is one of 19 states that ties its minimum wage to the federal minimum. Employees who earn tips or commissions can be paid less than $7.25 an hour. Tipped jobs are subject to a minimum wage of $3.27 an hour. But that’s not what people in those jobs actually earn. 

When tips are included, restaurant servers in New Hampshire average more than $18 an hour, according to the Restaurant and Lodging Association. 

So when looking for people who are paid only the minimum wage, the search has to be limited to non-tipped positions.

Before the pandemic, non-tipped minimum-wage jobs already were unusual, if not rare, in New Hampshire. The post-pandemic labor shortage might have eliminated them. 

It’s possible that some employer in New Hampshire is paying someone $7.25 an hour. But in interviews with business managers and trade associations around the state, we found no one who paid the federal minimum for non-tipped work — or who knew of any other business that paid it.

“I think it would be pretty hard to find anybody that’s paying minimum wage,” Donna Allen, manager of the Family Dollar store in Berlin, said. Her store pays $11.50 an hour to start, she said.

Kyle Daley, manager of Solomon’s store in West Stewartstown, said his store pays $9-$10 an hour to start for entry-level positions. Experienced tradespeople such as butchers make more. He didn’t know of any area employer that paid the minimum wage. 

Paul McGonagle, manager of Grant’s Shop & Save in Glen, said the store typically pays inexperienced teens $10 an hour to start. Experienced employees start at $12 an hour. 

“You’re not going to get any employees” at $7.25 an hour, he said. “You’re just not going to get them. And if the parent hears that you’re hiring their kid at $7.25 an hour, they’ll say don’t take it, go work somewhere else. Go to McDonald’s where they’re paying 11, 12 dollars an hour.”

Survey data compiled by New Hampshire Employment Security suggest that non-tipped minimum-wage jobs have been declining for years. 

The agency does not have a database of every wage paid for every job. To estimate how many people make the minimum wage, it uses data from the U.S. Census Bureau’s Current Population Survey.

Because the survey consists of a very small sample, its estimates are not considered precisely accurate. Even if the numbers are off by hundreds, though, the surveys show a years-long decline in the number of people reporting that they earn the federal minimum wage in the state. 

In 2016, Employment Security estimated based on CPS survey results that roughly 15,000 people in New Hampshire earned the minimum wage. In 2017, the number fell by nearly half, to 8,000. It fell to 1,200 in 2018 and bumped back up to 2,500 in 2019.

In 2020, the CPS survey estimated that only 235 people in New Hampshire earned the minimum wage. 

The 2020 estimate is based on a single person reporting to have earned the minimum wage. And that person reported having a tipped job, according to Employment Security. It’s possible that several times as many people earn the minimum wage in a non-tipped position — or that no one does. 

The 2020 number should be considered in the context of the pandemic-ravaged hospitality industry, where many lower-wage jobs are concentrated. Many of those jobs temporarily, or permanently, disappeared as restaurants, hotels, and tourism-related businesses closed or trimmed their workforces last year.

As the economy has recovered, the workforce has not. School closures, additional federal unemployment benefits, and a lingering fear of COVID have kept thousands out of the labor force. As a result, wages have risen unusually rapidly as employers have struggled to fill open positions.

“We put ads out months ago, and we’ve had two applications,” McGonagle said. “They’re just not coming to work because they’re being paid to sit home. And some of these people are making more sitting home than they’ve ever made before in their life.”

“Those ads run all the time. I got signs in my windows. They’re just not coming in. Why would they come in if they get more money sitting home? You go by some people’s yards, you say, wow, their yard’s getting a lot of work. My yard’s not getting any work done.”

Asked where we could find anyone still paying the minimum wage, Nancy Kyle, president of the New Hampshire Retailers Association, said, “Good luck with that.”

“Retailers are having such a hard time getting help, they have to pay in some cases double the minimum wage,” she said.

The lowest wages paid in retail, Kyle said, are typically to disabled employees who need to have someone assist them on the job. But even in those cases, it’s unlikely employers are still paying the minimum in this job market, she said.

“Oh, no,” said Lauren Blessington, manager of O’Neil Cinema in Epping, when asked if she knew of anyone who paid $7.25 an hour. 

O’Neil, a family-owned theater, pays inexperienced teenagers $8-10 an hour, the lowest starting wage we found. Experienced staff make more.

Blessington pointed out that the theater job comes with non-cash benefits that employees highly value: free movies, drinks and popcorn for the employee and a guest.

Though it’s possible that some Granite Staters are making $7.25 an hour in 2021, it’s clear that market forces have made non-tipped minimum-wage jobs extremely rare. Given recent wage growth, it’s likely that the $7.25-an-hour minimum wage job will soon be eliminated in New Hampshire, if it hasn’t been already.